The customer’s buying decisions and what happens when you’re not there…

OK…so you want to talk “value” to your customers. But ask yourself deep down, why?

Martin Southern
October 10, 2019
Articles

“Easy!” you scream, “If I don’t talk value then I might not secure the right price for what I’m offering, I may lose out to another project or initiative, or I am forever stuck with a ‘Do Nothing’ decision maker”.

All of this is true, but there is more to it than that. Let’s start this thought process by pretending that we are working for the customer and think about what goes on inside their business when you aren’t there.

It’s the customer’s monthly Board meeting and your beautiful proposal is being reviewed not just by your contact / sponsor but by all their colleagues as well. During the meeting, they’ve just finished their own internal business review, and things are currently a little tight. The Sales Director got a hard time for failing to sign up a large customer renewal and the Operations Director missed a key shipment deadline. Things are tense, and next on the Agenda is your proposal for them to spend $1 Million on a new IT / cloud outsourcing infrastructure!

Let’s get down to base human instincts and behaviours, and think what would you ask if you were inside that team and not working for the supplier?

Consideration 1

Does this proposal have the economic benefits that we agreed would result if we moved ahead? Do these benefits reflect the time delay between signing up and realising the gains? Have leaders around the table signed up to their departmental gains and savings and are they all on the hook for delivery? Are all these factors included in a fully presented ROI-based business case? If the answer is “No”, well time’s up, so let’s wait until next months’ Board meeting when we do have one!

Consideration 2

OK, you passed all the requirements of Consideration 1, so what’s next? Is this proposal better (more $ valuable) than the other things we can do? Can we devote our own internal resource to deploy and is this a priority for us? Whilst the business case on its own may make sense, it might not be our priority. The quantified $ scale of the opportunity will keep this decision more “unemotional” than without a case and will undoubtedly keep you higher on the priority list and avoid being kicked into the long grass.

Consideration 3

So we’ve now got this far, but we aren’t there yet. Even if we meet 1) and 2), have we actually got the money for it? It’s easy not to worry about this when you are selling, but it is critical when you are buying. Don’t ignore the CFO, they are the gatekeepers of funds and they have to make sure that they have got enough money to pay payroll, taxes, inventory costs etc., so even the most powerful value case can fall short if the CFO isn’t brought into the fold by having visibility of a funded case. The CFO wants to know if this is affordable by identifying the maximum investment required and at what point it’s needed.

Consideration 4

Only once you have got this far the rest of the Board (not the sponsor) will ask:

  • Are these the best vendors?
  • What differentiates these from other suppliers?
  • Have we checked their status, longevity and do they supply our competition?
  • Have we got references? Do we know it is working somewhere else?
“we did all that before the Board got involved!”

I now hear you screaming “we did all that before the Board got involved!” True, but the Board wouldn’t get involved at that early engagement stage and it’s the Board who are now being asked to grant the investment. Your current contact and supporter may be just one Board member. The CFO, CEO etc. doesn’t own the delivery of IT for example, but they are gatekeepers and owners of the investment decisions. So, no-one is saying don’t cover Question 4 early, but just recognize that it isn’t necessarily the top priority of the Board.

So, now we have thought about the above, we can safely build our checklist for what should be thought about in “creating the perfect value proposition”:

  1. Understand that the value quantification sits alongside everything else you would normally do in your current customer engagement process. All the other feature, functionality, customer testimonials etc. stuff stays!
  2. Quantify the believable - what the customer agrees to, rather than what you are claiming as a maximum. A “perfect value proposition” can only reflect in its own perfection if it achieves a desired result. That result is that the customer believes the case and uses it to “adopt” what is being said and move forward with the program as a result.
  3. How does your case work when you aren’t in the room? 100+ page spreadsheets won’t cut it with CEOs! Is it convincing, timely, reasonable, visual, believable, credible and worked through for their understanding, rather than something offering misty or hopeful wishes from the sponsor?
  4. A proposal is just a proposal and is NOT a business case. There are hundreds of impressive proposals submitted, but virtually all have no believable customer sponsored, timely benefits within them.
  5. Quantify hard benefit facts, with clear and simple explanatory notes for decision makers. Avoid technical jargon and identify not what it has done for other customers but precisely what it will do for their business in their own environment and location.
  6. Complete the case for your customer and with your customer. Is it really in your interest to let the customer build their own? Even if they do have to build their own (internal rules), produce what the end case will look like, so they know that starting the process is worthwhile.

Of course, what you need is a tool that does this for you, takes the customer on the value journey, and avoids you having to use complex spreadsheets at home…or worse in front of the customer! Everything we have learned over 15 years in the “value” business is baked within our software, so customers believe what you offer, adopt and support the value conclusions and deliver a “perfect value proposition” with all the right Board terminology to leap ahead of the competition who may not be as “value-ready” as you now are!Of course, what you need is a tool that does this for you, takes the customer on the value journey, and avoids you having to use complex spreadsheets at home…or worse in front of the customer! Everything we have learned over 15 years in the “value” business is baked within our software, so customers believe what you offer, adopt and support the value conclusions and deliver a “perfect value proposition” with all the right Board terminology to leap ahead of the competition who may not be as “value-ready” as you now are!


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