Wednesday, October 21, 2015

From a Business Case to a Case for Change

Despite the growing need to convince buyers as to the unique value you can deliver, the traditional Business Case - long a staple of value selling - may be losing it’s luster in driving sales success.

Why? According to Cheik Daddah, Vice President North America Value Consulting for Oracle, it’s because the Traditional Business Case is too inside-out (vendor-centric), focused too much on the solution and what it can do. Most are overloaded with too many numbers that clients have difficulty connecting with. 

And this opinion was shared by many other experts, as we discussed key challenges and best practices in a first of its kind gathering of two-dozen value consulting practice leaders.

A Traditional Business Case typically tallies the costs, benefits and risks of a proposed solution. By design, it provides numbers and metrics to convince clients you are investment worthy. Discounted cash flow, ROI, payback, NPV, and IRR are typically calculated and presented to deliver financial justification and rationalize the purchase.

IDC reports that 95% of purchase decisions require a formal business case. Without it, your proposal will not get approved, however, 2 out of 3 buyers indicate they don’t have the knowledge, metrics and models to produce the business case on their own, so they rely on you to stand up and deliver.  Fail to, and you face significantly stalled decisions and sales cycle delays.

Your clients rely on you to deliver a business case if you want deal approval, and as such, the Traditional Business Case has become “table stakes”.  

Our value experts concur that going forward, the Traditional Business Case is not enough to differentiate your unique value or motivate today’s more empowered, skeptical and frugal buyers to change.

The Case for Change

Cheik thinks the best value consulting organizations need to evolve to something better, from the Traditional Business Case to making a solid “Case for Change”.

The Case for Change takes a client “outside in” approach, focusing not on your solution or key ROI financials, but first on the buyer’s strategic imperatives and key challenges that hinder them: collaborating with clients to identify key opportunities, diagnosing, benchmarking and illuminating important issues, communicating and quantifying the cost of “Do Nothing”, and linking them back to key success factors to enable their strategic objectives.

And why is it important to focus on “Do Nothing” first? Almost 60% of a typical pipeline ends up at “Do Nothing” (SBI), choosing to remain with “business as usual” versus change. Successfully selling with value means you have to now not just provide a perfunctory business case and rationalization, but provocative motivation and risk assessment. Identifying major risk factors and mitigating strategies have to be center stage. Left alone, risks are magnified. Understood and mitigated against will help organizations establish a roadmap for success.

You have to compel prospects that are all too content to avoid the risks and resource commitment you are proposing. If we look to the neuroscience of decision-making for guidance, the research shows us that the most motivation is when you Reveal and Quantify the Pain before you Prove the Gain.  

Instead of a numbers laden document focused on the solution, price and benefits, the Case for Change is about articulating your unique value story, in the context of the buyer’s challenges. The best Case for Change stimulates the 3 “buy buttons” in the brain to motivate change and approval:

  1. Storytelling, visuals and contrast are leveraged to emotionally motivate change – to stimulate the Reptilian brain (Aristotle’s Pathos).
  2. Success stories and 3rd party proof points are presented for credibility and trust, driving a positive “gut feel” on the decision– to stimulate the Middle brain (Aristotle’s Ethos).
  3. The numbers are used, not as the focal point, but to reinforce the status quo risks, the cost of Do Nothing, and potential benefits – stimulating the New Brain (Aristotle’s Logos). 

The Bottom Line

It’s not about the numbers, but how the numbers support your unique value story.

So what does your business case look like? Is it about your solution and ROI, ticking the required box for financial rationalization, or is it differentiating you and your selling approach: powerfully making a compelling case for change?

You might want to take the lead from this prominent group and improve your selling success: evolving from Traditional Business Case to making the Case for Change.

For a roadmap of exactly what you need to do to make this important get our new book from Amazon:  The Frugalnomics Survival Guide - How to Use Your Unique Value to Market Better, Stand Out and Sell More

The Value Selling and Realization (VSR) Council met in Dallas this week, a historic gathering of two-dozen leading value practice leaders forming a new industry group – the VSR Council - to advance the communication and quantification of value for clients.  The first VSR Summit will be held February 29 / March 1, 2016 and will feature Tom Pisello and Alinean.

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