Incumbent-itis pitfalls

The cardinal sin of any government contractor is to lose their bread-and-butter contract that they rely on as a major source of income. This is a job they know inside out. They have bonded with the customer; they could recite the customer’s challenges and hot buttons with their eyes closed. All they have to do is discuss the issues and solutions in their proposal to make it sing.

Despite this, incumbents still struggle to defend their positions, especially in the volatile services market. Although incumbents prevail more than they lose, they could prevent many upsets by avoiding some of the mistakes common to incumbent-itis:

  • Complacency. An incumbent should not assume that the customer’s love towards their company is greater than it is in reality. The customer may care for the incumbent’s staff, but does the customer love the company? This customer may be convinced that they can keep the personnel because anyone that replaces the incumbent will absorb them as their own workforce. What value does the incumbent bring as a company?
  • Ease of “ghosting.” Incumbents, and their performance, are extremely visible, as opposed to the newcomers who bring a “grass is greener” offer. With the knowledge of the incumbent’s challenges, newcomers can make the most fantastic promises. Though the incumbent wants to write a proposal to wow the customer as well, their experience and knowledge tell them that most of those new “solutions” would not hold water, so they refrain from making empty promises. An incumbent simply knows too much. As a result of knowing all the hidden realities, incumbents won’t propose all of the “alluring solutions” that a newcomer might. The customer may not even be aware of the obstacles or privy to the depth of the incumbent’s knowledge. Thus, the customer may be seduced by a “fresh perspective” the non-incumbent brings and buy into a newcomer’s claims of innovation and improvement over the more pragmatic and realistic incumbent proposal.
  • Fear to claim improvements. While the newcomers are able to claim any innovations and improvements they please, an incumbent is tied to what they are already doing. They think, “If we drastically reduce our staff to do the same work, what would the customer say?” The customer may respond, “Why haven’t you done it with less staff to start with?”
  • Thinking that delivery is the first priority, proposal is the distant second. Incumbent Murphy’s Law always places the most time-sensitive project smack dab in the middle of a proposal. An incumbent’s best personnel are busy on a customer site, and the incumbent is afraid to rock the boat by asking for them to be excused to work on a proposal. They feel that they have to focus on delivery and that a happy customer is more likely to award the proposal to them. As a result, incumbent proposal quality is lower than the competitors’ proposals, which had more available resources to write.
  • Tendency to recycle the old proposal. It is tempting to reuse the old proposal. After all, it won—didn’t it? Most in the proposal profession, however, are shocked by how poor it reads after some time has passed. They wonder how in the world the proposal won in the first place. But, the times, the circumstances, and maybe even the customer have changed. It is a new ball game warranting a new proposal, rather than a tired boilerplate.
  • Cost challenges. An incumbent had salaries of its key personnel grow over time, and enjoyed price escalations every year. Now here comes the “wonderful” time to retain the superstar staff the customer wants while enticing them with salary cuts. Newcomers can be more aggressive with their pricing, while an incumbent feels stuck with the hand of cards they have been dealt.

Best regards,

Olessia Smotrova-Taylor

President, CEO

OST Global Solutions, Inc.
…Because There is No Second Place in Proposals! TM
https://www.ostglobalsolutions.com

 

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