RAM | Reseller Advocate Magazine: Issue 52

By Beatrice Mulzer

TAKE A LOOK AT THIS SCENARIO:

For months, system builder X has tried to meet the owners and decision makers of particular businesses in town. He has been hitting the wall thanks to office managers and receptionists, which appear to have been especially trained to stop any unfamiliar face right at the doorstep. System builder X is not getting very far by using common sales approaches like phone calls or stopping by the office to introduce himself in the hope of getting an appointment. He decides to add these businesses to his monthly newsletter mailing list as well as the regular monthly ad flyer. Finally, the day arrives that the system builder receives a Request for Proposal (RFP) and an invitation to take a look at the office network. It turns out the machines are aging and aching for an upgrade. Moreover, the office is looking for a new technical provider for many untold reasons.

The prospect of adding this particular office as a customer is very appealing to the system builder's business, so several hours are spent on preparing the machine specifications, licensing information, gathering upgrade information on the requested financial application, and the writing of the proposal itself.

Weeks later, after several unsuccessful phone calls (remember the trained receptionists), the system builder finds out that the contract for the workstation replacement and maintenance has been given to a competitor. "Interesting" he thinks, scratching his head and wondering, "What did I do wrong?"

In his mind, he did everything he possibly could, but could he have done more? At last, he picks up the phone and makes the dreaded phone call to the beloved receptionist (from now on referred to as ‘the gatekeeper') and inquires why his bid didn't make it. He finds out that even though his proposal was the lowest in price, or at least in the same price range as the others, the business made its decision based on what appeared to be a logical, plausible reason, but deep down the system builder knows it is not so.

What happened here that influenced the business decision maker's choice?

SWOT

No, SWOT is not the successor of the dual-core chip. Maybe it's time to point out here that an excellent technician doesn't necessarily make for an excellent businessman. Say our system builder in the above scenario knows lots about dual-core chips but has never heard of a SWOT. He is also the business owner or a decision maker in the system builder business. Either way, he is probably so involved with working within his business that he hardly has time to sit down and review sales and marketing strategies, reevaluate his business model, or even take the time out to think about what makes him different from his competitors.

SWOT is an MBA tool that requires putting on the "strategic thinking hat." Yup! You heard right. Most system builders, VARs, and consultants I talk to hardly ever use it. With a little thinking, the SWOT analysis can pay off big.

SWOT stands for Strengths, Weaknesses, Opportunities, and Threads. Not the usual IT talk here, but just stay with me on this one. Get a piece of paper right now and take five minutes to do this for yourself.

In the Strengths section, you ask questions like "What does your company do better than your competitors?" or "Are there any advantages you have?" or "What do other people tell you is your strength?" You could enter items that pertain to you such as "excellent hardware knowledge" or "uncanny ability to diagnose issues" or "being certified in special areas."

In the Weakness section, you should be honest with yourself and really dig. Ask questions like "What could be improved upon?" or "What should be avoided?" You could write "sales and marketing" or "not documenting." The point is that if you are aware of your or your company's weaknesses, you can proactively manage them by either hiring a person that is strong in what you are weak or partnering with someone instead of trying to ignore the business's weaknesses.

The Opportunities section allows for thinking about current opportunities like "What market trends work in my favor?" This might include things like the growing popularity of home automation. Or "What government rules or changes will bring new opportunities?" This might cover items like businesses having to be HIPAA compliant, requiring the system builder to focus more on security. If you just take the time to think about it and write it down, you will be surprised at how many opportunities are really out there.

The Threads column pertains to anything including local or global competitors, market conditions like competing mass system builders (I won't mention the four letter "D" word), or a shift in technology focus, such as hosted services becoming popular or cash flow issues.

Putting this in writing will help you focus on your objectives as well as realize your shortcomings. Businesses will be much better equipped to focus on a target market that lends itself naturally to the strengths and opportunities column.

Maybe one of the weaknesses is getting past the gatekeeper. The business could then work out a strategy on how to get the salesperson in front of the decision maker. The Gatekeeper

There are numerous general best practice recommendations by so called "authorities on sales and marketing" regarding how to deal with a gatekeeper when you want to gain entry to an office. For instance, when making a sales call:

1. Try to engage the gatekeeper into a conversation so you can get more information on the business or prospect you are pursuing.

2. Consider the gatekeeper your friend and treat him or her with respect and warmth so you distinguish yourself from other callers.

3. Have a practiced "elevator" pitch, so when you get unexpectedly put into voice mail, you'll be able to leave a concise message and not sound like an imbecile.

Nonsense! How about not even dealing with the gatekeeper and going straight to the top? And how can this be accomplished? Well, it will take more energy than just making a phone call, but it will be well worth the time, effort, and payoff in the long term.

Focus

First steps would be finding out more information on the target customer you would like to work with. After the SWOT analysis, a system builder, consultant, or VAR should have a pretty good idea on what target market the business should focus based on strengths and strategic decisions. A strong point may be having a background in real estate, construction, medicine, or other verticals in which the system builder has intricate knowledge but most competitors do not. For instance, if the system builder has spent the last ten years working in the medical industry and specifically has knowledge in dentistry, it would make sense to focus on all dental offices within an acceptable radius based on demographics and density.

Foot in the Door

Now, there is a dental chain or big medical complex you would like to service. When you want to get your foot in the door and the gatekeeper acts as a doorstop, instead of beginning your approach from the bottom (gatekeeper) consider starting from the top (owner, CEO). Invest some time in finding out about the business and its owners and managers. You may learn that they contribute to a special cause, belong to a certain association (such as the American Dental Association) or are involved with local clubs. (Hey, country clubs count!) The next step would be to join that same organization, cause, or country club. Start contributing to the associations' causes by volunteering your time and money (annual fund raiser chili cook off, tschotchkey donations to the golf tournament, etc.), and with a little effort you will be able to meet the owners and CEOs in person in that environment as well as make additional connections you hadn't planned on. A typical system builder or VAR may say that he doesn't have the time to spend on engaging in this type of marketing, but in reality, in the long term, a couple of hours per month of schmoozing with your target market will get you a long way. Through your involvement within the same organizations, you will be looked upon as an equal and not the guy that is trying to sell computer equipment. Over time, you will be known as someone that specializes in technical dentistry services, and you will have just carved yourself a niche! Yes, this will realistically take at least one year, but by the third year I guarantee you continued referral business.

Benefits for the system builder include being brought in and introduced by the owner as a possible person to do business with. The gatekeeper will accept you and move you automatically up in the hierarchical ladder of vendors. Additionally, by specifically catering to one industry, you will get to know its common daily problems inside and out, learn to speak that industry's lingo, and know exactly how to talk to industry insiders and ask the right questions.

That part is extremely important. Knowing and understanding your client's needs allows focusing of sales and marketing messages towards the exact target market, and you will know how to present the right value proposition.

Value Proposition

Ouch, another one of those non-technical words that is definitely business jargon. What is a value proposition anyhow, and why does it matter? The only reason why we do business with one another, according to Fred Johnson, owner of Ross-Tek (rosstek.com) in Cleveland, is mutual necessity.

"There are only two reasons," says Johnson. "One is when I need you, and the other is when you need me."

What Johnson is really saying here is that clients only call you when they need something. Do you agree? Clients call from a need that they cannot handle on their own.

Now put on the prospect's shoes and look at it from his side. The dentist has heard about dental imaging technology and realizes that being able to store all of the images from his intraoral cameras and x-ray machines in a digital format would allow him to get rid of the back room full of paper files and folders. Besides being able to pull up each client's history, including all dental images on the spot right next to the dental chair rather than having an assistant pull files beforehand, new technology will allow the dental assistant to focus on more important tasks then filing papers. Also, the back room can now be converted into an additional patient area used exclusively by the dental hygienist.

The dentist picks up the Yellow Pages and, sort of clueless about what to look for, picks out a couple of phone numbers from different computer store advertisements. Of course, if any business would have followed the advice above, its business card or tschotchkey would already be floating about the office and would have been the first choice of calling for help. Appointments are set, and three different geeks from local computer stores are invited and shown through the office while the dentist tries to explain what he wants done. (Keep thinking from the dentist's perspective.) The dentist doesn't know anything about the businesses he asked to prepare proposals nor what their differences from each other are. The dentist made sure to tell each of them that he wanted to spend as little money as possible, but it is more important to have the right technology in place to support the constantly growing number of patients.

With this information on hand, the technology specialists drop off their proposals, and the dentists ends picking two out of the three he likes best and does a side-by-side comparison. For fairness, let's say both proposals in the end provide the exact same solution.

Which proposal has the better value proposition? Does the dentist care what hardware powers his server? Is making a statement like "work more efficiently" or "effective way" any tangible promise the dentist can envision and work with? The value proposition is all about "What's in it for me?" You want to create value for the client! That is why it is so important to speak the client's language, to understand his needs and to talk to him at his level. By offering a tangible benefit, the dentist can understand your message of growing the database to 20,000 patients or being able process an additional six patients per day. Now that he can envision. You have to know the dentist's value perception and priorities.

Relationships

Ouch, another one of those non-technical terms. Back to our system builder X who has been unsuccessful in growing his business to the goal he had set for himself. There are several factors that could be influencing why he wasn't considered for the proposal. First, there never was a relationship with the business decision maker directly, but also the proposal most likely focused on a hardware solution and not addressing the prospective business's needs.

So even though system builder X is putting in a good day's work, talking to people, advertising, and putting out several proposals a week, he is missing his mark. Business in the end is built on relationships, and once the relationship has been established (from the top down), you better also have a good value proposition.

Remember the SWOT? That is a good start for determining business strategy. There are numerous articles and books like Michael Porter's Competitive Strategy: Techniques for Analyzing Industries and Competitors; a book I recently penned, Making It Big In Small Business 2006: Top 15 Successful SMB Consultants Share Strategies and Lessons Learned; and one I previously mentioned, The E-Myth Revisited: Why Most Small Businesses Don't Work and What to Do About It, which is now also available on audio CD.

And finally, one small insight quoted from an unknown author: "If you always do what you've always done, you'll always get what you've always gotten."