Whether you're a private organization, a part of the healthcare sector, or a part of the government sector, making high-priced purchases is a complex process with endless variables. Once you’ve decided that you need a supplier to enable you to improve your financial controls and maximize revenues, the goal is the same: to achieve better results AND higher ROI.

But where do you start?

An important starting point is submitting a request for proposal (RFP) to receive responses from qualified vendors in your industry. Within the recovery audit space, it’s difficult to differentiate which suppliers have the capabilities you need -- especially when it’s on paper, comparing suppliers can be challenging.

Because the process of RFPs is an objective way to vet potential recovery audit firms, it helps level the playing field. While each conversation with a potential recovery audit firm is unique, RFPs help ensure that firms are dealing with the same set of information to build a proposal from and therefore help you compare apples to apples more effectively.

So what should be included in your RFP and what should you expect in return from a solid RFP response?

What is an RFP?

An RFP, or Request for Proposal, in the recovery audit industry, is a bid proposal document issued by an organization to a list of potential recovery audit firms. The term RFP refers to both the proposal solicitation process and the RFP document.

This document presents potential suppliers with a list of typical RFP questions about the services, methodology, and costs that will go into fulfilling the organization’s needs for the project in question. The RFP response is drafted by the recovery audit firm (aka the bidder) and then sent back to the organization for assessment. This enables the procurement team to make a fair assessment of the potential supplier against the needs of the business.

Why RFPs are Important

RFPs, in the context of recovery auditing, signal that an organization is aware of financial leakage within its operations and is actively seeking help from an outside vendor. These organizations submit an RFP, often to multiple vendors, in order to evaluate their options and encourage competition between recovery audit firms.

A well-written RFP gives the potential recovery audit firms the necessary context to propose the best solution for the organization, while offering a structured framework that helps stakeholders of the organizations (the issuer of the RFP) think through the details of a project, such as:
  • Project goals
  • Project budget
  • Project timeline
  • Evaluation criteria
  • The recovery audit process of the firm

What to Include in an RFP

An RFP will look different depending on your organization and the needs and goals of your project. However, RFPs always include basic information about your organization and the challenges you are facing.

What's typically included

(the basic requirements)
  • Information about your company
    • Scope of the audit i.e. what financial years are available for review
    • What categories, territories, or entities are included within the review
    • What ERP, pricing, and promotional management systems are used by the requesting organization
    • The number of suppliers that will need to be reviewed
    • Your annual turnover, annual sales values and/or the annual value of commercial income
  • Confidentiality terms
    • Legal disclaimers
    • Contractual obligations
    • Warranties
    • Security or Data Processing requirements
  • The purpose of the RFP
    • The nature of the project/initiative
  • Information about how the RFP process will be managed
    • The key points of contact within your organization
    • The timetable for the vendor selection process
    • Whether/when a face to face interview might be required
    • What type of response document is required
    • Any standard response templates
  • A request for a firm's scope of services

Because your organization is seeking expert advice, your team may not know the best solutions to your challenges or what you need to provide to address those challenges.

What is often forgotten in a Recovery Audit RFP that should be included

(along with the basic requirements)
  • Clearly defined expectations of RFP process AND recovery audit process
    • What you expect from a partner
    • How much the firm should recover within a specified timeframe (required minimum recoveries)
    • Whether an existing firm(s) already provides recovery audit services
    • What financial scope they have or are currently reviewing
    • Recovery values from prior years
  • The goal of the audit
    • Related goals of your business
  • Timeline - Dates of completion and checkpoints 
    • Key dates/deadlines that firms need to be aware of
  • Your organization’s IT infrastructure/data security requirements
  • Requests from the firm:
    • IT infrastructure / data security
    • Demonstration of approach, methodology, and capabilities
    • References/case studies
    • Team structure
  • Possible roadblocks
  • Relevant recent industry / organizational events
  • How to submit the RFP
  • Response Guidelines
    • Currency used in response
  • Decision criteria
  • Fees + Payment Terms (with examples)
    • Include fees and expenses that you will cover AND what they should expect to cover
  • Clarification process (phone, email, etc)
    • Provide a template (i.e. spreadsheet) for Q + As
  • Glossary of terms (to avoid confusion)
    • Terms related to your business/industry

What to Expect from an RFP Response

The recovery audit process is complex but the responses you receive should not be. Experts in this space should be going above and beyond with their proposals to ensure you are receiving clarity to your challenges and the potential solutions.

What's typically included

(the basic requirements)
Executive summary
  • Procedures/approach
    • Recovery Audit
    • Real-Time
    • Ongoing support
  • IT infrastructure
  • Accreditations and certificates

What should be included

(aka how to know when you’ve received a solid RFP response)

You will know when you’ve found a solid response if they include…

  • First and foremost, the RFP response should be extremely tailored to your organization. When you read the response, you should not be questioning if it fits you. It should feel as if you can see your problems being addressed and solved.
  • Outlines audit goal
  • Projected timeline
    • Resources needed to complete within the timeline
  • Lays out a clear claim settlement and recovery process but should be adaptable to your needs, not the audit firms
    • Manages and negotiates with suppliers (on your behalf) while maintaining a strong relationship
  • Emphasizes the importance of evolving to prevention (this shows that the firm cares about your organization and wants to see you succeed).
  • Is transparent about their security protocols
  • Performs root cause analysis
  • How they track and report KPIs
  • Full list of files they need in order to complete the project. Here are a few:
    • Ledgers
    • Vendors
    • Buyer-Vendor Email files
    • Contracts
    • Deals/promotional files
    • Invoice Matching
    • Invoices
    • Debit/credit notes
    • Order files and received files
    • Cost and price files
  • What teams will be involved
    • List of notable employees with descriptions of related experience
  • Relevant case studies + testimonials
    • This ensures the recovery audit firm is familiar with your market/region and has worked with a client similar to you.
    • It is also helpful if they provide use cases on specific capabilities/tools to show you what exactly the process will look like.

Basically, the potential recovery audit firm should be making your life easier and taking this process off your plate. However, it can be difficult to differentiate between which firm presented the best information vs. the best firm for the job. 

So you have to ask yourself, “what am I getting from one potential recovery audit firm and how does it compare to other firms?”

Capabilities of a strong Recovery Audit firm:

  • Clear benefit analysis - what’s in it for the client
  • 100% vendor review for maximum recoveries
  • 24-hour global production schedule
  • Speed of implementation
    • Ready to audit day 1 of contract
    • Review time-restricted vendors
  • Integrates their processes and technology into your current tech stack
    • Explanation of each technology and how it’s relevant to completing the project
    • Ability to focus on results without the burden of new tool integration, training, and ongoing tool maintenance
  • A capable team of auditors
    • Highly trained, senior employee auditors
    • Audit and IT resource bandwidth to properly execute your project with the ability to deliver maximum results with minimal impact to your organization
  • Scalable resources to enable maximum recoveries and acceleration alongside transformational audit tech
  • History of successful Client and Vendor relationship management
  • Knowledge of the industry and applicable nuances
  • Proven data security infrastructure, management and oversight
  • Ability to provide actionable insight to improve financial operations + processes

Best Practices for a Robust Recovery Audit RFP

The RFP process can be complicated and time-consuming. But to ensure a smooth process, make sure to...

  • Be specific
    • Establish detailed and clear BANT - budget, authority, need, and timeline
  • Be prepared
    • Go into the RFP process with clearly defined criteria to ensure a smooth selection process
  • Ask questions
    • The purpose of submitting an RFP is to select the best firm for the job. Ask in-depth, thorough questions to get a feel for the firm and their capabilities.
    • Do not be afraid to ask the audit firms what would make it easier for them to provide you with the best proposal.
  • Conduct preliminary research
    • Do not blindly go into the RFP process. Before submitting a RFP, you should do research on recovery audit firms, the recovery audit industry, and seek other sources like colleagues, to validate whether or not firms prepared valuable yet reasonable proposals.