Thursday, May 07, 2015

SiriusDecisions and the “No Decision” Challenge

When you examine your sales pipeline and compare your wins vs. losses, research from SBI indicates that an amazing 58% of deals don’t get lost to the competition, or end up in your hands – they result in “No Decision”.

In most cases, these appeared to be good opportunities, with many interactions and touch points. So why did these deals fail to evolve to “Yes”?

With SiriusDecisions Summit 2015 just around the corner, Jim Ninivaggi the Director of SiriusDecisions' Sales Enablement practice, indicates that this is one of the top sales issues, and to overcome the challenge, you need to understand that every “No Decisions” necessarily the same:

Lost to status quo – Today’s buyer is more skeptical and frugal, a condition we call Frugalnomics. As a result, your prospect is more apt to stick with the status quo – their legacy solution and processes - versus moving forward with your proposal. Rightfully or wrongly, your sales reps did not convince the buyer that the cost of “do nothing” was serious enough to drive change, and / or they perceive the solution as too big a change management nightmare - risky, too resource / budget consuming, especially compared to the perceived benefits. Your sales reps are battling the neuroscience of status quo bias – a cognitive disposition for resisting change and sticking with “business as usual”, and they need to be armed with the ability to communicate and quantify the cost of “do nothing” and the overwhelming value of your solution – emotionally (diagnosing and connecting with the pain), rationally (financials) and credibly (providing direct and relevant success story evidence to gain trust)

No buying process – More stakeholders are involved in every purchase decision. Buyer’s are struggling just to “keep the lights on”, much less considering and implementing new solutions. Unfortunately this leads to a dysfunctional buying processes in many of your opportunities. In many cases, your “champion” does not have the credibility or authority to steward a buying process amongst all the different stakeholders. To help, you must arm the sales rep with "tools" to facilitate the buyer’s decision making, mapping and guiding the typical process with "buyer’s journey" playbooks, and most importantly at each stage, providing the value communication and quantification for all the different stakeholders – each with their own unique view of what’s important and what represents value to their part of the business (and personally too).

Stalled deals – A good number of purchase decisions get delayed. The good news, the buyer is still interested. The bad news, they’ve prioritized other projects ahead of yours, or your sales rep has been told they have to wait a budget cycle or two, According to Jim, “One of our clients, selling into higher education, shared that one of their biggest deals had a legitimate sales cycle of three years, as their buyer needed to keep waiting for next year’s budget cycle to get approval. Three times was the charm.” Unfortunately, you likely will have a hard time waiting three years for every deal. What can you do to raise the priority of the project? Have you diagnosed the challenges properly, showing the prospect that the issues are bigger than they imagined? Have you proven that the cost of “do nothing” is higher than the other projects they have made a priority? And once this is clear, have you demonstrated that your solution provides a superior ROI and faster payback than the competing solutions? If you have not, no wonder your proposal is not getting the budget allocation or priority it deserves. The deal still may take longer than you wanted it to, but a little work can go a long way towards prioritization and acceleration.

The buyer goes dark - They won’t return my phone calls. Unfortunately, too many prospects that were engaged – actively consuming content, in constant communications – suddenly and inexplicably “go dark.” They simply stop returning phone calls or emails. More often than not, they have decided to stick with status quo or go with another vendor, and have not told your sales rep yet. They just haven’t admitted this to your sales rep yet. If the deal is really lost, are your sales reps doing a good enough job of “pressing the 3 key decision-making buttons” – Pathos (Emotion), Logos (Logic) and Ethos (Trust)? Did they communicate and quantify the high cost of status quo and value of change? Competitively, did your reps get involved early enough to help set the agenda, or later in the decision cycle, prove that your solution had more value and was lower total cost of ownership (TCO)? If not, why not?

Abandoned Decision - According to Jim, “This is the true “No Decision.” A buying process that was underway is simply dropped for a variety of reasons: a merger or acquisition, change in personnel (either on the decision team or corporate leadership), shift in corporate strategy, a wholesale shift in requirements (i.e. what the buyer needs and is looking for has dramatically shifted), or even poor financial performance (budgets disappear).” There are factors outside your control, and you have to reset your approach to accommodate the "new world" of the buyer, often starting over to reframe with emotions, rational and evidence to align with the new company post merger, with their new financial challenges, and / or with new stakeholders. The good news is that you can still revive the deal. The bad news, you have to go back to a few steps before moving forward: diagnosing, illuminating, and re-justifying .

The Bottom-Line

Although we tend to lump all “No Decisions” together, there are nuances that deserve special attention, and can be leveraged to get the deal to “Yes”.
Our advice? The key to overcoming the “No Decision” challenge is to arm your sales reps with the right value messaging, tools and training to deal with each situation and help facilitate the buyer to overcome their biases and decision-making issues.

Overcoming “No Decision” requires that your sales reps effectively communicate and quantify the cost of “do nothing” and the value and low risk of your solutions to all of the various decision makers – using emotions (diagnosing and connecting with the pain), rational (quantification of current costs and financial justification) and credibly (providing direct and relevant success story evidence to gain trust). Unfortunately, 71% report that the “inability to effectively articulate your value” remains the biggest sales challenge.

With almost 60% of your pipeline likely being lost to “No Decision”, what is this issue costing you each quarter?  Likely your biggest opportunity, so what are you doing today to help your sales reps better categorize and tactically address each scenario - to get your “No Decisions” to “Yes”?

Learn more about overcoming "No Decision" from our new book: The Frugalnomics Survival Guide: How to Use Your Unique Value  to Market Better, Stand Out and Sell More

Source:
The Sirius Decision on "No Decision" or 50 (OK, Five) Shades of No Decision - 
https://www.siriusdecisions.com/Blog/2015/April/The-Sirius-Decision-on-No-Decision-or-50-OK-Five-Shades-of-No-Decision.aspx


1 comment:

Tim Cahill said...

Excellent post Tom. Great advice on how to address these challenges.
Thanks