How to Write an RFP for Analytics Software | Free Question Template
This blog describes how to write a professional request for proposal (RFP) for software. Specifically, we'll focus on procurement analytics software, but the process remains the same for all solutions. Learn best practices and get a free RFP question template.
In this blog, we'll focus on RFPs for procurement analytics, although many of the factors considered can apply to other types of solutions.
Define your scope
There are many procurement analytics software providers that all focus on different areas. As a rule of thumb, software vendors can be divided into best-of-breed and full-suite providers.
Best-of-breed vendors focus on a specific niche, for instance, analytics, whereas full-suite providers aim at having all applications under one platform.
To narrow down the scope and include only relevant vendors in your RFP process, it is a good idea to research to market and consider what services and solutions you would need.
Shortlisting vendors and booking demo sessions with a few is a good way to get a basic understanding of their solutions.
Include all stakeholders in your organization that have needs from the software. For instance, Procurement, IT, and Finance should internally align their requirements for the software. Including relevant people in your organization helps in formulating helpful RFP questions.
If you don’t know what you need from your software, it is difficult for the vendor to guess what type of solution your organization is looking for. They might provide you with too much or too little irrelevant information, which is time-consuming for you to review.
Give relevant background information
It's essential to provide the vendors with background information for them to understand your current situation, your organization's needs, and the challenge you are trying to solve, in addition to the purpose of the RFP and other things that are relevant for your project, such as the timeline you have outlined.
Stating necessary technical details at an early stage will prevent roadblocks in the later stages of the project. Giving the vendors as much relevant information as possible at this point saves you some time since you won't have to answer the same questions they would ask you individually.
Depending on the software provider, some information vendors would often need from your organization to provide a pricing estimate include some or all of the following:
Amount or ERPs/source systems
Number of users
Internal and external spend
Amount of taxonomy levels required
Description of categorization
Number of invoices and purchase orders
Provide clear instructions
The deadline for a response to the RFP and the preferred format in which the vendors should submit their response should be determined, such as an Excel spreadsheet or a PDF file sent via email. It is also a good idea to define the length of the response you wish to get, for example, by word count.
Standard format RFP responses enable you to make comparisons across vendors and help vendors know how detailed their answers should be.
Share the next steps in the RFP process
It's a good idea to share with the vendors how their responses are assessed and which criteria are used. Let the vendors know how the selection process will continue, for instance, if the best two-three vendors based on their RFP responses are selected for the next phase.
RFP question tips
Section your question areas. If you send your RFP questions in an Excel file, it is worth considering making separate sheets for each question area.
In procurement analytics software RFPs, the question areas could include some or all of the following: