right focus on enabling a customer’s business, on taking the time to understand what customer needs are and on providing responsibility for the end result, the only outcome is customer disappointment.”
The big difference between solutions and products is that products are about the offering – what it does, how it’s built, what it delivers, and how good the product is compared to the competition. In contrast, solutions evolve from a specific business issue or need. Solutions help solve a problem or enable the customer to capitalise on an opportunity. Solutions are usually mapped to a business challenge, dynamics occurring in an industry and/or regulatory trends.
“Solutions are generally, complex combinations of products and services. Solutions create extra value, are usually integrated, and upfront and on-going costs should be optimised,” explains van Heerden. “Solutions start with a clear understanding of a customer’s needs and end with an answer that meets those needs.” The distinction between products and solutions is particularly relevant in the IT sector, where technology’s role as a business enabler rests on far more than a product on its own can provide. Instead of operating in isolation from the rest of the business, business needs have to be the first step in a seamless process that ends with IT delivery. Van Heerden adds that in recent years those companies that have become adept at discovering customers’ needs and finding solutions that fit those have had to evolve.
“In the past, customers often didn’t know how to solve their own problems, even though they often had a good understanding of what their problems were. But now, owing to an increasing overlap between IT and business, companies can readily define solutions for themselves. Solution providers have to transition into trusted advisors that not only identify needs and the solutions to those, but that can provide answers to questions customers didn’t even know they had. Today’s business environment demands results, and solutions are ultimately about discovery as much as they are about delivery.”In fact, a recent Corporate Executive Board study of more than 1400 companies found that they completed, on average, nearly 60% of a typical purchasing decision—researching solutions, ranking options, setting requirements, benchmarking pricing, and so on—before even having a conversation with a supplier.
“Customers know they have choices, and understand a great deal more of what they need. Companies selling solutions need to create more value than ever before. Solution providers need to be even more than a partner, they need to become a part of their customer’s business in order to ensure customer satisfaction,” van Heerden concludes.
Relationships are Key
Harvard Business Review (HBR) recently conducted research at 83 companies across the globe to determine if the selling of solutions is being challenged on a universal scale. They found that a solutions approach is no longer cutting it and that good relationships are part of novel new strategies that need to be developed to secure sales success.
Under the conventional solution-selling method that has prevailed since the 1980s, salespeople are trained to align a solution with an acknowledged customer need and demonstrate why it is better than the competition’s. This translates into a very practical approach: A rep begins by identifying customers who recognize a problem that the supplier can solve, and gives priority to those who are ready to act. Then, by asking questions, she surfaces a ‘hook’ that enables her to attach her company’s solution to that problem. Part and parcel of this approach is her ability to find and nurture somebody within the customer organisation—an advocate, or coach—who can help her navigate the company and drive the deal to completion.
But customers have radically departed from the old ways of buying, and sales leaders are increasingly finding that their staff are relegated to price-driven bake-offs. One CSO at a high-tech organisation told HBR, “Our customers are coming to the table armed to the teeth with a deep understanding of their problem and a well-scoped RFP for a solution. It’s turning many of our sales conversations into fulfilment conversations.” Reps must learn to engage customers much earlier, well before customers fully understand their own needs. In many ways, this is a strategy as old as sales itself: To win a deal, you’ve got to get ahead of the RFP. But our research shows that although that’s more important than ever, it’s no longer sufficient.
Are you Buying Products or Solutions
We live in an information age, where easy access to the world’s knowledge via the Internet has changed the way we approach everything from education to business. Today, customers are often way ahead of the salespeople who are ‘helping’ them, armed with a knowledge and understanding of their needs that makes it difficult for service providers to transition the ‘order fulfilment’ role.
This situation was only exacerbated by the global recession, which placed even more pressure on sales pipelines. Anton van Heerden, General Manager at Altech ISIS, says that in trying to overcome this environment, many IT service providers have been their own worst enemies. “The lines between products and solutions are easily blurred, and misunderstood. ’Solution’ has become a buzzword. The word solution suggests results. In far too many cases, companies selling solutions have neglected the delivery side of the business, placing the focus on the products that enable the solution. Without the