Price to Win Output
On a Price to Win Curve, what points of interest do organizations typically focus on? Why?
Best Practices suggest the 85% Probability of Win point is sufficient for most competitions. Higher values of PWin should only be used for highly strategically important competitions. Lower values may be used for low strategic value, low risk, high reward situations.
How does a Company’s Bid Price affect their probability to win? How does their bid affect other offerors’ probability to win?
As the Bid Price decreases, a company’s Cost Score will increase leading to a higher Probability to Win. For each simulated competition, TruPredict is selecting the offer with the highest overall score to win that competition. This means that as a company’s PWin is increasing, the PWin of the competitors is decreasing. This relationship will not be a simple one-to-one relationship in competitions with more than one offeror where interactions can be complex. However, if you sum the PWin for all competitors it will always equal 100%, regardless of the size of the competition. It should be noted that Non-Cost scores play a large role in PWin – changing Non-Cost evaluation scores can increase or decrease PWin much more than Bid Price in some situations.