28 Mar How complex is your complex sale? An analogy with Judo belts
This post kicks-off a new section of the KAM With Passion blog dedicated to Complex Sales.
In another post, I have introduced 3 complementary capabilities organisations need in a B2B world and presented them as a pyramid. The series of posts on Complex Sales is about the bottom of the pyramid.
How complex is a complex sale situation?
In the world of B2B sales, the term of complex sales is a well-accepted term but what does it mean exactly?
The core definition states that a B2B sale is complex when several people are involved in the purchase decision. Is this sufficient to capture the degree of complexity of a sale situation? Clearly not, because many other factors determine the level of complexity in sales.
In this article, we illustrate various levels of complexity of a buy and sell situation and we explore why this matters a lot to companies and sales leaders.
Comparing the complexity of sale with the colour of judo belts
The various degree of complexity of sales situations can be compared to the coloured belts in judo.
The levels of mastery in judo or kyu grades are represented by the colour of the belt worn by a judoka: from white for the beginners to black for the experts with the various colours being white, yellow, orange, green ,blue, brown, and black. The black belt kyu is divided into 6th levels called dan.
(Beyond the black belt 6th dan, there are even 4 additional levels – 7th to 10th Dan – with red-white and red belts, but we will not consider thid in our analogy. However, as we progress on the development of this series, we might come back to this).
Let’s look at a few typical B2B sales situations and match each of them with a judo belt.
White belt situation example: transactional buy and fixed specifications
A procurement person is chartered to buy concrete for a construction site or stainless-steel bolts and screws for a maker of industrial machines. A technical specialist is chartered to help the buyer and to check the offers from the various vendors. The specification of the goods to buy and the acceptable price range have been fixed beforehand and the buying organisation is currently not open at changing them.
That type of transactional situation represents the lowest level of complexity pf a complex sale. It might be worth talking to each of the involved persons about a few specific parameters (the delivery time, safety of supply, logistics, payment terms) but the free space left to the sellers to add value remains limited and easy to identify (still, not all sellers identify it and try to leverage it).
Green belt situation example: Acquisition of a CRM system
Most B2B sales professional qualify a sale as complex when a buying committee is involved in the purchase decision.
The notion of Buying Centre or Decision-Making Unit (DMU) was developed in the late 60s to help analyse such a buying committee. Not only this concept remains relevant in today’s B2B world but it has even gained in importance. It provides a solid framework to analyse the role of the different people or group of people involved in a buying committee. Typical roles are the sponsor, the decision-maker, evaluators (experts), users (quite often from various teams), procurement, gatekeeper (with various interpretations of what this means).
In real life, the exact composition of the buying centre can vary a lot and using this concept efficiently requires an accurate identification of all the roles at play. In addition, it can happen that a member of the buying organisation wants to push a specific vendor. In that case this person plays the role of coach (if officially hidden from the buying committee) or champion (if visible to the buying committee) for the sales team of this vendor.
For example, a company wants to buy and implement a CRM system. The Global Sales VP is the sponsor of the project without being directly involved in the decision. The Sales Excellence Director and the CRM IT Project Manager chair the buying committee but will take a consensus-based decision. A few carefully selected people are chartered to represent the users from different functions. A professional buyer manages the procurement side and, as a formal tender process will be used, is also playing the role of gatekeeper. A flexible and smart usage of the concept or Buying Centre can well cover most purchase (and sale) situations where a single organisation is involved on the buy side.
The situation described above is an emblematic complex sales situation mostly for three reasons.
- First, the buying centre is made of a lot of stakeholders with different views and expectations.
- Second , the stake is high for the buying organisation, especially for the sponsor and decision-makers.
- Third, the definition of what will be purchased eventually is not fixed: numerous modular platforms are available on the market and a CRM project is not only about software but also about consulting and training.
In such a situation, the seller has a lot of freedom to educate and influence the buying side. It is up to the sales team to use this freedom smartly.
Black belt situation example: large infrastructure project
You might wonder why we consider a CRM project as a truly complex sales but only at a green belt level? The answer is that there are far more complex situations. Let’s look at a typical example.
Imagine a large infrastructure project such as a new highway to offload the existing road network, or a spectacular bridge project to connect an island to the continent.
In that type of situation, the project initiators and grantors are governments, and many stakeholders are involved on the buy side (government agencies and departments, advisors of various types, politicians), as well as on the sell side (bids to large infrastructure projects are submitted by a consortium, not by a single player). In addition, the stakeholders impacted by the project (citizens, who are also voters, business networks, groups with vested interests) have their own views and agendas. This can lead them to become active to either support or fight the project, to try to influence its definition, or even to kill it as illustrated by all the aborted windfarms projects in Europe in a recent past.
Sales teams operating in such an environment need to use more sophisticated strategies, techniques, and tools than for most of the classical B2B sales situation. Therefore, an infrastructure project is a black belt level situation whereas a CRM project is, in most cases, a green belt level one .
Identifying the drivers of sales complexity
An analogy always has some limitations. This also applies to our comparison between complex sales and judo. Elaborating on the presented examples, let’s try to be more specific and identify the various factors that characterize the complexity of a sale situation.
Factors of complexity in a sale situation
- The richness of the project ecosystem and the variety of stakeholders, both on the buy and sell sides.
- The presence of impacted stakeholders outside the buying organistation. .
- The familiarity of the buying party with that type of purchase. The lower the familiarity, the more complex the buying process.
- The level of risk for the project sponsor and decision-makers and for the impacted stakeholders.
- A process of co-construction of the solution involving the buy and sell side.
- The duration of the buying process and potential changes of key stakeholders in the middle.
- The structure of the selling team, whatever “team” means.
- The political environment and the political stakes for the sponsor, the decision-makers and other key stakeholders.
- The environmental, technological, social and legal factors.
The factors in the last 2 items in the list above are best handled with a PESTEL analysis. In a very complex buy & sell environment, such an analysis, conducted on the proper perimeter, is a crucial tool for the sales team. The importance of the political, environmental, social, and legal factors are crucial when the customer and decision-making organisation is a government. In addition, although this is less recognized, they are also relevant in a purely private environment as they define the organisation’s environment and set of constrains.
Why assessing the degree of complexity of sales correctly matters
One might think that assessing the degree of complexity of a single sale situation or of a company’s sales environment is an exercise for consultants and scholars. But does this apparently “intellectual” exercise really matter to a company or sales leader? Yes, it does, and a lot. Here is why.
The average and maximum degree of complexity encountered by your sales team should determine how you build your commercial capabilities: how to structure and size the teams, which types of people you need, how to develop skills and capabilities, how to define the sales methodology and tools, how to digitalise, how to use data and analytics. Any mismatch between the reality of the selling environment and the organisation’s way to operate creates inefficiencies and lowers the overal performance.
As a typical example, many organisations buy a CRM, define and implement a sales process and invest into sales training and coaching without having carefully evaluated the real degree of complexity of the situations encountered by their sales teams. The consequence is that part of the processes and tools are either too complex or too simple and have therefore a limited impact. A high proportion of organisations suffer from such a problem without even being aware of its existence.
Symptoms that the degree of complexity of sales is not managed properly
Here are a few of the most frequent symptoms of a misfit between sales (and marketing) capabilities and the true complexity of your selling environment.
- The company wants to move from selling products to selling solutions, but sales figures show that the transition is not happening as most sales teams stick to the old approach .
- Despite the deployment of a CRM, management reviews of major opportunities show a lack of understanding of the buying centre and of the motivations and expectations from the various stakeholders.
- Also despite the CRM, it remains challenging to get a complete picture of the history of business and status of relationship with each existing customer.
- Many fields in the CRM and associated tools for opportunity and account management are not used by most of the sales reps.
- Win rates are a bit low, without necessarily being very bad, but far too often, the company finishes second in bidding processes (and this is the worst position to be in).
- A significant investment has been made in training and coaching the sales reps on value-selling and outcome-based selling, but the corresponding tools are not used efficiently and the sales results have not been durably improved.
- Far too often, your company is not invited to a RFP process of potential interest to you whereas your competitors are.
What should company & sales leaders do about it?
To make a long story short, performing in a complex sales environment is about a collective capability to efficiently create and maintain intimacy with the relevant stakeholders in a rich ecosystem. The capabilities and way to operate of the organisation must be well aligned with its selling environment.
Company and sales leaders should identify symptoms of misalignment and build a cross-functional team chartered to drive a root-cause analysis and build an improvement plan. Getting adequate help from the outside, working with true specialists of a systemic approach to sales performance increases the chances of success.
As stated at the beginning of this article, it kick-offs a series on complex sales. In future posts, we will explore the many factors of performance in complex sales. Stay tune!
If you want to discover how we approach the development of the complex sales capabilities, take a close look at the KAM With Passion website and discover our service offering: Complex Sales & Sales Enablement, Account Management, and KAM/GAM To be informed of new posts, register to the Newsletter. And, if you have a Complex Sales & CRM, Sales Enablement or Key/Global Account Management project or need to improve something in one of these areas, get in touch!