Differentiate or Die

"If you can differentiate a dead chicken, you can differentiate anything," said Frank Perdue.

Differentiation takes some thinking. Nothing comes easy except for not thinking.

Sure, the marketplace is tough. There are more competitors than ever before. Our products, services and ultimately the final solution proposed to the client, all look alike. Or do they?

Your products, services, and solutions only look alike if you do not know what the client wants and why they want it. And your solutions only look alike if you don't know how to align the advantages your "solution" to what the client wants and address the client's critical issues. Understanding why a client wants a particular solution is important to defining your solution and finding points of differentiation.

Looking back at your current clients and understanding why they bought from you and your firm is another critical and required step. You can also learn a lot by understand why your competition beat you. Looking back over your company's past wins and losses, and applying those insights against what this new client wants can give you something your new prospective client does not have: insight. This insight is valuable, but only if you can frame it in such a manner that your new prospective client not only understands intellectually, but also appreciates the value of your insight. Insight must have some significance to the person(s) to whom you are  talking to.

Frank Perdue understood this. And he understood this from a mass market appeal. If he could understand this, so too can you. Not because you are smarter than old Frank was, but because Frank had a much tougher product to differentiate to the average consumer who usually bought chicken "on sale" or bought the lowest price per pound. After all, what's the difference between two dead chickens? Now that's a hard question to answer.

Your product, services and solution has multiple points of differentiation. Frank had to stretch to find his. How could he possibly differentiate a dead chicken from another brand lying right next to his in the supermarket?

Still not feeling great about differentiation?

Maybe you ought to thank God you don't sell water.

Great Sales People Cannot Fix Declining Sales

The world of selling has changed since yesterday. A lot of the changes we see in the world today have come through technology--primarily how people interact and get their information. These technological changes have also brought about other changes. Frankly "brought about" is a polite term that masks the dramatic and sweeping changes we have seen in corporations and government that all of us are far too familiar with. These changes are "oh yeah, so what" things now because they are now "normal." Nevertheless these changes are critical to how we operate today.

Competition

One of the big changes brought about by technology is the broad and sweeping competitors that come from all over the globe. You may remember a time when your major competitors were companies from the US. Now competition comes from India, China, even the old Soviet block countries who would not even dream of competing in the western world of business as it was for them, against their philosophy.

Commoditization

Think about that for a minute. But don't stop thinking there, because what was once accomplished through face-to-face selling is now being accomplished through a website. Sales people used to fight for a customer's business on the basis of their product's features and functionalities and benefits versus your product's features and functionalities and benefits.

Today many of these same products or similar products all look the same--except for minor variations that are difficult to articulate. This is commoditization. Commoditization  makes price the ultimate distinguishing factor for so many decision-makers. If price is the ultimate deciding factor, what is the role of the sales organization?

Who needs a sales force to show the customer their product is cheaper? Who needs a sales force for that? The correct answer is you don't. This is one of the biggest mistakes managers and executives don't understand they are making when they want to boost sales.

 

The best sales person, cannot make a commodity not a commodity.

Looking for Lowest Price is in Our Blood

The idea of shopping for the lowest cost product is not new. What is new, however, is we forget to recognize is how deeply this has become ingrained in our culture. Just look at the hoards of people who wait for "black Friday" hoping to get a better deal, or the rise of eBay where people are hoping to win something at a lower price point because everyone is bidding to buy something at a lower price point. Something else we do not recognize readily, is how this mindset has impacted our  marketplace.

Commoditization has seeped into our strategic services and solutions. Product and service marketing people have become lazy and have not taken the time to figure out how to reposition their services and solutions to pull their products and services and their companies out of the quicksand.

The Search for a Quick Fix

The easiest and seemingly simplest solution to declining sales and revenues is to hire "good sales people to get us out of this mess." The thinking goes, these "good sales people" have a rolodex of names, contacts who are so loyal to these "good salespeople" that they just buy from them; and these sales people can hit the ground running.

This approach is a solution with it's foundation based in a hiring strategy. This hiring strategy is rooted in a very false premise, that people (future customers and clients) will buy anything from  sales people. Even bad products.  Or so that's theory anyway. By the way--it's a theory that has proven false over and over again. Actually it's an ignorant or even stupid premise. I could go into a lot of detail here why it is an ignorant premise but I won't--except if you think about this premise, it means that sales people have such a loyal fan base of customers that this fan base of customers will buy anything they sell.

This way of thinking is done by some very superior minds. Except they are superior minds in other aspects of the business. But not the client-facing aspect of the business.

A Dose of Reality--the Market's Reality

The thinking is too narrow and it is too incomplete. If you have a bad product (or service) a great sales person is going to have poor sales--period. The problem here is, great sales people before being recruited are smart enough to know to ask the recruiter, "What is the product and why isn't it selling?" The great sales people may ask the same question differently by asking, "What makes your product better than all the rest?"

Here's a chart for you to review and digest. See if this makes sense to you. If it does, and it should, it is a simplified version of what we are discussing.

You cannot talk your way out of this.  These are the facts. A great salesperson, even if you could persuade him or her to come over and join your firm, will not come to sell a less than good product or service. This factor, is one of the reasons these salespeople are truly great. Another factor that makes them great is they will not sell inferior products or services to their clients.

Here is the warning I am trying to make: don't make the mistake of not looking at your products as the culprit or at very least part of an overall solution strategy.

There is good news. At least I hope it is anyway. Very few firms sell only a product or service alone. There are other components that go into an overall solution. More on this in the next post.



 

Clientize--"A Landmark Book" The Survey that Will Change How You Approach Clients

How To Win Clients--What Exceptional Professionals Do

"Clientize: Who Gets In, Stays In and Why is a landmark book, with thoughtful analysis, certain to become a widely referenced guide for illuminating the darkness surrounding clients selection behaviors. Murphy provides an extensive assessment, examining the mistakes wrought by self-centered professionals and his 7 Strategies to Win Lifelong Clients should serve as a 'gut-check' for conscientious professionals everywhere; reminding us of our vulnerabilities and forcing us to validate our strengths."— Patrick J. McKenna, seasoned management consultant, co-author of First Among Equals and acknowledged contributor to The Trusted Advisor.

The 400-page client survey and study that will change how you approach winning clients and how to keep them for life. The survey that reveals what exceptional professionals do--and how you can move from good to exceptional without tricks or manipulation, but by being genuine, observant, caring, and focused on the client's needs first and foremost.

This book is now available for Amazon Kindle users. You can get the book here for a limited time only for a deeply discounted price. Click Here for your Copy of Clientize--Who Gets In, Stays In, and Why


 

How To Increase Your Value in the Eyes of Your Prospective Clients

Here are a series of questions that you may want to know the answers to in order to differentiate you and your services and be a success with your clients:

• How do professionals increase their value in the eyes of their clients? 
• What is it that the best professionals do that allow them to grab the attention of prospective clients who are too busy to see anyone else?
• Why do clients prefer to do business with one firm over all the others?
• How do professionals turn onetime customers into lifelong clients?

These are questions I have been asking for years. I have been, in a word, obsessed. I have wanted to know the secret to why certain firms won a majority of clients business ever since I entered the workforce.

I am pleased to say, that I believe I have actually "discovered" the patterns of why clients choose one firm over all the others vying for their business.


I used to think clients bought products and solutions and services based on their advantages over competing products, solutions, and services. Then I thought it was advantages as well as costs.

Perhaps these aspects were reasons why clients bought at one time. But, as everything does with time, things change. Today clients are more sophisticated, have less time to just meet with vendors, and are walking the razor's edge because the people responsible for delivering client shareholder results, need ideas, solutions, and strategies to achieve their business objectives. And if you cannot help achieve their business objectives, you are noise.

Here is what clients want from you today--if you desire to become the best professional you can possibly be.

Enhancing Your Clients' Strategic Plans

The best professionals, the top people in their industry, have learned the value they bring is highest when it is aligned to their clients' strategic plans. This means your value comes from your ability to properly apply your services to the most critical aspects of your clients' strategic plans.

 

As a professional, you do not have to be a strategic planner for clients; it does mean that clients have to have strategic plans and do the strategic planning. Strategic plans are always the client's responsibility. The responsibility for strategic plans cannot be outsourced. Yes, strategic plans can be helped along with the likes of consulting firms like BCG, McKinsey, and Accenture. Accepting the plans and implementing them belongs to the responsibility of the client's stakeholders. Helping clients achieve their objectives is where you as a professional comes in.

Your Role and Responsibility as a Winning Professional

The best professionals understand their value comes in the execution of the strategy, and therefore this defines the professional's role and responsibility. The role and responsibility of the professional providing strategic services and solutions is to accelerate the objective of the client's strategic plan, ensure its success and the desired outcomes, and if possible, increase the overall measurable business results.

As a professional, you must understand the value you and your services bring to clients. You are able to reduce time, ensure the objectives are achieved and improved through your services. You apply your services to the client's business operations. In the end, to be of value, you, not your firm, not your colleagues, and certainly not your client, has to know how you and your services impact the following:

1. Reduce the time horizon to achieve the client's strategic objectives,
2. Ensure the objectives are achieved, and/or
3. Increase or improve the value of the client's objectives.

If you cannot address one or several or all of the criteria, you are not thinking strategically or your services are a commodity.

Action Exercises

1. Make a commitment to study your current clients' measurable business results that they have gained through the use of your services and solutions. Do this today. Tomorrow is too late.
2. Every project you begin needs to start with a baseline of the client's current achievements and operations. This means how is the client currently performing? How many widgets are being produced? How much does each widget cost to produce? How long does it take to produce one widget? Ten widgets? How much executive time and attention is devoted to the production of widgets? Could the time and attention be devoted elsewhere, somewhere more valuable? (the answer is always yes) Baseline, baseline, baseline. Always baseline. So many consultants, professionals, and technicians never think to baseline because they are too busy and are impatient to get started. Don't be one of them.
3. Be able to articulate your value in terms of the measurable business results (MBRs) using the criteria (one through three) above. Write the answers to these questions in as complex language as you desire. The point is do it--don't try to perfect your answers here or you will never get started. Perfection is your enemy at this point. Then, once your answers are written, rewrite and rewrite until you can boil all your technical jargon out of your statements to the point where your 16-year-old daughter or son can understand them (if you can get them to sit down long enough). Make your statements in plain English. Be able to say them articulately and clearly when writing and speaking.
4. Put your value where your mouth is. Your value is so crystal clear and you are so assured of the value you can bring to your clients that you are more than willing to place these terms in a statement of work or contract. Don't believe you can deliver? Then you are not going to compete the way you can and should and you will be relegated as a commodity competing on price and margin reductions for the remainder of your career (which may not be that long).
5. GO OUT and MEET as many prospective clients that have similar needs to the results you can deliver. Test your message--until you break through the noise and clutter that is preoccupying the client's mind and gain the client's attention through results rather than the superlatives all the other vendors are hawking--because now you stand out. You are different. You bring value and you have moved to the top of the heap, and you are in an entire different category of providers from the perspective of the client. You have moved to delivering value and achieving their strategic objectives, up from a vendor hawking features, feeds and speeds.

 

A Lesson from Tom Watson, Jr (former CEO of IBM)

Lessons from History
There are lessons in history. You all know that already, so I won't plow into quotes and metaphors to convince you of this. So, if we know this, why is it so hard to learn these lessons and incorporate them into our business practices?

The answer is, at least to me, we are looking for easy solutions or some of us are looking for the next best idea. And then there are some others who believe that if the idea or strategy is more complex, then it's gotta be better.

The Question Most People Get Wrong
Let's start with a simple question. What is the purpose of a business?

Many people answer, "To make a profit."

I don't think this is the correct answer. It is the correct answer to many analysts on Wall Street.  However, the truly great analysts will tell you that for the short-term this answer may be true, but the long-term? No way. These analyst look at the long-term. They want to see long recurring revenue streams and good margins.

I like Drucker's answer to this question. Drucker said, "The purpose of a business is to create and keep a customer." I think this is the right answer, in spite of what some executives think about profits and orders and meeting quarterly pressures.

Keeping a Customer--The 25-Year Study: Clientize

The keeping part of "keeping of a customer" is the main theme behind a study I have been conducting for the past twenty-five years. This work has culminated in the book titled "Clientize."

My study started with the simple question to executives, "What is it about this firm (the one you have chosen to be your long-term partner) that you chose them over all the others?" I found clients' buy from certain providers and vendors because of the professionals handling their account and the concern they had for their clients' business and professional interests.

Winning Professionals: Winners Buy From Winners
First rate businesses buy from first rate winning professionals. Winning professionals are those who are looking out for the client's interests. How the professionals demonstrate that they are looking out for their clients is what clients revealed to me in my face-to-face discussions. I took a lot of notes and taught these ideas to other professionals who worked with me. This study and the clients answers are captured in the book Clientize. You can get it from Amazon or through the link on my website which is over the left of this post--just click on the book.

Here is what Thomas Watson, Jr., the former CEO of IBM said about what IBM does, "We make computers. But we sell improved profits that our computers can make for our customers."

In the day, sales people used "features and benefits" type sales techniques. It went like this, "We have a faster processor (feature), which allows you to get your work done in a shorter amount of time (benefit)." And so this is how almost all of IBM's competitors sold. It was easy to point out that IBM's products were inferior in terms of feature based technology to prospective customers. And yet, IBM dominated the industry. In the hallowed halls of corporate boardrooms and government agencies, the message that everyone heard in their heads was, "Nobody ever got fired from buying IBM." And so they did.

Winning Professionals Focus on the Client's Interests
Why was this? Why did executives buy from IBM? Why did IBM dominate the computer industry? Because IBM got it right. IBM focused on the customer and their needs. The customers' needs were and oh-by-the-way, still are, profits. IBM sales people didn't focus on their own profits, they focused on the customers profits. IBM got it right years ago, while the other smaller players, focused on the speeds, and the latest technology, IBM focused on what mattered to their customers--and the safe bet became "buy IBM."

Focus on your customers needs--not yours--and you will turn customers into longtime clients. And maybe, you will be as successful as IBM.
 

Are You Being Commoditized?

The bells and sirens should be going off inside your head every single day as a consultant or in fact, any type of professional.

You may actually have this big target on your back. Don't try to turn around and look for it - as you'll look paranoid, or look like you're checking to see if you have dandruff.

But you should feel as if you have this target on you. You are an expensive item to keep around on the warehouse shelves. You are unsold inventory. The only unsold inventory that makes sense to keep around is something that actually contributes to making something for someone to buy. And the higher the price they want to pay for your contribution the better. The higher the price means the more they see you as a valuable asset - and this is all for the better.

However, we - as professionals and consultants - may not recognize the signs of our disintegration of value.

Here are several signs you should watch out for that can be the fortune teller for your fate or demise:

Is it harder to get clients to listen to you? Do they already seem to know the answers to your questions? Have they already mapped out the probable cause of the issue?

Are clients sending you RFPs? Are you finding it harder to get into meet with the key people to help them uncover the problem? And by uncovering the problem, help shape the requirements for the solution? Are you dealing with procurement people more and more?

Are there firms you have never heard of, in your account, vying for the business? Are these smaller, more nimble, less overhead type of firms?

Is the work you typically compete for, being split up, parceled out, sectioned off, into smaller and smaller chunks? Was the work you were doing - one big pie before - and now you are getting slices of the pie?

Are you looking for cheaper and cheaper people for your practice, in order to deliver the work? Are you becoming a little reckless in your hiring approach by looking for people with 80 percent or 70 percent or even 60 percent of the required skills? Are you hiring more temporary labor because you cannot guarantee that the employees will all have positions after this gig?

Do you feel you are underwater most of the time because of the amount of work you are taking on and shouldering because in order to meet the profit targets, you couldn't hire the full team of people you needed? Or the people you hired and brought on are not capable of the work, because you went "cheap" to meet the client's budget and therefore you are doing the work that they were supposed to do?

Do you fantasize about the life you used to have? Or could have had? But you now see your family less and less. Even when working from home - does that feel like a distant hotel room now? Do you now consider staying the weekend at the client site in order to get "caught up?"

Are you now looking at adjacent markets and solutions? And are the adjacent markets - not really adjacent? They're really nothing like what you do?

Are the terms and conditions onerous? Are the timeframes crazy and insane for deliverables and completion? Is the client continously trying to categorize you and your firm as a general provider? Is it harder to distinguish your "value add" and describe it to the client? Is the client yawning, playing cards, or reading profiles and counting the number winks they received on Match.com? Is the client looking at Facebook half the time you are presenting to them?

Finally, are you becoming shorter and shorter with the people you work with? Because you don't have the time to deal with issues and problems? And are you finding that the afternoon jog is now a continuous run of conference calls, from one to another? Are you now looking at the guys and ladies in the Residence Inn lobby as possible competitors for your business? Are you paranoid they are vying for your business - especially because they look "foreign" - and you are now equating "foreign" with "cheap?"

Well - then - good luck to you AND at the same time - welcome to the club.

PS - don't go to football games. Because in the huddles - they are planning your demise.

Measurable Business Results - Differentiate or Die

Why is it that We as Professionals Don't Do this One Little Thing?
Most companies providing professional services "forget" what the client is ultimately buying.  Frankly, client also forget!

Both the seller and the client get wrapped up in the technology and how it works too often.  The provider of professional services actually "trains" the client this way though. If you review marketing literature most companies provide - large corporations and small firms - you will probably find more discussion on how things are done or what was done rather than what was actually achieved.

My Experience with MBRs
Several years ago the firm I was working with went and visited Gartner.  It was a long meeting, in which we talked about SLAs, how our model worked, who we were, who our clients were, and did I mention SLAs?  It seemed like we mentioned SLAs over and over.

Most clients want results.
And then later, they may want to
know how you are going to do it.

Toward the end of the meeting we brought up results we acheived for our clients.  I mean, real, tangible results.  We coined the term "MBRs" or Measurable Business Results prior to our meeting, as I kept on saying to our COO and CEO and anyone else that listened, that the work we were doing was far, far different than our competitors.

Our Competitors Talked Certifications
While our competitors were talking about certifications of ISO this, and ISO that, and SEI CMM certifications this (and in reality there were no such things as a SEI certification!) and that and this, our firm was able to go in and talk to a client about what they needed done - or more exactly achieved.

Sure some of our competitors could talk about results from a cost reduction, but they could only talk about this from a "labor arbitrage" point of view as they were just swapping out US labor costs for offshore labor costs.  Jeez, anyone can do that.

The Value Prop We Didn't Know We Had!
Our firm was able to guarantee in writing that by this date they would have X amount of customers, at least this amount of revenue, and depending on the type of client they were dealing with they could get even more specific to the industry (i.e. hotel bookings, airline bookings, car rental booking, gas and oil trades, etc). 

Now here was the real kicker: They were able to guarantee this in the contract, before they even began the project.

When I got there, we really did not tout this as a real distinction. But that was because they were so accustomed to doing this, that the some of the people there did not see this as important or a critical market distinction.  Because I came from the outside and looked in - I saw this as a critical differentiator.

So when we got to Gartner - we started talking about these MBRs.  And this made us unique to Gartner.  All of a sudden we stood out. We were different. They, like I, could not believe we would contract, up front, to drive MBRs in our contract.

To Stand Out - Well, Just Stand Out
So, if you want to be unique, understand the value in what you do.  I know MBRs are "risky" if and only if you don't know how to drive them and achieve them.  In reality - results are what the client is buying.

We Train Our Clients To Pick Us Apart
But because we are used to selling features and benefits - the old way of selling - we actually train our clients to buy from us that way.  And what do they do?  They try to understand the only thing other than price. That is - how are you going to do what you are doing?  This is allowing the client's technical staff (IT, legal, procurement) to pick apart the proposal. 

It's All More or Less - "Death by Duck Bite" 
Death by Duck bite looks like this - which you may have seen before:

1. Who are the people on this project? Can I see their resumes? Can I interview them? I don't like Jack, you need to replace him.
2. What is your approach? Don't you think you should start with this group first? Don't you think this should take two weeks and not five weeks? How come you have four people doing this - can't you get just two people to do this?
3. What is the price? How much per hour for these people? What - are you kidding me?  I can get them for one-third of the price -
4. Your competition says that they can do half of this off-shore at $22 per hour. Can you match this?  They also are saying this and that - can you do this and that?

Get the picture? If you want to avoid the trap of being picked apart - avoid selling features and benefits and get into selling results.

You Suck At Selling

Why does your selling suck? Since this is a question - I will give you a choice to help you decide the answer;
A.) Is it your sales people?
Or
B.) Is it your ability - or should I say - your inability to define what it is you actually sell?

In about 99% of the cases I have been involved in - guess which is the correct answer?

How many sales people are in a state of limbo because they really don't know what it is they sell. Are you kidding me? "That's pure bullshit." one sales director would say. Okay smart guy, Let me ask you just two questions. First question; Who is your competition for this specific service (solution) and why are you better? And second question; What problem does it solve for your target prospect - specifically? And the answer "lower costs" or "improved operations" is not specific enough.

The look I get - is a puzzled look. And then an answer that basically says; "F - you." And they leave.

But no matter who is right here, the sales person does not know either. If you leave it to them to decide - you are making a huge and expensive mistake.

This needs to be defined for them. You need to - without delay - define this for them. You cannot be everything to everybody. No prospective client will even see you today without some reason - and leaving them a voicemail saying "I can reduce your costs. Please allow me the opportunity to stop by and see you." will be met with a *7 or whatever the code is to "delete" a voice message. Do you know how many calls prospective clients are getting day from sales people? This is not a value proposition. This is lazy marketing. And your sales are suffering because of it.

Put Yourself In the Client's Shoes

From the author of Clientize. How to Win Lifelong Clients. Now available on Amazon.

I have a saying when I advise people on getting their point across or trying to persuade someone, "Always put yourself in the client's shoes, to see and feel what they are experiencing."

Think about it for a moment, but from your perspective. How often do you get a phone call or an email or a request that at the moment, just doesn’t fit in with the urgency of things on your plate right now? You know what I mean. You are in the middle of solving some problem for the company, and a colleague comes rushing with a “you have to get the information updated on the HR system right now, because . . .”

Your immediate reaction is “Don’t they know I am swamped” or “This really is a nit, what I am doing right now is much more important?”

Think about this from your client’s point of view. What is going on in their lives right now and what is it that they are trying to deal with, that your proposition just might not fit in? Understand what could possibly be going on in their lives will help you be much more empathetic and tuned to their needs and actually help you solve some of their issues with your proposition.

When discussing your solution or proposition and you put yourself in the client's shoes, you begin to really listen from their vantage point. Too often we as advisers, consultants and professionals fail to listen carefully to the client and miss what they are saying or not saying. By doing this you can understand the client's perception of his or her problem and, in the process, uncover what, if any, risks the client sees in employing a consultant to help solve the problem.

By uncovering the risks, you uncover the “hidden objections” and by doing this, you can address these proactively, and consultatively, and therefore, move forward to closing your transaction.

To order your copy of the landmark book Clientize--the 25-year survey of what professionals do to win clients business for life, click here.

 

Focus On Benefits With Current Clients

When selling a project or solution to a prospective, new client, we remember to point out benefits and advantages. You know how important benefits and advantages are to demonstrating your solution's value to the new prospect. So, if we know the importance of benefits and advantages, why is it that we forget its importance when talking to current clients?

When we talk to clients we tend to forget that clients need to be reminded of the advantages of the services and solutions we provide. We overlook the reasons to buy, and assume the client understands the benefits "automatically" because they already know us and what it is we provide.

But it is just as important to focus on the benefits of the solution with past or current clients as it is with prospective clients. No matter what you are proposing, you should always look for the benefit or advantage to the organization.

Remember that clients are always more interested in the benefits of your services than they are with how your solution works or how it is put together.

Always focus on the benefits of the solution, by looking at the advantages, the "reason why" they should buy now and from you.

Never all the client to guess what the benefits will be.

Get To Know The Client's Business

Learn about your client's business as much as possible. Learn what is important to the client's business. Know how each the business units operate and how they contribute to the overall goals of the company. Know the company's growth businesses - that is - where the company sees it's revenues coming from over the next 5 years is critical to your getting aligned to the right business units and the right people.

Knowing how the client's business operates, how the decisions get made, and who makes certain decisions is critical. Understand the politics of the organization. Who is getting the funding? What are they getting funding for? While you may have a copy of an organizations chart, you need to understand the invisible organization chart. The invisible organization chart is who goes to whom - outside of the boxes - to gain approval and agreement.

The best way for you to be successful is for you to meet and get to know as many people as possible inside the company. Really listen and look for other consulting service opportunities within the client's enterprise. The best thing for you to hear is that there is a problem and it is costing the company business and/or costs.

See Things From the Clients Point of View

The best place to start - no matter what your business - is to start from the client's perspective.

• How do they see it?


• Why do they see it that way?


• How did they reach those conclusions?

It's always best to start from their perspective.

You can do this best by sitting where they sit.