Creativity Creates Opportunity!

While it's great to have an efficient and effective business that is meeting all the obligations you have today, grasping opportunities requires new thinking. It also means bringing new ideas to your customers all the time — and not just at tender time!

You know the feeling. Business is running along pretty smoothly. You're pretty much on top of your work load. Customers are happy. All’s right with the world.

But the next day, something disturbing happens. A juicy tender comes out that should have your name all over it, but it’s asking for something completely unexpected. You go to a routine meeting with a customer, and they pepper you with questions about a competitor. You meet up with an ideal prospect, and they raise a problem that you haven’t even thought about yet.

The opposite of reaction is not “proaction” — it’s creation. Actor Ray Liotta once said “As soon as I started producing my own stuff, I started getting other roles.” Action generates energy, and energy makes stuff happen.

Lately I have been talking to senior procurement leaders as part of a project I’m working on. All express frustration that their existing suppliers don’t bring them new ideas nearly often enough — in other words, there is just not enough value creation.

The more ideas you create that are of value to customers, the better your business development results will be. What are you creating right now?

Why It’s Good to Get Comfortable with Discomfort

At the moment, I am interviewing successful business development leaders as part of a new project.

Something that they all have in common is that they are comfortable with a level of daily uncertainty that would be very confronting to many others. In other words, being uncomfortable is actually comfortable for them. It’s when they get too comfortable that they start to worry!

Bill Gates once said “Success is a lousy teacher. It seduces smart people into thinking they can't lose.”

Successful business development leaders welcome discomfort because they understand this well.

They know that there is a delicate balance between trading off past achievements and experience, and presenting something that’s new, fresh and exciting. They get that customers are only really interested in their team’s 300 combined years of experience if it means that they are using them to do something interesting and valuable right now.

Achievements are great, but like trophies in a trophy cabinet, they eventually start to gather dust and cobwebs. For example, in my local area, there's a restaurant with a sign proudly proclaiming “Food Shop Hygiene Shop of the Year”. Under this, in huge letters, it also says “…2000”. The award was a great achievement — at the turn of the century. But as customer who might be thinking of eating there today, it’s more off-putting than enticing.

This thought might make you feel a little bit uncomfortable, but that’s actually a good thing.

The seeds of future success can come from many places — a chance meeting, a brilliant idea, or even just a deliberate decision to think differently. It is worth making yourself just a little bit more uncomfortable to find them.

Turn plotting into planning!

In today’s sales environment, it takes more than just plotting to achieve success. It takes planning.

Planning involves developing new things that we want to make public — that we want our market to know about — so that customers and prospects will see us as the obvious people to buy them from when it comes times to do so.

There’s a very good reason to do this, even though it feels counterintuitive when compared to the way we have traditionally been taught to sell.

Back in the handshake days, sales deals were conducted under a veil of secrecy. Plotting these deals was very deliberately a behind-the-scenes strategy. We didn’t want to leave a trace or let competitors know what we were doing.

In today’s procurement-led environment, when the value of government contracts and the winner of those contracts are published online, there is no veil of secrecy anymore.

Selling to procurement might look like it’s all about paperwork, but actually it’s all about positioning.

In her excellent new book Agile Selling, Jill Konrath says “Buyers have changed: fundamentally, drastically and for good. (They) self-educate, leaving the seller totally out of the loop. When they finally decide to engage, they’re often 60- 70% of the way through their buying process.”

According to Konrath, a seller’s success today depends on “knowing more… Providing value…and meeting (buyers) where they’re at.”

In my experience, something that is particularly appealing to customers is to see that suppliers have things going on that they are not just waiting to be funded, or paid, for.

This shows that you are interested in something other than just taking the customer’s money. It creates an energy and excitement around what you are doing. Even if what you’re building is not specifically for that customer — maybe it’s for yourself, or for another customer, or for another industry that you play in —it creates something tangible that you can talk about and that customers can see.

There is nothing more soul destroying than being in the business of serving customers, but having to wait to be chosen.

Planning creates positioning, and breaks you out of the waiting game. It also helps you to take some of your power back.

Essentially, planning is just a way of getting all of your business-winning ideas out of your head and figuring out how you're going to achieve them. So what are you planning?

Are you trading on ancient artefacts?

If you have 300 years of combined experience, that’s a heck of a lot of knowledge sitting in your organisation that the customer would love to take advantage of. The problem is, you can't show them how in just one sentence.

There are basically three things that we can trade on when we sell.

Products.These exist in the present. Products, including service-based products like programs, are what we have available right now that the customer can take immediate advantage of.

Precursors. Precursors exist in raw form in the present, but have a huge impact on the future. In chemistry, a precursor is a compound that creates a chemical reaction and produces another (often more valuable) compound.  In business,  precursors are the things that we're working on right now — the innovations, the pilot programs, the new initiatives that we're bringing to the customer that will ultimately result in goodwill, good relationships and good outcomes for us and for them.

Artefacts. Artefacts belong very firmly in the past. An artefact is an object of cultural or historical interest. In business, artefacts are the projects we’ve done, the contracts we’ve delivered, the systems and processes we built years ago. And our 300 years of combined experience.

When you’re bidding for a long-term contract of three years or more, the most valuable things you can trade on are your products and precursors.  Precursors are particularly valuable, because they are the inputs to future products; the essential compounds that help you create what you will deliver in the future. And most of us don’t have nearly enough of them.

Make no mistake, when you are pitching for a long term contract, you are not just selling what you have today. You are selling what you will have in three years’ time, or even further into the future.

A Contract Isn't a Gift for Life!

Winning a contract is really just a licence to keep doing good work. Even when there is an option for the buyer to renew the contract, it’s dangerous to assume that the renewal will happen automatically.  Think of your contract end date as more of a “use-by” date — a hard deadline by which you need to have a compelling strategy win the customer all over again.

As consumers, most of us have contracts that we would rather not put too much effort into.  These often roll over automatically, or are renewed with very little effort on our part. I once went three months before I realised that my phone was out of plan, and therefore the handset was fully paid for. I had to call Optus to get my rate reduced and my money back. Likewise, when insurance is up for renewal, we are often happy enough just to pay the invoice, rather than researching other options.

The businesses we buy from set it up that way, and good for them – they are the ones who are really in charge.

But when you are the supplier, selling to procurement, the situation is very different. The buyer sets the contract and the terms. Even when there is an option to renew, it’s their option, not yours.

Because of the way we see contracts operating in our personal lives, we sometimes tend to assume that “renewal” means “rollover”, but this is a mistake.

Consider for a moment how you think about use-by dates on food. Do you throw out food that is past its use-by? Is the use-by date a hard deadline for you, or more of a flexible one? I was once given a gigantic Toblerone, which I was hugely excited about, at least until I bit into it. The chocolate was crumbly and awful, and it turned out that it was 18 months past its use-by.

No one really wants to test their intestinal fortitude with food that old. In effect, though, this might be what we are asking our customers to do when we treat the renewal of a contract as a given, rather than as a genuine opportunity to win their business again.

Rather than a “rollover”, a more useful way of thinking about your contract end date is that it’s an opportunity for renovation, redevelopment, and reinvigoration. Competing successfully as an incumbent means working on projects that will create customer value, and this project work needs to start well before the contract use-by date.

Take More Risks and Create a Stronger Competitive Advantage

By definition, competitive advantage doesn’t mean doing exactly what everybody else is doing. But it does mean taking risks and moving away from what we know — something that is neither comfortable nor easy to do.

Have you ever seen movies where the hero swings across an impossible impasse, runs up the side of a building, or does a backflip off a dumpster? Then you’ve witnessed parkour, where adventurous types get from A to B using only their bodies and their surroundings to propel themselves. To avoid injury, parkour practitioners must look at their environment in ways that most of us can’t even imagine.

When it comes to the competitive landscape, I reckon we could learn a lot from this idea. We tend to see our market as a familiar track we have run around many times before, rather than as an exciting playground full of new things to try.

For example, in Australia, professional football is big money, and all AFL clubs are looking for an edge to win a premiership flag.

In April, The Age ran a story about Peta Searle, who gave away her job as a high school PE teacher 7 years ago to become a full-time football coach. Searle worked as assistant coach in the VFL (the amateur league), where she built the competition’s best defence back line at Port Melbourne. Port won a premiership in 2011 and came runner-up in 2012. Unfortunately, Searle was paid only $5,000 a year in the role, and needed a job with the AFL to make a decent living. Despite her outstanding track record, she couldn’t get one, and had to give away her football dream.

From a purely commercial standpoint, this is crazy. Searle is a proven performer. If she had been a bloke, her results would have started a bidding war.

Fortunately, Peta Searle’s story has a happy ending. This month, St Kilda recruited her as the AFL’s first female development coach. I’m guessing that St Kilda will have one of the best backlines in the competition before too long, and with it a sustainable competitive advantage.

If you’re pitching for a multimillion dollar contract, you will be in a competition of equals who can probably do the job just as well as you can. Often, it’s the very small things that will tip the buyer over the edge to choose a winner. What will yours be?

Point of View Comes Before Point of Difference — A Tale of Two Big Winners

There’s a lot of talk about unique selling propositions, but clients often see far less difference between suppliers than we think they do. It takes work and commitment to identify your point of view about a new business opportunity, build an offering and a strategy around it, and be rewarded for it. Last week, two of my clients were announced as big winners in the Department of Health’s sector reforms of mental health and alcohol & drug treatment in Victoria. One, a consortium headed by UnitingCare ReGen and Odyssey House, grew their business in all the metropolitan Melbourne regions that they pitched for.

The second, the Australian Community Support Organisation (ACSO) won intake and assessment services across both drug treatment and mental health services in regional areas of Victoria, a significant chunk of new business that adds 30% to their annual operating budget and means they can employ more than 50 extra staff. Both had been setting the ground work and scaffolding that led to these wins for a long time. I worked with Odyssey and ReGen for six months before the RFT came out, and have now been working with ACSO’s business development team for almost a year. All are great people who do great work that helps a lot of people take back control of their lives, and I am beyond thrilled for them. (Congratulations guys!!).

In The Challenger Sale: Taking Control of the Customer Conversation, Matthew Dixon and Brent Adamson set out a solid base of research proving that clients value suppliers who challenge the way they think about how they operate and compete. “Customers appreciate it if you can confirm what they already know to be true”, Dixon and Adamson say, “….but there is vastly greater value in insight that changes or builds on what they know in ways they couldn’t have discovered on their own.”

When the client has bought a service before, every formal tender is a red flag for change. It doesn’t matter whether the Request for Tender explicitly spells out an agenda for change (as the Department of Health’s did) or not.

“Improvement in the status quo” is the underlying expectation that sits behind every Call for Submission, Request for Tender, or grant proposal request you will ever see. It’s a warning for incumbents to up their game, and an opportunity for challengers to come up with something new and exciting for the customer to buy.

Buyers Expect and Buy Innovation - Even in Prescriptive Markets

Last month I wrote a piece titled Why Innovation Matters to Your Most Important Customers.  While this statement is true, it doesn’t always feel that way. In some markets, where the buyer sets the KPIs, tells you what to do and how to do it, and even how much they are prepared to pay, the relationship feels prescriptive; like a boss and staff rather than customer and supplier. Service delivery teams are so focused on delivering day-to-day — and are constantly told that they can’t do anything else, because there’s no money in the contract to pay for it — that innovation feels like it’s unimportant.  This, however, couldn’t be further from the truth.

Recently the Federal government held a Red Tape Repeal Day, scrapping more than 9500 regulations and 1000 redundant pieces of legislation. In commenting on this initiative in The Age, Malcolm Maiden pointed out that not all red tape is created externally. We create our own systems and structures to deal with problems and bureaucracy, and don’t always dismantle them when they go away.

In my opinion prescriptive contracts, which contain plenty of red tape, are part of this problem.

Fortunately, buyers in some prescriptive markets are starting to realise that if they prescribe everything, they may not get what they really need — even though they will get what they have asked for.

A good example is the current recommissioning of the mental health and drug treatment sectors in Victoria, which are undergoing wide scale modification to better align service delivery with changes in community problems with drugs and alcohol.  Another is the government employment services market, which is highly prescriptive but needs to be flexible to accommodate the broader political agenda and Australia’s economic needs.

If you operate in a prescriptive market, remember that you’re competing for the attention of tired bureaucrats who are wading through dozens or maybe hundreds of submissions that all sound pretty much the same. Behavioural economics theory holds that we tend to give greater weight to highly memorable things (a concept known as vividness).  Suppliers who are innovative and who are able to paint a vivid picture of how they will provide solutions to long-standing problems are rightly seen as a breath of fresh air, and are far more likely to be rewarded than those that offer a business as usual approach.

What Does It Really Take to Win Business through Continual Innovation?

Innovation is not a one-time thing – it’s an “all the time” thing.  Individuals and teams who keep thinking and keep innovating are always going to win more business than those that don’t. Bidding to provide services, in particular, is never going to be 100% transactional and all about price. It is always about something more. Buyers need help to navigate complex problems that weren’t conceived of a year ago — let alone 10 years ago — but some suppliers are still offering solutions that are well out of date. New solutions can come from anywhere; from a multinational in Texas to a small business from Australia.

For example, Birdon, a small-to-medium marine engineering company from Port Macquarie, was recently awarded a contract worth $A285m to supply the United States Army with 374 specialised boats.  Birdon won against global competitor General Dynamics in a four-year tender process. SmartCompany ran an interview with Birdon Group General Manager Iain Ramsay, in which he acknowledged innovation as the key to the bid’s success. Birdon had purchased an innovative marine propulsion system when it acquired another company, NAMJet, in 2011. Ramsay said  “Our boat design was superior to its competition… The innovation which went into it allowed us to win, even though we weren’t the cheapest on price.”

Innovation isn’t it just about the systems, products and services you build. It’s actually about having a process for continuing to generate improvement ideas.

There are formal, organisational innovation processes like the Ten Types of Innovation, and then there are things that we can each do individually to improve our ability to innovate. In an interview with emotional intelligence expert Daniel Goleman, Teresa Amabile — Director of Research in the Entrepreneurial Management Unit at Harvard Business School — identified the four key ingredients for continuous innovation by individuals as domain expertise; the ability to learn new things; creative thinking; and working hard. Domain expertise is about having a depth of knowledge and skill in the area you work in. Being able to learn new things — both inside and outside of what you do and know — will help with creative thinking and original ideas.  Hard work speaks for itself.

To me, this sounds like a pretty good recipe for career success. When innovation becomes a habit, you win, the team wins — and so does the customer.

Why Making Assumptions Could Just Land You A Winning Bid

One of the reasons why sales people who are trained in consultative selling methods can find it challenging to write bids and proposals is because the writing process lacks the feedback loop that they are used to. On the other hand, bidders who are successful in picking up new business through formal bids and tenders — even with prospects they’ve never met or spoken with before — are great at providing insight into the problems and issues the prospect is likely to be facing based on what they know about the clients that they are already doing business with. These assumptions, based on their expertise, are what form the core messages of their winning bid.

One of my favourite sales experts is Jill Konrath, who wrote the book Selling to Big Companies and who writes an excellent blog on sales. She also has a lot of great ideas about successful strategies for achieving cut-through with what she calls “crazy-busy prospects”, who just aren’t interested in educating suppliers any more.

In this video, Jill has posted the best and most succinct example I’ve seen so far as to why making assumptions works in sales.  It will only take 90 seconds to watch and Jill has thoughtfully provided a summary as well, so you can read it if you’re not in a position to listen.