Value Selling is Broken

newlogo-companyOver the past ten years one of the biggest trends in enterprise sales is the explosive growth of CRM platforms like Salesforce.com. A good CRM platform is the necessary precursor to VALUE SELLING. Value Selling is a fundamentally different approach to sales then traditional feature/function models and represents a methodology that aligns perfectly with SaaS applications like Salesforce and Microsoft Dynamics.

The practice of Value Selling involves a specialized skill known as ‘Value Engineering’ or ‘Business Value Consulting’. Another new process called ‘Pre-sales Compliance’ focuses on facilitating the pre-sales negotiations with a customers procurement department. Both are approaches based on an analytical, data-driven approach toward building customer-aligned value propositions. The bottom line is that sales people get a cutting-edge new toolkit that drives bigger deals, faster and with less risk.

The typical sales team, specifically in the tech and services sector, is comprised of the sales representative (FSR) and sales engineer (SE). These two roles are attached to an engagement as each is responsible for very specific activities during the sales cycle. The third role, that is frequently missing, is the individual responsible for creating the detailed business case including ROI, Value Alignment, Road-mapping and Current/Future State Analysis. Nowadays many companies have attempted to build dedicated teams of specialists to fill that role. The result has been less than expected.

Unfortunately most sales organizations tend to go about implementing the Value Selling program based on a number of flawed assumptions. What often plays out is the result of underestimating the challenges of managing a scalable practice that can meet the needs of a large sales organization.

Why Most Value Selling Programs Fail:

One of the basic maxims of economics tells us alot about why Value Selling programs fail:

“Any resource that is perceived to be free will inevitably be oversubscribed and undervalued.”

In my experience most sales organizations make the mistake of trying to give away Value Engineering for free. Obviously it’s unlikely that a prospect is going to pay the vendor for a service designed to help sell them something so the alternative is to hide the cost of the Value Engineering in the price of the deal. Measuring the performance of the Value Engineering team becomes an exercise in trying to determine the ‘probable contribution’ of the Value Engineer to the deal rather than the more traditional approach of using quotas.

“A Value Engineering service only has VALUE if someone is willing to pay for it.”

The following life-cycle diagram illustrates the most common scenario that occurs when launching a Value Selling program. The third stage ‘Scaling Problems’ is where most programs begin to collapse. Once reps experience the power of Value Selling the demand grows rapidly to have support for every deal in the pipeline. Given that most Value Engineering teams are small the potential to quickly get swamped is almost guaranteed. This leads to disillusionment across the sales organization.

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The Solution is Automation:

The best way to fix the problem of scalability is to leverage automation for those Value Engineering tasks that are repetitive and time consuming. Let the ‘machine’ do the grunt work so the humans can focus on the value added parts of the engagement. This allows a true service model to emerge whose costs and performance impact can be accurately measured.

Luckily there is a solution and it’s all about converting Value Engineering into a paid service that leverages automation within the CRM platform. Automation allows for highly scalable, consistent,  C-Level collateral to be generated with the click of a button.

When the automation is tightly integrated into the CRM platform it allows every sales rep to have access to game-changing tools on EVERY DEAL. In addition, having access to on-demand consulting services, via the automation platform, means you’ll always have an experienced Value Engineer at your disposal for the most complex deals.

Email me if you’d like to learn more about the next generation automation and services platform for Value Selling…