This complimentary copy of the Introduction to Win Big The EXA Way is available to people who pre-ordered the book.
© Alex McPhail, 2023
Companies are obsessed with sales, and for good reason. Sales make it possible for businesses to hire employees, manufacture products, deliver services, conduct research and development, expand into new markets, issue dividends, and carry out virtually every corporate function. If a company misses its sales targets, its livelihood hangs in the balance.
Major contractors—that is, businesses that perform large, complex contracts—generate their sales through proposals. Without strong proposals, the company struggles and eventually dies.
This book offers a comprehensive overview of capture and proposal (C&P) leadership for companies responding to major, complex requests for proposals (RFPs), typically for programs over $50 million. As president of The EXA Consulting Group, Canada’s leading capture and proposal support firm, I have led complex capture and proposal programs for over thirty years. I wrote this book because I was unable to find an authoritative guide for capture and proposal leadership in Canada.
The EXA Way is essential reading for people who support or interact with businesses that bid on major contracts. In this book, I show companies how to improve their win rates, and C&P leaders how they can consistently pursue opportunities more confidently and successfully. Finally, I show business leaders how to transform a good C&P team into a championship team.
A capture cycle for a major program typically spans several years, from the time the company starts following the opportunity, called first contact, to the time it signs the contract. A company will typically spend well over $100,000 in C&P costs for major programs, and pursuit costs can easily reach into the millions of dollars.
As daunting as these pursuit costs seem, they are inconsequential compared to a more critical factor: the win rate. Consider a professional baseball team with a batting average of .250 (one hit in every four at-bats), which is just below the Major League Baseball average. Statistically, that team will score four runs per game and win 40% of its games.
Imagine that, through training, personnel adjustments, and organizational development, that team increases its overall batting average to .333 (one hit in every three at-bats). Now, it will average over six runs per game and win 60% of its games. That 60% win rate will put this team at the top of its division and ensure a berth in the playoffs, whereas its past win rate of 40% would have placed it at the bottom.
The same dynamic holds true for business. Companies that increase their average proposal win rates from 25% (one win in every four submitted proposals) to 33% (one win in every three) significantly increase their economic vitality. In fact, C&P pursuits share a lot in common with baseball. Each contract pursuit involves teams of highly specialized professionals competing against each other. Each person has a role on the team. To have any chance of winning, each team requires peak performance from every individual, and every individual must also collaborate effectively with all the others.
Baseball requires more than just players on a team. There are coaches, owners, scouts, groundskeepers, trainers, statisticians, equipment managers, and many others connected with the enterprise. Beyond the team, there are umpires, schedulers, television crews, stadium operators, merchandisers, city planners, league officials, and many more stakeholders. All these people need to know different aspects of the sport to different degrees.
Contracting is similar. While there are capture teams and proposal teams, there are also people in product development, marketing, production, service and support, human resources, engineering, finance, offsets, and many other areas within the company. Everyone who interacts with the C&P teams must understand contracting and proposal development to some extent. Beyond the company itself, there are parent companies, affiliates, subcontractors, suppliers, law firms, procurement authorities, clients, end users, and many more stakeholders that need to know about C&P leadership to different degrees.
Increasing win rate is elusive. There are so many interdependent factors that it is seldom obvious which of those factors to address. If a baseball player falls into a batting slump, is that slump a result of their stance, bat grip, swing technique, fitness, focus and concentration, personal issues, or some other factor? To complicate matters, progress does not become apparent until long after an initiative takes place. In other words, in baseball and in business, you often do not know which initiative to attempt first, and you might not know whether an initiative leads to improvement until months after you try it.
On a baseball team, an initiative may involve better fitness, more training, skills development, team psychology, scouting reports, or a plethora of other factors. These initiatives tend to be complex and multi-modal, and often involve specialists who support the players. For the player who fell into a batting slump, for example, it would fall upon the batting coach, the trainer, the sports psychologist, and other such specialists to help restore the player to their full potential.
A bid pursuit team may require better processes, discipline, leadership, training, facilities, coaching, management attitudes, worklife balance, and a host of other factors to improve its win rate. Like the baseball batter, a proposal team member relies on the people around them, such as the Proposal Leader, the quality assurance specialist, course trainers, the continual improvement officer, the human resources manager, and other specialists that help that team member reach their full potential.
Improving organizational performance is not just about individual development. In business, as in baseball, if the organization lacks a positive attitude, or if the managers do not trust each other, no amount of individual improvement will allow the organization to reach its desired performance levels.
Every baseball and business manager will ask this question: What initiatives are within my power that will improve my team’s win rate? It is fine to talk about win rates in hindsight, but that does not help the manager decide what to do now. It is also fine to say that pursuit costs are inconsequential next to win rates, but every manager has a limited budget. Spending your way into higher win rates is seldom an option. Managers must judiciously consider which measures to adopt, both to remain within their budgets and, more importantly, to select and implement measures that actually increase the win rate. Adopting measures that do not deliver results squanders precious budgets and prevents the team from improving.
How do managers with limited budgets select the measures with the best chances of improving the win rate? One approach is to watch what successful teams do and copy their methods. Experience tells us that just because an initiative worked for one team does not necessarily mean it will work for another. For one thing, teams closely guard their methods, and for good reason. For another, an organization must consider too many variables to successfully replicate any initiative demonstrated by another team.
The answer lies in understanding what principles lead to success. Instead of copying the methods of one specific team, successful leaders look at high-performing teams overall. Successful leaders seek answers to three questions:
What best practices are common among the most successful teams?
What are the gaps between those best practices and my own team?
Among those gaps, which ones should I address first, and how?
A sober and thorough examination of a team’s strengths and weaknesses compared to industry best practices provides the insights leaders need when considering which measures have the best chance of improving the team.
Improvement is not a luxury, nor is it a quality reserved for top-performing teams. Every team must improve all the time. A baseball team or company that stands still actually falls behind as its competitors continually improve and overtake it. Eventually, the non-improving team falls to the bottom of its class and struggles to survive.
C&P teams must likewise continually improve to survive. A successful leader repeatedly asks those three questions. Each time the team achieves an improvement goal, the leader will refresh the prioritized list of gaps and pick the item with the next highest priority. When evaluating gaps and improvements, a successful leader will consider three principles.
The EXA Way offers a comprehensive study of C&P leadership in a step-by-step process, including:
In this book, I explore the bidder’s side of complex procurement. I do not explore government procurement except as it applies to C&P leadership. Many other resources study government procurement history, rules, policies, successes, reform, and spectacular failures. Here, I explain how to maximize your win probability on individual pursuits and for the enterprise overall. I will break the C&P processes into building blocks and explore how to master each element.
This book is not solely about Canada or Canadian procurement—the leadership principles I address have served EXA around the world. But Canada has some peculiar procurement laws and practices. When applicable, I explain the uniquely Canadian procurement elements, and I dedicate a single chapter to Canadian procurement laws, governance, and practices.
The EXA Way is a process and philosophy that applies to C&P teams and to all people in a company who respond to complex RFPs. The EXA Capture and Proposal Capability Maturity Model, which I describe in Chapter 16, explains how everyone in the company shares a responsibility for bid capture success and continual improvement.
A complete list of definitions for terms in this book is available on page 465 (the words I list in the glossary appear in boldface type), but it is also important to define a few fundamental terms here. A capture is the entire campaign a company follows in the pursuit of an opportunity. A Capture Leader is the person who oversees the capture and is responsible for the win.
A proposal is the document containing the offer a company submits to a procurement authority. Proposal development is part of a capture process. In this book, the terms “proposal” and “bid” have the same meaning. A bidder is a company that submits a proposal. The Proposal Leader is in charge of the proposal development process.
In this book, a customer is a consumer of EXA’s services. EXA helps customers win huge programs. A client is the recipient of EXA’s customer’s proposal. The client is (usually) the government department that receives the goods and services sold by EXA’s customer.
The EXA Way offers guideposts based on best practices that mark the pathway to success for complex C&P campaigns. Many activities and steps in this process boil down to best practices and common sense, while other nuggets of wisdom arise out of decades of experience.
The ability to win major programs requires a sustained and dedicated commitment, both during capture campaigns and in between pursuits. Some capture cycles extend over years, even decades. The most famous (infamous?) example in recent Canadian history is the Fixed-Wing Search and Rescue program, which started in 2002 when the Canadian government announced the “high priority and urgent replacement” of the aging CC-115 Buffalo and CC-130 Hercules aircraft. The procurement authority did not release the final RFP until 2015 and it awarded the contract in the following year—fourteen years after the Government of Canada issued its urgent announcement.
Most capture cycles are shorter than ten years, but many can span more than four. It is common for people to change jobs in both the bidding company and the procurement authority during a capture cycle. Companies must have a well-established capture process to maintain continuity over the lifetime of a capture.
Businesses have limited resources and can pursue only a finite number of opportunities. Selecting which opportunity to pursue is just as important as winning it. The EXA Way provides a process that allows an executive team to distill disparate pursuits down to common assessment factors and then analyze and trade off programs.
While capture cycles can drag on for too long, proposal cycles are far too short. There never seems to be enough time to do everything a complex proposal demands. The EXA Way offers a sequencing and prioritization process that maximizes the value and impact of the time your team spends developing the proposal.
Every capture and every proposal is different, and C&P leaders know that each project demands improvised approaches. There are no hard and fast rules. The EXA Way provides a leadership framework that you can adopt across the organization as well as best practices that you can adapt to individual capture pursuits.
The EXA Way uses the terms “Capture Leadership” and “Proposal Leadership”, not the more conventional terms “capture management” and “proposal management.” Capture campaigns and proposals demand so much more than management. As I explain more fully in Chapter 5, leaders must instill a sense of both inspiration and aspiration among team members. It is common for people to look back upon a major proposal with an appreciation that they accomplished more than what seemed possible. That accomplishment is achievable only through strong leadership.
The executive team must recognize the Capture Leader as a fierce competitor and honest broker. The Proposal Leader must be the architect of a master plan that delivers success, and they must inspire the bid team to sprint over marathon distances.
The EXA Way philosophy is as much about character as it is about mindset. Major complex pursuits are not for the faint of heart. Starting at the top, executives must make challenging trade-off decisions that will impact the company, one way or another, for years, decades, or forever.
Seldom does the future of a company (and its employees) hinge on a single milestone as much as it does on winning one pursuit. EXA has worked with companies that expected to face significant hardships if they failed to win a specific pursuit. In a meeting I attended at the beginning of one $500-million pursuit, I asked my customer how important this win was.
I was seated in a boardroom among twenty vice presidents and senior directors. The president, who was sitting at the head of the long mahogany table, replied, “Look around,” as he drew his outstretched hand through a wide arc, gesturing to his entire senior staff. “If we lose, half of these people are gone, and so are most of the people who work for them.” An uneasy silence filled the room. After a moment of reflection, the fortitude drained from his face and he said, “And so am I.”
I am happy to report that EXA’s customer won, and everyone kept their jobs. The incumbent contractor that lost to EXA’s customer, on the other hand, closed its facility permanently soon after.
Managers who take on a leadership role know that a major pursuit can make or break a career. Most “voluntold” technical writers must temporarily give up the job they know and love for a task they neither know nor trained for, and sometimes hate. C&P leaders must inspire and prepare these employees to excel under stressful and unfamiliar conditions.
A strong Capture Leader influences upward and across more than they manage downward. Executives and managers must trust a Capture Leader’s visionary judgement when that person recommends that the company realign its sales, marketing, production, human resources, services, partnering, supply chains, and other functions to best position the company to win future programs.
The Capture Leader must make critical decisions early in the capture cycle, long before there is enough information to be certain of the best approach. The success of these decisions relies more on the Capture Leader’s deep and broad understanding of the competitive landscape and on their ability to read the opportunity dynamics than it does on their management competencies.
A strong Proposal Leader is more of a coach than a controlling manager. A Proposal Leader will:
Finally, the C&P leaders must instill confidence. Confidence in your team builds people up, even when they question their own abilities. A lack of confidence breeds doubt. Doubt is contagious. It slowly creeps across a proposal team on silent cat feet and then all at once it kicks like a mule.
When confidence fails, doubt cripples a bid. Therefore, C&P leaders must remain vigilant and always exude confidence. In summary, The EXA Way is more about leadership than it is about management. It is as much about people as it is about business. Finally, The EXA Way applies to the whole enterprise, not just the bid and capture team.
This book contains three sections, and each section includes several chapters. You may find this book more appropriate as a reference manual, referring to chapters in the sequence that interests you, or you may find reading it front to back most satisfying.
SECTION I, PROCUREMENTS, addresses government procurements and covers the following topics:
Chapter 1, Government versus Business Relations, explores how government contracting is remarkably different from business-to-business relations and discusses how to pursue government contracts.
Chapter 2, Canadian Procurement, explains procurement laws, policies, and processes, including those unique to Canada.
Chapter 3, The Request for Proposal, explains the structure and contents common to all RFPs.
Chapter 4, Understanding Evaluation Criteria, explains the different types of evaluation criteria and bases of selection and their significance in winning pursuits.
SECTION II, BUILDING BLOCKS, describes all the elements of a C&P execution:
Chapter 5, The Capture Team, describes the structure and role of the capture team.
Chapter 6, Capture Reviews, describes the reviews every complex capture goes through.
Chapter 7, Capture Gates, describes gates, which are different from reviews, and explains how companies use gates to manage the capture cycle.
Chapter 8, Proposal Reviews, describes all the reviews the proposal goes through.
Chapter 9, Win Themes, explains what a win theme is, what unique role win themes play in Canadian proposals, and how to develop compelling win themes and benefit statements.
Chapter 10, Document and Requirements Management, explores the complexities of documents and of the management processes involved in captures and proposals.
Chapter 11, Corporate Teaming, explores contracting and teaming arrangements between companies and the steps to secure those agreements.
Chapter 12, Industrial and Technological Benefits/Value Proposition, provides a high-level overview of ITB/VPs and how to manage them.
Chapter 13, Writing for Proposals, identifies the three most common and harmful proposal writing mistakes and explains how to correct them.
SECTION III, LEADERSHIP, combines these building blocks into a cohesive capture and proposal leadership framework:
Chapter 14, Opportunity Capture Leadership, walks you through the entire capture process, from first contact to contract award.
Chapter 15, Proposal Leadership, explains the detailed steps and philosophy Proposal Leaders adopt in a complex proposal.
Chapter 16, The Capture and Proposal Capability Maturity Model, shows how companies improve their C&P effectiveness and win rates.