🏢 Stage 1 — RFP Receipt & Initial Qualification
🎯 What the Stage Is For
To decide:
“Should we even pursue this opportunity?”
Not every RFP should be pursued. This is a strategic filter stage.
👥 Who Is Involved
Customer Side
| Role | Involvement |
|---|---|
| Procurement Team | Issued RFP |
| IT Leadership | Not directly involved at this stage |
Service Provider Side
| Role |
|---|
| Sales / Account Manager |
| Pre-sales Lead |
| Delivery Leadership |
| Finance (initial view) |
🛠 What Gets Produced
| Output | Description |
|---|---|
| Go / No-Go Decision | Whether to pursue the opportunity |
| High-Level Qualification Summary | Initial assessment of the opportunity |
Qualification Summary Includes:
| Aspect |
|---|
| Deal size |
| Strategic fit |
| Risk level |
⚠️ What Can Go Wrong If Poorly Done
| Risk | Impact |
|---|---|
| Chasing bad deals | Wasted effort and resources |
| Underestimating complexity | Future delivery and financial losses |
| Overcommitting to unrealistic scope | Execution challenges and credibility risk |
🚨 What Does “Chasing Bad Deals” Mean?
“Chasing a bad deal” refers to a situation where a service provider invests time, effort, and resources into pursuing an opportunity that is unlikely to be won, unprofitable, or strategically misaligned.
🧠 Real-World Example (Based on ACME Scenario)
📄 Situation:
Acme releases an RFP for:
- Large-scale cloud transformation (10,000+ VMs, SAP, ERP)
- Aggressive timeline (e.g., 9–12 months)
- Strong emphasis on cost reduction (30–40%)
- Fixed price expectation
- Requires global delivery capability
🏢 Service Provider Context:
Let’s say a mid-sized service provider evaluates this RFP.
⚠️ Red Flags:
- No prior experience with large-scale SAP migrations
- Limited global delivery presence
- Weak automation/platform engineering capability
- Tight pricing expectations with fixed price model
- Aggressive timeline with unclear scope
❌ What Happens If They Still Pursue It?
Step 1 — Bid Submission
They submit a proposal:
- Underestimate effort to stay competitive
- Overpromise capabilities
- Assume “we’ll figure it out later”
Step 2 — Win the Deal (Worst Case Scenario)
They win due to:
- Low pricing
- Aggressive commitments
Step 3 — Execution Begins
Now reality hits:
- Migration complexity is much higher
- SAP workloads require specialized skills
- Timeline is unrealistic
- Client expectations are high
Step 4 — Consequences
🔻 Financial Loss
- Actual cost > quoted cost
- Margins become negative
🔻 Delivery Failure
- Delays in migration
- Quality issues
- Escalations from client
🔻 Reputation Damage
- Loss of trust with client
- Negative references in market
🔻 Internal Impact
- Burnout in delivery teams
- Leadership pressure
🧩 Why This Is a “Bad Deal”
Because:
- It was not aligned with capability
- It was not financially viable
- It carried high execution risk
✅ What Should Have Been Done Instead?
✔ Proper Go / No-Go Decision
The service provider should have:
- Declined the RFP
OR - Scoped down the response:
- Focus only on areas of strength (e.g., non-SAP workloads)
- Propose phased engagement instead of full fixed-price commitment
🎯 Key Lesson
Winning a deal is not success.
Delivering it successfully and profitably is.
🧠 Architect / Leader Insight
As you grow into leadership roles, your responsibility is not just:
- Designing solutions
But also:
- Evaluating whether the opportunity itself is worth pursuing
This is where technical understanding meets business judgment.