When compared to any other commercial process, the participating in a tender is one of the most intricate and unique. It is difficult to guarantee the best results when operating in the Life Sciences / Healthcare market and managing this manually or without specifically designed tools. Ensuring that the Tender Management practices are sufficiently supported by the best-in-class Tender Management system is paramount to achieve that the company produces the best performance and results. As the first step in the revenue chain for tender purchasing in tender driven environments (such as the EU) this is a key issue the company must address.
Life Sciences and Health Care Tender Management Processes
Looking at the main issues we can isolate and identify the key areas that are crucial to provide a full strategy, that will address them to Life Sciences Tender Management. These areas can be broken down into 5 stages of tendering, that run from the first steps of the tender’s analysis through the offer and awarding process together with the pricing management, during the tender developing period. In each case we can identify the specific issues, set a list of objectives that we should attain to be proficient in our tendering practices and identify which part of a Tender Management tool-set responds to this requirement.
Shape the tender
Preparing the bid in terms of technical, administrative and economic documentation.
The company may be asked to request and receive permission before participating in the tender and receiving the specification. The content of the specification will be studied, and subsequently the right pricing and products to respond will be determined.
Administrative, quality and technical documentation will be produced to be sent with the economic offer. The offer may also requires the provision of specifically labeled samples as well as payment of taxes and bank guarantees.
Each step of the participation and submission activities must be carefully planned, assigned and checked to ensure they are error free.
The pricing strategy should be chosen based on an informed decision making process, that maximizes the potential return on the tender.
Documentation must be automatically generated following the customer's specifications, as well as been modified and tracked, and be associated to the tender so that it may be retrieved quickly and efficiently. The tender office must have a complete overview of the situation of the tender as well as the current activities in progress, next steps and the critical deadlines that must be met.
Where the tender specifies requirements such as samples, taxes etc. these should be automated and controlled to ensure that they are correctly and timely provided.
Win the tender
Awarding of contracts to the bidders.
Each company’s submission will be scored on price and quality. The results will be know and the company should note which lots have been won.
The company may be required to produce more administrative documentation and provide guarantees and awarding may be contested by competitors.
The awarding moment is an opportunity to collect and manage important data about offered products as well as market competition.
At the same time the awarded pricing offered becomes applicable. The company ERP system must be aligned with the new pricing conditions available to the customer. This must be managed to correctly replace existing pricing where present.
Documentation must be generated and tracked.
Fulfill the tender
Managing the contract with the customer for the duration of the tender.
The duration of the fulfillment period will vary from tender to tender, and can last for several years.
The membership of customers may change during the period, including additional , or removing participating customers.
During this time the customers may request the addition of products and further discounts. It is also possible that the product catalog will undergo changes such as entire product lines being discontinued or replaced with a new ones. The replacing products must be given compatible pricing with the original offer. At the end of this period the customer may request that the tender be extended for a further period.
Manage the complete life-cycle of the tender for the entire duration in an efficient, correct and controlled fashion. Ensure that pricing is maintained within the limits defined in the contract to avoid complaints.
Track sales and relate these to the existing contracts with the customers.
Extend contracts where necessary. Ensure that changes to the product catalogue and list prices are correctly managed with the customer to avoid liability and credit-notes.
Value the tender
Extracting value from the tender itself through mining commercial knowledge, to provide insight towards future tenders.
The result of the tender is measured from a profitability standpoint. The customer may have ordered less than was originally requested. This is taken into account when the new tender is created. The sales rep discussed with the customer the product lines that were less profitable to see why they were not purchased, and realised that this was mainly due to lack of training / product understanding. The salesman also discovered that there was another product line that would have suited the customer better in some cases.
Have the information from the tender provided to a Data Warehouse so that sales data can be resolved back to the original offer to be able to provide compliance reporting. Review performance and provide insight to the sales rep for the next customer’s tender. Identify product lines that are not performing as expected by the customer. Provide access to the pricing history for the current tender.
Continuous improvement that a company will follow as strives to become proficient and dominating the process.
The purchased vs awarded quantities will be carefully monitored to ensure that the best value is extracted from the tender. The sales staff will be more closely involved with the customer in the period prior to the creation of the tender to ensure that the product features are well known and appreciated, and to ensure that the right product is offered in relation to the customer request.
Know in advance when a tender will take place/happen or when an existing tender is up for renewal or expiry.
Document and manage processes to reduce exclusion rates or missed deadlines.
Monitor and assign actions based on bandwidth and prioritize activities.
Outside of the event sequence related to a specific tender, a series of activities and concepts must be employed to ensure that the activities are controlled, maintained and managed in an appropriate fashion.
These are put under the header of Governance and are very specific to each company. The system must produce an audit trail that can be followed and certify that the actions the user take are within the processes that have been defined. Tender Management is where revenue is generated and as such it is important that this is controlled following company rules, regulations and guidelines.
The data that the person may see, print and actions that the person may or may not take must be configured based on the role the user plays within the team. The software must be certified and activities within the software must follow the processes that have been defined for executing the tender. Changes to the workflow must be designed by people who understand the processes and the importance and consequences of each decision as well as effectuated by people who are trained and authorized to do so. Each time the user makes a decision that could deviate from the "straight path" this should be logged and ensure that a complete audit trail is produced.
How can you improve your Tender Management Strategies?By implementing a smarter business process that
Feedback Contract Managerresponds to your requirements by
FBK's suite of Tender Management products are specifically designed to respond to the needs of a Life Science and Healthcare company during the phases of preparation and participation in a tender as well as through the entire duration the process life-cycle.