1 How does your firm operate and why is it good for us?
One category of RFP questions—call them the “about your firm” questions—tries to identify the serious contenders among the plan advisors who’ve responded. The required answers here may seem basic and broad brush, but don’t let that fool you into thinking they’re unimportant. This is your chance to make a first impression that will linger in the sponsor’s mind throughout the screening and hiring process.
Key questions to expect about your firm’s structure and standing include:
- Who owns your firm, how is it structured, and how does this benefit us?
- What lines of business is your firm involved in and where does retirement fit?
- What’s your new client win-loss percentage over the past 12, 24, and 36 months?
- Who do we call for answers?
2 Tell us about your experience and hands-on capabilities
The plan sponsor will also be wondering if you have the specific talent and organization to get the job done. This is the “experience and credentials” line of questioning. Data such as years in the retirement business, education, earlier roles, and industry designations are part of this story, but a proven ability to achieve the outcomes your prospect is aiming for can be just as important.
Key questions to prepare for so you can showcase your team’s experience and capabilities include:
- Can you supply a breakdown of your current retirement business—both plans and participants—by industry, size, and other factors that matter to us?
- Describe how you help prepare plans to meet DOL and IRS requirements—and, on the other side, how you’ve helped clients with audits.
- Explain how you approach the plan analyses and changes associated with mergers and acquisitions. Give us an example of one or two cases you’ve been involved in.
3 How will you help us with our fiduciary duties?
As litigation continues to be a big risk for plan sponsors, the fiduciary support your firm provides can either set you apart from the competition or tip the balance in another firm’s favor. Some prospects will want you to carry some of the fiduciary burden; most will expect guidance and services to help carry out their own responsibilities. It’s up to you to find the right offerings for your target market and to articulate the value of what you can offer.
Key questions to expect about fiduciary support include:
- As our plan advisor, will your firm act as a plan fiduciary—and, if so, in what capacity?
- Can you provide 3(21) investment co-fiduciary or 3(38) full investment fiduciary services—either yourself or through a partnership? If so, describe how this works.
- Describe how you’ll help our plan committee members understand and fulfill their fiduciary obligations.
4 What kind of investment services will you provide?
Investment selection and management services tend to get a lot of attention in RFPs and finals presentations. After all, a thoughtfully designed lineup is crucial to both a participant’s progress and to fulfilling fiduciary duties. To prepare for questions related to investment services, you’ll need both a competitive service offering and the ability to show how your firm’s approach contributes to a suitable and competitive lineup.
Key questions to expect about investment services include:
- Describe your firm’s philosophy on and approach to investment consulting.
- What support will you offer us to develop and maintain our investment policy statement?
- What tools will your firm use to evaluate fund performance and fund managers?
5 Tell us how you can help our participants succeed
Financial advisory firms vary widely in the support they offer to help engage, educate, and guide plan participants—and yours may range from minimal services to on-site seminars or one-on-one consulting sessions. If you do choose to play an active role, you may want to focus on certain groups of workers. And your firm’s guidance is always important in helping to monitor the effectiveness of plan communications and education—and in helping participants make the most of all available services.
Key questions to expect about participant services include:
- Will you provide individual plan participants with personalized financial and investment advice services, including tools to help manage their finances? If so, describe how.
- Will you conduct educational seminars or other forms of general financial and retirement plan education? If so, what will they include?
- Can you design model portfolio allocations? If so, what’s the process and how do you fit them to our workforce? And will you share models you’ve built for other plans?
6 What’s your approach to technology and security?
With technology and data handling so important to a plan’s success—and cybersecurity a top concern—your prospects will want to know about the systems and platforms your firm uses to conduct its business. Make sure your practices and story will provide what they need to know.
Key questions to expect about technology and security include:
- What technology is available to your firm, besides the platforms and applications that recordkeepers might provide? What platform and applications do you use to run your practice?
- Would any of the technology you use benefit our plan? Are any of these applications proprietary to your firm?
- What cybersecurity protocols are in place, and what are you doing to protect your customers’ data? Can you describe your firm’s disaster recovery plans?
Best practices for writing better RFP responses
It’s often said that the only piece of marketing material that a prospect’s guaranteed to read is a proposal that they’ve asked for. This can make your proposal the most important place to tell your firm’s story.
Over time, you’ll build a collection of responses, which you can adapt to address the specific questions included in each RFP. In every case, you want to tell a story that clearly and consistently reinforces your experience, your expertise, and the unique value your firm can deliver.
Use these best practices to help you craft a more convincing story:
- Write from a consistent point of view and in a consistent style—to help ensure that every proposal holds together, from executive summary to references
- Consider setting a theme for each RFP based on each prospect’s stated goals and needs—and use it as a touchstone through your proposal
- Commit to using facts—statistics; diagrams, tables, and screengrabs; and selected, nonidentifiable operational/participant data—to reinforce your story and commitment to delivering outcomes
- Separate your winners from your losers—in other words, keep track of the responses that have worked well and reuse/refine them
- Automate the process as much as possible for overall efficiency and to leave bandwidth for meaningful personalization
Track, learn, improve, repeat
If you’re focused on growing your practice, you’ll likely be answering a lot of RFPs. Be sure to learn from the experience.
Track your results, whether it’s advancements to finals, falloffs at various stages of the sales process, results by client profile, and any other metrics that can help refine your process and improve your batting average.
Although it can be painful to hear, always ask for feedback if your bid falls short. Were there specific responses that rubbed the prospect the wrong way? Are your competitors offering services that you aren’t? Could your fees be too high?
Write your story to build your business
The time you spend writing and polishing your firm’s story for proposals, presentations, and other uses may not only improve the way you get your message across. In fact, taking a close, end-to-end look at your services and practices could lead you to make improvements that make you more competitive.
Telling your own story can be hard. So, if you need help refining certain responses, try talking with a few trusted partners, such as a plan consultant (TPA) or recordkeeper contact. The Retirement Advisor Council’s RFP resources for plan sponsors can provide some broad perspective on what prospects hope to hear from you. And don’t underestimate what a skilled and objective editor can do for you.
Chances are, there are plenty of plan sponsors who could profit from your experience and ability but need to understand all you have to offer. So, what do you say? Is it time to do a little writing?
This is intended for financial professionals.
The content of this document is for general information only and is believed to be accurate and reliable as of the posting date, but may be subject to change. It is not intended to provide investment, tax, plan design, or legal advice (unless otherwise indicated). Please consult your own independent advisor as to any investment, tax, or legal statements made.