How to avoid slipping deals -control the decision process with MEDDICC

"We haven't had time to talk together, we have to postpone the meeting"

How often does it happen to you that the closing meeting is canceled at short notice, perhaps even on the same day. Of course, it can feel sour to inform your salesmanager that the contract will not come as planned. In this chapter, you will get a method for early mapping the customer's decision-making process, which steps and time frames apply. You will be able to spot potential sales problems and influence the process in your favor. I will introduce a tool, the MEDDICC GO-LIVE plan, a way to make joint planning with the client.  

"We had been working for months to get the contract ready before the end of the quarter, but the day before the customer decided to cancel the process"

An example of when the salesperson had not discussed the decision process with the customer was when the final meeting was suddenly cancelled. A municipality wanted to purchase a new financial system, they did not go out in a tender but selected the supplier that their municipal colleagues had recommended. Everything was correct, the customer's needs were similar to those of other municipalities and the solution was largely ready. The contract terms were based on a municipal-wide framework agreement with fixed prices, the customer thought they did not need to be renegotiated. The seller and the customer's contact person had set a tight schedule for the implementation and he had received a verbal OK that the deal was in port. At the last minute, the client's CFO comes up with an idea: wouldn't it be great if the CFOs could see and give their input before the final design was decided? A demo will be arranged at short notice. But the seller's expert in municipal accounting was booked up, so they asked another talented economist to carry out the demonstration. What no one had anticipated was that the financial assistants had very specific accounting technical needs that they wanted to see the system handle. The economist was unable to demonstrate these functions during the demonstration. The following day, the closing meeting was booked. The reason? The financial assistants saw the system and felt that it did not meet their needs. No one had expected that the finance assistants would have such a strong influence. They couldn't sign a contract but they could block the deal. If the financial decision maker had run over the financial assistants, they would probably have made the implementation more difficult. The seller failed to ask his champion about the importance of the finance assistants and their influence. Because it was so important, the demonstration should have been moved to when the municipal expert had time. Now the seller pushed the meeting to get a quick signature and the deal was lost.

With the exception of public procurement, the decision-making process is usually not particularly structured.

If you sell high-tech solutions, your customers are probably first-time buyers, they don't know what their buying journey should look like. It becomes even more important that you help them plan their timeline and what decision steps they need to take. If the customer has bought similar products and services before, they probably have an idea of how to proceed. My experience with High-tech sales is that customers rarely know how to buy. This means that the buying journey can become messy, new people get involved, the requirements changes and there is a great risk that the whole project will be postponed.

This happened to me very recently. My economic buyer and I had identified a great need to train the sales managers in goal management and coaching. We had conducted both interviews and a survey. The plan was that we would develop and launch a training program based on the survey results. Everything (as usual) looked good, the metrics were in place and there was a clear business case. In addition, their sales had decreased sharply, there was a clear pain. We are working on the investigation and analysis. But at the closing meeting, a new person is invited, the company's sales director. He sits in a staff function and has no influence over the operational decisions. I ask my economic buyer about Mikael's role, how we should involve and engage him. I get short text messages in response: "The goal is for him to like the program". My gut told me that something has happened, that this will not go as planned. Unfortunately, I was right. Somewhere my contact has told me about the program he intended to run and met with resistance. He gets cold feet and to keep the peace in the house he invites the opponent without giving me the whole picture. I thought that we jointly decided on the process and that my contact was my Champion. But I was wrong, Mikael blocked the program. I bring up this example to show the importance of analyzing the political decision-making climate and how it affects the decision-making process. With hindsight, I should have asked questions like: "How will you anchor your decision? Who in management will have opinions about it, what interests do you need to balance? What is the best way to involve the most important people without creating too much work? What can happen if someone thinks that this program does not fit into the strategy?” Awkward questions I missed asking. Why? I was honestly convinced that my contact could do as he pleased. I was completely focused on the work we were doing together, that it would lead to a great result for the client.

The customer and you need to agree on the decision-making process

Before you get the solution for how you can agree with the customer on what the decision-making process should look like, we will take a closer look at which parts can be included in a decision-making process, which roles are important and which formal and informal steps need to be completed in order to it will be business. Most deals are not particularly complicated, all we need to do is ask the right questions and clarify the decision steps. Gradually, you can move the business forward in your CRM system.

The decision process describes how customers choose to evaluate your offer. This includes timeline, validation and different types of approvals. There can be both formal and informal decisions to be taken by the customer.

The decision criteria are about what the decision is based on, the decision process is about the way there.

We divide the decision-making process into the path to a technical decision - that the solution solves the operational needs (Technical Decision Making), the path to getting money (Business Decision Making) and the path to all formal approvals, such as contracts and agreements (Paper Process) .

Technical Decision Making (TDM)

Based on TDC, companies set up formal or informal processes that lead to a technical decision. It is important to understand what these steps are and who is involved in it.

As decision criteria, this process should also be documented and confirmed by the customer's champion and those who must approve that your solution will work in practice. It can be tests, demonstrations, proof of concept, reference visits, certificates from suppliers whose solution will be integrated with yours and certifications that are needed.

An example of this was when a large company would choose a data center. On paper, the technical requirements picture was easy to understand, it was about power and cooling capacity, physical security and access to backup power. But when the salespeople dug deeper into the decision-making process, it turned out that the customer's sustainability department had strong opinions. They wanted all processes and subcontractors to be environmentally certified. This was a requirement that was not included in the procurement documents. The seller discussed with his team and came up with an idea: If they could get the customer's technical decision makers to include environmental certification as a key requirement in the procurement, their position would be strengthened. The vendor proposed that the customer's evaluation team make a virtual visit to the data center so they could see for themselves how environmentally friendly it was. This "sightsing" convinced the customer to choose them. The vendor had identified more technical requirements, matched them with their strengths and was able to influence the technical decision-making process.

Often there are more influencers, more demands and greater opportunities than you think at the beginning of the sales process. Expect your competitors to do their best to influence the customer's technical decisions so that their position is strengthened.

Business Decision Making (BDM)

Who needs to approve the deal? Are there any formal boards and decision-making bodies? Is there a formal procedure or are decisions made informally? When do the different groups meet? Do they meet regularly? How do they prepare decisions and what information do they look at? Can you make a presentation? You need to have full control over how they make decisions about investments, if they are big, the client's board needs to approve them. When this is the case, you need to get to know the board members to know how they think and what they like.

A seller I know had a great champion. Together they had developed a solution, a business case and also carefully investigated the technical conditions for an implementation. All that remained was approval from the board. The seller was not allowed to attend the meeting, but champion had promised to call if there were any problems. The day after the board meeting, the seller received a brief email: "We have chosen another supplier. Thank you for a great collaboration.” The seller called to get an explanation, the manager would call if something went wrong. The manager explained: “One of the board members had done a parallel process that I didn't know about. He suggested another supplier who pitched a different solution. I explained that it won't be as good as the one I produced, but was overruled." This is not entirely unusual, for champions to overestimate their influence. I asked the seller what he knew about the board and their network of contacts. He hadn't read up on their profiles. But when he did, it turned out that the person who suggested the new supplier had worked there. But with a little research, the seller could have prepared his champion better. You need to know how the customer makes the financial decisions, who has influence and power and how they evaluate the investment.

A positive outcome came from a salesperson who carefully discussed with their champion how they made decisions. Champion said that the board often tabled investments that lacked an ROI, return of investment analysis. The seller asked to see examples of how some approved investments were presented to the board. He copied the best ROI template, adapted it to his quote and gave it to his Champion. The investment was hammered through without any questions.

Paper Process (PP)

Paper process is a misleading name, it should be called document flow, most documents today are digital. You need to know which agreements must be signed in order for the deal to be approved. You need to know who will sign them, what language they will be in and how they will be signed, physically or digitally. Rigorous requirements for regulations or business compliance often lead to time-intensive negotiations. These can take weeks or even months, but are necessary to have a legal agreement.

This process is the most common reason contracts are postponed and deals are pushed to the next quarter. Make sure you have sponsorship from the financial decision maker to give negotiations with the purchasing department and lawyers the right focus, the right time and the right resources. Be paranoid about the details!

An example of how easily a deal can go wrong was when a state-owned company was ready to sign the agreement with a seller. Both parties had worked for several months on the solution, planned the implementation and agreed on the terms of the agreement. The seller worked for an American company, he could not sign the contract himself, it required a high-ranking manager in the United States to give his approval. On the day of the contract, the seller presents the signed contract. All that was needed was the buyer's signature. When the pen was a few centimeters from the contract, the customer's CEO discovered that the contract was in English, not Swedish. In addition, all the draft contracts that had been presented had been in Swedish. The CEO refused to sign an agreement in business English. The seller's team quickly tried to produce a translation, but their American colleagues did not prioritize a costly translation. The deal was delayed and the customer finally chose another supplier. A completely unnecessary mistake that cost the seller a great deal.

I worked with a fantastic sales team who underwent the MEDICC training. They had realized that the decision-making process always took time when the lawyers started discussing the contract. In order to speed up the contract process and reduce the risk that external circumstances changed the conditions for the deal, they asked their lawyer to get involved early in the sales process. In parallel with the technical and financial decision-making process, he began the legal one. The sellers' lawyer got in touch with the customer's lawyers. Thanks to this change in the paper process, they were able to shorten the decision-making process by 6 months.

If the decision-making process reduces your chances of winning the deal, you should withdraw or renegotiate the process

If you notice that the customer's decision-making process is to your disadvantage, you need to pull the handbrake. It could be things like you having to submit a quote without getting to meet the decision makers, that another supplier influenced the decision criteria or the timeline. Are there requirements you cannot meet? Then it is just as well to withdraw, alternatively renegotiate the decision-making process with the customer. My advice is to take action immediately and bring it up with the customer. You gain nothing by waiting. If you have the opportunity to influence the decision-making process and the timeline yourself, you should do it as quickly as you can - it will increase your chances of winning.

An example of how a brave sales manager made an uncomfortable decision was when a large procurement was at stake. A large company wanted a quote for a complex POS system. The client had set the rule book for the procurement: first they wanted to have quotes from a number of suppliers and then select the three they met, a fairly common way of proceeding. When the sales manager, who has completed the MEDDICC training, read through the request documents, he saw that they did not meet several of the decision criteria and that the timeline was too short for them to be able to submit a reasonable quote. He did the only right thing, wrote a nice email with a rejection, they wouldn't submit a quote, time was too short and they didn't think the customer's idea of a solution would work. The customer made contact immediately, they were both worried and annoyed. They were not used to a supplier giving them criticism. After several contacts, even the sales manager's CEO received a call from the customer, they agreed on a plan. The sales manager and his team were given a week to present an alternative proposal, if it seemed reasonable they would be allowed to meet the Swedish management team. The client liked the proposal, the meeting went well and after 6 months of negotiation they signed a large contract. Afterwards, the sales manager was overjoyed: "We win when we tell the customer what to buy, we are professionals in our field". He inspired his salespeople to dare to stand up for their competence, even if it meant refusing to participate in important procurements.

It is becoming increasingly common for the customer to hire procurement consultants. They effectively block all direct contact with the customer. The consultants are hired to be impartial and experts in their field. Unfortunately, consultants often have their favorite suppliers. If you are one of them, you should notice it in the way the procurement is written - then the consultant has included decision steps and criteria that increase the odds of you winning the deal.

One of the salespeople I coach told me about a procurement: "The customer's buyer asked for an informal meeting. The purpose was for the buyer to get inspiration from us, so he could include our advantages in decision criteria in the request for quotation. He wanted us to win the deal.”

But if you are not on the consultant's favorite list, your chances of winning the business are small. Sometimes you need to submit an answer in order to develop the relationship with the consultant, sometimes for other reasons. The fact remains, to win you need to create a partnership with the consultant so that they become your champion, they will sell for you when you are not there. In my other books, Co-Creative Selling (REF) and Solution Selling, Success or Failure (REF), I describe various methods of getting the consultant on your side. My best tip is to see the consultant as your champion, your success is the consultant's success. If you can convince the consultant that you are his winning ticket in the decision-making process, you get a champion. Spend time developing relationships with key consultants, training them, socializing with them, getting to know their everyday lives and success factors. Some of the most successful sales people in the IT industry that I know have succeeded because of their relationships with consultants. The sellers are always invited and get a cream pie in the procurement. They get to meet the customer and most importantly, they get information about competitors' offers.

The GO-LIVE plan

Soon I will give you access to an amazing tool: the GO-LIVE Plan. It is a plan that you make together with your champion and the financial decision maker. In the plan, you document which milestones must be met, technical, business, contractual, in order for the contract to be signed. You set up a timeline for when the various milestones are to be reached and which people are to be involved. In order for the planning to be proactive, you set a start date for when the solution must be operational, a GO-LIVE date. Planning is based on that date. The plan becomes more realistic and you avoid delays in the decision-making process.

A few examples of questions you should ask everyone you meet:

• Which people are involved in the decision-making process?

What are the formal decision-making bodies that must approve the contract?

When and how often do they meet?

• What are the steps you decided to take to make a decision?

• What does the timeline for the decision-making process look like?

• What does the approval process look like for a business the size of ours?

• What does the formal procurement process look like, who is involved and what are their roles and agendas?

• How is the legal contract construction structured? Who is the formal organization that buys?

• Does a framework agreement need to be in place?

• What are the critical mandatory terms of the agreement?

• Which contract is the basis for the negotiation?

Who or who can influence the decision-making process?

Summary

The decision process, decision process, is very important to control. It can be complex or simple. The saying the more cooks the worse the soup is definitely true. When there are demands from many departments, especially in procurement processes where you have to answer 200 questions in order to qualify to submit a quote, it's easy to get lost. If not sooner, you need a strong Champion who can guide you in the decision making process. With a joint GO-LIVE plan and a strong backing from your company, you will be able to put the resources required to complete the decision process all the way to the contract being signed. If you notice that you cannot cope with the decision-making process, or cannot influence it in a way that allows you to win, it is wise to withdraw - the chances of winning are too low. Your resources are better used in other sales processes.

Jens Edgren, Master MEDDICC instructor, CEO

www.meddicc.se jens@meddicc.se