Part 2 (of 3) of a white paper I wrote 10 years ago for a customer that had just recently started selling professional services, but had sold product for over 20 years. This deliverable was one of several I created over the years to train sales and delivery staff in the ways of professional services and intangibles in general. Part 1 is here.

Pre-Sales Project Considerations

Confidential is now maturing its sales approach to include other IBUs into a more complete and comprehensive offering. This unified approach makes for a much more exciting pre-sales phase, and allows us to meet and impress our Strategic Partners and sister IBUs.

A very important function of the new SDM (Service Delivery Manager) position is the close integration with the SAE (Sales Account Executive) and the sales phases of an engagement (Sales Cycles). In many cases, this new area of responsibility is very new to an SDM who may have risen through the technical/engineering ranks. In Confidential, the sales efforts were not a part of the technician’s concerns until after the sale was complete.

A purely technical approach in pre-sales can be disastrous. Equally bad is the pure sales meeting where the SAE can’t answer a question. The time to answer every question is every single meeting. There should be no take-ways to get back to the client on our capabilities. Understand that in almost every case each client meeting will have representation from their managerial and technical staff. You must have a team here to field questions and inquiries from both areas of the client’s business.

For this reason, we will review the basics of IT sales with a slant toward how the orthodox engineer can begin to better understand the complex processes leading to the signing of a PO.

When combining the resources of non-like organizations, the SDM must be aware of certain elements of an engagement as they relate to your co-provider/partner. Above all, realize that any endeavor with another organization is designed to advance all parties involved. In other words, your strategic partner has sales goals as well and will only participate with you if you are providing worth to their efforts.

Perspectives

As an engineer in pre-sales, the SDM must remain aware of the variety of people who will look at your project, and how they will perceive its value. There are 4 basic perspectives from which your project will come under scrutiny:

-Financial Perspective
-Internal Business Perspective
-Customer Perspective
-Learning and Innovation Perspective

Financial Perspective

Focuses on the costs of IT

-Planned versus actual contribution of IT project to the business
-Return on Investment (ROI) or Internal Rate of Return (IRR) of each project
-Percentage of projects completed on-time and within budget
-Cost reduction or cost avoidance within a program or line of business
-Ratio of expenses of legacy systems to total IT expenses (technology Cost of Ownership, or COO)

Internal Business Perspective

Focuses on internal processes that deliver products and services

-Staffing – Planned versus actual level
-Alignment of the IT project with the strategic IT plan and architecture
-Cost of services or operations – Planned versus actual (operational COO)
-Service – Ratio of the number of requests closed to number of requests received
-Acquisitions:
-Schedule – Planned versus actual contract award date or delivery dates
-Percentage of tasks on-time, within budget
-Cost – Variance between budgeted cost of work scheduled, budgeted cost of work performed and actual cost of work performed

Customer Perspective

Focuses on how the customer experiences the project or system

-Level of understanding of requirements
-Level of satisfaction with the computer systems, networks, training and support
-Productivity enhancement
-Convenience – Access to the right information and the right time
-Responsiveness – Ratio of the number of service or assistance requests completed within acceptable time to the total number of requests

Learning and Innovation Perspective

Measures the degree the project includes innovative technology and contributions to worker development

-Degree to which new technologies are introduced to maintain competitiveness or currency
-Percentage of change in costs of new procedures to old procedures
-Percentage of change in cycle times of new procedures to old procedures
-Percentage of users and IT personnel trained in use of technology
-Percentage of employee satisfaction

Customer Expenditures

All things you bring to the table are viewed by the customer as expenses. You must work to establish value by being keenly aware of not only the value offering’s value from each of the above perspectives, but also from a cost (expenditure) category.

Try to avoid cliches like “You will save money” or “We want to stop you from losing more money”. The client hears this every day from the dog and pony shows that attempt to sell quantifiable items to them. You offer only solutions, and do not refer to a lessening of bad, but rather the good times just over the horizon.

You can sometimes make a large expenditure more palatable by showing lesser amounts in each of the categories within the project. Therefore, you must be able to discuss the project in business terms the customer will understand. While you are making phased proposals, the client does not think in phases when approving a project. They think in terms of recurring and non-recurring expenditures. You need to think and speak on the same level as your client, and here is an idea of how they are thinking and categorizing your proposal:

Non-recurring: (one-time)

-Hardware
-Software
-Network hardware and software
-Software & data conversion
-Site-preparation
-Installation
-Initial loss of productivity

Recurring: (on-going)

-Strategic Consulting
-Hardware Maintenance
-Software Maintenance
-Systems Management
-Data Administration
-Software Development
-Communications
-Facilities (rent)
-Power and cooling
-Training

Project Benefits and Opportunities

Bring up as many of the following in both your proposal and demonstrations as they apply. This list is not meant to be inclusive, but rather to give a good baseline for the depth of discussion that will be useful.

-Higher productivity (cost per hour), increased capacity
-Reduced cost of rework, scrap, failure
-Reduced cost of IT operations and support costs
-Reduced cost of business operations (primary or support functions)
-Reduced errors
-Improved image
-Reduced inventory costs
-Reduced material handling costs
-Reduced energy costs
-Better resource utilization
-Better public service
-More timely information
-Improved organizational planning
-Increased organizational flexibility
-Availability of new, better or more information
-Ability to investigate an increased number of alternatives
-Faster decision-making
-Promotion of organizational learning and understanding
-Better network and system interoperability
-Better information connectivity
-Reduced training costs due to personnel reassignments
-Improved IT response time to user requests
-Expandability of standards-based systems
-Greater access to corporate information
-Legislative and regulatory compliance

Next: “What Decides Whether a Project Should Be Approved?“

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