Many sourced products and services involve complex technical requirements. Therefore, RFP scoring ensures a fair process of selecting the best option for your organization.
Since multiple stakeholders assess numerous criteria, it’s essential to pick the best way to conduct evaluations. Fortunately, there are multiple evaluation methods you can use, the right one for your organization will depend on your project and specific needs.
The most common methods of evaluation take into account both cost and technical requirements. Criteria are established based on these, and in most cases, a score and weight are attached to each criterion.
Before we get into how RFP scoring is done, let’s see what RFP scoring is.
What is RFP scoring, and why is it needed?
The purpose of RFP scoring is to identify the supplier who most closely matches your needs. For this, you need to gather an accurate representation of your need - the evaluation criteria.
Once the evaluation criteria have been defined, information is gathered from the suppliers. This means drafting an RFP questionnaire and issuing it online for suppliers to complete. Once the supplier data has been collated, it's time to score the RFP.
RFP scoring objectives:
Encouraging an accurate comparison of suppliers;
Enabling criteria to be weighted (not all criteria are of equal importance);
Allowing criteria to be grouped into sections;
Enabling multiple stakeholders to contribute;
Supporting various parallel sets of weightings to reflect stakeholders’ priorities;
Allow the scores of multiple stakeholders to be averaged.
Types of RFP scoring
1. Basic scoring
To do a basic scoring, you need to give each criterion a score, generally from 1 to 10. Each criterion is given the same weight - they are all equally important. However, this is frequently not the case when evaluating proposals, which is why basic scoring is not always the best method.
This method gives each criterion a weight by assigning it its own scoring scale. One criterion might have a maximum score of 10, while another might have a maximum score of 15. Although this method allows various criteria to be weighted differently, since they are measured on a different scale, it can become confusing.
3. Distinct weightings
This method allows each criterion to be measured on the same scale. Also, each criterion has a weight by which the score is multiplied to give it a total weighted score. This makes RFP scoring easy and ensures that the most important criteria are given proper consideration.
4. Hierarchical structures
The more complex an RFP is, the more detailed the evaluation method needs to be. A hierarchical structure makes it possible to group criteria together. Each category and subcategory will be assigned a score and a weight relevant to its importance.
5. Lowest cost compliant
If the technical aspect of the RFP is critical, you need a method to evaluate proposals based on the technical requirements of the project. Using this method, a proposal will move beyond the first stage of evaluation only if it receives a minimum pass mark based on the sum of the weighted technical scores. Any proposals that make it past this stage will then be considered based on the cost; the lowest cost provider will be awarded the contract.
6. Price/cost per point
The proposals are first evaluated based on technical requirements, then, the technical scores are averaged. This results in a combined quality score.
In the second stage, the proposals are evaluated based on the cost/price per quality point. Usually, the provider with the lowest cost will be awarded the contract.
7. Best value
Technical and cost criteria are each given a weight. For instance, the price might be 20% and technical 80%. This way, technical criteria are given considerably more weight than the cost, which is the best scenario when dealing with products and services that are more complex in nature.
How to do RFP scoring
1. Develop your supplier evaluation criteria
Evaluation criteria can be divided into 3 main categories:
Competitiveness and reasonableness of cost.
To do this, first, you need to gather all stakeholders and ask them to list the requirements that are most important to them. You can use questions like:
What’s your definition of success?
How do you determine success?
What categories should we judge solutions against? How important is each category?
Is pricing a weighted factor? (it shouldn't be!).
Second, you should use the answers to prioritize needs. You can use the following categories:
Features and functionalities: determine which features are a must and which you can live without;
Implementation: how fast can you start using the solution?;
Customer service: does the supplier offer support?;
Price: do you want to go for the lowest price possible, or are you willing to invest in getting exactly what you want?;
Innovative or proven solution: do you want to risk and use a new and innovative product, or do you want to choose what everyone else is using?
2. Determine the importance of each evaluation criteria
The next step will be to assign each category and question a weight, based on how important it is to you. A scoring system can play a part here.
For example, you can assign “points” to each evaluation criterion to indicate how well each proposed solution meets your project’s requirements. You can use a scale of 1 to 10, or you can rank proposals in order. Whatever scoring system you use, keep in mind you should assign a rough value under each of your evaluation criteria for each proposal you’ve received.
3. Scoring proposals
It’s very unlikely proposals will perfectly meet each one of your project’s requirements. Most will score high on some evaluation criteria and low on others.
Here’s an example of how you can score your proposals:
5 points: Meets all of your requirements;
4 points: Meets almost all of your requirements;
3 points: Meets many of your requirements, but requires some compromises;
2 points: Meets some of your requirements;
1 point: Does not meet your requirements.
4. Create your RFP scorecard
The best way to keep the supplier scorecard simple is to create a shortlist of invited suppliers. To keep things simple, you can limit the number of suppliers at 5 and the number of questions at 20 or less.
It may seem like you’re narrowing your options too much, but actually, this means each evaluator has to judge and weigh 100 individual responses.
Here’s an example of how your RFP scorecard should look like:
Pro Tip: Use an exponential scale for your scoring
If you feel the total scores often don't differentiate suppliers enough, consider implementing a margin for error. When you have a large number of criteria and closely-spaced scores, the unders and overs cancel each other out, so you end up with very similar totals. In this case, use an exponential scale for your scoring. Here's how to do it:
1. Write your RFP questions in a way that really elicit the type of response you can give a meaningful score to.
2. Assign each question an exponential weight (like 5, 10, 25, 50), and eliminate any low-weight questions.
3. Use your team’s collective experience and knowledge to determine each response’s worth. Use an exponential scale to score the answers, e.g., 0, 10, 100, 1000.
4. Multiply and add scores.
5. If the grand totals don’t match your instinct, fiddle with the weights, and calculate again. You can repeat this step until you feel your evaluation system matches the reality.
How Prokuria can help you score your RFPs
If you want to make things really easy, think about investing in an RFP software.
Why? Because this way, you don’t have to waste time and energy compiling spreadsheets manually. This means no more complicated weighted-decision template matrix, macros, complex formulas, or miscalculations.
Ultimately, doing RFP scoring is reduced to determining which method is best suited to the complexity of the project and the RFP. By defining the criteria ahead of time and giving each criterion a score and a weight, you have the highest chance of selecting the best supplier for your organization.