'Go/No Go' evaluation as a risk-reduction tool

July 2013 » Features » BUSINESS STRATEGIES
Optimize proposal opportunities and costs with a proper decision-making process.
Bernie Siben, CPSM

Architecture, engineering and construction (AEC) firm managers face many types of risk, and there are different risks at different levels of management. Some of these risks involve exposure to liability, whether from design errors or poor construction. Either of these could result in the collapse of a building, bridge, or other structure, ultimately resulting in injuries or deaths. Another type of risk might involve exposure to information theft, whether by hackers taking proprietary strategic data from a firm's computer networks or individuals taking hard-copy files – activities that might compromise a firm's ability to become or remain competitive in its markets. Another form of risk involves manpower and financial resources lost or opportunities missed because of poor decision-making processes. In this regard, one of the most important processes is the "Go/No Go" decision.

A proper Go/No Go evaluation, especially if required of and enforced by the firm's most senior staff, can help the decision-maker say "no" when "no" is the correct answer. The process can also help to ensure that no opportunity that might be viable is missed due to a collection of incorrect assumptions or a lack of consideration.

I will always remember the final Red Team meeting on a major proposal for an Air Force Base in Texas, which had been a major client a decade ago. The proposal manager, principal, technical champion (the proposed project manager), graphics designer, and a few technical staff had spent almost 200 hours on the proposal. A second principal in the meeting said, "I think this is a solid effort, but I wonder why you are proposing to this installation in the first place. We screwed up a project for them a few years ago and nobody ever did anything to fix the relationship!"

After a realignment of our expectations, we decided to submit anyway, since the proposal was already 99 percent complete and only required minor fixes (including deletion of the offending project from the firm's "Experience" section), printing, and delivery. We were not short-listed. A proper Go/No Go evaluation, with a number of relevant staff participating, might have uncovered this problem before incurring a lot of proposal costs.

I worked with an A/E firm whose engineering vice president proposed on every solicitation from more than 10 TxDOT districts. He insisted that he had a great relationship with the district engineers of all the districts where he usually submitted proposals. He really wanted to do big highway work, but the firm was only 50 to 60 people.

I did the research: We had not been short-listed by any of those districts – ever. When I checked the short lists for the projects on which we had submitted, I found that most of the districts usually short-listed the three largest firms that submitted proposals. We needed to get much larger before we had a solid chance in any of those districts. Proper Go/No Go evaluations might have revealed our past unsuccessful history with those TxDOT districts and enabled us to determine the causes before spending more money to propose.

An international A/E firm called me to manage the development of a proposal for a utility planning project. The requirements set forth in the RFQ were very complicated, the effort required a number of subconsultants, and a significant portion of the submittal would need to be very technical, requiring the participation of a number of senior engineers and graphic designers. I asked my contact about the Go/No Go analysis and was assured that the opportunity had gone through a rigorous evaluation before being approved.

At the end of what proved to be a very expensive effort, the technical champion copied me on an email to another senior engineer in the firm who would participate in the Red Team review. He advised the reviewer that they didn't really have a good chance for selection because nobody had been in contact with that client in a few years. The firm was not short-listed. A proper Go/No Go evaluation would have revealed the lack of contact with the client and pointed out the firm's poor chances.

I forwarded the email to the person who had hired me for the effort. She told me that they often had this problem with this technical person. It seemed that if he was interested in the project, he would "fudge" the Go/No Go evaluation to support his decision to pursue. In this particular instance, it might have been even more helpful if the firm's process required Go/No Go evaluations by two or more individuals who did not collaborate in their evaluations.

In another instance, an environmental engineer received an RFP from a colleague who wanted a place on our team if we decided to submit as a prime. The potential fee was around $1 million. The engineer mentioned the project and client to her department head, who instructed her to let it go. But the engineer had also sent a copy of the RFP to the marketing staff, who determined that this RFP represented a great opportunity for the firm. A week later, when no Go/No Go evaluation or proposal opening form had been submitted, the marketing manager called the engineer and learned that she was told not to pursue.

So the marketing manager went to see the department head and talked about the project, the potential fee, the interest by a possible subconsultant, and why he thought the firm could win the project. The department head expressed interest. So the marketing manager told him who the client was, and the department head said, "No. I know some people there and I don't like them."

Believing that this was not sufficient reason to pass up a $1 million opportunity that could be won, the marketing manager showed the RFP to the firm's president and told him about the pursuit decision. Luckily, the president overrode that decision, a proposal was submitted and short-listed, and the project was won. And it turned out that the people the department head didn't like had no involvement in the project.

In this case, the risk was in allowing an opportunity to be missed by not doing a Go/No Go evaluation – for one of the worst reasons.

More often than not, a manager decides to pursue a project for all of the wrong reasons, some of which include:

  • We need the work – If the client is a public agency, it could take so long to reach the first invoice (and payment) that it will not help the firm's current situation.
  • I really want to work on this kind of project or for this client – If the firm doesn't have the right credentials, it won't matter how much the manager wants the project or wants to work for that client.
  • They will excuse our missing credentials because we're DBE, MBE, WBE, 8(a), etc. – If your firm lacks the credentials (registrations, licenses, staff size, etc.) stipulated in the RFP, nothing will cause the client to excuse that lack.
  • I want to put our name in front of these folks – This is quite possibly the worst reason ever to propose on a project for which the firm is not qualified. The client will remember you as being non-responsive and wasting their time.

As far as I can tell, a Go/No Go process has two major purposes:

  1. Take the "ego" out of the decision process and eliminate the risks inherent in an ego-based decision
  2. Help the decision-maker to say "no" when "no" is the correct answer (and "yes" when "yes" is the correct answer).

More often than not, a manager decides to pursue a project for all of the wrong reasons

In a brief personal research project a few years ago, I asked a number of marketers in firms with a "hit rate" of 60 percent or greater to explain why they thought this was so. Every responder ascribed their success to having and enforcing a strong Go/No Go process. A Go/No Go process that results in a "yes" is much more likely to be a successful pursuit. A process that results in a "no" helps reduce the risk of wasting capital and manpower in preparing a submittal that cannot succeed.

Bernie Siben, CPSM, is principal consultant with The Siben Consult, LLC, an independent A/E marketing and strategic consultant located in Austin, Texas. He can be reached at 559-901-9596, through his website (www.sibenconsult.com), or at bernie@sibenconsult.com.


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