The VP of Sales for one of our customers was recently lamenting about the challenge he was facing in trying to help his sales reps transition from what they were used to selling, on-premise solutions to IT decision makers (CIO, IT Manager), to selling cloud/subscription solutions to Line of Business decision makers (COO, VP Sales, VP Manufacturing, CFO, etc).
He said the challenge is two-fold, “not only do my reps have to learn a completely different value proposition – subscription/cloud vs. on premise – they’re having to learn how to talk to a completely different set of Line of Business decisions makers, who care about completely different things compared to the CIO or IT Manager that they’re used to selling to.”
This conundrum is one that many channel partners making the transition to cloud/subscription are facing. Having spoken to many Promys customers who have successfully made this transition, here are 3 Tips that we distilled down from their feedback:
Three tips for selling Managed Services/Subscriptions to LOB decision makers:
Tip #1) LOB Decision Making Process: The decision making process for Line of Business executives can be different, compared to IT Managers and CIO’s.
Many IT Managers or CIO’s are focused on important things like existing infrastructure compatibility, scalability, security, business continuity and don’t always tie technology investments directly back to specific business outcomes.
Line of Business decision makers care first and foremost about achieving the business outcomes and the solution infrastructure details are waaay down on the list of things important to them, if the solution contributes to achieving the business outcomes.
Decision making process that most LOB decision makers go through:
- Do I have a problem?
- Is this a problem worth devoting resources to investigate further?
- What are the different ways of solving this problem?
- Which way is best for me/my company?
- Which vendors sell this solution?
- Which vendor is best for me/my company
- Traditional evaluation, RFP, buying process
The problem many traditional reps face, is that they’re used to getting engaged in Step 5 (which vendors sell this technology solution) by IT Managers or CIO’s. If you get engaged in Step 5 with Line of Business decision makers, it’s probably too late. Based on their self education and research, the LOB decision maker probably already have a solution/vendor combo in mind, and if the competing vendor was involved in shaping the answers to questions 1-4, then you’ll have a real up-hill battle in changing their mind at that point in their decision making process.
So Tip #1 is, get involved in LOB decision making steps 1-4, don’t wait until Step 5.
Tip #2) LOB Decision Making Criteria: Since LOB decision makers care alot less about technology and alot more about business outcomes, the real opportunity here is for reps to provide consultative, educational information to the Line of Business Manager in decision makers in steps 1-4.
1) Do I have a problem?: Do your reps have a list of traditional problems Line of Business Managers have, where your solution could have an impact? What are the KPI’s (Key Performance Indicators) for each LOB executive title you want to target? For example, the prospective customer VP of Sales is probably held accountable for Revenue, Margin growth and how quickly new reps start achieving quota. VP Manufacturing might have KPI’s around reducing scrap and rework and ensuring on-time production runs. CFO’s will probably be focused on cash flow, cost reductions and departmental and overall company profitability.
The key thing to train your reps on, is that LOB decision makers don’t care about your technology solution, they only care about how it will impact the business outcomes they’re trying to achieve. Tell your reps to stop looking for LOB decision makers who want to buy your solution (Step 5) and start looking for LOB decision makers who have problems or unachieved business outcomes that your solution can positively impact. (If the LOB decision maker doesn’t have any problems or unachieved business outcomes, then you don’t have anything to sell them).
2) Is this a problem worth investigating further?: Can your reps consistently tie the financial cost of not achieving a particular business outcome back to an actual dollar value? How does that cost compare to the cost of your solution? What’s the ROI time frame?
An example for the VP of Sales might be, what’s the cost of a new sales rep taking 9 months to ramp up to quota instead of 5 months? For the VP of Manufacturing, what’s the dollar cost impact of having a 3% scrap rate vs. a 2% scrap rate. For the CFO, what’s the financial impact on cash flow of having customers pay in an average of 45 days vs. 30 days. For each of these examples, the answer should be quantified as “X” dollars. Another spin on this in general might be, can your solution/approach help drive user adoption of the technology investment more quickly, which would then achieve the business outcomes and ROI faster. What’s the “$” value of achieving those business outcomes in 4 months instead of 9 months?
If you can’t quantify it into a dollar value, then LOB decision maker won’t care (or at least not as much). The other awesome part about dealing with LOB decision makers is, if you get the financial cost of not achieving their business outcomes right, then you’ve already automatically justified your budget for the technology investment.
3) What are the different ways of solving this problem?: It’s really important to keep in mind, that LOB decision makers don’t necessarily default to thinking about a technology solution as their first/best way to achieve business outcomes, the way IT Managers or CIO’s do. An analogy might be, if you don’t want to wash dishes by hand, then the technology answer is “get a dishwasher” and go immediately to Step 5, with questions around dishwasher feature/function/price points. But an LOB decision maker might consider eating in restaurants, or off paper plates, or hiring a maid. This analogy highlights that the LOB decisions makers don’t really care about the “how”, as much as they care about the outcome.
So if you want your reps to earn “trusted advisor status” with your LOB decision makers, this is where a consultative pro’s and con’s conversation can really earn your LOB decision makers trust. Pro’s and con’s of a dishwasher, paper plates, maid, etc.,.
Sure your rep wants to influence the decision making criteria here (if you sell dishwashers), but this is also a qualification step, because the best solution for this particular customer, might actually be a maid.
Tip #3): Tie a bow on it: Don’t leave it up to the LOB decision makers to connect the dots, take the information from steps 1-3 and tie it together for the prospect in Step 4.
4) Which is best for me/my company? This is where the rubber hits the road for LOB decision makers and where your reps have the potential to add the most value to your customers decision making process. Again, LOB decision makers don’t care about technology, they care about business outcomes. The sales reps that can map the straightest, shortest, highest value road, between the solution you provide and a) how it solves the problem or achieves the business outcome, 2) the cost of not solving the problem or achieving the business outcome vs. the solution cost, 3) why your way of solving the problem is the best way for this prospective customer, that rep will have a very high likelihood of winning the business.
If you’d like some examples of how to position a technology solution against the Line of Business problems it solves or business outcomes it helps achieve, review the Promys blogs link for some great examples of this approach.
You can also find the Promys PSA Buyers guide here: Click on the link to download the Promys PSA Buyers Guide