A typical enterprise sale involves approximately 12 - 16 people on the buying side. There is the leader that identifies the need, the people tasked with finding potential solutions, the collection of individuals that will be impacted by the selection, the IT team that has to validate the acceptability of the solution and its security profile, and then the procurement, legal, and finance teams, and ultimately an individual or committee makes the purchase decision. Enterprise sales people know that they need to coordinate and manage all of these influencers. They have to tease out and handle any objections in order to win the hearts and minds of the whole team.
Great sales people bank the influencers and invest in the detractors. Instead of focusing solely on the buyers that are supportive and willing to engage with the seller, a skilled seller has ‘good’ paranoia, and goes looking for trouble. They know that a deal can be torpedoed by any number of people, so they are constantly looking for the soft spots and the potential veto votes. Instead of donning their ‘happy ears’ and only hearing support, great sellers avoid flying into the target by managing all of the buying influences until the deal is inked. They know they have to go broad and deep to manage the panoply of actors, even the ones that may only have a minor say in the deal.
Years ago, I attended a sales lecture that described “budget makers” and “budget takers.” Sorry, I don’t recall who deserves credit for the concepts. The idea is that there are people on the buyer side that are given a budget and seek to find a solution to a pre-approved and known problem. These are the budget takers. Then there are individuals who have vision and see a problem or opportunity and create the budget to solve it. These are the budget makers. As a seller, you want to find the budget makers because they have the ability to get a deal done, and they appreciate the value of buying a solution. They tend to be less risk averse, and they are willing to champion a purchase decision. Unfortunately, they do not always know how their organization buys things, and they may overlook steps that will trip up a deal, so as a seller, you cannot solely rely upon the budget maker, but you definitely want them in your camp, and you want to engage them to assist you to discover all of the other influencers. In some instances, you will need to teach them how their own organization purchases things. You do not want to fall victim to the trap when a budget maker says “I will make the decision alone.” It is never a true statement.
The other type of buyer is the budget taker. Somebody else decided there is a business need, and approved a process to go find a solution. They handed the challenge to a budget taker, and said go find a vendor. Budget takers tend to be very risk averse. They may not fully grasp the value of solving the need, or the potential impact to the business, but they know they have a budget and they do not want to make any mistakes. Budget takers ask everyone they can think of what features they want in the solution, and they make lists of ‘requirements.’ They research all of the vendors and demand detailed presentations, demos, proofs of concept, trials, and anything else they can think of to cover themselves and avoid being blamed for a purchasing mistake. Budget takers will suck up seller’s time like a vampire, and they are typically the creators of RFPs.
A Request for Proposal (RFP) sounds like a great idea. Create a list of everything you need and ask vendors to tell you how their solution achieves your goals. Great in theory, horrible in practice. In their zeal to avoid risk and not be blamed for a bad purchase, budget takers pollute RFPs with ‘requirements’ for every feature they can dream up. Wild future scenarios and corner cases that will never occur make their way into RFPs. The result is a list of items the company probably does not need and will never implement, and no vendor can fully satisfy. The immediate real need is lost in the volume of superfluous possible future needs. Vendors will twist themselves into pretzels to answer positively to every feature on the list, but in the end, no vendor will have a perfect score. The budget taker now has ‘cover.’ No matter what solution they select, they can say “it is not a perfect fit for our RFP, but it meets many of our needs.” An RFP provides job security and insurance for the budget taker in the event of a failed purchase because the budget taker can remind everyone that they clearly said it was “not a perfect fit.”
An alternative flaw in the RFP process is when the fix is in for a single vendor. A buyer falls in love with a vendor, but knows that their organization requires an RFP to make a substantial purchase, so they game the system to get what they want. They already know which vendor they want, so they allow the vendor to co-author the RFP. All of the requirements magically line up with the chosen vendor’s offering. Other vendors stumble and stretch to provide positive answers, but the chosen vendor will clearly stand out. As a seller, there is nothing sweeter than finding a buyer who is willing to let you author the RFP. We have all seen RFPs that clearly have a competitor’s fingerprints all over them. It rarely ends well if you were not the co-author.
Knowing that there can be bias in the process, some organizations rely upon a neutral procurement team to manage the purchase. In the worst application, procurement teams have so little trust in their business groups that they prohibit vendors from directly interacting with business users once an RFP process begins. They effectively remove institutional knowledge of the business need in order to avoid purchaser bias. Once we end up in procurement we are not only dealing with a risk averse budget taker, we are also dealing with a team that is not directly involved in the business need, and is typically motivated just to get the best ‘deal.’ In many situations, driving for the best deal either means forcing bad economics onto the best solution, or forcing the company to buy an inferior solution because it is cheaper or the vendor is more desperate. In their neutral assessment of vendors, procurement teams treat vendors as if they are fungible, and rarely acknowledge the nuances and soft items of relationships, service mindset, vendor team competency, vendor reputation, etc. For complex business solutions, the outcomes are often less that ideal.
From the seller’s perspective, understanding the purchasing landscape and getting to know all of the players is hard work, but successful sales people earn the big bucks because they do it well. They know who are the budget makers and who are the budget takers. They focus on objection handling and seek out every participant to ferret out the potential vetos. They know that if they are not defining the dialog and telling their story directly to every influencer, then someone else is, and that someone may not have their best interest in mind. Great sellers also recognize when they need help. Sometimes there is a hierarchy game - execs will only talk with execs, managers with managers, techies with techies, etc. A great seller knows that it is imperative to build relationships at all levels and in all corners of the buying organization, so they bring their full team to the dance. They lead the process like a conductor leads an orchestra.
Here is my baseline rule of thumb for selling to an enterprise: we need to know at least four people in different roles on the front-line, and deep connections with people in at least three levels of the hierarchy (doers, managers, execs). We also must have strong contacts with the IT team, and the procurement person. Once a buyer declares that we are the vendor of choice, we need to quickly establish a positive rapport with a specific named person in legal, and ensure that the buyer’s executive contact remains in the loop in case legal becomes too aggressive.
Going broad and deep to truly know the buying organization requires skills and perseverance, but it pays off with more predictable sales outcomes.