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April 2013

Is the RFP Process Broken?

By Christopher Durso, Executive Editor

To that end, Schultz would like to see RFPs — electronic or otherwise — get their due as a crucial part of the planning process. “I feel RFPs are very, very valuable, and I think that there is not enough value placed on the RFP and its purpose,” she said. “The RFP really begins the whole negotiation process, so there needs to be a lot of forethought that goes into the RFP to make sure that it's going to meet the program objectives and obviously the budget.”

3. Sales professionals need to be more adaptable.
“There is no doubt,” Vonderheide said, “that electronic RFPs have brought a new way of doing business to us.” Dominguez agrees, to a point. “There is a huge learning gap for us, because it is a different way for us to approach the sell,” he said. “I don't want to phrase this the wrong way, but I do believe it has created some complacency in our sales arena, especially with less veteran salespeople. I don't want to say ‘younger,’ because it's not an age issue, it's an experience issue.”

And yet, it wasn't so long ago, Dominguez said, that 80 percent of leads came in via fax. “Why is that so different and earth-shattering that now it's coming through an email or an electronic system that is automatically populated?” he said. “When we [say] people are doing more of it, what has changed is the breadth of our industry. Our industry has never been larger. We are seeing a lot more volume because of that. I really do think we have to get back to basics when it comes to selling.”

4. Everyone needs to remember the basics. One time during a meeting of Hyatt's customer advisory board, a salesperson asked board members how he was supposed to build a relationship with them when their business was coming to him online and they wanted him to reply within hours. “A customer stood up,” Vonderheide remembered, “and said, ‘If you're waiting for the RFP to hit your desk before you make a relationship with me, you've waited too long. You better get to know me and you better get to trust me and I trust you before the electronic RFP comes across, because when it comes back to me with a response, that relationship I had with you is going to be crucial to me deciding that your property is the right choice.'”

That's not just a lesson for salespeople. “I like to do business the way I used to do it,” Schultz said, “where I would send an RFP to a hotel, and then I would follow up with an email and a phone call and I would make sure they received it, and start that personal connection, that personal relationship. I feel for suppliers, because they are now so inundated. Staffing has been reduced all across the board, and I think suppliers now are feeling the burden of having to respond to a lot more RFP requests, a lot more planners, and a lot more clients than they used to.”

Which brings us back to Dominguez's belief that the eRFP is just one more aspect of an ondemand world — that “we've trained the customer [to expect that] they can get whatever they want and they can get it now. If they want to do a search in 12 different cities, guess what — they can do it. We need to figure out how to work through that process.” But that doesn't mean you abandon the core values of the meetings and hospitality industry. “We need to get salespeople out from behind their desk and going to meet our customers,” Dominguez said. “We need to be on the road much more frequently, we need to be with our customers much more frequently, because at the end of the day, this business is still about relationships.

“I can't stress enough, if people are waiting until they get the RFP to try to build a relationship, they're too late in the game,” he said. “You should've been building that relationship with our customer ahead of time. [The eRFP] is a distribution method. It is not an opportunity for us to build relationships. It is their distribution of a lead. That has nothing to do with the relationship you should've already been building with the customer.”

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