Intelligence in Sales: Driving Business Performance
Consaliaâ€™s new event publication
Consalia’s new event publication.
Over the past few years, Consalia have organised numerous thought leadership forums for the sales industry. These ‘Global Sales Transformation Events’ have quickly gained momentum and popularity, allowing us to expand the concepts and ideas generated across borders. Later this year we will be hosting our 4th Global Sales Transformation event, the 2nd in Singapore. The theme will be a continuation of “Intelligence in Sales: Driving Business Performance”. These events are vital for bringing together business leaders and professionals from some of the world’s foremost companies to generate new perspectives and innovative ideas. In doing so Consalia seeks to remain at the forefront of sales performance improvement. We are privileged to share this goal with Middlesex University, Institute Work Based Learning (IWBL), who plaid a key role in this event together. On behalf of Consalia, we hope that you find this report informative and enjoyable.
Contents Page Sales Operations: Optimising Resources Intelligence in Sales: Driving Business Performance ........................................ 3 Reflecting for a brighter future ...................................................................... 4 - 5 How Intelligence in the military drives field operations ............................. 6 - 8 How BP segmented customers to create new routes to market .................. 8 - 9 How Logica are using Intelligence to transform field sales operations ......... 10
Winning Large Deals Managing the stages for bid persuit - Logica ........................................... 12 - 13 Best practices for bid persuit - Unisys ...................................................... 14 - 16 The Unilever Story ............................................................................................. 17
Research into winning large deals - Defining ‘Mindsets’ ................... 18 - 19 The ‘Mindsets’ Applied ...................................................................................... 20 The path to ‘Strategic Procurement’ ......................................................... 21 - 23 Using intelligence in handling complex negotiation situations ............. 24 - 27
The Role of Academia in Sales ....................................................... 28 - 29 With Thanks to Middlesex University, IWBL ............................................... 30
Intelligence in Sales: Driving Business Performance The 3rd Global Sales Transformation Event
ast month Consalia, in partnership with Middlesex University, brought together expert speakers and delegates from a variety of disciplines for our third Global Sales Transformation event. This was held at the prestigious London Stock Exchange. The topic, “Intelligence in Sales: Driving Business Performance” addressed the ways in which sales must respond, at both a leadership and a sales operations level, in order to compete more effectively in today’s tough marketplace. The event explored the role that intelligence and creativity plays in achieving this. The event was attended by senior level executives in sales, marketing, sales operations, large deal and bid pursuit activity, outsourcing, psychology, procurement, learning specialists, HR, academic and training specialists. The companies represented included:
HSBC, British Airways, Logica, Tetrapak, Hewlett Packard, UNISYS, Toshiba, SAP, Hertz, Mott MacDonald, PRGX, Allergan Medical and Munich RE. Intelligence is not only about the information we receive but also about how we interpret the information in order to inform better decision making. The words “inter”, between, and “legere”, to pick out or to read, are of Latin origin; combined they imply ‘reading between the lines’, or connecting information in an ‘intelligent’ way. The ability to reflect deeply and to connect the different dots together to form new ideas and strategies is what intelligence is all about. In the context of business this is essential. Steve Jobs utilised this philosophy to great success. He connected things together that he was passionate about – design, calligraphy,
electronics and buddism. These were underpinned by a rather obsessive nature. His standards were extremely high, but it was his ability to connect different strands that formed his vision of what good looked like for Apple - Intelligence. It is this concept of intelligence, which formed the framework of the forum. By bringing together speakers from a variety of disciplines, the event gave people the opportunity to draw from the experiences and best practice of experts in their fields, and creatively stimulate new thoughts and ideas on how to transform their business for greater success
Reflecting for a brighter future I
n today’s fast paced, often frenetic business climate we are rarely afforded the luxury of time. Reflecting deeply on our actions certainly would not be at the forefront of most peoples’ agendas.
have learnt in the past in order to help us determine what to do in future.
But what does reflective thinking actually mean? Essentially, reflective thinking is a form of learnWe are so busy, rushing ing – it enables us to learn from one quarter to the from our experiences. If next, that we don’t have the something didn’t go well, time and mental space to what did we learn from think and strategise. Ofthis and how can we do it ten this leads to a reactive better next time. If somemindset, acting only on thing went really well, what is going on around what exactly was it that us rather than proactively was so great and how can thinking about what we we make sure that we do C eV
it again next time. There are three types of reflective thinking: 1) Reflection on action learning from the past 2) Reflection for action planning & preparing for the future 3) Reflection in action reacting to the present Often we reflect more when there is an emotional trigger. For example, if something has made us really angry, or if an incident has left us very upset. It’s these sorts of situations
where we naturally tend to reflect the most. If we make time to fully explore and comprehend our thoughts in a structured way, there is a great deal of benefit to be gained. During last month’s Global Sales Transformation conference, we asked what type of reflection people do most of? Only 14% of our audience replied ‘reflection on action’. If we think about the process and importance of learning in a business
context, we could certainly learn a lot from past events, such as deals won/ lost and why, in order to help guide our future actions
“By three methods we may learn wisdom: first, by reflection, which is noblest; second, by imitation, which is easiest; and third, by experience, which is most bitter.” (Confucius)
Reflective practice culture? Yes
What type of reflecting do you do most of? 14%
Reflecting on action Reflecting for action Reflecting in action
Sir Graeme Lamb
Lieutenant General (Rtd), KBE, CMG, DSO How Intelligence in the Military Drives Field Operations
N the first session of the day, we were joined by Sir Graeme Lamb. As a former director of Special Forces and commander of the Field Army, his insights into the ways in which intelligence drives effective field operations within the military proved to be an extremely valuable and well received topic. Sir Graeme discussed how an over reliance on process and technology does not necessarily qualify as a competitive advantage. He drew on powerful examples of how in his world, “people are very much part of the solution”, and that in the business world, one can data mine to unheard of levels in search of market intelligence and a competitive advantage, however, it is the interpretation that matters. “It is the people who matter”.
“A third of my time was spent with my people... C eV
A third of my time was spent on the task that was absolutely in front of me and a third of my time was spent thinking. Reflecting”
This strongly relates back to the concept of ‘inter’ ‘legere’, reading between the lines, to interpret meaning and guide subsequent action. Citing the Prussian General, Carl Philipp Gottfried von Clausewitz, Sir Graeme defined ‘knowing as science... doing as art’. He discussed how in the military they talk about the balance between science and art. Often we focus too much on the science and not enough on the art, and in doing so, confuse process with progress. Using the Cold War as an example, Sir Graeme discussed how for six decades the British army fell into this trap. They were fixated by equipment, about numbers, about capacity. They polished the theory of what they intend-
“We separate pe ception from judgement and allow illusion to take on a reality
d to y.”
“If I had 60 minutes to save the world, I would spend 55 minutes defining the problem, and five minutes finding a solution.”
ed to do, all the time with the naivety that it would win them the war. By contrast, “There were the Russians sitting in effect 70 kilometres away from the inner German border. Their tanks fully fuelled up, fully bombed, i.e. with 54 rounds of ammunition and their crews beside them. At 90% readiness at all times.” “What we were fixated by was situational awareness. That was the absolute bench-
mark on which we then built and looked at our problem. And that is the ability to identify process and comprehend the critical elements of information about what is happening. It’s knowing what is going on around you. Because all it is, is awareness. It’s not tested. It is just the science.” The only reason why the British army was allowed to do this was because it was never tested. Had it
been, Sir Graeme is certain that today, we would either be speaking Russian or we’d be dead. So situational awareness in its purest form tells us where, not why and not how. It should be understood that this is just as valuable, as without it we have no insight. Technology is absolutely crucial to this. In many ways though our real strengths lie in the team around us, in their ability to “interpret and therefore see,
shape and then seize that competitive advantage and opportunity over others.”
when you really got down to true profit, we were losing money on those customers. 500 accounts with negative gross profit. So that’s kind overall picture of that analysis of the business was suggesting that something was broken.”
How to think is the art, this is situational understanding. As a leader, Sir Graeme stressed that for all the investment in ‘the science’, an equal or greater amount should be invested into our people. It is therefore the balance between art and science, which determines the degree of success or failure. “The prestige lies in the judgement... It is your and their judgements, your and their decisions which give you that competitive advantage.”
Former Key Accounts Director, BP How BP segmented customers to create new routes to market
ARK DAVIES’ presentation was a reflection on two high impact case studies from his time at BP, with a particular focus given to using data for effective customer management. Mark was able to draw on the outcomes from Sir Graeme’s C eV
presentation to demonstrate the practical application & success that can be achieved from effective data insight. Mark discussed how BP conducted effective market and customer analysis’ and then applied principles to grow value where it was most needed. In 2000, BP bought Burmah Castrol for around £3bn, primarily for their big consumer brands like Castrol GTX. At the time Burmah Castrol were just about a FTSE100 company. After conducting a profitability analysis, BP discovered that about 80 % of the Burmah Castol accounts were making $1,000 gross profit or less. “given that we were shifting into more of a service-driven type business,
During this case study, Mark explored the concept of customer centricity. In thisparticular instance BP were not serving the marketplace appropriately; they had too many customers that they were over-servicing. This, mark believed to be poor client centricity. BP had to decide on which would be key accounts and the sort of criteria to use when dealing with clients directly. Mark explained how BP were also very selective in asigning the right people to deal with key accounts.
“It was a bit of a battlefield, we made those changes, those rationalisation changes, because we had to.”
“The big change actually was the smaller customers, the ones that necessarily would never give you big volumes of product or profit... to move them through to different channels. Move them through into selling through distributors and actually tooling up those distributors to deal with those clients more appropriately”. Mark explained how traditionally BP had considered distributors as merely an extension to the supply chain, instead they should be considered as an extension of the sales force. “It’s an extension to your customer management and your commercial function, and it can indeed be an extension to your technical support as well. So when you look at the distributors, set up partnerships with them - you turn a switch on that extends your reach into markets fairly quickly.” As part of this resources optimisation, Mark explained how getting the right people with the appropriate skills was vital in managing these large, powerful key accounts. This process of understanding the market as well as BP’s
own capabilities, and then reassigning resources appropriately was “fairly brutal”, but also very successful. The profit increased very dramatically. The relationship with the customers improved very quickly as well because BP started serving their big customers better. “You scale up the service they’re getting, you’ll get more back, you’ll get more positive feedback. Actually, some of the smaller
customers that we moved to distributors got better served. They got a better level of service as well.” Mark’s discussion highlighted how a route to market analysis is critical. He stressed how in BP’s case direct selling, key account management and channel management were not only critical, but actually very powerful. Further he showed how BP were able to successfully use data/intelligence along with sustained and effective change management to save the business
Audience Response 1) We have an established function that has clear processes & provides our business with a significant competitive advantage 2) We have a few people that are part of marketing, tasked with providing tools & processes for sales 3) Sales sort out their own ways of working & processes. This works very well & we have a sales function 4) Sales sort out their own ways of working and processes. It’s ok, but we do have some issues! 5) All we do really is provide training for our sales force. There is no formal / informal Customer Management function.
1 2 3 4 5
Chief Client Officer, Logica How Logica are using intelligence to transform field sales & operations
N THIS session Paula Sussex and Mike Hurley explained how Logica are creating a competitive advantage in the way that they have approached building the sales case and value propositions for their clients. Many organisations face the challenge of a disconnect between sales, marketing and the places that create the intellectual capital in the industry. Paula and Mike gave an insight into how Logica are successfully tackling this issue by integrating all these elements together into the sales function. Paula described the uniqueness of her role in creating a competitive advantage. To many, Chief Client Officer would just seem to be an alternative title for ‘Sales & Marketing’. However her position includes a dedicated function to innovation and proposals. By incorporating all of these aspects together, Paula believes Logica have created a unique way of building the sales case; something she feels C eV
is helping to create a competitive advantage. Within share price affecting deals, closure is handled by someone in the large bid team, such as Mike Hurley. So why have Logica constructed the sales case in this method? Logica believe that in the 21st Century business environment, if you don’t have the scale of, for example, Hewlett Packard, then you need industry/technology smarts. But you must also take these out to market in a timely and relevant manner for your industry. Logica’s heritage in invention provides them with a specific capability and focus for sales to take to market.
a relatively small team could succeed with an integrated approach. Paula did go on, however, to discuss how taking a similar approach to gaining market insights on “the sea of digital consumers” was much more difficult, requiring the input and administration of 6,000 employees in the UK and over 44,000 worldwide.
Paula used the example of auto-enrolment in the pensions industry to illustrate how industry and technology intelligence, combined with a responsive and integrated approach to the sales case, won them a contract with AGON. This case demonstrated how
Interestingly Paula described herself as “the what”, and Mike as “the how”. It is this very balance of science (what) and art (how), that Sir Graeme Lamb had spoken about earlier as a means of establishing a competitive advantage
The balance between science & art
WINNING LA Managing the stages of the bid team
Director, Global Outsourcing Services, Logica
N the afternoon session, the core topic was “Intelligence in the sales process: Winning Large Deals. Consalia brought together two senior bid professionals in Mike Hurley, Logica, and Birgitte Pingle, Unisys, to provide insights as well as best practices from their experience as deal professionals. Research into winning large deals was also shared by Consalia. Mike’s role is in the persuit and closure of the shareprice affecting and strategic, “Mega Deals”. His talk followed on from Paula Sussex and showed ‘bid persuit’ as an extension of the sales case. Mike disussed how Logica are approaching large and complex bids, particularly focusing on the stages he would typically take a team through in formulating these “outstanding differentiating propositions”. C eV
Know the Customer We live in a changing world, a world of public opinion; selling to perception means it’s all about brand, customer, market and capability awareness. One must seek to understand before being understood. This means looking at the data and intelligence that can feed effective decision making. What do the reports say? What do their customer’s say? What do the industry experts say? What driving pressure is there in the board room? Know the People People run on self interest, when preparing an RFP response, one should be aware of the individuals who may have a personal and professional stake in the business and or deal. Self interest can come in many forms, understanding people’s motivating factors as well as the networks they share is vital. New Entrants & Market Shrinkage As the economic and financial climate has shrunk, deals worth $1bn 5 or so years ago may now represent £150 million. The cost of sales has significantly increased, responding to bids in the same way is very costly. Mike explained how achieving the right level of information, can enable bid teams to make some fairly de-
ARGE DEALS fined calls regarding their response and how achieving the right level of information, can enable bid teams to make some fairly defined calls regarding their response and therefore, reduce the cost of sale. This concept is heightened when one considers that there is an increase in the number of new, smaller entrants to the market, who are thinking differently & responding differently. Knowing one’s competitors are responding appropriately should not be undervalued. Know Yourself Knowing yourself and being bluntly honest is vital. Any dilussion or vanity can cost a company significantly. Do we have the relationships? Be honest. What’s driving the key players? Do we have the inside support? Do the company favour someone else? Did we know the deal was coming? “I would suggest if an RFP turns up and you just found out about it, you probably don’t want to bid for it” You must formulate the thinking for an RFP before it comes through, and
this all comes down to good account planning. Did the account planning team influence the thought process of the client before they went to market? Do we have capabilities and skills for this? Do we have them available today? Managing in the Virtual World Mike discussed how the vast array of virtual communications makes us lazy. Much like Sir Graeme, he stressed the importance of direct interaction and engagement, “nothing compares to the inspiration and insight gained when there is human contact”. Whilst the time and financial pressures of large and complex bids necessitate leadership, a balance should be struck between autocracy and democracy. Everybody needs to bring in their thoughts and assimilate the information together as group. This will create an empowered team. If it is not the right team, or there are players that don’t fit, this issue has to be resolved quickly and often bluntly
Director Business Development, Global Outsourcing Services, Unisys
IRGITTE’S presentation complemented the Logica case by exploring the different types of deals that take place, along with some of the key skill sets required, best practices and militaristic strategy of a deal professional. Birgitte revealed the qualities of a deal professional; she explained how they must be someone who is high on execution - able to take complicated elements, bring them together under intense time pressures and close off a large transaction, much like M&A’s
The Two Types of Large Deal Persuit 1. Unsolicited deals:
NSOLICITED DEALS are those that are proactively and creatively driven - they are initiated by the salesperson. These deals require both a skilled salesperson, and the right level of intelligence and insight. The salesperson should be able to broker their thoughts about their own portfolio with the relationships and in depth knowledge of their clients. Often this will involve crafting a Joint Value Proposition, whereby the salesperson influences the thinking of the prospective client and then brokers their services. The aim is to create a “burning platform”, or need, from which to create traction in the deal process.
2. Solicited deals: Solicited deals are “a beauty parade”. Typically an issue is brought forward by the client and then handled by either a third party, or in some cases, the company’s procurement function. This is a responsive deal whereby you must rely on your skills in proposal writing and your perceived brand. Once down-selected, it is no longer just about creating thought leadership. Here you need to know your enemy, know the target and take the enemy out. This is where a militaristic style of strategy can play an important role. You need to know what is going on in the deal process and the offers that are on the table
Best Practices in Large Deal Pursuit Lateral account planning nderstanding the business needs of the client is vital, as is understanding the concerns the client has about their own business. You need to be able to analyse the market your client is in as well as the stakeholder community. Who is making the decisions? Remember to consider self-interest.
Further to this, you must be aware of strategy. Know the client strategy, which you can find on the internet or buy. How are you based in your account? Is this a client that you are seeking to win back? Perhaps you have had a turbulent operational relationship. You must think about how you are going to go in and “do a disruptive game so I can set the agenda in moving forward into my deal”. Unfortunately, account planning is rarely done well. Improving win rate can really depend on having a good account planning team who can do these things.
Data points turned tangible How can we can leverage synergies between the two companies? Perhaps the client wishes to migrate into a new market, or is experiencing unfamiliar challenges that you yourself may have experience in. It may be possible to share some of our intellectual property. Bring it to light during discussions and thereby create a thought leadership position with the client, so they are engaging with us to talk about their business needs, which eventually will yield some form of transaction. Look at the competitive play into your account. Make sure that you understand how the client views the account and why they are buying a particular vendor? When considering risk mitigation and how to risk mitigate your transaction with the client, make sure your commercial proposition reflects the degree of risk your client is willing to take. May
be the client is willing to do gain sharing with you. Maybe the client is willing to share on risk because “risk is ok as long as you are the one controlling it” Benefits realisation Once I have sold, how will the client deploy the services, will they be able to harvest the results? If you are dealing with a client who is very weak in execution, you might be able to help with this by embedding a far stronger form of governance for the transformation and transition of services. The right team In the Logica presentation, Mike discussed his function as an extension of the sales case. Birgitte was keen to emphasise further how deal makers or ‘rain makers’ are neither marketing or sales - they are execution professionals - like M&A’s. Deal makers are transaction focused, the skill sets required differ from sales & marketing
Birgitte described the traits of a good deal professional as “ACE”: Attitude, Character and Extreme Excellence. Remember, the weakest link in a team will cost you the deal! What is the most important thing when you do big deals? Is it sales process? The skills of the team members? The mindset? The opportunity at hand? Is it the values, the values being deployed around your client, the values deployed about how you approach deals? Is it the methodology? “If you don’t have all these cornerstones in your persuit team & the way you engage with your client, even if you know what you’re doing, you probably won’t succeed.”
“If a company are in the big deal business, and they are closing less than 40% of the big deals then they are having a major issue”
The Unilever Story
irgitte explored a case example to illustrate the points covered in her talk. “The Unilever Deal” was conducted with Hewlett Packard and was initiated in 2007 by a very effective account manager.
Situation Over discussions with the CIO of Unilever, it became apparent that the client viewed HP as little more than a storage & server provider. It also came to light that Unilever were becoming increasingly frustrated by their incumbent provider, IBM. During the meeting, questions were raised over the added value HP were providing; although both companies were in the C eV
Supply Chain business, the CIO asked why HP had never shared the reasons for their successes. Task The account manager went back to his team to discuss how they could put an innovation agenda in front
of the client. If they could do this correctly, and provide the CIO with this added value, the account manager was confident that Unilever would be prepared to give them an Unsolicited process to go in and outsource all their data centres and end user services worldwide!
the development of.
Action For this â€˜innovation workshopâ€™, experts in every relevant competency, came together from around the world. These experts had successfully combated similar aspects and challenges that Unilever were facing, and therefore would allow HP to create an environment where they could be provide innovation thrust to Unilever.
Result The innovation agenda had positioned the innovation thrust of HP with the client. HP quickly went into pole position for the deal; they created the perception of a being a highly innovative company, capable of doing exactly the same as IBM, but also adding value in innovation, experience and ideas.
Following the workshop, win themes were agreed upon based on the business drivers of Unilever. These formed the basis of the value proposition that was taken to client. Supply chain: Leveraging HP technologies to deal with counterfeit issues as well as providing better supply chain management. Innovation: The co-creation of a retail digital laboratory and a proposition that both companies would co-fund
Governance: Governance around innovation in the development of the contract so that Unilever could be assured that during the seven year agreement HP would continue to innovate as part of its contractual obligations.
HP had resolved similar problems to Unilever using own technologies and own enablers, this gave them a proven record of success, along with credibility. Unilever granted HP an Unsolicited process which resulted in a $675 million outsourcing deal. By deploying all the intelligence they had on the account, and leveraging their own experience, technology and expertise, HP had been able to set the agenda, place themselves in pole position for the deal. This remains a living deal
RESEARCH INTO WIN Phil Squire CEO, Consalia
ONTINUING the earlier theme of reflection, Phil encapsulated much of the day’s discussion within the context of the event’s theme. It also acted as an interactive session where the audience actively participated by using voting keypads. If you look at your own organisation, and the amount of effort and investment made each year in improving sales performance, potentially that investment of time and money could have gone into many other areas. These could be improving sales process, creating common sales methodologies across the organisation, equipping the sales people with the product knowledge, selling skills or even in ensuring the right mindset.
Audience Response Where has your biggest investment been? 12% 24% Sales process Product knowledge
Selling skills Mindset None of the above 19%
The diagram (left) represents the audience’s perception of where their company’s biggest investment has been in improving sales productivity, in terms of time and money. Interestingly, investment in the sales process wasn’t the most popular choice. It had been
NNING LARGE DEALS anticipated that this would have been the largest investment area. The variation could be attributed to the high degree of product-focused companies represented on the day. But is process or product knowledge the most important quality for a sales person? The audience were then asked the following: Would you rather have a sales force that has the right... (see right) This question brought to light some intriguing conclusions. Whereas in the previous question, mindset had been given the least amount of focus, time and effort by companies, when asked what characteristic people would most like within their sales force, mindset was voted as the most desired trait. Phil drew on the earlier comments of Sir Graeme Lamb, that understanding information is a step higher than awareness. He then led on to his experience within sales and how over many years he and Consalia have conducted research with customers on ‘How do you want to be sold to?’
Phil explained that for the first two years of his four year doctoral research project, he listened to the information from customers through a filter that was influenced by his past. This meant looking for models of conformity for what good looks like in sales. On revisiting the data, he found that when customers were talking about competencies of sales people, they were not actually talking about competencies but about values. Rarely in today’s training climate do you find that connection between people’s values and sales effectiveness
Audience Response Would you rather have a sales force that has the right..? 7%
Sales process Product knowledge Selling skills Mindset 74.4%
The Mindsets Applied technology companies, they were able to design a system that would utilise GPS to ‘communicate’ with, and effectively synchronise the propellers, to keep the ship ‘stationery’. Where the ‘Mindsets’ fit in The costs associated with the development of this solution were significant, running into hundreds of millions of dollars. Viability could only be attained if linked to long-term The following case study describes the applied “mindcontractual agreements with key customers sets” of an oil tanker company (a Consalia client) during the 2010 Gulf of Mexico Horizon oil spill crisis and co-funding. What the proposal allowed the company to do was to approach major in establishing a competitive advantage. oil companies with an ingenious solution to the production halt. In taking the initiative Problem to shape the value proposition, present it to HE 2010 Gulf of Mexico Horizon oil the customer, engage with all stakeholders spill had a dramatic effect not just for and negotiating a win-win strategy for all BP, but for all 33 deep-sea drilling rigs that parties, the company demonstrated both operated in the Gulf. Obama issued a statement declaring a halt to production of oil in Proactive Creativity and Tactful Audacity. the Gulf until a solution to manage this and future crises could be found. As the petrole- As a result the company has signed a 20-year contract with the Marine Well Containment um companies were affected so too was the Company (MWCC), a conglomerate made tanker company, it had a 60% market share in the Gulf and so needed to respond quick- up of companies such as ExxonMobil, Chevron, ConocoPhillips, Shell, BP, Statoil etc. to ly. deliver an improved containment response capability for the US Gulf of Mexico. Solution The proposal was to utilise two modular “As a major tanker operator with extensive capture vessels, which would be linked experience in the US Gulf, we are delighted together to act as a floating platform upon which a processing and pumping infrastruc- to have won the confidence of the world’s ture could be placed. The problem was that leading oil companies. We have worked long and hard to establish ourselves as the marany change in lateral position would have ket leader in US Gulf tanker operations and ruptured the pipes from the seabed. The team came up with idea of placing addition- I am delighted that we are able to play a al propellers on the tankers. Partnering with central role in this initiative.”
Director Procurement & Supply Chain, Vector Consultants Trends in Procurement
ONTINUING the topic on ‘Winning Large Deals’, Steve spoke about the trends and evolution of procurement. Steve explained how procurement in its more modern form started in Japan with the post-war quality revolution, principally in the automotive industry. He discussed the geographical spread of procurement as well as the spread by industry; from automotive to manufacturing, construction to services, and then into financial services and aviation.
“To ask the question where is procurement today is to beg the answer everywhere, at every point”
Steve further explored how procurement has embraced more and more of a company’s spend, and that it is now a central function to any major purchasing decision, whether it be a tangible product and resources, or the more intangible services such as training, recruitment, HR, actuary audit and legal services.
Strategic procurement has to be cross-functional, it cannot work alone. By definition, procurement is a crosscutting business process, “We buy stuff, we convert stuff, we sell stuff ”.
Following this evolutionary journey from geography, through to sector and ‘categories of expenditure’, Steve posed the following statement:
The procurement team should be able to cover all these bases. Their focus should be on creating tangible value for the business from their engagements
with the customer, rather than just focusing on their fee structures. This means having a sense of vision, it also means approaching business intelligence in a very strategic way. Steve touched on Mark Davies’ presentation and the need for category portfolio analysis as well as Porter style market analysis. He discussed the necessary considerations of risk, cost of sale and failure, and drew on the best practices for these elements from Birgitte’s presentation. Steve demonstrated the journey of procurement from the traditional and tactical role, to the more aspirational, strategic integrator. He discussed how strategic procurement talked about how procurement should discuss solutions and value propositions for the client. This, he said, leads to a very differentiated ways of doing procurement. The qualities of the traditional procurement professional compared to the modern day strategic procurer were highlighted. Steve discussed the dangers of a traditional style of procurement in today’s business culture and climate. Historically, procurement tended to take a fairly adversarial approach, it would C eV
seek to commoditise firms and negotiations aggressively. Today this approach could lead to the seller feeling disempowered, losing control of the value proposition and being driven into price negotiations prematurely. This could lead to a loss in margin, market share, volume, revenue etc. and ultimately damage the business. Steve argued, therefore, that sales and account management professionals need to qualify procurement as it is practised in the customer’s organisation. Once understood and spotted, we can start to adjust the sales process and the account management process in order to respond proactively to the style of procurement they’re actually facing, and therefore begin to manage the impact of procurement on their business with that customer
End-user sour ing decisions
Supplier Term & Conditions Discounts
Procurement Maturity Spectrum Tactical
‘Centre of Excellence’ Professional Internal Consultants Core ‘end-to-end’ process Focused on business issues Sourcing strategies and vision Strong Internal Connectivity Our Terms & Conditions Relationship Management (SRM)
Tactical, RFP & Negotiation led process Volume Leverage Our Terms & Conditions MSAs, PLSs, Rate Cards, e-auctions Focused on savings Poor Internal Connectivity Confrontational Price Savings
Cost & Value
Audience Response Which of these does your No 1 Customer most closely resemble? Traditional
Which of these does your No 2 Customer most closely resemble? Traditional
Dr. Rob Kennett
Former Hostage Negotiator Using intelligence in handling complex negotiations Never stop learning OB’S session signified the final lecture on the theme of ‘Winning Large Deals’. His extensive experience within crisis and hostage negotiation provided a fascinating and alternative perspective on handling complex negotiations. As the second ‘out of industry’ speaker, Rob continued the day’s theme of bringing together differing perspectives and experiences to stimulate debate and original thought.
Rob opened his talk by explaining the extreme circumstances under which he had come to work as a hostage negotiator. It was upon reflection of this inaugural ‘baptism of fire’, that Rob had a revelatory moment, which would change his career forever. “… it got in my head that if I'm ever going to do this again (hostage negotiation), I'm going to learn how to do this properly. And I'm going to learn and learn and never stop learning… The minute you think you've learnt everything… that's the C eV
day you lose your edge.” This became point alpha of Rob’s Talk, - never stop learning! Preparation & Planning As a demonstration of the role of the hostage negotiator, Rob showed a select clip of Samuel L Jackson in “The Negotiator”. Setting aside the “Hollywood” nuances / glaze, Rob highlighted planning as the paramount activity before entering any negotiation situation. This he explained in a short anecdote during about a conversation with Special Forces personnel.
“I looked at h he’s dressed f to foot in wh are dressed in machine gun you think a m carry! And I him and I sa well prepared said...
“Nev to a
him and from head hat they n, more ns than man could looked at aid, ‘You’re d’. He
And it was this imagery that shaped Rob’s point on planning. Don’t walk into a negotiation situation unless you know your strategy, you’ve got the right equipment & team, and unless you’ve considered and rehearsed the A, B, C, D, E’s etc. of scenarios and responses.
process as if they were in the shoes of the hostage negotiator themselves. The audience explored the concept of ‘opening lines’ & first impressions as well as body language, perceptual distortion, and the ramifications of minor miscalculations.
Rob explained how conducting Rob explained how in his world, these kinds of role-play activities help him to… planning often manifests itself though role-play; here the team “get rid of all my little tics plays a vital part. The team and my little gestures that I do approaches the role-play with brutal honesty and constructive (before entering a negotiation criticism in order situation), that we all do, which A, could be annoying, and B to prepare the ver take a knife could give him ammunition”. lead negotiator for the various gun fight” scenarios and re- During the Q&A session at the actions that could end, clear industry parallels take place during were drawn when it was comthe live situation. mented by an audience member that from the buy side, Rob took this “Nearly all the buyers I know concept of roledon’t do enough of two of the play to the audience; he utilized a things you’ve said. They don’t plan and they don’t sure as real life scenario to engage the au- heck rehearse as much as they should. And I’m wondering dience and walk whether that’s highly relevant them through here to the sales guys who, in this negotiation
my opinion… don’t spend much time rehearsing or planning either.” The Team “We’re all bloody good at chess when we’re looking over someone’s shoulder, aren’t we” This quote perhaps underpins Rob’s belief in the role and importance of the team. Rob described the typical framework of a negotiation team as well as their roles and functions. He explained how it is near impossible for one person to negotiate alone and succeed; everyone has a role that it equally important, whether it is the coach – the primary negotiator, or whether it is the observer - who simply seeks to qualify the situation in order to provide insight. “For every minute you’ve listened to me, 20 seconds of that minute… you just drift off ” It is vital that a team is attuned to his or her colleagues, their strengths & weaknesses, their actions and reasoning. Within the hostage negotiation business, Rob explained how interoperability training is a continuous process to allow people of all roles and rank to stay aligned with the mindset and approach of the team around them.
The practical application of this point was raised in the Q&A session where an audience member asked how Rob would communicate with team members present, in a scenario whereby the client is also in the room. This could occur any time during the sales cycle but could be particularly relevant to building credibility in the initial qualification period, or within the actual negotiation phase. Rob explained how in such situations you need to be able to rely on an almost telepathic understanding of your team to effectively comprehend non-verbal communication: a glance, a body movement, some form of physical contact. Emotional Intelligence & Communication Rob attributed this close connection between team members to emotional intelligence: “The ability to use your own emotions, to be aware of what your emotions do to others, the ability to inspire and lead by your emotions. The ability to pick out the one important person in the whole group as being the person to talk to.” Much of this relates to communication and listening skills. Just as Sir Graeme Lamb would decipher
“the problem” for 55 minutes, and save the world with “the solution” in 5, Rob explains how he listens for between 70 and 85% of the time, talking in the remainder. “Because if I try and understand their world and deal with the emotions surrounding their world, ‘I’m really worried about this’, ‘I sense that is important …’, whatever it is, I deal with the emotions first, try to get an understanding of their world and then see how we can work together to move it forward.” This Rob attributes to trust and authenticity, without which negotiation cannot exist. “I’m listening. Because that gives them the honour of being listened to, and when they honour you by trusting you and they then move forward in a trusting way towards you.” Rob concluded by stating that his world can offer so much to business as the principles, morals and psychology of negotiation are truly transcendent
Keep It Simple Stupid
“Negotiating is an art, wrapped up by science”
THE ROLE OF ACADEM IN SALES S
ALES is one of the oldest professions, so it is somewhat surprising that there is little or no opportunity for people entering sales to gain a professional qualification in sales or sales leadership, either in Europe or the US. Very few universities offer an undergraduate or post-graduate degree in selling. Part of the problem for this poor take up by businesses has been relevance. Why invest the time and money in a generic programme of learning that
bears little relevance of the real world of sales people? Why take sales people off the road for long periods of time when targets have to be hit? Since 2005 Consalia has been researching Work Based Learning as a framework for accrediting learning in the workplace. Initially we explored this ourselves with our CEO completing a Doctorate based on research into a values framework for a global account selling. At the same time, we introduced the approach with a number of important and high profile accounts. For example, Consalia provided the consulting help for Hewlett Packard to establish its MSc in Business Change â€“ a work based learning Masters for its senior level large deal pursuit specialists. This process was then replicated for Santander Bank and HBOS where we helped establish a work based learning diplomas in retail banking practice for their branch network. HBOS has hundreds of employees currently undertaking this programme. The advantage of work based learning
programmes is that the academic qualification can be built around existing in-house programmes, where the outputs are measured against key learning outcomes and based on corporate goals & objectives, not inputs. This deals with the relevance issue. The transformation achieved through these programmes have been so successful that Consalia is now launching itsâ€™ own Masters & Diploma programme, accredited by Middlesex University, Institute of Work Based Learning. The programme will offer routes to accreditation for sales leaders and sales professionals.
- MSc Leading Sales Transformation - MSc Client Centric Business Transformation (Titles may change)
The advantage of our Masters is one of cost and time. Our clients now donâ€™t have to invest in the upfront set costs and time taken to accredit a programme. Further, by accrediting learning in the workplace, companys realise the benefits every step of the way. Thus now the sales profession has the chance to achieve professional qualifications
With thanks to Middlesex University Institute for Work Based Learning, sponsor and partner during this event. Middlesex IWBL seek to connect businesses with higher education through Work Based Learning, to accredit learning for the benefit of the individual, and the organisation.
Published on Jun 27, 2012