Chapter 11: The Structure of the Letter Proposal

Overview

The letter proposal may be as brief as a single page or as long as three or four pages with attachments. The exact salutation you use, the particular format you choose (block, modified block, whatever), the complimentary close, none of that's really very important. What's important is that your letter proposal clearly address the essential elements of the persuasive paradigm as described in Chapter 4:

1. The client's need or problem. Get right to the point. Don't waste time with clich openings. In fact, mark it down as an infallible rule, any sentence that begins "Per your ..." is a bad sentence. Even more common is an opening sentence like this: "I would like to take this opportunity to thank you for allowing us to submit our proposal for your consideration." What's wrong with that? It sounds like the writer is groveling.

   What's a better opening?

   Well, you can start with a "thank you," if you want to. For example, "Thank you for providing the information we requested so that we could complete our proposal and develop the right solution for your situation. We are committed to developing a solution that offers the right business fit as well as conforming to your key technical requirements."

   Or you can start by referencing previous meetings, contacts, or the client's RFP:

   "Based on the meeting held at your offices the first and third weeks of June, plus several phone interviews with other members of your team, we have developed an approach to deal with the three specific challenges you identified."

   But the best opening is usually one that gets right to the point, focusing on the specific problem or need that is affecting the client's profitability or productivity:

   "Physicians and nurses working in your hospital have indicated that the current process for recording case notes is awkward, time consuming, and inaccurate. As you explained to us, it represents a legacy system, which has long been out of date, and a number of patches and additions created in-house."

   Or like this:

   "Your decision to provide an online option for those customers who prefer not to shop at one of your three retail outlets is very exciting, because it will make it possible for them to order the finest in golf equipment, balls, and clothing at any time of the day or night and from any location. But it also means your Web site must be overhauled to be more user-friendly, more secure, more interactive, and more compatible with your e-commerce strategy."

2. The benefits of solving the problem or meeting the need. You arouse the client's interest by reminding them of a particular problem they have. You hold their interest and motivate them to take action by showing them there's a significant payoff that comes from fixing the problem or meeting the need.

   As we said earlier, most businesses have lots of problems, but the vast majority of them will never be solved. They just aren't worth it. There's no payoff to the company, no ROI for the investment, nothing that makes this problem important enough that the client is willing to spend time and money to fix it.

   If we take the example of physicians and nurses who are spending too long to enter notes in their patients' files, the benefits paragraph might read something like this:

   "Simplifying the process of updating case files, entering patient care notes, and documenting treatments can save Rutherford Psychiatric Hospital hundreds of hours and thousands of dollars every week. In fact, we estimate it can save your physicians a total of 120 hours weekly and your nursing staff a weekly total of 1,650 hours! Here's how we calculated the savings:

   	DICTATION/WRITING TIME PER WEEK	REVIEW TIME	PATIENT LOAD	TOTAL TIME
   PHYSICIAN	10 min./patient	5 min./patient	20 patients	5 hours
   NURSE	20 min./patient	10 min./patient	30 patients	15 hours

   The table above summarizes the average time a typical physician and nurse respectively spend recording and reviewing notes on patients each week. Multiply that by the number of physicians on staff (24) and the number of full-time equivalent nurses at Rutherford (110), and you're looking at a huge drain on productivity. Add in the staff of clerks who do nothing but type up physician notes because the existing system doesn't work well and you're looking at a massive expense that contributes nothing positive to patient care."

   If you knew what the average charge rate was for physicians and nurses at Rutherford Hospital, you could calculate exactly what that expense is. But you can see how marshalling the numbers makes the analysis of impact more convincing, particularly compared to just offering generalities about "dramatic improvements in productivity" from replacing the existing system.

3. The solution. The presentation of your solution in a letter proposal should contain:

   A high-level description of the product or service you are recommending

   • Include enough detail to answer the customer's primary questions

   • Tie those details to the client's needs, showing how the features of your system address the issues the customer is concerned about

   • Remember to stress your company's differentiators

   A specific, clear recommendation to act

   • Use phrases like, "I recommend ..." and "I urge you to move forward ..." so there is no doubt where you stand

   • Too many proposals merely describe a solution rather than actually recommending it; descriptions don't motivate anybody to do anything

   You might also consider covering alternative solutions very briefly. Typically, you will cover them not to recommend them but to show why they aren't as desirable as the approach you are recommending. This creates the appearance of thoroughness on your part, something the analytical decision maker values. More importantly, by briefly considering and dismissing alternative approaches, you have the opportunity to anticipate the competition's approach and point out its weaknesses without engaging in disparagement. This technique is sometimes called "ghosting" the competition, perhaps because it raises issues that come back to haunt your competitors.

4. The wrap-up. The final part of your letter proposal should address three key issues:

   First, articulate the cost/benefit ratio. Line item pricing, if it's even necessary, can be relegated to an attachment, but within the body of your letter itself you should graphically show that the return on investment or payback period or total cost of ownership being offered by your solution is extremely compelling. You want to show the client that the benefits of moving forward far outweigh the costs. The essence of your analysis of the cost/benefit ratio will be based on the price of your solution compared to the benefits calculated in the second section of your letter proposal. You should also include the intangible costs, such as training, necessary equipment upgrades, and so forth. Mention the intangible benefits, too, of course, such as higher employee morale, regulatory compliance, better customer service, elimination of maintenance and repair costs, and so on.

   Second, provide basic information about the implementation schedule, project plan, and deliverables. If this information threatens to become lengthy or very detailed, include just the key dates and put the rest in an attachment. Mention any assumptions you have made which could affect the schedule, and indicate how the responsibilities will be shared between your firm and the client's.

   Third, cover any special technical considerations. If the customer has made very specific technical demands, indicate that you will meet them. Or, if you cannot meet these technical requirements, indicate that you will be able to deliver the functional requirements and will be doing it in a way that is somewhat different from what the customer specified. You will need to judge how big a problem this will pose to winning the opportunity, but concealing the fact that you do not intend to deliver the solution in conformity to the client's technical specifications is not a good idea. If your pre-proposal research has indicated that this aspect of the bid will make or break the deal, perhaps you should consider not bidding at all. However, you can usually expect a client to take a somewhat open-minded attitude toward technical issues if other aspects of the solution are attractive. Also, if you must take exception to certain requirements or terms, or if you have reservations about the delivery schedule or implementation plan, you may want to point them out here. It's very difficult to put anything the client might construe as a negative into your proposal, but nothing good ever comes from deceiving the client or withholding information, either.