Prevent Unpaid Consulting
In the Design phase of the sale process, we focus our efforts on the solutions to our customers' problems. Model sales professionals guide the design process by managing expectations of the cast of characters. In this phase, they help their customers establish expectations about solution outcomes, determine the methods and alternatives for obtaining those outcomes, specify investment levels and implementation timing, define the criteria that will govern buying decisions, and build consensus and confirmation among the cast of characters within the customer's organization for the findings and decisions that have resulted from the diagnosis and design efforts. In short, we create and align the solution.
If you paid close attention to the preceding paragraph, you may have noticed that it says nothing about the products and services that salespeople are bringing to market. Instead, it focuses on defining the parameters of a high-quality solution. In the Design phase, we specify and confirm the customer's preferred outcomes and decision-making criteria, but we do not present solutions. This is a continuation of the spirit of partnership and collaboration that we have been building throughout the engagement.
Our methodology stands in stark contrast to conventional selling methodologies. In conventional selling, the only acceptable result of an engagement is the customer's buying the salesperson's offering. This statement dictates a fixed solution. When salespeople enter the engagement, they have this fixed end in mind: Regardless of the customer's situation and requirements, the conventional salesperson is focused on only one solution - his or her own. Given this pre-established outcome, is it any wonder that so many customers perceive sales engagements as zero-sum games and think of salespeople as being willing to use any means to achieve their ends?
Exemplary professionals approach the solution phase of the enterprise sale as an exploratory process. The aim is to equip the customer to make the best, most effective choice among the solutions competing in the marketplace. This is not to say that top-notch professionals approach an engagement without a preferred solution in mind. Like other salespeople, they are in business to sell their products and services. They understand, however, that their offerings are not always the best solution for the customer, and they recommend only offerings that are in the best interests of the customer. As always, they apply the "do no harm" principle of the doctor and integrity test of the best friend. If professionals' offerings do not fill the bill, they are the first to recognize and acknowledge that fact and even recommend a more appropriate source for the required solution. In this way, sales professionals protect and retain their "valued advisor" status in the customer's mind and remain welcome to revisit the customer at a future date. At the same time, the salesperson has freed himself or herself and resources to move on to a more qualified customer.
While conventional salespeople often act as if competing solutions do not exist, successful professionals discuss solution alternatives head-on. They know that in the competitive environment of the enterprise sale, customers will examine alternative solutions, and they also realize that actively participating in that examination is better than ignoring it. Given the fact that so many salespeople are afraid to act as if competing solutions exist, the open, customer-first attitude of the sales professional often becomes a positive differentiating factor in and of itself.
When salespeople do join a customer's search for the best answer to problems, they take a seat on the same side of the table and act as partners instead of adversaries. Further, model sales professionals use this opportunity to strengthen their position by ensuring that their customers can recognize the inherent advantages and disadvantages among the solution alternatives.
In a larger sense, the goal of the design phase is to minimize the risk of change for the customer. In the diagnosis phase, we maximized the customer's awareness of risk. That is, we helped them to fully comprehend the risk involved in not addressing their problems and in not changing. When that effort was successful, the customer "owned" his problem. In the design phase, which the customer enters prepared to make a change, we begin working to minimize the exposure to risk inherent in the act of changing. When this effort is successful, the customer will be happy to "own" the solution to the problem.
Customers are exposed to three kinds of solution risks, which salespeople need to consider when designing solution parameters: process risk, performance risk, and personal risk. Process risks are exposures that stem from the implementation and ongoing operation of a solution. Performance risks are exposures that stem from the outcomes produced by a solution. Personal risks are exposures that the members of the cast of characters incur when they lend their personal support to a solution. As we create and define the parameters of a high-quality solution, we need to anticipate how each of these three risks might impact the customer and be sure to communicate those exposures to the customer during the decision-making process.
When it comes to deciding enterprise sales, no matter what solution the customer chooses, including your own, that solution will contain positive and negative aspects. When we willingly and openly explore alternative solutions and their ramifications from the customer's perspective, we exhibit integrity and strengthen the bonds of trust between our customers and ourselves.
To illustrate these risks, we consider financial accounting software. A process risk is the possibility that a customer buys and installs a new accounting software package, which crashes the organization's computer network. A performance risk is the possibility that the new software does not work and miscalculates the organization's financial results. A personal risk is the possibility that the problems caused by the new software cause the person who recommended the purchase to be fired or shuffled off to a much less wanted position in the organization.
Consider the risks a customer faces when buying your offerings. What are the process, performance, and personal risks? How do you address them during the sales engagement?
The first point of focus in the Design phase is on our customers' desired outcomes. This is primarily a visioning process. We want to create a discussion that is centered on the future, at a point when the customer's problem has been solved. This portrait of the future helps us define the customer's expectations about the solution. We can sum up expectations in the answers to three questions for our customers:
What do you expect this desired state to look like?
How much do you expect to invest to attain the desired state?
When do you expect to have the desired state in place?
The easiest way to begin to define the parameters of a solution is to ask customers how they expect their situation to look after the problem is solved. This portrait of an imagined future produces a list of outcomes that customers expect from the solution. It gives us the basic information that we need to begin to define the standards by which those outcomes will be measured.
As always, questions are the most effective tool at our command. We add depth to the customer's vision for solution outcomes through our questions. For instance, when a customer says that reliability is a critical outcome, it is our cue to ask questions that generate more detail about that outcome. We need to establish a specific definition of reliability and an exact figure for its measurement. In the process of establishing those answers, we are creating a clear definition of the customer's expectations and a valuable guide to the best solution to the customer's problem.
In addition to preventing miscommunication, sales professionals must also ensure that the customer's requirements of a solution are realistic and attainable. Just because we ask customers to define their expectations does not necessarily mean that we should or can accept whatever answers they offer. The outcomes they envision must be possible, and it is our job to ensure that fact by managing the formulation process.
Mismatches between customer expectations and reality are a common occurrence in sales, and too often salespeople abdicate responsibility for resolving them. Instead of bringing the customer back to earth as soon as unreasonable expectations surface, salespeople, who are often reluctant to say anything that might disappoint the customer, pass that unpleasant task downstream to the service and support functions. As a result, the customer's expectations become fixed, and when reality finally strikes, the level of dissatisfaction is higher. There is little point in providing a solution to a customer if we have fostered exaggerated expectations about performance of the product or service (or delivery date or final cost, for that matter). The only results we can expect from such a sale are complaints, conflict, and, in many cases, permanent loss of the customer.
Reliability is an example of what we call a fat or loaded word. So are words such as quality, value, soon, and support. Customers often use fat or loaded words to describe their expectations about solutions (as well as their problems), but the words themselves are vague and can easily cause misunderstandings. If our definition of quality, for instance, is a 5 percent defect rate and our customer's definition is a 2 percent rate, we are setting ourselves up for failure.
Defining realistic expectations, on the other hand, sets the stage for customer satisfaction and repeat business. By defining expectations in quantitative as well as qualitative terms, we protect our customers and ourselves from disappointments and conflicts that result from poorly defined and unrealistic expectations.
The next set of expectations we need to define is the set that centers around the size of the investment our customers are willing to make to solve their problems.
In the Diagnose phase, we assigned a cost to the customer's problem. In the Design phase, we use that cost to calculate the value of the solution. This does not mean that it is time to talk about the price of our offerings or to begin negotiating price with the customer. Instead, we are going to quantify the financial impact of the desired outcome, that is, what the customer can expect in terms of increased revenues and/or decreased expenses. We want to determine what it is worth to the customer to solve the problem. The value of a solution and appropriate investment to obtain it can be expressed with two simple equations:
Return on solution (ROS) - Cost of problem (COP) = Value
Value × Customers expected return on investment (ROI) = Investment
When we help our customers calculate the worth of a solution, we set the financial parameters for a high-quality decision. Those parameters, which consider cost of the problem and return on investment the customer must earn on corporate resources, tell us how much is worth spending to resolve the problem.
Once those value parameters are set, it becomes very easy for the customer to evaluate the cost of solution alternatives. The actual cost of the solutions being offered becomes less important than how each solution's costs compares to the value the customer stands to gain. The ability to determine this information is a significant improvement over the typical way that customers approach price - a side-by-side comparison of solutions that tells the customer nothing about how much it is actually worth spending to solve the problem.
Defining investment expectations also serves the salesperson. First, because we already know the cost of our own offerings, it allows us to establish whether our solutions are financially feasible for the customer. If they are, the engagement continues. If not, the customer is returned to the salesperson's opportunity management system, and it is time to move on to a more qualified customer. Second, setting investment expectations largely eliminates price negotiations and objections about the price of our offerings. We know ahead of time that the investment required to purchase our solutions is a match with the customer's expectations.
Three common pitfalls that salespeople need to recognize and avoid in defining solution expectations are discussed in the following sections.
Conventional selling puts great weight on the customer's budget. Budgets are part of the corporate planning process. They represent management's desire to forecast and assign resources for anticipated needs. Conventional sales methods ignore the reality that the corporate budget is largely irrelevant in the enterprise sale.
Enterprise sales are investments. Corporate resources flow to the best investment, that is, the investment with the best return. In enterprise sales, budgets are altered and created; they rarely impede an attractive investment.
If we qualify based on an already-existing customer budget, it is highly likely that we are entering the enterprise sale too late. It may be possible to increase the customer's awareness that the problem is large enough to change the investment criteria. Our goal is to be working with customers when they create the investment criteria on which the budget is eventually based.
First, when customers begin talking about expectations, there is always a temptation, often an irresistible one, for the salesperson to slip into presentation. Customers say they expect high reliability as a solution outcome, and suddenly the salesperson is off and running with a speech about the consistent and reliable performance of the offering. We need to be aware of this and avoid the urge to present in the Design phase.
The second trap that often undermines salespeople during the Design phase is the trap of unpaid consulting. Unpaid consulting starts when we cross the line between defining parameters of a solution and creation of the design of the solution itself. When we start designing solutions, we start acting as consultants. In past decades, this was not a monumental issue. Generally, there was limited competition in enterprise sales. If you figured out the problem and designed a unique and competent solution for a customer, the sale was almost guaranteed and the salesperson was rewarded for his or her consulting effort. Ironically, many sales organizations continue that strategy and, for some reason, choose to ignore the fact that the environmental conditions that made that strategy successful in the past, for the most part, no longer exist. Today, there is an ever-increasing proliferation of competitors in the enterprise sale, and once a solution is designed, the customer can easily shop it to the competition. When that happens, we become unpaid consultants and our own worst enemies. We've enabled our competitor, who did not have the design investment, to provide the solution at a lower price. We can avoid that trap by staying focused on the customer's expectations for solution outcomes and not straying into the design of solutions. If you are providing true consulting that is transportable to competitors for fulfillment, you must extend your business model to include fees for professional services, and you must decide at what stage of the decision process the line between required diagnosis and design and paid consulting exists.
The final trap is sprung when customers become so enthusiastic about the potential value of solutions to their problems that they expand the scope of the outcomes. When customers drop into this "as long as we're going to do this, we might as well also do that" mode of thinking, they tend to lose their sense of fiscal responsibility and conventional salespeople start to count the extra commissions.
The problem with this response lies in the very nature of the enterprise sale. There is no single decision maker in this sale, so when a salesperson allows one member of the cast of characters to unnecessarily expand the scope of a solution, you can be sure that the entire project will be shot down by the other members of the cast.
Quintessential professionals ensure that their sales do not expand beyond reasonable financial parameters. The rule they follow is: Never allow an expectation that is not backed up by a specific problem and a cost that supports the additional investment.
The final set of customer expectations is based on the timing of the expected outcomes. These are relatively simple to establish and don't require much explanation, but they are important. After all, in today's fast-changing world, a solution that arrives late can cause as much damage as one that does not arrive at all.
The customer's expectations as to solution timing tell us when the solution must be in place and the timetable on which it must be producing results. Further, timing expectations have the added benefit of signaling the customer's intentions for purchasing the solution, thus offering valuable information to the salesperson and another opportunity to influence the final decision.
As with expectations about solution outcome, it is our job to ensure that timing expectations are clearly defined and mutually understood and that they are reasonable and attainable.
Once we have helped our customers create a portrait of what "fixed" is going to look like, we need to turn our attention to how they will decide on the best solution alternative available to them. To do this, we create decision criteria that offer set guidelines by which customers judge all solutions and the proof points needed to measure, analyze, and compare solution alternatives. This is where we teach the questions the customer needs to ask of any salesperson to help them sort through the smoke and mirrors of enterprise solutions and half-answered questions.
The truth is that alternatives always exist in the marketplace, and each carries differing degrees of risk. As we explained at the start of the chapter, there are no free moves for the customer. Superior salespeople use decision criteria and help customers recognize the consequences of their choices. This is very similar to the process doctors go through when prescribing medications. The FDA requires that every prescription drug carry with it a full description of contraindications, warnings, adverse reactions, possible side effects, and detailed instructions for proper dosage. Patients often ignore this "small print," but doctors use it to make informed decisions about prescribing a drug and communicating that choice to their patients.
This awareness reinforces reasonable expectations, supports a high-quality choice of solution, and serves as the basis for monitoring the progress and adjusting solutions during implementation.
Taking an active hand in the formulation of decision criteria is a task that is largely nonexistent in conventional selling. Thus, traditional salespeople are depending on their customers to provide these criteria, and, as we already know, customers typically do not have the expertise to undertake this task. Further, conventional salespeople are often reluctant to admit the existence of alternative solutions that might compete with their own offerings. They are like ostriches - sticking their heads in the sand and hoping that the customer will not see anything more than they can see themselves.
The same concept that applies to medical prescriptions also applies to business solutions. To make a high-quality decision about solutions, the customer must be aware of the potential pain and risk associated with available alternatives.
Conversely, trained professionals face the reality that the marketplace is a competitive arena and that their customers often have instant access to information about competing solutions. They know that their customers are going to explore these alternative solutions with or without them, and they understand that the only true choice salespeople have in the matter is whether to participate in that process. As always successful salespeople recognize that the preferred alternative is to help guide and shape the customer's decision process.
Decision criteria specify the features, situations, and capabilities required to achieve the expectations of the customer. They are the material specifications of the customer's vision. They enable customers to explore treatment options in an organized fashion, ensure that alternatives are weighed equally, allow customers to match solutions to expectations, and then test and confirm their choices.
Decision criteria are not a laundry list of features and benefits. In other words, salespeople can't simply cut and paste the capabilities of their offerings under the heading of "Decision Criteria." The criteria must grow from the expectations of the customer, and they must be directly connected to the findings of the Diagnose phase. When we specify a solution's capability within the decision criteria, it must relate to a symptom or indicator of the problem. Otherwise, there is no defensible reason for requiring the capability in the solution.
This is a critical connection. How often have you had a customer become enamored with a competitor's product or service feature that sounds, looks, and smells good, but which the customer doesn't need? The customer is seduced by the decision principle: "If in doubt, it's better to have a feature than not have it." In this state, customers suddenly announce that they "need" a specific capability and they want to know if you have it.
For example, the feature in question is a whicker attachment (an imaginary part), which your product does not include. It is usually obvious what has happened: Another salesperson has presented the whicker as the latest and greatest product feature, and now the customer wants a whicker. How do you counter that claim and the customer's desire? The decision criteria. They tell us whether a whicker actually addresses an indicator present in the customer's problem or if it is a superfluous feature. (By the way, if the customer does actually need a whicker and we can't provide it, it may be time to be leaving.)
In enterprise sales, the list of decision criteria can quickly get unwieldy. We usually suggest that salespeople focus on a short list of three criteria that will have the most impact on the customer's decision. Within each of these three criteria, we need to teach our customers to ask the solution questions that make sense in our industry. We are, in essence, showing our customers how to sort through the smoke and mirrors that typify so many sales presentations and grasp the information that they need to decide among competing solutions.
For example, a customer is planning to buy capital equipment that requires authorized service and install it in plants in 21 countries around the world. Service support is obviously a critical issue in such a purchase. Typically, a customer in this situation asks: "Do you have a service program in place that includes my 21 international plants?" The salesperson replies, "Of course, we offer a global service program." The customer checks this solution criteria and moves on.
Next, the customer buys from this salesperson, and the capital equipment installed in Singapore breaks down. The customer calls for service and finds out that it will be 48 hours before the service technician in Maryland can get there. There are two days of downtime before the tech even arrives on-site, and the customer is wondering how many days of downtime will be recorded when he starts multiplying the number by 21 countries.
The global service program that the salesperson promised actually means that his company will send a tech from its headquarters to wherever the equipment is located. But the customer never discovered that because he never asked the next logical questions: "Where are your service techs located?" "How long will it take to get one of them to my sites?"
Exemplary sales professionals pay particular attention to those points where their product and service strengths intersect with the customer's decision criteria. Key opportunities to differentiate ourselves from our competitors exist at these points.
An example drawn from the training industry illustrates the idea. The effectiveness of training is heavily dependent on the abilities of the person conducting the training and how well he or she understands and relates to the audience. Accordingly, the attributes of the trainer should be one of the decision criteria considered by customers.
If you were a salesperson for a training firm and your company paid particular attention to matching the experience and abilities of trainers to their clients (sending trainers to meet clients before sessions and asking the trainer to customize those sessions, for instance), you have a competitive advantage over competitors whose trainers do not meet clients before the actual training and who assign trainers by geographical location or at random based on previously scheduled work. It only makes sense that you would implant these criteria in the customer's decision process. Customers would receive a high-quality solution, and you would have a greater chance to earn their business.
As always, the ultimate goal of decision criteria is to empower our customers with the information they need to make a high-quality decision. When we have established the decision criteria that the customer will use to find the best solution to the problem, there is only one task left for the salesperson: confirmation.
One of the biggest obstacles in enterprise sales is the inability of salespeople and customers to understand each other. We call this gap between the two parties the "Valley.of.Mystification". The salesperson stands on one side of the valley unable to see the problem, but with the solution in hand; the customer stands on the other side experiencing the problem perhaps not understanding it completely and unable to fully understand the solution. As a result, a successful sale becomes a random collision of pain, product, and lucky timing.
The process of confirmation is one way out of the valley. By confirming that our customers and we are on the same page and that everyone involved in the engagement comprehends both the problem and parameters of the solution, we eliminate ambiguity and confusion and foster mutual understanding.
In our sales process, confirmation is driven by a discussion document. Discussion documents are much like preliminary sketches that architects draw. In the process of designing a building, an architect and the client first discuss the features that the client wants in the design; then the architect draws a preliminary design based on those requirements. A client can't actually build a house from these drawings, but they do serve as a starting point for the blueprints that are needed to begin construction.
The discussion document serves a similar purpose in the enterprise sale. This pencil sketch recaps the problem, its financial impact, the customer's expectations, and the decision criteria with which the best solution will be determined. It sums up the engagement to this point and puts into writing the agreements and understandings reached with the customer.
When a customer won't confirm the discussion document, we know that a serious impediment to a successful sale has surfaced. Before we move forward with the engagement, we need to trace each concern or disconnect back to its source and resolve it to the customer's satisfaction.
Salespeople tend to forget that there are always conflicting objectives coexisting within organizations. When the design of a solution that is clearly in the best interest of the organization is meeting resistance, you must first ask yourself, "What is wrong with this picture?" When you identify what it is that doesn't make sense, ask a second question, "Under what circumstances would this refusal to confirm make sense?"
When the customer does confirm the contents of the discussion document, it tells the salesperson two things: First, all of the requirements needed to design the best solution are addressed, and second, it is now the right time to formally offer the customer that solution. It is time to move into the final phase of the sale process, Delivery.
Normally, the answers to these two questions lead you to one or more members of the cast of characters who believe that they will experience pain because of the solution. You can neutralize that pain by recognizing it and addressing it in the solution or by building a consensus that it must be accepted for the overall benefit of the organization.