by Cindy Barnes
We had different representatives from different areas of the business come together for the Value Proposition Workshop and I think for the more commercially-oriented team members who were present there were a lot of ‘a-ha!’ moments. For the non-commercial team it really put the business – as the customer experiences it – into context for them and perhaps helped frame, from a neutral standpoint, what our customers deem as ‘our content’ – be it our legal or editorial content or our analysis – and therefore they were able to take on that unbarred feedback and digest it in a neutral way.
Implementation programmes
The Value Pyramid™ really framed where we are and perhaps where we can go to. That was a centre point for discussion and it still helps us today to shape our decisions about how we move up that value chain. We can then focus on our ability to do that from a technology perspective, how to position ourselves, the messages that we need to be putting out to our customers, how we support the commercial process and bring our teams together to be able to speak with one voice. So there was a lot there, both from a content and a commercial standpoint, that we were able to rally around. It was also a very good neutral forum to do that with some unbiased feedback from the market – that was very successful for us.
I went region by region in January and February this year, taking a lot of the discussion points and actually sitting down with the team and talking with them about why we needed to change our approach, what our customers were saying and sharing some of that feedback with each region. And then starting to use those forums to get input from those commercial teams as to what they thought that change should be and really enable us to get buy-in from them, to check how to position ourselves to really serve our customers in the best possible way. And so it was a good jumping-off point, again with an independent viewpoint – sharing the views of customers helped really reinforce the need to position ourselves differently and change the commercial structure and set-up. We were then able to implement quite a lot of change in each of the regions, which we felt needed to happen but it was a very important catalyst to rally people around – and as I have said, an independent view of what our customers are saying and how we could serve them better. So I think there was a lot more done around the commercial change aspect of how we were set up – and understanding that we were making the technology changes to support that.
At the end of the process we had the master global overview, which took components from each region, and I think one of the real benefits was boiling it down to messages that were transferable across geographic regions. Within each region with its own idiosyncrasies we framed our market positioning and issues, which were perhaps more of a concern in one region over another but we came away with a consistent set for the three regional teams, which I still talk about today – a consistent set of positioning messages that we use to centre on with each region’s own adjustments. So it was a very, very helpful format by which to showcase the overarching message and support the areas we need to focus on and the changes we are making.
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CASE STUDY
GlycoSelect
Start-up GlycoSelect used the value proposition process to shift its focus away from its technology and towards customer needs.
Based on investment funding, GlycoSelect is a start-up with less than €1 million revenue and 10 employees. It was born of an industry-academia collaboration to address problems associated with the development, analysis and production of biopharmaceutical products. The resultant technology uses an innovative separation method that enables improved product analysis and more effective manufacturing processes.
GlycoSelect is currently targeting the product purification segment within the pharmaceutical market, where 95 per cent of all new drugs are biopharmaceuticals.
CEO Robert Dunne comments:
We are involved in a very specific area of science: glycobiology. It is becoming increasingly important but it is a relatively young part of biology. It has grown in the last 20 to 30 years and we are now coming to the point where people understand that it is very important in physiology: for example, many new pharmaceuticals are based on the science that our technology works on.
Challenge
We have very little in terms of sales and any sales increase we have will be down to product licensing deals, so our sales are very granular. The pharmaceutical industry is notoriously conservative. We may have our first technology licence this year and it is two years since the potential customer called us to discuss the licence.
Solution
When you are scientists and selling to scientists, you may think you know your customer. But in reality that may not be the ‘real customer’ because the lab scientist is generally not the person who signs the cheques.
It is a complex market, and being able to understand that, put it in basic terms and to be able to refocus our sales pitch and customer experience is important for our company’s future. This is the area where we are focusing on now: understanding our customer experience. I think scientists have a problem – because they are handling the same thing, they think they know what the other guy wants and in fact they don’t. I’ll give you a very good example. One of our development advisors uses the same equipment that we put our technology on to. Despite the fact that he uses the same piece of kit applied to plastics, he does not understand our technology as it is applied to pharmaceuticals. So two scientists can use the same equipment but they still have to have the technology explained to them. For that reason, we have taken the decision that we will always have a scientist at every customer meeting unless there is a really good reason why they should not be there.
We identified that having closer engagement with our customers by making our scientists available to them, to advise them and visit more, was a customer need we were fulfilling, but not fully recognizing the significant value it had for customers. By increasing these interactions we have increased sales, especially repeat ones, but also gained new insights into other applications for our technology. We were already providing added value but had not recognized its importance to our customers. We have definitely changed our priorities when dealing with customers.
Result
Principally the Value Proposition BuilderTM process gave us focus, I think that has been the main advantage that I’ve gained from it. Our technology is quite complicated and one can get very parochial about it – taking my focus away from the technology has given me the ability to go back to the business and say okay, well what is the value proposition that we are giving to our customers? That has been great and in fact we are working on that now and, for example, we put our scientists in front of customers more. We have made adjustments in two ways: putting the focus on to the business and actually implementing the reality of what I learnt.
We also identified our branding as being very weak, in fact we don’t do any, and I’m working on that at the moment. I’ve found a mentor from Enterprise Ireland who will help me with the branding work, and that should be in place by year end. The reason for stronger branding is because we could get swamped by our customers’ brands as they all happen to be larger companies that use our technology on their equipment. We need an ‘Intel Inside’ strategy.
Learning
It has given us a structure, the Value Proposition Builder™ has become our template. One can do business canvasses and all the rest but this is a bit more powerful because it directs the strategy, the positioning and it has enabled us to focus on the customers a lot more.
Future
Our value proposition is now based on following this analysis – we know we improve manufacturing and improve product analysis in the pharmaceutical industry. And that’s it, that’s the value proposition, and we reinforce that with our expert advice. This is a far easier sell to investors, so I think what I’m saying is that, having gone through the process with Futurecurve, I started on the value proposition journey not really believing it was going to change anything,
but I now know what my business is really about – as distinct from what the science is really about.
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For further case studies of companies that have been through the Value Proposition Builder™ process, see Appendix 2.
See things from the customer’s viewpoint
The value experience step in the Value Proposition BuilderTM process highlights that one of the most critical areas is in understanding issues and needs from the customer’s perspective. It is all about perspective. In particular, learning how to see things the way the customer sees them. Many businesses, especially those that are technically focused, find this shift particularly difficult. They struggle to make the leap from thinking about their own capabilities and products to thinking about what the customer really wants, from his or her own point of view.
Changing your frame of reference to see things from your customer’s perspective is, in essence, like practising empathy on a corporate scale.
How do you ‘reframe’? The following exercises are tried-andtested ways to shift your perspective. Do try them for yourself:
1 Walk with an expert: in Alexandra Horowitz’s book On Looking, she walks around familiar places with various experts on typography, public spaces or geology in order to gain a new perspective. This approach mirrors using consultants who will bring in people from diverse backgrounds with different experiences and expertise.
2 Change your physical position: if you are a factory boss and you always enter the factory by the same door each day, always take the same route to your office, always have lunch in the same place, then deliberately try changing this routine. Do things differently. Mix it up. See if you start to notice different things about your regular day.
3 Zoom in and zoom out: imagine that you are looking through a viewfinder on a camera and you are zooming in on something nearby. Take a few moments to focus and see the detail and richness in that thing. Then imagine you are zooming out and looking at that same thing but now you are seeing it in the context of its relationships with everything else around it.
References
Barnes, Cindy, Blake, Helen and Pinder, David (2009) Creating and Delivering Your Value Proposition, Kogan Page, London
Perry, Grayson (2014) [accessed 24 August 2016] Grayson Perry: The Rise and Fall of Default Man, New Statesman [Online] http://www.newstatesman. com/culture/2014/10/grayson-perry-rise-and-fall-default-man
04
How to translate a value proposition into a sales proposition
Every day when your salespeople meet customers and prospects they are out there creating sales propositions. But are they selling what is best for your business goals? Are they selling what the customer really needs or wants? These are important questions, because if your sales activity is out of sync with your overarching value proposition, it could at best be wasted effort and, at worst, counterproductive.
It is not uncommon for businesses to put time and effort into developing and refining a value proposition, and then to miss out the crucial next step of translating it into how they go to market. For example, if a business has decided that it is now a solutions business, but salespeople are still pushing product and focusing on price, a new value proposition will not deliver the desired results. Your customers will not take you seriously if you try to introduce a new value proposition without planning it carefully first. Imagine if value retailers like Wal-Mart or Primark started selling Tiffany jewellery. Their customers would not be in the market for these expensive items and Tiffany customers would not go looking for them in low-cost retailers. Commodity businesses trying to make the shift to solution selling are exposed to precisely the same credibility or value gap.
It is also crucial to get the pitch right for different customers. For example, if a company sells to both business-to-business (B2B) and business-to-consumer (B2C) markets, the concept of ‘confidence’ in its value proposition would need to be articulated differently for each audience. Business customers might be focused on how this could affect their standing among their peers (‘no one ever got fired for buying IBM’), while a consumer’s main concern might be around the feeling that a device will not fail. Looking at the same example through the lens of different job specialisms, finance directors might see ‘confidence’ as something that helps with cost control; while IT specialists could be mostly thinking about reliability and uptime. Each function will have a ‘job to be done’, an idea created by Professor Clayton Christensen and Michael Raynor in their book The Innovator’s Solution (Christensen and Raynor, 2003). On Christensen’s website (Christensen Institute, 2016) he points out:
The jobs-to-be-done framework emerged as a helpful way to look at customer motivations in business settings. Conventional marketing techniques teach us to frame customers by attributes – using age ranges, race, marital status, and other categories that ultimately create products and entire categories too focused on what companies want to sell, rather than on what customers actually need. The jobs-to-be-done framework is a tool for evaluating the circumstances that arise in customers’ lives. Customers rarely make buying decisions around what the ‘average’ customer in their category may do – but they often buy things because they find themselves with a problem they would like to solve. With an understanding of the ‘job’ for which customers find themselves ‘hiring’ a product or service, companies can more accurately develop and market products well-tailored to what customers are already trying to do.
So new sales propositions need to be carefully planned and framed appropriately for different markets and audiences. How do you do this?
There are several steps to the process, the first two of which are taken care of in the Value Proposition Builder™ process:
1 Understand what customers value.
2 Understand how they see you – in relation to your value.
3 Identify your core skills and capabilities.
4 Decide where to place sales propositions on the Value Pyramid™.
5 Create customer-centric sales propositions.
6 Choose the right sales approach.
7 Frame the sales propositions with the right story.
8 Make sure that everything you do supports this sales approach.
By the time a business has designed a new value proposition (see Chapter 3) it will know the answers to the first two steps: what customers value and how they perceive the business. Let’s recap these and then explore all the steps needed to turn a value proposition into a sales proposition. We will also look at case studies of two companies that have successfully achieved this.
Understanding what customers value
The outcome of good value proposition design work is a finely crafted set of organizational attributes. These are the ‘company treasures’ – the unique characteristics that are known and valued by customers and that give a business its unique characteristic. They can be summarized at a high level and used to focus all subsequent activities.
For example, in one company the attributes might be:
expert;
trusted;
innovative.
For another, they could be:
reliable;
safe;
responsive.
The themes above look deceptively simple, so for the full detail please review the section in Chapter 3 on the Value Proposition Blueprint™. Typically, value proposition work uncovers three to five key attributes that are the top reasons for customers to do business with a particular company. Any credible sales proposition should use and build on them.
How customers see you
How are you viewed? As a Components supplier or a Solutions company? Customer interviews in the value proposition design stage will have revealed what customers think of you. If you have not carried out that stage, this quick diagnostic will give you a ‘read’ on how customers see you.
Does the customer always provide a ‘request for proposal’ (RFP) or ‘request for information’ (RFI)? If yes, then your business is prob
ably being seen at the ‘Components’ or ‘Offers’ level. (see Figure 4.1).
Of course, some markets (for example public-sector organizations) must always issue a formal bidding document. However, when a RFP appears out of the blue and it is the first time that a business has heard of the opportunity, there may well be another company already involved with the customer who is better positioned. When a business has not been consulted about how to structure a solution, the customer believes it knows what it needs. It will have obtained this view from someone (often a competitor) – and will buy accordingly.
With whom do sales discussions take place?
Figure 4.1 The Value Pyramid™
SOURCE Futurecurve, 2016
If your dealings are mostly with procurement or purchasing specialists, then you are being seen as a supplier at the Components or Offers level. Any time a salesperson cannot speak to the individual within an organization who owns the need, the chances are that the sale will be transactional and at the Components level of the Value Pyramid™. On the other hand, if most dealings are with the people who own the business problem to be resolved, then it is possible that the customer will be open to a more consultative style. Unless you have access to the individual(s) within the prospective customer who owns the need being solved, it is virtually impossible to sell consultatively.