Most sales increase revenue in drips and drabs. Other sales, however, are transformative: The customer buys the company’s full range of services rather than a niche offering; signs a multiyear contract for products and their maintenance; the customer makes the company a preferred vendor or, better yet, a sole service provider.
The CEO has better things to do than get involved in the chief sales officer’s job. When an opportunity to make a mega-sale presents itself, though, the CEO must swing into action. That’s because the company has to deliver a proposal that provides mega-value, and creating such a proposal requires contributions from its many units or departments. The CEO is the only person who can lead this effort.
Can the financial people create a better way for the customer to budget and pay for what it’s buying? Can R&D redesign the product so it’s more valuable to the customer? Can IT help the customer order and inventory the product? Can the logistics people create innovations in shipping and warehousing? The CEO has to make certain that every internal resource that can make a contribution is identified and becomes engaged.
The greater the contributions from resources outside the sales unit, the greater the chances are for making a mega-sale. This has been shown repeatedly in the success stories related by the sales managers we train and consult for. What’s particularly effective, our analysis reveals, is having the company’s resources interact with counterparts at the customer company. This will help develop a proposal that benefits many parts of the customer company and creates internal champions for the sale.
A sale last year by a provider of data services to a financial services company illustrates the value of having idea-generating meetings between the seller’s internal resources and their counterparts at the customer company. The seller’s executives in charge of finance, marketing and IT worked closely with their customer peers to add value to the proposal.
Indeed, the proposal identified operations improvements and opportunities to cut costs that the customer didn’t believe were possible. The proposal went through four drafts, incorporating ideas from customer people in every version. Not incidentally, the final cost of the three-year contract was more than twice the customer’s original budget.
Every unit at the customer company that will be affected by the sale should be identified. Unless this is done, the proposal can be undermined by someone who wasn’t consulted. Even the least powerful member of the least powerful unit at the customer company can torpedo a sale. This almost happened with a proposal for an auto-maintenance agreement offered to a home-improvement contractor’s truck fleet. A member of the customer’s IT staff had to be persuaded that the contract wouldn’t compromise their customers’ data confidentiality.
In some of the mega-sale cases we studied, the salesperson’s initial contact person was hesitant about identifying the people at the customer company who would be affected by the sale. In many of these cases, the contact person was later determined to be a non-serious buyer.
The customers in the sales studied asked anywhere from three to 17 providers to submit proposals. In each of these cases, the winning provider made a group presentation. The presentations in which the CEO participated had a higher success rate than the others. The highest success rate was enjoyed when the CEO reached out to the customer CEO before the presentation with personal assurances that the company will deliver what it offers.
Finally, some of the most successful presentations were led not by the CEO but by the person who would manage the service to the customer. The participating CEOs deferred to this person to show confidence in their choice and give the person an opportunity to demonstrate leadership. It may not feel natural for a CEO to defer to a lower-level employee during a proposal, but the customer will be impressed.
Bill Rosenthal is CEO of Communispond, which has taught more than 600,000 people to communicate more effectively. It has trained employees for more than 300 of the Fortune 500 companies in sales and presentations skills. Go to the Communispond website for free access to webinars, videocasts, audiocasts and articles, and subscriptions to the company’s e-newsletter on selling. You can contact Rosenthal by e-mail and read his blog.