Terrie's Job Tips -- Securing Your Position in Sales - Part Six: Solution Selling

When economic times are hard, it is only natural for clients to want to cut costs. It is also only natural that they do so by reducing their reliance on outside parties and doing as much as possible in-house, or by dispensing with certain services all together. This means that if you're in the "dispensable" services category, such as training, marketing, translation, design, and technical support sectors, your company is probably also feeling the pinch of the recession. It can be very draining on sales staff morale when they go out to see clients and have to report back to the sales manager that yet another contract is going to be lost or reduced in size.

While one way to tackle this problem is to meet cut-back with cut-back, by reducing the size of your own operation to match client cut-backs, the fact is that this recession may last a while, and therefore may outlast your ability to be the last man standing. Therefore, preparing for the worst, in my books it is better to be proactive and try to influence what might seem a foregone outcome. That is, you need to start figuring out what you can sell that the clients want more of, not less. The fix required is not hard to imagine. It involves you stepping out of your traditional business space and looking to give your clients a way to reduce their own dwindling profits or to perhaps even increase them again. And usually this means an integrated solution rather than the sale of discrete products or services.

Just what kinds of solutions a client may want depend of course on your sector of industry. For example, a software company might start offering hardware leasing so that the client doesn't need to order in and configure additional equipment. A hardware company might offer onsite support alongside its cheap products. An accounting firm might start looking at doing turn-key JSOX consulting, ensuring that a client doesn't go with an upstream competitor. A training company might facilitate training not just for the client's staff but bring in their customers as well, to critique and give real feedback on what the vendor is doing right or wrong. Or if you're a B2C retailer, then you might look at customer loyalty program that ties in rewards provided by a third company, rather than simply offering discounts on your own products and merchandise.

The best way to come up with solutions that fit your clients is to open up your input funnel and ask anyone with a stake in the success of the idea to contribute with ideas and comments on those ideas. Try to set up specific brainstorming sessions with both staff and clients, to give them a chance to come up with something original. After you've collected the ideas, no matter how crazy sounding they are, put them in front of a review panel of industry-knowledgeable advisors, for validation.

Of course the solution also has to have sufficient benefit for the client to want to use it. The simplest value proposition and one which is hard to resist is the simple cutting of costs. If your solution offers a 30% cost-cut in the next 6 months, it is highly likely that your client will be interested and will keep buying more of the same. In IT for example, we normally only sell to a client when they want to expand or replace an old product, because Head Office usually gets to decide product type and replacement schedules.

However, what if you could offer a sub-system of the IT infrastructure by incorporating some local software that immediately results in lower administrative costs? Then it is highly like that the local Admin Manager would champion the project, even though it may deviate from the normal standards. Certainly in my experience I have found the reduction of personnel is usually a good cost-cutting point to start at. Since people usually cost at least 30% more than their salary, an administration person earning JPY5MM represents an JPY8MM cost to the company. Therefore, and if your solution costs less than JPY5MM, you're already putting your Client ahead of the game. So Rule Number One: make sure that your solution produces noticeable savings.

Lastly, let's look at how to put together a solution. Usually you need three collaborators to make a good solution: 1) a person or team who knows your Client(s business and understands where the opportunities are to improve systems, 2) a person or team who knows how to put together the solution technically (be it software, better work flow, better training, or even more effective government certifications), and 3) a person to project manage the solution implementation so that things get done on time and professionally. Of course, there is also you, the salesperson.

If you're a small company, these three collaborators may not all be in your immediate circle. In that case, after you've had the basic idea of what you want to offer, you need to go out and find partners who will work with you and who, most importantly, agree not to charge you anything unless you pull off the deal. Thankfully, this bootstrapping method is easier to do at the moment because everyone else is looking for more business, too. I've used collaborating partner companies like this on a number of occasions. My only advice is that because you don't have control of the collaborating resources be sure that you're dealing with someone senior in the partner firm to get responsiveness, and also be sure that you have back-up vendors, just in case things don't work out.