The people most likely to make buying decisions along these lines are purchasing agents or managers. Sometimes, to help them make purchases, companies hire third-party intermediaries such as contracting firms, engineering firms, architectural firms, and management firms. Like purchasing personnel, intermediaries rely on the bid system. It equates lowest prices or fastest delivery schedules to best buys. It concentrates on Column 1, almost completely ignoring Column 2. Therefore, intermediaries invite as many competitors as possible to bid. When it comes to driving prices down, they know the more the merrier.
Yet, bids still attract salespeople to them like mosquitoes to a bug zapper—often with the same results. Zap! Understandably, it is hard to pass up opportunities when you know customers are going to buy something from someone. Why not you? Yet, bids can become tremendous time robbers. All you need to do is look at bid documents to understand why.
Bid documents are at the heart of the bid process. They contain specifications that describe technical or operational features or capabilities your products must meet. Some are so specific that they are difficult to satisfy—for example, quarter-inch stainless steel, twenty widgets per minute, twenty-four-hour response time, and 200 horsepower. Others are so broad that it is almost impossible for you not to satisfy them. Terms such as “established credentials,” “improve operations significantly,” and “enhance performance,” mean whatever anyone wants them to mean.
You mix these two extremes in one package and you have a lot of room for interpretations and disappointments. Yet, bid documents have a more fundamental flaw. They focus on product features (Column 1 details), not owners’ measurable goals (Column 2 details). Without defined goals, it is difficult to determine whether any product meets owners’ expectations. Everyone is trying to hit moving targets. Therefore, a catch-all goal surfaces in the bid process. Intermediaries award sales to companies that supply what is considered to be “the most value.” Translation: Quick and cheap products win bids. Without measurable goals, everyone’s products and services look the same.
However, even in a bid process, preferred salespeople exist. Intermediaries give them the inside track to help them win bids. Favored salespeople insert their products’ unique strengths into the bid specifications and documents. The goal is to use their benefits to outweigh competitors’ lower prices or faster deliveries. However, specifications tailored to your unique strengths can be a curse as well as a blessing for two reasons. First, you must count on competitors adhering to the bid specifications describing your unique strengths. If they choose to ignore them, ironic situations result.
Let’s say you coauthored bid documents to end up as the only salesperson who can meet the specifications. This compliance raises your costs and lowers your price competitiveness. For instance, if you are the only one to supply titanium-tipped pens while competitors supply ballpoints, you are the only one adding costs to your bid. Without fear of penalties, competitors can win by simply ignoring specifications they cannot satisfy—the same way you would.
Therefore, you always want to find out what penalties, if any, competitors receive for noncompliance. In weak-enforcement bids, let competitors influence the specifications and be obligated to abide by them. Let them comment on the ironies of losing bids built around their unique strengths that you ignored.
Second, to keep unique strength specifications from becoming a negative, you must connect them to measurable goals to produce value. Otherwise, they look transparent and superficial. In bids where goals are vague, you cannot match them up. They appear to serve no purpose other than as artificial barriers to competition. This can hurt both your credibility and that of intermediaries.
Sharp-witted competitors will show owners where these so-called unique strengths only add costs, not benefits. Therefore, if comparisons between bids do not reward your unique strengths, they erode your competitiveness. They become unique weaknesses. For the most part, the bid process discounts the value of unique strengths.
Even if awarded the bid, you invest a great deal of time, effort, resources, and profits defending services or justifying costs. Thus, profit margins suffer. Still, it is not a bad outcome considering the alternative of losing the sale. However, no sale is a complete victory without compensation for the value of your unique strengths.
Change the Rules
The bid process distorts the sequence of the Measurable Phases along with your ability to sell value. With price being the main consideration, bids skip MP 1: Spark Interest and MP 2: Measure Potential, and instead begin the bidding process in the third phase, MP 3: Cement Solution. With bids, hard-fought, low-profit orders go to the last competitor willing to offer or match the lowest price. Everyone strives to be in a position to get the last shot at the order. Most important, if owners’ goals do not consist of lowest prices or quickest deliveries, bids do them a great disservice. Many salespeople choose to play the bidding game, and take the risks that they will receive their fair share. Whenever possible, do not play along.
Act as if owners do not exist, and you play the price game. If you think owners desire no contact and do not influence purchasing decisions, you contend with bids. At least, until someone—make sure that someone is you—boldly asks if he or she really believes the following:
Strong-ego executives abdicate 100 percent of their decision-making authority to third-party intermediaries.
Owners buy products and services for the sole purpose of seeing how cheaply they can get them.
Of course not! They want to achieve specific goals that are cost effective but not necessarily in the cheapest manner possible. In fact, every sales opportunity—even bids—involves owners or beneficiaries wanting to discuss the best ways to measure and achieve goals. Great selling involves tapping into those discussions. Owners welcome discussions with professional salespeople who explain how to make their goals measurable. Do not disappoint them by making product pitches on the first call. If that is all you have to offer owners, the bid system works just fine.
Selling Measurable Value Is Habit Forming
Whatever sales techniques you employ become habit forming. The approaches you use out of habit in every sales opportunity become your overall mindset. If you mostly try to sell bid jobs, you tend to think that way. When you observe every opportunity through bid-tinted glasses, measurements of success will focus more on price differences than on value differences.
A great sale occurs when only one dollar separates your winning bid from the next lowest competitor’s price. In bid lingo, you “left nothing on the table.” You also received no compensation for providing a better table. In a bid-minded world, a Mercedes could be considered equivalent to a Yugo, and then judged only on price. So much for your opportunity to sell compensated value.
Nevertheless, one must wonder why companies with the fastest deliveries and lowest prices lose orders. Someone knows how to help customers select goals and measure value. Someone knows how to offer solutions whose value does not depend solely on lowest prices or fastest deliveries. Someone knows how to show customers that his or her solutions achieve their goals measurably better than do those of competitors. Someone knows that allocating selling time for maximum results requires thinking of Column 2 sales as the meat and potatoes with Column 1 sales as the gravy—not the other way around. Someone knows how to help customers fill out the measurable benefits of Column 2. The selling system outlined in this book will ensure that someone is you.
No Magic Wand
There is nothing magical about asking whether it makes sense for customers to conduct business with you and vice versa. When customers say yes to solutions that meet or exceed measurable expectations, it comes from logic not magic. The idea is to make a conscious decision not to waste anyone’s time, efforts, or resources (especially your own). When you use a selling system like MeasureMax in your sales opportunities, you make that conscious decision.
Summary
Use measurability to influence performance, not judge results.
Strategy determines structure and tactics, not vice versa; use a strategy to make customers’ goals measurable so you can outvalue competitors, and receive compensation for doing so.
Avoid wanting to accomplish something for customers more than they want to achieve it for themselves.
You can only manage what you can measure.
The salesperson with the most long-term customers wins.
Relationship selling and long-term (and loyal) customers go hand-in-hand.
You use brinkmanship and courtship selling with prospects and new customers, respectively.
Time powers the progression from brinkmanship to courtship to relationship selling.
Long-term customers and relationship selling do not need to depend on time.
Introduce measurability into the sales process and you shrink time; prospects and new customers respond like long-term ones on the first sales call.
You can make measurable the dollar value of features and goals, the ability of you and your customers to achieve their goals, and your sales progress.
Measurable Phase Changes (MPCs) are like a road map of where you started, how far you have gone, how fast you travel, and how much farther you need to go to reach a sale. MPCs enable you to evaluate performance in a measurable manner so you influence and calculate chances for success.