value

Understand the Client’s Meaning of Value

So you want to deliver outstanding value to your clients and your organization? Your marketing is astounding. You’ve generated attractive leads, your prospects are requesting conversations, and you are ready to get down to business — the time has come to think strategically… to align with the client… to create and deliver. What do you do next?

In this series of articles, we outline an approach which will keep the client in focus through your entire sales cycle and win his or her regard. The first article is focused on understanding what the client means by value. You’re not going to be able to win every lead, nor can you give every opportunity the utmost attention — some opportunities are going to be more valuable than others. The process outlined here will help you cull and order your thoughts, shorten your sales cycle and consistently find your way to success.

The following three tenets will help to begin our discussion. First, you must acknowledge that your success is entirely dependent on the success of your client(s) – this is the essence of partnering – you place the client’s agenda ahead of your own. Second, you must be empathetic and understand that the client has an existing, unsatisfactory situation (which can be latent or active, business or personal), and if you are unable to help them with their need, there will be no sale. Third, each client is unique as is each opportunity.

The goal will be to gain a commitment from the client, one which hopefully, will grow as time passes. The highest quality commitment will come from shared values, a level of trusting interaction – accentuated by your genuine interest in their situation, shared insights and assistance, and conceptual agreement on objectives, outcomes, metrics and value. You’re still far away from such a commitment, so let’s get started.

Step One: Understand

The first step in any conversation is to Understand. You need to understand the client’s business and understand their needs. What is their core strategy? What are their objectives (e.g. financial performance, client focus, business integration, etc.) and priorities (initiatives)? How do they characterise their needs (their desired capabilities that you will provide, and the impact the capabilities would have to their business)? What kind of business and technical issues are they facing? This should lead us to understand why the client has a compelling reason to act, and more important, why they are ready to act now. You should be able to link to a key client initiative and gain a sense of their urgency. You should also aim to learn how the client judges value: there must be a reason they are looking at you to provide a product or service solution, so how is it they think you can uniquely add value? How can what you offer fit their specific needs? The initial meeting is not a time for answers, it is a time to have the right questions – you should focus and listen. As you learn these details, you can begin to execute on the client’s agenda in an effective and timely manner.

The first step in any conversation is to Understand. You need to understand the client’s business and understand their needs.

Before your first conversation, you probably already performed some degree of “Account Planning” to supplement your “Opportunity Planning” — if you haven’t, then it’s not too late. You should gain some deeper understanding of the account by reviewing the client’s industry, their competitive position, and understanding their financials. Who are their key clients, and what do they value? Building a finance and strategy profile is a task you should be able to perform on your own — asking the client can be a sign you don’t know what you are doing. If you really don’t know and have no recourse, it’s better to know, so by all means ask. Any intelligence you gain in these areas will certainly help you better understand the client’s agenda.

Client Needs

Your client may have a lot of concerns and needs during the first meeting.

Your client will want to know if/how you can help them. You need to be respectful of them, and also realise you are probably not at the stage of commitment here — so you can consider offering one preliminary idea that may help them with the problem, not a solution, an idea. When offering the idea, be sure to connect the concept with their desire and needs. Ideas build trust, and since you are selling your proficiency and solution, your ideas are free currency.

Your client will need to feel their needs/issues are understood. Some level of reflection will help here – repeat the client’s goals and concerns in your own language to ensure harmonious interpretation, e.g. “I’d like to ensure we have the same understanding of the expectations, priorities and deliverables. Does that make sense to you?” Prepare, question, listen and think creatively to show your credibility and qualification.
Your client may need some assurance that their issues/concerns are of importance to your firm, perhaps owing to size — you must make it clear that all clients receive a high level of service, regardless of size. The client may require equal assurance that they will receive a custom, tailored solution to their unique, complex problem.

Your client may also want to know about price, and you should be prepared for this. The client only needs an immediate number to disqualify you. It would be premature to cite fees without knowing exactly what is needed, even when pressured for an estimate. If you have a particularly curious client, you can indicate that all details, including investment and options will be in the proposal you can have on the buyer’s desk in twenty-four hours — and, you’ll need to accelerate the gathering of information you will need to complete the proposal. To accelerate the deal, you will need to acquire deeper understanding.

Deeper Understanding

Not every opportunity is worth pursuing, and as you go deeper, you may be faced with many reasons to disengage.

You need to understand the roles and collaborative responsibilities of the players (so-called “governance”) – who is the true economic buyer (often called the sponsor), who is the key decision leader, and who else has a stake in the project (receiving benefits and/or impacts from the outcomes)? If you’re not dealing directly with the principal buyer, then you need to (cordially) bypass the gatekeeper, e.g. “I look forward to collaborating with you on the project. I must meet with the true buyer to manage expectations.” If you cannot bypass the gatekeeper to access the principal buyer, disengage.

You need to understand which problem needs solving. Which issue requires help? Serious buyers have real projects (not ideas), they cannot do without outside assistance. For example, they lack technical expertise to solve a problem, lack business expertise to apply technical knowledge, lack confidence in their ability to evaluate options, need independent verification, do not have the staffing or time to address a problem/opportunity, or doubt their ability to implement the solution. This problem is real and deserves a budget. If a project is not approved and funded, then it does not exist – disengage.

You need to understand, “why now?”. You don’t want to chase losers – some people will just want to kick the tires, or grab as many ideas as they can in order to implement their project themselves, or bench mark their performance against your proposal — you need to identify these types, and the most effective way to do so is to establish their compelling reason to act along with their sense of urgency. Without a sense of urgency, there may be no real opportunity, and little value associated with the project. Because you are a business advisor who understands relevant business issues, you know that urgency can come from external factors like an economic downturn, internal factors such as deadline pressure, or it can come from business goals like retaining current clients. You can learn a lot by asking questions such as, “what is causing this problem?”, “why does this problem need attention?”, “what happens if action is delayed?”, and “what happens if you do nothing?”. Clients will likely value clarification around priorities. Without a compelling event or reason to act, disengage.

You also need to understand your own place in the process – your unique value. The principal buyer should be able to answer why you were called – how are you expected to create value for them? If the client doesn’t have the experience to answer, you can provide some preliminary options that may uniquely meet their needs. Some value-related questions include, “what will be the difference in your organization when this project concludes?” or “what are the three greatest impacts to result from this project’s success?”. Better yet is gaining deeper insight into quantitative impacts (e.g. sales, market share, profit retention), and qualitative impacts (e.g. repute, convenience, ego). Before you can get into discussion about methodology, options, timing and fees, you need to understand, in the client’s words, how you are differentiated, how you can make them more successful and competitive, how you can meet their needs better than the competitor’s solution, how your solution fits their specific needs. If you do not offer unique value, this is the time to disengage. At this point, it is worth remembering that your perceived value can be a function of questioning basic premises, not agreeing, not supporting, and refusing impossible expectations.

Project Fundamentals

If you’ve made it this far, you’ve navigated some tricky waters with many possibilities to disengage. The rest should be slightly smoother, but also requires more technical precision.

The first item to understand is the expected decision date along with the expected delivery date – schedule details may be and usually are the most critically important factor in the success of the project.

Next, you need to understand the meaning of success, also known as the Project Business Objectives with justification — you can create a complete list by asking questions like, “what business capabilities does this project need to give you?”, “What current business capabilities must be enhanced?”, and if more prompting is required, you can ask, “would it help if you could do _____? Would this fix the problem?”, “What would you like the end result to be?”, “What must be changed, fixed or improved the most?” I always find it is important to be as concrete as possible, “Why does it make business sense to spend money on this project?” Everything is always measured on a relative basis, and when the case for change is made on business justification rather than the availability of new technology, communication is easier, gaining consensus is simpler and the results are better.

Finally, you need to understand how to measure results. How will your client know the outcomes have been achieved? Measurable objectives are the goal, so you can ask, “what measures will you use to tell that we’re on the right track?”, “what range of improvement would you like to see, what is minimally acceptable, and what represents overwhelming success?” and finally, “what specific business results will the capabilities give you, and how will you use the results?”

Once all project issues have been thoroughly discussed, be prepared for client questions related to project cost, hourly rates, proposal details, discounted fees (for a promise of future work), as well as project effort estimates. I advise providing these details in the proposal itself, and working on your method of communicating this standard business practice.

Concluding

Congratulations! At this point you have a (validated) opportunity to deliver a positive total client experience that creates value for your firm. Progress can now move in a few different directions.

The first rule of work is to understand what is expected of you before you start to work. You have: clear, concise project objectives, with quantifiable value in the form of benefits; a description of the desired end state; a project budget and assurance the project is approved; the names/roles of project stakeholders, especially the key decision leader and sponsor; a good picture of the competitive situation; agreement in principle on approach, scope and schedule; conviction that the project truly addresses the client’s problem; and confidence in your ability to solve the problem and deliver outstanding value.

If your situation merits it, you can attempt to close. With these details in hand, you can offer to start on a handshake (even an imaginary one over the phone) if the client is ready to begin immediately. If the client desires to see a proposal, you have all the information required, and can provide the proposal by courier within twenty-four hours (true professionals do not e-mail proposals) — be sure to establish a clear follow-up date. If your situation is not ready to close, you have more work to do.

We’ll tackle how to proceed in the second article in this series, “II] The Client in Focus: Explore Value Options”, and as always if you’re interested in learning more on this subject or want help enhancing your organization, we can help, and conversations and ideas are free.

  • http://www.forzaopportunities.com/About.html Kyle U.

    Outstanding article, it really covers all of the bases, I especially enjoy the sections about knowing when to disengage.

    • http://armurray.com Adam Murray

      Thanks for the encouraging feedback, Kyle. Look forward to the follow-up articles! Be sure to keep in touch.

      Best,
      Adam

  • Pingback: Google

Related Posts

Featured-Image-1240x390
On Professional Services

February 5 2013