Recently I was explaining solution sales to a colleague who works in operations and I highlighted that a solution sales person should genuinely care about whether their proposed solution will actually work in the client’s environment. This was to contrast the degree to which a solution sales person should involve themselves in fit, operational readiness and implementation, with the degree required in simpler sales situations.
Solutions need to work, and need to be architected for success, for two driving reasons: 1) winning the sale by competing on ease of implementation, and 2) future sales.
To elaborate, I’ll talk further on the solution sales method of the path of least resistance and share a model which I’m using to improve the perception of value at Cisco.
On the degree of solution fit
The most overt example of how solution fit is a competitive strategy for solution sales comes from the riskiest competition situation: a tender (or RFP or RFQ). For the purposes of illustration, I’ll not discuss the hugely important topic of influencing a tender or avoiding it altogether or of being ‘column fodder’, and presume that the tender is a genuine and fair exercise to find the right supplier.
Imagine a client has released a tender with a series of technical, operational and commercial requirements for the procurement of a bespoke software solution. The respondents requirements will be rated on degree of fit, some of which will be mandatory; acting as gates for consideration.
The responding companies will need to provide a solution which satisfies those requirements, and it is in the degree of compliance, or over-achievement, that the company competes. Their sales team needs to balance the costs of compliance with the competitive benefits gained. Judgements need to be made to distinguish (a) those items which are mandatory but not particularly important to the client, from (b) items the client will weight more heavily and upon which the company can distinguish itself.
The sales team needs to take a similar view to operational and commercial items. Unfortunately, many multinational IT vendors’ policies make the legal platform a very difficult competitive space. Some smaller vendors can compete through simply accepting terms and conditions (particularly from government) which their larger competitors cannot. The number of non-compliant or ‘to be discussed’ items that are flagged by the vendor’s legal department correlates directly with a negative rating from the client.
Operations are similar. If the proposed solution fits like a glove into the operational environment of the client, and really nails the issues of training, systems integration, documentation, knowledge transfer and warranties of fit, then the client will factor in a lower cost for its implementation.
Thus, the sales teams will be pushing the operational, delivery, legal and commercial representatives of their company to be as compliant as possible with the client’s requests. They should understand the importance of the requirements to the client, and to the competitive situation. They should know what their competitor’s weaknesses are.
If the final proposed solution — in its fullest sense, including its technical fit, commercial, legal, operational aspects — is easier to implement, then that vendor will have an edge.
Thus in turn, you can see how the best solution sales people will dig right into the details of the full solution and improve its fit with the client in order to compete. The result is a solution which presents the path of least resistance to the client.
Client’s perception of value
The client of a services supplier becomes more valuable over time, for reasons such as referrals and the reduced servicing cost of the client due to the mutual learning experience of service delivery (summarised on wikipedia). Retention of that client is important.
Clients buy results. A simple example is that if you have your car repaired, it doesn’t matter how good the customer service was, with coffee and newspapers or a courtesy car, if the garage can’t fix the car on time.
Though, what happens in many service-delivery organisations is an overly narrow view of the service from an internal perspective, with insufficient measurement and understanding of the results from a client’s perspective. There are probably loads of statistics and measures on staff utilisation, profit, and hopefully customer satisfaction, but likely to be fewer measures from the client’s perspective.
To start answering the question on how to improve the client’s perception of value, you need to appreciate how a client buys services, which is where this service productivity model1 comes in useful.
Key to this model is the fact that clients have their own operating processes which continuously run in parallel and interact to the service provider’s own processes. For the model’s service process, the provider may develop some element of the final service solution in isolation (A), some in concert with the client through meetings and interactions (B), and importantly the client’s operating processes are continuing to run in isolation (C). Thus the provider’s work in isolation indirectly effects the quality of the output whilst the work the provider and client perform together influences it directly.
A key point is that the client’s perception of quality is influenced by how well the service provider interlocks with them, not just how good the finished reports look, or how clever the engineers might be when anaysing a problem at their desk.
Thus a provider can improve the perception of quality by improving the exchange of information between provider and client, and crucially (but not seen as often) by improving how effectively the client consumes and gains from the service they received.
This requires that the service provider thinks about how the client will use the outputs of the service, and helping them take advantage of that service. Some examples include joint metrics; program management offices with mutual risk and issues registers; matching provider SLAs to the SLAs between the client and their customers; and business analysis which does not stop at the door of the provider, but considers workflow all the way through to the client’s customer.
Solutions sales involves thinking that chain all the way through.
This might require that the provider’s organisation has to change its metrics and processes in order to report value back in terms which matter to the client — by measuring results the client cares about — but that outcome will increase loyalty and thus the likelihood of retention.
1. Gronroos 2007, Service management and marketing, Wiley.