We have a new guest blogger in the ranks and while our worlds are different, her words ring true throughout the sales world.
One of the aims in sales, lately, is to help buyers buy. Unfortunately, we in sales continue to focus on selling a solution. And when we say we want to ‘help buyers buy’ that means we want to make it easier for them to make a purchasing decision and choose our solution.
But sales treats a need as if it were an isolated event. We haven’t been trained to realize that ‘needs’ arise in our buyer’s environments as part of a tangle of other issues that are going on. So a team building program is necessitated by a merger, by team members from disparate cultures joining together, by folks being laid off, by people being resentful they have been given new jobs, etc. Until buyers either resolve or garner buy-in from, the internal issues that necessitated the ‘need’ and hold it in place daily, they cannot bring in a solution without disrupting the other elements. And the time it takes them to do that is the length of the sales cycle.
Most sales people approach the sale from their perspective. But as I have mentioned earlier the sale will only be made if they approach the issue from the buyer’s perspective.
The DMU (decision making unit) usually would work by assigning weights to three parameters associated with the product or the service being purchased. The three factors are price, service levels and quality. A sale would be made if the total of the weighted average is the highest or lowest (depending on how the weights have been assigned) for the seller.
Now let me elaborate on this
Criticality of the Purchase: Done deal or No deal
In B2B scenario, the criticality of the product being purchased in the value chain of the buying organisation is a very important factor. This is such an important factor that it makes the difference between a done deal and no deal.
Criticality can be due to the following reasons:
The volume of purchase
If the volume of purchase is very high then the criticality of the purchase is higher. As higher volumes indicate huge payouts, the buyers would like to get the best price for an acceptable quality. In the healthcare scenario, bandages and dressings are the best examples of this kind of a purchase. The quality in these cases should be acceptable but ideally the DMU (decision making unit) is driven by price. And as the purchase is in bulk and on going, the criticality of this sale is high. Conversely a highly specialized clinic would not require the dressings in bulk instead this would be a non critical purchase for them. Hence the DMU will not be very particular about the sales process and the salesman can expect some leeway in negotiations. When I was running a dental practice my highest volume of purchase was ‘water’. Surprised? Yes so was I, when I realized that I was almost using 10 liters of water daily. This was used to cool the dental machines while drilling and scaling. Hence I needed water of acceptable quality; I needed it in bulk almost 300 liters in a month and on a on going basis. A critical purchase for me!
Quality
When it comes to quality some industries on the whole are far more particular than the others. The biggest examples are those in which, quality lapses can lead to injury. Prime examples are automobiles and healthcare. Now even a quality tool like, Six Sigma (3.4 DPM) is not a quality standard in products that require precision. Some time ago we had to work with this firm designing software for nuclear power plants. Now we could not afford to have a single mistake in the monitoring software. This would not only be a costly mistake, it could endanger the lives of millions. The same we can’t say about a logistics firm that can live with 3.4 wrong or late deliveries. Hence the purchase of a software package for a logistics firm can have a margin for such errors but not design software for a nuclear power plant.
Cost of the component as a percentage of the total cost
This factor though not very important in small or mid-sized deals assumes importance when it comes to bigger deals. As larger deals would involve huge payouts, the importance of these deals from the DMU’s perspective is higher. So factors like cost, volume and quality would combine to enhance the criticality of such a buying decision. A colleague of mine used to work for a firm which specialized in designer bathrooms with ‘Jacuzzi’s’. Now for the Jacuzzi the critical component was the water pump which was almost 60% of the cost. Hence in their case the negotiations with their pump suppliers were far more critical that the other suppliers.
To add to these factors are the regulatory compliances. In industries like Lifesciences and Banking complying with government frameworks become very important, hence any sale to these organisations would require the supplier to be compliant too.
A good salesman would keep all these factors in mind before proceeding for sales. This requires elaborate preparation and doing your homework as to what are the conditions under which the prospective firm operates. This can make the difference between a done deal and no deal.
Written by: Dr Vikram Venkateswaran
Who has to sell? Everyone!
The common perception in a sales process is that it is the responsibility of the sales man to sell. But that is a totally wrong way of looking at the concept of selling, because in a B2B scenario everyone sells.
Amazed?
But that’s the truth. Recently we won a deal from a major health plan in the
Now I am a sales guy. And I am not belittling the efforts of our brethren. But everyone in the organisation has to sell, right from the Public Relations (PR) to the HR department. Often though sales guys make the pitch it is the other guys in the team who clinch the deal. And that is the difference between a successful pitch and an unsuccessful one.
As I looked back at that incident, I came to a few ground rules while making the sales pitch
What I mean by that is apart from delivering the value proposition and understanding the client business it is important for the sales team to find out other aspects of the client organisation. Like in our case their interest in community development. These snippets of information can then be taken back to the board room and if any such activities go on in your organisation they have to be show cased.
Often the final presentation team would consist of only the sales people and those directly involved in the domain. But it would not hurt to include other areas in the discussion. Especially the support functions like human resources.
Most clients don’t like power point presentations. Anyways this is what your competitors would be doing. Rather think of other unique ways to get the message across, working models, video clips, walk through, site visits, among others.
Last but not the least many clients want someone they can relate to in some ways or the other and it may not necessarily be the sales team. So everyone has to make a sale!
Your sales team’s success depends largely on your motivational techniques and how you keep them going. You need to nurture and reinforce the positives in their lives, both professionally and personally. All successes – personal and professional – are intertwined. Someone who’s having personal problems won’t be motivated to push for sales, or worse yet, will come off as desperate.So it’s in your best interest to keep your sales team happy and motivated.
Let’s look to some techniques. The most common techniques are built around effective communications. Even the simple things like reinforcing a list of accomplishments done at the end of the day can build up morale and keep people motivated. More morale builders are built on repetition – remind them of the things you believe in your teammates, focus on the positive goals.
Observation is an important part of this process. You should be aware of your team members accomplishments and successes – you should know about them without being told, and if you want to win the “boss of the year” award, make sure that you bring them up early, regularly and often. People will work harder for a pat on the back and an earned “good job” than they will to avoid a chewing out. Likewise – sales is a job about taking calculated risks. Make sure that you reward the risk takers when they succeed, and remind the risk takers who fail that all they’ve really done is learned something. In the words of Warren Buffett, after seeing a manager inadvertently lose two billion dollars in assets over a quarter, “I just paid two billion for him to learn a lesson. After the after-action report, it was apparent that he had learned something, and that I might as well be the one who benefits from it – I paid for the experience, after all
Your sales agents start with an inborn personality that helps them with this – while it can be trained up, it can’t be instilled in people who don’t have it. Even so, it’s in your best interest to nurture your sales team with training and educational offerings. Make them feel part of the team, and make sure they know you’re investing in their personal growth and professional growth.