EDITING BOARD
RO
EN
×
▼ BROWSE ISSUES ▼
Issue 49

Shape commercial IT solutions that win

Iavi Rotberg
Head of Analysis Iasi @ Endava
MANAGEMENT

When it comes to a commercial IT solution, in the case of bespoke software development, it is not always obvious what your customer’s primary concern is and what the critical capabilities needed to construct the solution are. These two factors are the key enablers for closing the deal and should be understood. This is the very point where the shaping is initiated, having as the ultimate goal to satisfy the customer needs, culture and traditions. By working vice versa, from the commercial viability to the solution, chances are that the options proposed are sub-optimal or, even if some part are good, the overall is still below customer expectations. This article explores a way to shape IT solutions that are welcomed by clients.

Pinpoint where customer decision lies

Customer decisions don’t rely only on numbers, because numbers, even when in the context of fancy presentation decks, cannot speak by themselves. To influence customer decision and come a step closer to sealing the deal, one need to go were decisions start. This is a place that is not driven by numbers.

In fact, effective influence, which can sway the customer, starts with storytelling. Stories that tackles emotions and biases. It is not uncommon that decision makers are overly persuaded by successful analogies from the past. This is called the confirmation bias, when people perceive options in a way that confirms a pre-existent belief or hypothesis related to one, thus giving less chances to the alternatives. The danger for both the IT vendor and the client is that the past successful situation has a different context than the current deal, rendering it irrelevant.

In addition, another cognitive bias the halo effect, can be spotted. The halo effect attribute success and perfection based on past reputation and branding. This happens when the recommendation are made by vendor, and subsequently evaluated by client, without having good knowledge about the business model and client context. The risk is that instead of a win-win situation, the solution will turn actually in a lose-lose scenario.

Break from the tug of war

To break this pattern-recognition biases, challenge the client to explore new angles and look at the solution from a different seat. Avoid the initial bottleneck by pulling out from the past and start thinking about the future. According to McKinsey: “45 percent of fast-growing companies invest more than 6 percent of their sales budget on activities supporting goals that are at least a year out”.

Start with concrete things as visit the customer premises and observe the real pains that he or she is dealing with when putting down daily tasks. Test your value proposition against the customer pains and gains and check the how much does it fit. Unearth any concern with the customer to understand what really matters. Doing this steps, one can go directly to the source and simplify the decision process for both client and vendor. This elimination of waste, unnecessary steps and self-imposed barriers can constitute the unfair advantage that your solution brings and can make the difference between a winning and a losing one. Without this thorough exploration, the solution is likely to be deferred early from the game in favour of the competition.

Put in 3 different perspectives

Given this approach we can distil 3 major ingredients that combined can constitute a recipe for success:

By using a good mix of these ingredients, the solution has a good chance to find the appropriate pay-off decisions. Fine-tune the proposal in the following aspects:

  1. Team capabilities. In order to win, it is critically important to set up the right people with the right skills that can deliver. It is equally important that this team is able to complement the client organization. Usually the clients are looking at vendors for the right mix of: technical excellence, dedicated service relationship and expert business knowledge. Various permutations of these factors are possible, but the strategy should specify what the focus is on and how the others contribute. This mix should elevate the offering and give it a competitive advantage.

  2. Customer perspectives. The commercial solution is primarily linked to an understanding of what the customer really wants. What are his pains and how the solution alleviate this short term and build a solid foundation long term. Aligning to the customer’s domain and business model makes this understanding easier. This should be the basis for shaping of the solution, which is one of the key input for the price tag and not vice versa. Equally important is to place this solution in context of the client’s culture and tradition. An erroneous positioning comes with a great risk of being pushed aside by a competitor who clearly identify this set and puts the right pieces in the puzzle.

  3. Commercial viability. It is essential that the solution itself is decoupled from the commercial offering constraints. Decision makers pay special attention about how the total cost of ownership (TCO) and financing options are treated in the solution, to understand the total economic value of the investment they are betting on. Merging of the financial aspects with the servicing part leads to non-transparent options and lower the solution viability.

To conclude, the outcome of this process, i.e. the IT solution, needs to be reconciled with the client’s requirements and expectations. In case of anticipated gaps, the team may revise the solution in order to align better with the client. As a first step, ensure that the solution is complete concerning the structure required by the client. Subsequently, while building the proposal iteratively ensure that you do not lose sight of the big picture and ensure consistency. Continue to assess the level of maturity of the solution, which often includes deficiencies, gaps or missing decision points, and cater for each. Check how modular is your response/solution so that it can be analysed in parallel by client’ teams, this is especially important if there are aspects that can be treated independently such as warranty, financing and IT infrastructure. Be open with the client and proactively initiate the discussion about the weak points so that confidence is built and his knowledge infiltrates into the IT options that serve the business.

Sources

  1. http://www.modernanalyst.com/Resources/Articles/tabid/115/ID/3523/Use-Uncertainty-to-Win-Business.aspx
  2. https://en.wikipedia.org/wiki/Confirmation_bias
  3. https://en.wikipedia.org/wiki/Halo_effect
  4. https://en.wikipedia.org/wiki/Total_cost_of_ownership
  5. http://www.agileengineeringdesign.com/2009/08/designing-an-estimation-process/
  6. http://www.mckinsey.com/business-functions/marketing-and-sales/our-insights/the-sales-secrets-of-high-growth-companies

Sponsors

  • comply advantage
  • ntt data
  • 3PillarGlobal
  • Betfair
  • Telenav
  • Accenture
  • Siemens
  • Bosch
  • FlowTraders
  • MHP
  • Connatix
  • UIPatj
  • MetroSystems
  • Globant
  • Colors in projects