How to Build Winning & Profitable Project Proposals Using the Best PSA Software?

August 4, 2023


How to Build Winning & Profitable Project Proposals Using the Best PSA Software

IT services companies delivering billable projects to customers execute opportunities-to-cash cycles repeatedly. They must identify prospective customers, write winning and profitable proposals, deliver projects within budgets and on time, earn revenues, meet quality norms, and manage resources efficiently. Project management and resource management activities are crucial for their operations.

Writing a project proposal is a crucial step in every opportunity-to-cash cycle. 

Quality of project proposals is a critical success factor

Building a project proposal to win a contract is one of the most critical activities in the opportunity-to-cash cycle. The quality of a project proposal can make a difference between winning or losing a contract or between making healthy profits or losses in a project. It also impacts how smoothly you can execute a project. Further reading: High Quality Project Proposals – Your Key To Winning Project Deals

Over time, the ability to write winning and profitable project proposals directly impacts IT companies’ business sustainability. 

This article will examine and explain how to write a winning and profitable project proposal and what you need for that.

What is a Project Proposal?

A project proposal document that outlines the scope of the project, its goals and objectives, deliverables, prices, and its timeline. It is based on a request for proposal (RFP) from a prospective customer or various documents and communications between your company and the customer.

A project proposal is your marketing document backed up by specific technical and commercial commitments.

A quality project proposal document not only answers your client’s most pressing concerns and fears** but also serves as a guide for the actual execution of the project for both the client and the IT vendor. It is often the basis for a project contract.

** Read: Buyer’s risks are stalling your prospects

When you submit a project proposal, you leave your salesperson 24/7 on the customer’s premises. Make sure that it is your best one!

What are the Key Elements of a Winning Project Proposal?

A winning project proposal should be a comprehensive document that includes the following:

0. Executive summary

You will write this after all the elements mentioned below are ready. A well-written executive summary should summarize salient points from all the sections below. 

However, it must highlight the following:

-The statement of solution and its superiority over other approaches

-Outline of the project plan

-Pricing or project budget

-Key risks and how you will mitigate them

-how your organization is well equipped to deliver

1. Project’s background: 

The project’s background has a summary of the customer’s business. It should outline the customer’s needs in the current situation. It should reflect the RFP and other documents shared by the customer.

2. The statement of problem definition 

In this section, you need to state what problems the customer aims to solve. It would help if you understood the needs and perspectives of various stakeholders and decision-makers. The statement of problem definition should be thorough and crisply written.

Every decision-maker and stakeholder should easily relate to the problem statements.

3. The statement of solution 

You should state how you plan to solve the problem, why your organization is well-placed, and what resources and track record you have in your solution statement.

You must also compare your solution with other approaches and explain why it is the most suitable.

The statement of solution showcases your company’s competence in the context of your customer’s requirements. You need to avoid any superfluous information here.

The opportunity and proposal management module of professional service automation software (PSA) is a valuable tool to use the experience of your previous projects while preparing the above statement.

4. Technical Description and Solution Architecture: 

In this section, you need to elaborate on the above solution statement. You should provide technical details and describe architecture of your proposed solution, including the scope of deliverables and any possible exclusions.

The technical description must be detailed and written with rigor. Neat schematics go a long way in explaining your solution. You must provide supporting information or publicly available and credible resources wherever necessary.

5. The framework of the RAID (Risk, Assumptions, Issues, and Dependencies)

You must list all risks, assumptions, issues, and dependencies and how you will handle or mitigate them. The RAID framework should not be an afterthought. A rigourous RAID framework is critical for realstic estimation of costs and timelines.

The RAID is as essential as your solution architecture because it can impact the project’s work breakdown structure (WBS), resource planning, project plan, and cost.

The opportunity and proposal management module of PSA can provide helpful pointers based on the history of previous projects to the above while working on the RAID framework.

6. List of deliverables

In this section, you provide a list of all deliverables in a chronological sequence. It is good to include relevant action items expected from the customer.

7. Work Breakdown Structure (WBS)

The WBS must be granular enough to plan, track, and verify the completion of tasks on a day-to-day basis. It helps in optimizing resource costs and makes planning more realistic.

8. Project Plan

It would be best if you made a detailed project plan based on the WBS and the availability of resources. Your proposal should include the plan’s outline connecting with the deliverables.

A capable PSA for IT companies provides resource scheduling and soft booking capabilities for a realistic project plan. 

9. Project Pricing: 

Pricing of projects depends on their estimated costs, expected margins, market conditions, and strategic view that your management takes about the importance of clinching project deals. 

While the pricing decisions are matters of judgment, cost estimations aren’t. Estimating project costs must be based on uniform methods of calculating costs ( e.g., resource cost per hour, the basis for allocating indirect costs, and types of expenses).

Managers in many organizations use spreadsheets to calculate costs. Even if standard guidelines are in place, verifying that your managers have adhered to them is time-consuming. 

An enterprise-wide PSA software provides quick calculation of costs using the project plan and resource schedule above. It also uses standardized and approved costing resource hours and indirect costs. 

Project costing is your internal document, and it must remain confidential.

Based on the project costing, PSA software’s margin calculator in a well-designed opportunity and proposal management module makes pricing calculation very easy. 

10. Invoicing schedule

It is prepared depending on the nature of the contract.

11. Project Team Structure and Roles

You need to specify your team structure and roles.

12. Contact Persons

Provide your contact information here. Many customers prefer a single point of contact. An end-to-end PSA software empowers your contact person with all relevant information in real-time. 

13. Reporting

Regular and event-based reporting to customer bulbs trust. Therefore, your proposal must describe what information you will provide.

14. Change management and issue management

Describe how you will manage change requests and handle various issues..

15. Escalation 

Define the escalation process available to the customer if things go wrong. 

How to write a winning project proposal?

The conventional way

Preparing for all the above sections and writing them is a very laborious and tedious process if done conventionally – i.e., by using spreadsheets and writing software that allows some collaboration. There are many such standalone proposal writing software solutions in the market. 

Almost all the information needed to build project proposals is outside such standalone solutions it and must be obtained, validated, and entered into such software solutions. 

The PSA software way

Integrated Opportunity-to-Cash workflows in best PSA software has all the information needed to build project proposals. 

Building project proposals is an iterative and collaborative process. It needs your best people to write winning and profitable project quotations. It would help if you didn’t burden them by making them depend on spreadsheet-based conventional methods. 

Why should you build your proposals using ProductDossier PSA’s Opportunity and Proposal Management module?

The ProductDossier PSA’s Opportunity and Proposal Management module is configurable according to your workflows. It covers the end-to-end cycle of opportunity identification to contract creation with capabilities for opportunity ranking, detailed estimation, automated proposal builder, and finally, contract creation – in a collaborative environment. ProductDossier PSA puts information like project histories, issues faced, resources’ cost and skills, resource scheduling, etc., at your managers’ fingertips. 

Hemant Karandikar


Hemant Karandikar, a Product Marketing Strategist and an IIT Bombay graduate in Electrical Engineering, weaves decades of experience in R&D, engineering, and management. He initiated a successful industrial electronics startup and subsequently built a thriving consulting practice. As an author of management books, Hemant propels leadership, innovation, and content creation. He collaborates with Design Directions Pvt. Ltd. to shape UI/UX design. A fervent runner, he coaches individuals towards a healthier lifestyle through running