The difference between bids, tenders and proposals

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Are you resourcing a tender or bid team?  Need a proposal writer?  A bid manager…no, maybe a tender manager.  If you are confused with the mix of terminology used by procurement and business development professionals you are not alone.

Here we explain the difference between bids, tenders and proposals with a straight forward list of definitions every company needs.

The first thing to realise is that terms vary from organisation to organisation and country to country. They also depend on some extent on the background and skill set of the person involved. 

Bid – an approach to a client in order to gain significant new or repeat business. Bids, by their nature, involve staff from across the whole breadth of one or more organisations. The Bid Manager needs to be able to interact with many types of specialists – from technical to legal, finance, HR and senior management, and will need to know their roles, responsibilities, and what they can and cannot be asked to deliver.  The term “bid” or “bidding” can also relate to the documented Offer submitted in response to a request or invitation to tender. The ‘bid’ will then be evaluated against a set of criteria that are described in the request or invitation to tender.

Tender – The term “tender” is often used interchangeably to the term bid.  However, “Bid” is increasingly being used by the Offerer (the supply side) and the term “tender” used on the procurement side (the buyer).

Bid Manager – The bid manager takes full ownership of entire bid program. Sometimes, this may involve a period of research, information gathering and strategic messaging prior to the bid being released. Responsibilities include overseeing best practice processes and procedures, managing multiple resources – sometimes cross-functional, cross-jurisdictional and even across companies or the supply chain. As a leadership position, the Bid Manager – who must feel at ease working with executives and the Board – requires strong people management skills, the ability to deal with complex business relationships, competing priorities and driving the delivery of a strong winning business case to the client within a high stress environment within tight timeframes.

Tender Manager – The title is often used interchangeably to Bid Manager, however bids, by their nature, are project-based with a beginning and end point.  The tender manager, on the other hand, has traditionally been charged with overseeing the capture lifecycle – from identifying and converting significant business opportunities, to supervising and delivering tender responses and continually reviewing the bid management process.  A Tender Manager can also be hired on the procurement side to manage tender requirements, oversee the Request for Tender process, and negotiate contracts (sometimes referred to as Tender and Contracts Manager).

Project Manager – To some extent all Bid Managers act as Project Managers. A bid shares many characteristics of a project due to its defined beginning and end point, objectives, roles, responsibilities, milestones and deliverables. For this reason some organisations assign project managers to Bid Management roles.

Business profile, or corporate credentialsA business profile or corporate credentials is a promotional or marketing tool that presents a snapshot of your company. It essentially serves as a resume for your business.

Capability statement –  Similar to above but is usually tailored to the audience or the contract requirements, and describes the business’ capabilities and experience, including who you are, what you do, and how you are different from your competitors.

Proposal – The proposal is a written offer from a seller to a prospective buyer. It is a critical step in the complex sales process—i.e., whenever a buyer considers more than price in a purchase and serve as a persuasive business case for a product, service, or business opportunity. Proposals are client-centric selling documents that are highly tailored and solutions-oriented to the buyer’s requirements.

Proposal Writer – Proposal Writers are usually tasked with pulling together pre-existing information or creating custom content and tailoring it to the client’s needs. Generally, a proposal includes a summary, and then identifies the problem or business opportunity, defines the solution and how it will work (the methodology or project plan together with performance criteria), budget / pricing and organisational details, including names and description of credentials (past performance) and expertise of the individuals who will be responsible for managing and performing the work.

Technical Specialist  – Also referred to as ‘subject matter experts’, technical specialists are usually industry specific and are central to developing the client solution. Their focus therefore is on design and functionality rather than the sell. In the IT space they might be systems programmers or network designers; for major infrastructure they may be civil engineers.

Technical Writer –  Usually professional communicators who are skilled at translating technical language into plain English instructions for the everyday user of a product or service.  The Technical Writer and Bid Manager work closely with Technical Specialists to scope their information requirements to ensure it contributes positively to the Bid.

Want to brush up on your lingo?  Read our article on What’s the difference between an EOI, RFP, RFT and RFQ?

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Have we missed anything or would you like to know more? Please send us an email so we can update the list.

About the author

About the author

Nyree McKenzie is the Managing Director and owner of Thought Bubble, a business development and communications consultancy specialising proposals, tenders, major bid management programs, marketing and corporate communications. She is a trusted adviser to CEOs, board members and business development executives from leading global brands and firms throughout the Asia Pacific. [email protected] www.thoughtbubble.com.au