In the run up to Christmas a tender for creative work surfaced that generated an overwhelming response. Now the dust has settled, we offer our thoughts on Gentoo Group’s approach and why the whole tender process is wrong anyway.

Sadly, tenders and pitches are relatively common in the world of the creative nowadays, and generally, whilst frowned upon, continue to happen.

Typically, the process might roll out like this;

1. Medium-to-large business advertises its requirements for creative, with a stated budget of £50,000 and requests applications of interest back.
2. Small-to-medium creative agencies craft the response they feel best ensures success. This may involve creative work on top of the usual costing process.
3. Medium-to-large business receives twenty responses and sets about filtering them down to just one. This may involve multiple meetings with various agencies and/or boards/committees.
4. Happy on its decision, medium-to-large business informs the successful small-to-medium creative agency, and the nineteen unsuccessful, of its choice.

Whilst some argue there are plus’ to this process (more choice for the business and the opportunity to secure work in an open process for the agencies), here at Wonderstuff we believe the flaws in the process are obvious:

Dialogue

The tender process is essentially one open question responded to with numerous closed answers. It simply creates a supplier to consumer relationship; you say jump, I ask how high. Creative agencies however are not suppliers and should not be viewed as such, on the most part we are experts in our field, providing effective solutions to solve a given problem through the application of creative thinking. For this to be true, agencies need to be sure of the problem and the solution and this requires some level of discovery on their part; most commonly through dialogue.

In short, the tender process it is not a good foundation for dialogue and it is because of dialogue, and the honest and open relationships it creates, that the most effective work is produced.

Results

Following on from the last point, a tender process does not in any way ensure a more effective result; all it ensures are the illusions of choice and of opportunity. The commissioning business gets to choose one of twenty answers to its question, whilst the twenty agencies each have the opportunity to answer. But neither can be sure what the most effective answer may be, and neither can afford (see our final point for more on this…) to invest additional time finding this out.

It is only through a solid, open and honest relationship, where business and agency can work together to define the problem and create the solution, that truly effective results can be achieved.

Economics

For the sake of argument, let’s assume that each small-to-medium agency charges out at £100 per hour and spends four hours responding to the tender request. With twenty agencies responding and only one able to be successful, thats a minimum of £7, 600 of wasted time, effort and resource. Factoring in the time taken by the medium-to-large commissioning business to advertise the tender and then sift responses, this figure could easily increase to in excess of £10, 000. That’s not an efficient way to allocate the hypothetical £50,000 budget.

A bigger commissionable budget doesn’t balance this out either; a higher number of more detailed (and thus more time consuming) responses, from larger agencies (with higher rates) ensures that. It would be a far better allocation of budget, energy and personnel, for the commissioning business to research potential agencies, whittling it down to just a handful before engaging in a dialogue to ensure a truly effective end result.

We could talk at length about these things (and in due time we probably will), but thats enough for now. So we’ll move focus to Gentoo and how they stepped so spectacularly over the mark in the run up to Christmas.

The £100 Fee

Tenders are often unpaid, free time and effort given away by agencies in the pursuit of future business. This is bad enough, but Gentoo’s tender went one step further. They stipulated that a fee of £100 +vat would be levied to each agency upon submission of their response. According to Gentoo Group Principal Procurement Officer Colin Watson, their rationale for this was that the fee,

‘simply helps us cover the administrative costs associated in preparing the tender documents.’

Its an absurd reason.

Imagine putting an advert out for a tailor; you specify that you expect your new two-piece to be planned, executed, adjusted and delivered to perfection on time and on budget, but that you’re going to charge £10 to any person that responds to ‘cover the cost of the advert’.

You wouldn’t do it would you? Just as it’s an ignorant approach to commissioning a new suit, it’s an equally inexplicable way to commission creative.

Thankfully, following substantial backlash that stretched right across the industry (see Design Week and Twitter), Gentoo dropped the charge for the tender in question, with Head of Communications Sharon Appleby, stating that,

‘charging suppliers £100 to submit a tender does not fit with the Gentoo brand and what we stand for.’

Whilst we’re aware that this isn’t an isolated incident, we sincerely hope it isn’t the start of a wider trend. Commissioning truly effective creative just can’t be done like this. It takes a relationship to make it happen, and in a relationship both parties trust and value one another.

The Design Business Association

Wonderstuff is a member of the dba (Design Business Association), the trade body of the design industry in the United Kingdom and the organisation leading the charge in abolishing free-pitches. All members of the dba agree not to partake in these and the dba offers advice to all prospective commissioners of design about how best to go about the commissioning process. For more information on the dba and their resources for clients please visit the dba website.