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Chapter 7: Delivering on the Commitment

Overview

Keeping Close to the Customer and Ahead of the Competition

We hear two common statements from executives when they call on us to help them improve their organization's sales performance. They sound like this: "Our team isn't bringing home the sale often enough. We can't overcome objections and close." "We're getting beat up on price. We don't know how to negotiate." Can you see what's right and what's wrong in these statements?

Here's how we interpret the situation: The statement of the problem - declining sales and profit ratios - is based on observations and represents a very real and serious situation. But the identification of the cause - the inability of salespeople to close and negotiate - is an opinion and, in fact, is not the actual cause of the problem.

Closing and negotiation skills, in the traditional sense, are rarely needed in the enterprise sale. Or, more accurately, you don't need to worry about closing and negotiation during the eleventh hour if you follow our sales methodology. These two most erroneous, and often feared, tasks in sales are simply no longer necessary.

This is a difficult idea for salespeople to grasp. "What? No objections?" "No negotiations?" Their incredulity is a measure of how deeply the conventional selling mind-set is implanted in the psyche of the salesforce and how radical a shift away from that mind-set this sales process actually represents.

Our sales process eliminates the dependency on closing and negotiation skills because by the time the enterprise sale comes to its conclusion, our customers have already understood and confirmed the causes of their problems, the consequences of those problems, the parameters of a high-quality solution, and the financial value of that solution. As long as our offerings address these preestablished elements, all of our customers' concerns have been met. There is literally nothing for our customers to object to and no reason to question the price of our products and services. If any unexpected questions do surface, they can simply be linked back to the information that we've already developed and confirmed with the customer.

Negotiation takes on a new definition in our sales process. The essence of the sale process is clear and precise communication and collaboration - a continual "mutual understanding." Continual mutual understanding and agreement is negotiation at its finest. Open collaboration from moment one of the process means the process proceeds with continual agreement. If the salesperson is still engaged with the customer by the time the Delivery phase is reached, he or she has already passed all the milestones required to provide the solution. We should not be in the room unless both parties believe there is a strong fit between their problems and our solutions. This translates to no objections, no price negotiations and pressure, and no buyer's remorse or other deal-canceling reactions. It also means faster sales cycles, more predictable outcomes, and higher margin transactions - all of those things that define success in careers and organizations.

So, what are we doing at the conclusion of the sale process? The final phase of the process, Delivery, is focused on two goals: (1) successful completion of the sale and (2) the postsale relationship between the salesperson, the organization, and the customer.

Elements of the first goal, successful completion, include formalizing the sale and then delivering and implementing the solution. Formalizing the sale includes the salesperson's preparation and presentation of the proposal and the customer's acceptance thereof. In delivery and implementation of solutions, salespeople manage the risks of the solution implementation and ensure that their customers are getting what they have been promised.

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Before you enter the Delivery phase, there is one question to ask yourself: If you were the customer, knowing what you know, would you do what you are about to propose? This is the acid test of the sales professional and the primary tenet of ethical selling. Imagine that the customer is your best friend or that you are the doctor and the customer is your patient. Would you be offering the same solution? If not, now is the time to stop the process and reconsider the alternatives.

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The second goal of the Delivery phase is focused on the postsale relationship between the salesperson, the organization, and the customer. It includes, first, the monitoring, correction (if necessary), and communication of solution outcomes; and second, the expansion of the business relationship salespeople have been building throughout this new sales process. Educated, aware salespeople who successfully establish this expanded role become the preferred providers for their products and services in their customers' minds.

Formalizing the Sale

The first thing we deliver in the final phase of the sale process is the proposal. The proposal is a formal, polished version of the discussion document that we prepared at the end of the Design phase. It is the complete story of the best solution to the customer's problem - what that solution is and how we arrived at it.

The proposal lays out all of the technical specifications of the solution and the contractual details that go into a binding agreement. And, like the discussion document, the proposal summarizes all the findings we have developed thus far in our sales process. It leads the customer step-by-step back over the bridge to change from the solution itself to the decision criteria and outcome expectations to the problem indicators and consequences. This articulation and summary of the chain of decisions also takes into consideration and addresses the critical perspectives of each member of the cast of characters.

The proposal in our sales process is an instrument of confirmation. It is a formal statement of everything that has already been agreed on. It should contain no new information; it should inspire no debate. It is only the formal closing of the sale.

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Lawyers are taught never to ask a witness a question unless they already know how the witness is going to answer. The same advice holds true for proposals in the enterprise sale: Never put anything in the proposal that the customer has not already agreed to and confirmed. When we surprise our customers with new information in proposals, they will surely surprise us with unexpected, and usually negative, responses.

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When we use the word confirmation to describe a proposal in our sales process, we are making an important distinction between it and the typical sales proposal. In conventional sales, the proposal is used as an instrument of consideration. In other words, it is presented to customers so that they may analyze and judge the solution being proposed. That is why the content of most sales proposals is devoted almost exclusively (usually 90 percent or more) to the solution being offered.

Proposals devoted to solutions do not tell the full story of the engagement. They don't explain the customer's problem or why the solution proposed is in the customer's best interest. As a result, they are incomplete and unconvincing and serve mainly to generate objections. The conventional solution-focused proposal is full of pitfalls.

Further, as we discussed earlier in this resource, proposals based almost entirely on the salesperson's offering are largely a waste of time. They all sound alike to the customer, who can't connect their features and benefits to a well-defined problem. Therefore, they unerringly lead customers to decisions based on the lowest common denominator, the price. (They also inhibit the salesperson's ability to differentiate his or her company and offerings.)

Effective proposal writing in enterprise sales is part art and part science, and it is a topic unto itself. Tom Sant's book, Persuasive Business Proposals, provides a great guide. ^[1] We now provide a few tips specifically for practitioners of the sale process.

Write for the Invisible Decision Maker

Recently, we analyzed a proposal prepared by an outsourcing company in the commercial insurance industry. The company was offering to take over control of the management of all of its client's insurance needs, and the client represented a large account, almost 10 times the size of the company's average customer. The service being offered was complex; the proposal, on the other hand, was two pages long. The first page specified the rates per $100 in salary by the job classifications of the client's employees. The second page specified a rebate that would be earned if the client's incurred loss ratio remained below certain levels. That was the entire proposal. Picture yourself as a senior executive at the prospective client who hasn't been part of the engagement to this point but is being asked to approve this sale. Would you green light this expenditure? On what grounds?

Proposals need to be written for the invisible decision maker. Not because there always is one, but because proposals need to tell the entire story of the engagement convincingly and coherently. When we keep this imaginary reader in our minds as we prepare the proposal, we have a constant sounding board for the content. It can guide us to a proposal that is a business report - one that explains a problem, the parameters of a solution, and the solution itself.

Echo the Customer's Voice

When we meet with clients who are interested in our services, we tape the conversations whenever possible and take copious notes when we can't tape. There is no ulterior motive here; we aren't trying to trip up or trap customers. What we are doing is trying to capture the voice of the customer.

All organizations have their own language. There are special phrases and meanings that make sense to and strike chords in the people at work within them. Listen for key phrases and adopt them. Echo this language in your proposal. Customers should not be able to distinguish the proposal from an internal report prepared by someone in their own company.

Enlist the Cast of Characters

The cast of characters is the salesperson's primary source of information throughout the sales process. When the time comes to present the proposal, we can enlist their help once more by asking members of the cast to present selected portions of the proposal themselves.

We can call on them during the presentation, saying, for example, "Bill, this information on page 10 grew out of our discussions. Maybe you want to walk us through it." Hearing a colleague present sends a powerful message of support for the proposal and confirmation for the solution to the rest of the decision team.

"Go for the No" One More Time

When our customers indicate their acceptance of the proposal, it is time to "go for the no" once more. Throughout our sales process, we have indicated our readiness to walk away from the engagement any time that the customer decides that there is no good reason to continue.

What would you say to a friend who has told you that he has made a major decision? You would probably ask, "Are you sure?" We establish ourselves as "best friend" one more time when we ask customers questions such as "Are you sure this solution fulfills your needs? Did we miss anything?" Further, if the customer is not sure about the decision, we find out on the spot (not three days later) and have the opportunity to allay any doubts that still exist.

Delivering the Solution

What does the conventional salesperson do after the sale is closed? Move on to the next victim. That sounds harsh, but unfortunately, that is exactly how many customers believe salespeople behave. Aware salespeople deal with this prejudice by breaking type once again and remaining conspicuously involved in the delivery and implementation of solutions.

Our involvement in the delivery of the solution grows out of a simple idea: A single order does not make a relationship. Relationships are built on dependability and the customers' ability and willingness to rely on our expertise whenever they need assistance. When salespeople hand off customers and move on to new customers, no matter how smooth and problem-free the process, customers are going to perceive this as an abandonment of the relationship.

We are not saying that salespeople should spend all of their time with existing customers. Obviously, a major part of a salesperson's job is to discover, engage, and establish new accounts. But too often, salespeople move on too quickly. We need to recognize the value of existing customers and devote a significant portion of our time to the retention and expansion of our relationships with those customers. This value is well documented. A study by Bain & Company calculated that in the insurance industry, a 5 percent increase in retention results in a 60 percent jump in profits; in employer services, a 4 percent increase in retention results in a 21 percent jump in profits; and in banking, a 5 percent increase in retention results in a 40 percent increase in profits. ^[2] When salespeople stay directly involved with customers during and after the delivery of the solution, they capture a sizable opportunity.

The same cooperative and diagnostic skills that carried us through the previous phases of the sale process are put to work in the physical delivery of the solution. Trained salespeople start this work by confronting and communicating the implementation problems that their customers regularly encounter. If your company never has implementation problems, this doesn't apply. However, in our experience, that is rarely the case. We find that the typical solution implementation and a customer's reaction to it look something like Figure 7.1.

Typically, salespeople gloss over the ups and downs of implementation. Perhaps hoping that problems will not occur, they try to ignore them. Thus, when problems do pop up, customers are not anticipating them and are caught by surprise, maximizing their dissatisfaction. This, in turn, forces the salesperson and the service and support staff to spend too much time in damage control and recovery, or risk a worse reaction from the unhappy customer.

One way in which this negative cycle can be avoided is by analyzing the problems and negative reactions that tend to surface in delivery and defuse them before their occurrence. We have found that a new sales process elicited strong, defensive feelings from a small percentage of salespeople who felt extremely threatened by the idea of changing their business-as-usual mind-sets. The reaction of this group was to attack - they would corner their managers and complain that these new ideas were impossible to execute and it was sheer insanity to even consider adopting them. This caused managers to start questioning the effectiveness of a new sales program.

We have discovered that complaints almost exclusively come from the lowest ranks of salesforces. Surprisingly, those who needed the most help were resisting it the most. Managers should expect to hear a small number of participants attack these new concepts; these complainers will likely be among their least effective performers. If these managers are prepared beforehand with an effective script they will still hear a few complaints, but they handle them with ease. Thus, an implementation problem is defused before it occurs.

Defusing potential problems before they occur is an excellent, practical solution to delivery snafus, but we also recognize that salespeople won't be able to anticipate every implementation problem. Another way to break the negative cycle that begins when customers are unpleasantly surprised during implementation is to adopt a mind-set that admits the possibility of problems and prepares you to address them.

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Like pilots who are trained to react to emergencies, almost reflexively and without panic, enlightened sales professionals also need to be prepared to not be prepared. They must be so prepared, that their response seems natural and spontaneous. They remain cool, calm, and collected when confronted by upset customers. They say, "I'm sorry to hear that. That doesn't sound good." They then move immediately into diagnosis, "When you say it doesn't work, help me understand - walk me through it."

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The fact that customers experience problems in the implementation of a solution is often less of an issue than how salespeople respond. Informed salespeople prepare for these problems by understanding that they do occur, providing the customer with the means to report those problems, and, most importantly, by reacting to reported problems in a cooperative manner by acting as a business partner and diagnostician.

Measuring and Reporting Results - Value Achieved

After the solution has been delivered and implemented, salespeople have one final task. The last step in the Delivery phase and the end of the sale process itself is the measurement and reporting of the results generated by the solution.

Of all the sales methodologies, this sales process best positions salespeople to measure and report results. We have already determined the indicators of the problem, its financial impact, and expectations of the solution and its value. In delivery, we simply turn back to these figures, measure them against the actual results, and report our findings to the customer.

If the expected outcomes have not been achieved, we prove our value and professionalism to the customer once again by diagnosing the obstacles that are holding them back and designing new solutions. If the expected outcomes are being achieved, we can use the results report to open new business opportunities with the customer.

Salespeople should complete this work because of the following three compelling reasons:

1. It ensures that the promised outcomes have been achieved. Salespeople may be able to succeed in the short term by closing sales and moving on to new customers, but to succeed in the long term, we must deliver on our promises.

2. It provides the basis for renewing our sales methodology, which is also a cycle. When our customers achieve or exceed the outcomes they envisioned for the solution, we can renew our sales process by using their results to move back into the diagnostic mode and then design new solutions that are capable of providing improved results.

3. It allows us to establish our position as one of our customer's preferred resources, which maximizes the long-term profitability of the customer relationship and erects intimidating barriers for our competitors to overcome.

The ultimate goal is to become our customer's key resource for the solutions we bring to market. This relationship sets us apart from the competition in the customer's mind and leads to an ongoing role of diagnostic problem solver. Again, a source of business advantage.

Here are five characteristics of key resources:

1. Key resources are active participants in their customers' businesses. They understand those businesses and take an active role in their success.

2. Key resources commit to long-term growth relationships with their customers. They allocate the time and energy needed to work with their customers on a regular basis.

3. Key resources base their recommendations on measurable problems and outcomes. They are always working from the reality of the customer's world.

4. Key resources act as early warning systems for customers. They surface unexposed problems and notify customers of changes in products, technologies, and markets that may impact their businesses.

5. Key resources stay close. They know that two-thirds of customers stop doing business with companies because they feel unappreciated, neglected, or treated indifferently.

If it sounds as though there is a good deal of work involved in becoming a key resource, there is. At least, there is more work than the conventional salesperson typically undertakes. But the rewards are exponentially higher.

In the "You snooze, you lose" world of business, trained salespeople are always awake and alert to significant changes in the environment. Their customers learn to depend on this alertness and become loyal, long-term customers.

Further, in sales, your best customer is always your competitor's best prospect. The customers of enlightened salespeople, however, have a much higher resistance level than the average customer. Customers know the value that they derive from a high quality sales relationship. So, when competitors call them and say, "We can give you the same thing for 10 to 20 percent less," our customers don't get stars in their eyes. They know the right questions to ask and the traps to avoid. They are also well aware of all of the decisions that go into choosing a high-quality solution.

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