An Executive's Guide to RFPs and Requirements — You Don't Need Perfection, Just These 5 Points

An RFP (Request for Proposal) is a document used when commissioning software development to communicate to a development company what you want built. Originally used in procurement by large corporations and government agencies, this format has increasingly become recommended even for small and medium-sized businesses choosing a development partner. The reason is simple: relying solely on verbal conversations or fragmented email exchanges means each development company may work from different assumptions, making it difficult to compare quotes and proposals side by side. An RFP doesn't need to be a "perfect specification" — think of it as the minimum organization of information needed to correctly convey your intent to a development company. For an overview of the entire ordering process, see the Guide to Ordering System Development.

The word 'RFP' often conjures images of a polished, dozens-of-pages document, or a rigorous bidding process involving legal and procurement departments. For small and medium-sized businesses, however, that level of formality is usually overkill. What matters isn't length or design, but whether the core information — the purpose, the users, and the scope — comes through clearly. In fact, a one- to two-page A4 document with bullet points can function perfectly well as an RFP, as long as the content is specific. Rather than getting stuck on format, prioritize identifying the information you actually need to convey.

Development companies estimate effort and cost based on the information you provide. When that information is vague, they have no choice but to fill in the gaps with their own assumptions — about expected user numbers, functional scope, or whether integration with existing systems is needed. If those assumptions diverge from what you actually intended, it often leads to disputes later, with additional costs or scope changes that feel like 'that's not what we agreed to.' As discussed in Preventing Extra Cost Disputes, low information clarity at the outset is one of the leading causes of trouble during development. Conversely, preparing an RFP that covers the essentials makes it easier to obtain accurate quotes from multiple companies, reducing the likelihood of unnecessary cost overruns.

- ① Current operations and pain points: How things work today, and what's frustrating
- ② Who will use it: Number of users, departments, general IT literacy
- ③ Must-haves vs. out of scope: Non-negotiable requirements and what to deliberately exclude
- ④ Budget range and timeline: A rough budget range and desired launch timing
- ⑤ Existing systems and data: Existing systems to integrate with, and where data currently lives

The first thing to communicate is your current workflow and where the pain points lie. A vague request like 'we want to streamline inventory management' doesn't give a development company enough to work with. Specifics — such as 'we manage inventory in Excel, and duplicate entries occur across multiple locations' or 'month-end stocktaking takes a full two days' — help the development company grasp the actual shape of the problem to be solved.

Who will actually use the system is equally essential information. Whether it's a handful of internal staff, a large workforce including part-time employees, or external clients and business partners who will also operate it, the answer significantly affects the required usability, how thorough the documentation needs to be, and how permissions should be designed. Sharing the general IT literacy of your users — whether they're comfortable with PCs or primarily use smartphones — also helps the development company design for actual usability.

Given a limited budget, it's important to distinguish between requirements that are truly non-negotiable and those that would be 'nice to have but not this time.' If everything is presented as equally important, the development company can't judge priorities, which tends to inflate the estimate. Conversely, explicitly stating what's out of scope allows the company to drop unnecessary functionality from their proposal and offer a more realistic, cost-conscious plan.

Requesting a quote without disclosing any budget information causes different companies to assume different quality tiers, making comparison difficult. You don't need to give an exact figure — simply indicating a rough range, such as 'around 3 million yen,' allows a development company to narrow their proposal to a realistic scope. Similarly, when you'd like the system up and running is information that helps them judge whether their team and schedule can realistically meet your needs, so it should be shared early.

If you already use accounting or sales management systems that need to connect with the new system, that information must be shared as well. Where and in what form data that needs to be migrated currently exists — whether in Excel files or paper ledgers — is equally important. If this information is missing, unexpected integration or migration work can surface mid-project, affecting both schedule and cost.

An RFP is a tool for organizing the requests in your head into a form you can share with a development company. You don't need to aim for the rigor of a large-corporation-style document — simply covering the five essentials introduced here (current operations and pain points, who will use it, must-haves vs. out of scope, budget range and timeline, and existing systems and data) in one to two A4 pages can significantly improve the accuracy and comparability of quotes from multiple companies. For an overview of the ordering process, see the Guide to Ordering System Development, and for what to decide internally before ordering, see the Pre-Order Checklist.