Implication #5: Sales Process and Opportunity Planning
If there’s one takeaway you should have from all the research and best practices shared to this point, it’s this: commercial organizations need to place far greater emphasis on supporting the customer’s purchase process. One of our all-time classic best practices comes from an organization that has done just that and shifted their entire salesprocess to more of a purchase enablementprocess. The company is ADP, the global payroll and human capital management firm, and this is their “Buying Made Easy” Purchase Process (see figure 10.10 on page 244) … This entire approach is designed to support the customer through a series of customer outcomesthroughout a typical purchase experience.
But what ADP is doing is different. From their perspective, the real question isn’t “How do we help our reps better sell?” but rather, “How can our sales teams help our customer better buy?” … This process is predicated upon the major decision stages that nearly any customer will undergo, including:
- Recognizing a need – This is where the customer initially determines a reason to explore a potential purchase, whether based upon an opportunity, a risk, or a problem. In this stage, the customer will frequently make excuses to maintain the status quo. The customer may preliminarily research suppliers and even conduct an initial supplier outreach.
- Exploring options – Here, suppliers start to get initially compared. More extensive supplier research happens, including differing capabilities and pricing. Customers often request more detailed information at this stage.
- Defining purchase criteria – Here, customers evaluate the efficacy of their current business processes, assessing precise areas where improved performance is necessary, along with minimum thresholds for that performance. Customers undergo some form of risk/reward analysis. Buying groups convene and stakeholders are tapped to help evaluate the purchase. Purchase criteria are initially proposed.
- Evaluating options – Here, customers present a clear business case to senior leadership. Solution providers are formally evaluated and a short list of preferred suppliers is created.
- Validating options and selecting a favored supplier – Supplier return on investment is evaluated. Formal requirements are finalized. Funding is secured and the go/no go decision is made.
- Negotiating the purchase – Procurement is formally involved as terms are negotiated. A final round of executive sign-off occurs, legal reviews occur, and finally the contract is signed.
- Implementing the solution – A project team is assigned. Old processes are retired and new processes are implemented.
- Evaluating impact – Various service levels and other agreed-upon performance standards are evaluated relative to expectation.
The conventional thought is there are as many buying processes as there are customers … True, customers are all different, but the motion of buying is not nearly as different as you might initially think.
ADP has created a series of actions that salespeople can take to support the customer purchase – these are referred to as the “Seller Leads” column within their process overview (figure 10.10). The Seller Leads actions capture the activities a rep can do to move the deal forward. For each stage of the customer buying process, ADP has also included a series of expected customer actions, which are referred to as “Buyer Signals.” The Buyer Signals column notes a series of customer verifiersthat indicate the customer is committed to and ready for the next stage in their purchase. This is a dance between the seller and customer, where the seller leads and the customer responds, seller leads, customer responds. If the customer, for whatever reason, fails to respond, the seller immediately takes stock of what is happening inside the customer’s purchase process. Perhaps new stakeholders have entered the picture. Perhaps the competition is encroaching on the deal. Or maybe a new debate is happening about the purchase criteria or required performance thresholds.
Are seller actions or buyer signals the thing that is being tracked, right now, in your CRM to monitor pipeline health and forecast? For most organizations, it’s the seller actions.
At ADP, the “Seller Leads” column is no longer considered the one path to closure but a description of many different possible paths. As a result, don’t think of the Seller Leads column as the set of rules but rather a set of principles. These are suggested actions that might help the starting point for reps to apply their judgment to do what they believe is necessary in a particular situation to achieve the Buyer Signals that indicate purchase progress is being made on the customer’s side.
See Figure 10.11 on page 246. … as the customer moves from exploring options to defining criteria, the expected customer verifier is for the customer to commit to an analysis to help refine their requirements. If the customer fails to commit to this analysis, the seller is instructed to stop all progress and reassess the situation. If, however, the customer commits to the analysis, the seller then provides the customer with a tool to support the next stage. In this case, ADP may provide a questioning guide that helps the customer determine what their purchasing criterial should be. In this way, ADP’s sellers are one step ahead (but only one step) of the customer, supporting the customer as they progress through their purchase experience.
For this approach to work, the customer verifiers have to be created in a special way (see figure 10.12 on page 247). First, they require active participation on the customer’s part. In other words, a good verifier is not one where the customer could passively insinuate they’re progressing. Instead, you want the customer to clearly state their intentions, take an action step, or otherwise signal their commitment to further explore a purchase. Second, good verifiers are clear, binary, and objective. In this way, they should leave little room for misinterpretation.
Otherwise you’ll slip into a big debate about whether something is verified or not, and the power of a “customer-verified pipeline” will be lost. Finally at least someof the verifiers (certainly not every single one) need to test the customers willingness to change their current direction. These may include verifiers where the customer readily acknowledges the unnecessary costs their business is incurring, or commits resources to exploring the root causes of their business challenge. But in some way, shape, or form, you’ll want to track the customer saying “we’re currently doing this wrong and need help.”
By assessing precisely where the customer was in their purchaseprocess, ADP’s teams were able to reassess what need to happen to reinvigorate these opportunities. Mangers were able to get a clear sense of where the customer was in their purchase process – not just where the rep reported the customer was in the sales funnel. For the first time it allowed managers to ask their reps two important questions during deal review sessions: (1) where is the deal? And (2) how do you know?
By encouraging sellers to focus on the ends (the customer-verified outcomes that happen throughout the sale), not the means (the sales activities), sellers are better able to do what they need to do. … to help customers progress through the deal. In this way, sales managers and their sellers can exercise creativity without penalty.
Sample customer verifiers can be found in Figure 10.13 on page 250:
The first stage reflects customer learning. Customers are always in some state of passive learning. This includes reading articles, attending conferences, reading books, etc. The idea here is that customers are always looking for ways to improve their business and in search of a new direction. … the verifiers of this stage are merely customer willingness to take a live call – indeed, good verifiers don’t need to be overly complex!
As customers progress through their purchase, they begin to better understand and refine their needs. The verifiers at this point largely center upon the customer acknowledging that their current beliefs, mental model, and state of practice are not sustainable or somehow flawed. Ideally, you are looking for your customer to show receptivity to your Commercial Insight and commit to exploring the implications for their business.
In the third stage, customers begin to define their purchase criteria. This is where a clear Mobilizer should be identified (preferably fairly early within this stage) and have committed their support to the purchase exploration. The customer committing resources to the exploration, as well as establishing some semblance of timeliness, are important verifiers at this stage.
The fourth stage is where the customer evaluates their options. Stakeholders expressing consensus for a new direction becomes an important verifier for this stage. The customer’s defined requirements should reflect your solution’s unique capabilities as well.
In the final stage, the customer validates their selected supplier and enters into a signed deal. Gaining Mobilizer support to rally their colleagues for the implementation phase is a smart customer verifier at this point.
Tracking indicators such as these encourage the proper use of Mobilizers, Commercial Insights, Commercial Coaching, and a variety of other tactics we’ve discussed to this point. It ensures customers are well supported as they move through their purchase experience, while simultaneously understanding and acknowledging your company’s unique capabilities.