The seven people involved in every deal and their motivation

ST. JOHN’s N.F.L.D. – Channel partners sometimes get stuck closing a deal that looks like a sure thing. There can be several reasons why deals get stuck.

Mark Smith, a sales analyst for Outsource Channel Executives Inc., says that one of the reasons for deals getting stuck is that the solution provider does know who the main players are in the deal and what motivates them. Or they are only dealing one or a few players, he told the audience at the TechSelect Canada conference.

Smith indicated that there are seven players involved in most deals and to be successful you need to know who they are and what they want.

The First Player – Vendors

According to Smith, vendors make products and that’s where their focus is on. Another motivator is the vendor’s brand.

The Second Player – Distributors

Distributors are focused on two core things: velocity and margin. How quickly can distribution move product through the warehouse and make margin on each transaction, Smith said.

The Third Player – Solution Provider

The third player is you the business partner and your particular motivation is the customer relationship and their satisfaction.

The Fourth Player – Customer/CIO

Customers do not care about a vendor’s brand. Their key performance indicator is operational uptime. Significant downtime gets CIO’s fired. The challenge becomes when introducing new technology that will put their jobs at risk. “Cool new stuff is risky,” says Smith. He advises that education is the only way to teach them to increase uptime.

The Fifth Player – Chief Financial Officer CFO

IT has a budget but they will need permission to spend any of it over and above a certain limit; usually anything above and beyond the toner cartridge refresh.

“CFOs are historians. They just report on what other business units are doing.  The CFO’s motivation is cash flow, can’t pay employees, suppliers or the boss? They get fired,” Smith said.

The CFO manages cash flow and credit lines; money coming in and money going out. Compliance is another objective for taxes and local/federal mandates. And, a CFO’s numbers are accurate. What a solution provider sells must improve cash flow and compliance. The CFO is the player that cares the least about the brand amount the seven players.

The Sixth Player – Chief Executive Officer CEO

The buck stops with this person. The CEO’s motivation is profit and maintaining or enhancing shareholder value.

“Two years ago, Mark Hurd, the CEO of HP, used the wrong credit card on the wrong person and the got rid of him. In came Leo Apothekar and HP stock lost half its value. So bye-bye Leo and say hello to Meg (Whitman). Stock rebounds. It’s about shareholder value, profit and then growth. For Government and education customers it’s about the mission, but with companies it’s only about shareholder value.

The Seventh Player – End User

The end user is part of the sale but not the most important. The end user’s motivation is simply to get his or her job done.

Smith added that only the vendor cares about the brand and it puzzles him that solution providers keep talking to the customer about brands such as Cisco, Symantec, IBM, HP or any other brand.

His advice is to “lead with the need.”

The seven people involved in the sale are motivated by uptime, cash flow, compliance, profit, and growth.

Those are the five key performance indicators. These are the reasons why people buy IT and there are no other reasons,” Smith said.

He warns that if a deal is stuck in the pipeline then the solution provider has yet to reveal that one key indicator of the five they need to solve for the customer.

Smith told the TechSelect audience that solution providers have to educate customers on what they are selling. Deals get stuck for various reasons such as changing executive priorities, budget reallocation, changing execution team priorities, no visibility on slippage impact, and they are stuck at a lower price level.

How do you unstick these deals? The first is to know who the players are and what motivates them.

You need to find out what has changed. Have the desired outcomes changed or has the success metrics changed?

One of the questions Smith tells his clients to ask is this: “What’s your strategy for planning and budgeting IT growth?”

By asking this question, you will find out who the top decision maker is because the person that you are dealing with will normally say who the person is if it’s not them as part of the answer.

 

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Jim Love, Chief Content Officer, IT World Canada

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Paolo Del Nibletto
Paolo Del Nibletto
Editor of Computer Dealer News, covering Canada's IT channel community.

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