What’s the ROI of an RFI in Federal Contracting?

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As a former proposal writer, I always appreciated it when an agency would release a Request for Information (RFI) in advance of a formal solicitation. From my vantage point as a vendor, the RFI served two key functions:

  • It allowed our proposal and project teams to shape the ultimate solicitation by demonstrating our strengths and providing honest insights regarding the best potential solution for the agency.
  • It enabled our organization to begin the process of analyzing and mobilizing resources in anticipation of the full request for proposal (RFP) or request for quotation (RFQ), including the design, development and/or enhancement of a product or service.

From industry’s perspective, it’s extraordinarily helpful to know in advance how we might put our best foot forward in a full solicitation. For an agency, an RFI is a critical part of gathering requirements that improve the overall acquisition process.

In fact, when I interviewed Tom Kuhn, an Integrity Management Consulting Fellow with over 22 years’ experience as a Marine Corps officer, program manager and professor of acquisitions, I asked him:

“What’s the one thing an agency can do to improve its market research activities?”

The first tool that he mentioned was an RFI.

Based on my interview with Kuhn, I see 5 specific ways that an RFI benefits a government agency:

1. Signal to Industry That a Solicitation is Imminent. “If you have the time, sending an RFI out is a good practice,” said Kuhn, “because it will notify industry that you have this requirement coming up and you’re going to go with a particular contract vehicle.” An RFI begins to create buzz and energy, spurring vendors to begin the process of determining how they can solve your challenge – either through their own solutions or by partnering with one another.

It also puts the solicitation on the vendor’s radar, which greatly increases the chance they will bid it since most vendors don’t pursue bids where they didn’t have any advance knowledge (largely due to the perception that it might be ‘wired’ or simply because they didn’t budget the time for this solicitation and they don’t have the bandwidth on no notice to go after it).

2. Save Time and Energy Later in the Acquisition Lifecycle. While an RFI might require an investment of time upfront, an agency can reduce its level of effort later on in the requirements generation and proposal review process by leveraging this important listening tool. Many agencies have learned the hard way that a poorly written solicitation required a lot of time and energy from themselves and the companies, only to find out that they didn’t ask for the right product in the first place.

For example, “You may have come up with requirements that are too much for industry to meet right now,” said Kuhn. “If you want to colonize the moon and industry indicates that it’s going to be 10 years before it can meet that requirement – maybe your requirement is too lofty.” Also, it can minimize schedule delays when vendors ask questions during the RFP stage that an agency hadn’t thought of yet, which can avoid (sometimes multiple) modifications to address these salient questions/points made during the solicitation process. Responding to those questions requires a lot of rework and delays, and ultimately reflects poorly on an agency.

3. Narrow Your Potential Pool of Vendors. Another way that an RFI ultimately saves time is that it is an excellent way to gain a sense of what’s available in the market before beginning a full-blown procurement process. By releasing an RFI first, an agency might learn that its requirements were far too broad and invited a number of irrelevant or unqualified vendors to participate in the process. “An RFI can narrow the field down to just those companies that will be capable of meeting your project requirements,” said Kuhn.

4. Discover Unknown Solutions. On the flip side, sometimes an agency may have completed some preliminary market research to identify a list of vendors and products or services that might meet its requirements. The agency thinks it has a sense of the market and builds its solicitation around known solutions. However, it’s also possible that, as the saying goes, ‘you don’t know what you don’t know’ and an agency could unnecessarily exclude certain vendors that would offer an innovative, more cost effective solution. Requests for information can surface these diamonds in the rough.

5. Give Small Businesses a Chance. Many small businesses just don’t have the resources to respond to a full solicitation while sustaining their current projects. Oftentimes, they’ll think they are ruled out of an opportunity based on the requirements of a full solicitation and will make a Go / No Go decision. Kuhn suggests that an RFI is a lighter lift for small businesses and allows them to throw their hats in the ring. “Depending on the agency, there are varying small business requirements that are out there. If an agency wants to make sure that it’s reached out to small businesses, one way they can do that is through an RFI.” Please note, however, that an RFI should never be a substitute for fulfilling a small business requirement. Agencies should remain open to the value and viability of small businesses throughout the process.

In closing, Kuhn acknowledged that, “an RFI is not feasible for every solicitation, and they are certainly more critical in larger, complex solicitations (or those dealing with a technology that is rapidly changing). It also requires contract shops to efficiently collect and analyze the responses.” In other words, the reality is that RFIs might require a little more time on the front end of a procurement, but the potential return on investment (ROI) could make it pay off down the road.

How else have you seen an RFI deliver ROI for an organization?

This blog was brought to you by Integrity Management Consulting, an award-winning small business and leading provider of major systems acquisition and program management support services to Federal customers. Integrity’s mission is to deliver exceptional results for government customers, employees, and the community, driven by a single value: Integrity.

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