32 Proposal Terms Defined
If you’re new to the proposal space, you’ve likely come across a few unfamiliar terms. The world of proposals is filled with many acronyms and specific terms that you have to learn in order to bid effectively, especially for government contracts. To help you navigate requirements, below are 32 common proposal-related terms and what they mean.
Business Development
The definition of business development varies based on who you ask; each company has its own definition. In general, however, business development is the act of identifying and pursuing strategic business opportunities. This might be expanding into a new market, identifying a new, high-value government contract to pursue, or cultivating a list of potential clients with similar characteristics.
Capture Management
Shipley defines Capture Management as “a disciplined approach to qualifying business opportunities and developing a win strategy to improve your probability of winning a strategic opportunity.” In practice, capture often is the act of identifying highly-valuable contracts and developing a detailed plan for how to win those contracts. Capture work is particularly important in the federal government space.
IDIQ
IDIQ stands for “Indefinite Delivery, Indefinite Quantity”. According to GSA, these contracts “provide for an indefinite quantity of services [or goods] for a fixed time”. IDIQ contracts are valuable because there is no limit to how much can be purchased off of them. Federal, state, and local governments all have different types of IDIQ contracts, and they are less common in the commercial space.
Evaluation Criteria
Almost every RFP or other bid document will have a section describing how they will evaluate proposals. Some are detailed with percentages assigned to different sections of the proposal (e.g. 10% for resumes, 20% for pricing, etc.). Not all RFPs go into this level of detail, unfortunately, but you should still use any evaluation information as a guidepoint for creating your proposal.
Best Value
Best Value is a type of evaluation process that many government agencies use to evaluate proposals and award contracts. Best Value means that factors beyond price and minimum qualifications are used to evaluate bids. Overall quality, convenience, and competence of the bidder are other factors that may be considered.
Best Value is a government term, but this approach is how most commercial (i.e. corporate) buyers evaluate proposals.
Lowest Priced, Technically Compliant
This is another government evaluation term. In this process, evaluators will award the contract to the “Lowest Priced, Technically Compliant” bidder. This means that assuming all bidders are technically compliant, the award will go to the lowest priced. If the lowest bidder is not technically compliant (for example, they meet all but 3 of the requirements), then the award will go to the next highest bidder who is fully technically compliant.
Most RFPs will describe how they plan to award, especially if it is a federal opportunity.
BAFO
BAFO stands for “Best and Final Offer”. This step typically occurs at the very end of the proposal process, often after any presentations but before contract negotiations. During this phase, you are asked to provide your “Best and Final Offer”, which often translates to a slightly lower price.
Request for Proposal
Request for Proposal (RFP) is when a buyer asks vendors to provide proposals for a specific type of service or product(s). Many organizations have a minimum estimated spend limit (many times $100,000) where they are required to release an RFP to ensure they conduct their due diligence by evaluating multiple vendors.
For public agencies, such as governments or public schools, RFP announcements are public and anyone can respond. Private organizations (i.e. commercial/corporate companies) often solicit proposals from a select group of vendors that they already know a bit about.
Request for Qualifications
Request for Qualifications (RFQ) occurs before an RFP. The goal of the RFQ is to narrow down the pool of bidders to only those who are most qualified before asking that they respond to the RFP. The RFQ phase does not include pricing.
Request for Quote
Request for Quote (also RFQ) is when vendors are asked to provide a quote for a project. These are often far simpler than RFPs and typically don’t require much content beyond a simple price quote.
Request for Information
Request for Information (RFI) occurs before the RFP phase. During the RFI, the buying organization is trying to learn more about potential solutions available in the marketplace. This doesn’t include pricing, but they may ask that you provide an estimate to get an idea of what should be budgeted for the project. This is very similar to a Request for Qualifications.
Statement of Work
The Statement of Work (SoW) is the detailed description of all aspects of the project. The RFP or other bid documents may include a SoW for reference or you may include your own with your proposal to clearly define the scope of the work that you will provide.
Prime Bidder
Many times multiple companies must work together to complete the scope of the project. When submitting a proposal, there will be one “prime” bidder, which is the organization who officially holds the contract with the client. Any other companies are often subcontractors unless you have another type of agreement in place.
SBE
Small Business Enterprises are businesses that meet Federal or State definitions of a small business. Many government contracts require that a certain percentage of the contract be supported by a small or disadvantaged business (see below).
DBE
DBE stands for Disadvantaged Business Enterprise. In this type of business, socially or economically disadvantaged individuals own at least 51% of the company and control daily operations.
WBE
Women Business Enterprises are businesses where 51% or more of the company is women-owned.
MBE
MBE stands for Minority Business Enterprise, and these businesses are 51% or more owned by individuals of a minority group.
Question/Response Proposals
Question/Response is a popular proposal format where you copy the exact requirement or question from the RFP and paste it directly into your proposal document. You then write the answer or how you meet the requirement below the copied text. This format makes it easy for evaluators to review your proposal based upon their requirements.
Boilerplate
Boilerplate is the term for standard content that you repeatedly use without too many changes. Boilerplate is the content that you have stored in your content library or template, such as company overview, resumes, and any other common topics.
While boilerplate is helpful, it is important to customize your content for each proposal to directly address that specific customer’s needs.
“Shred” (the RFP)
When someone “shreds” an RFP, they are reading through the RFP and related solicitation documents and adding highlights or comments for key components. This step is critical before you start work on your RFP response to ensure no requirements are missed.
Executive Summary
An Executive Summary is a short (often 1-2 pages) section that serves as a summary of your proposal. This is the one section that almost every evaluator reads (except for maybe the cover letter and pricing), and it is the perfect place to highlight your key differentiators and why you should be chosen. Read our blog where we included proposal executive summary examples if you struggle to write them.
Shipley Proposal Process
The Shipley Proposal Process is one of the most recognized and accepted processes for creating competitive and winning proposals. Established by Shipley Associates, the Shipley Process starts in the marketing and sales stages and encompasses through post-award activities. Proposal development is a key component, and an entire proposal development process is available for you to follow.
Ghosting
Ghosting is the term used to describe addresses the weaknesses of your competitors within your proposal while highlighting your strengths. This is a content strategy that can make your proposals more compelling and competitive.
Color Team Reviews
As part of the Shipley process, different color team reviews take place to evaluate various aspects of your proposal and win strategy.
Red Team Review
A Red Team occurs near the end of the proposal development process, but you still need plenty of time to revise content. During a Red Team review, the team evaluates the near-final proposal using the evaluation criteria as a guide to predict scoring. Any low-scoring sections are revised to increase overall score.
Pink Team Review
A Pink Team occurs at the beginning of the proposal development process. A pink team is often a brainstorming and strategy session combined where win strategies are finalized. The next steps are to incorporate those win themes into the proposal content (often discussed during a Pink Team).
Blue Team Review
The Blue Team is part of the capture process where the capture plan and progress is reviewed and the win theme is established. This should occur before the RFP is released.
Black Hat Review
A Black Hat also occurs before the RFP is released. This is the competitive review where you analyze your competitors to develop a win strategy and identify key differentiators to incorporate within your proposal.
Gold Team Review
A Gold Team occurs at the end of the proposal process. This is the final review of the proposal and pricing.
Green Team Review
Green Team focuses on reviewing pricing. This often occurs before Red Teams and serves as the first pricing review.
White Hat
The White Hat review occurs at the end of the process and serves as a debrief to identify areas to improve and any lessons learned.
War Room
A War Room is used for large proposals (typically large Federal RFPs), and it serves as the action center for creating a proposal. In a War Room, the team is often in the same room with all content and requirements on hand to streamline proposal development and collaboration.