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10 min read

SBA 261: Understanding Strategic Sales in BAS

By Phil Zito on Jul 16, 2021 6:00:00 AM

Topics: Podcasts

In this episode we discuss how to approach strategic sales opportunities in building automation.

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Phil Zito 0:00
This is the smart buildings Academy podcast with Phil Zito Episode 261. Hey folks, Phil Zito here in Episode 261 of the smart buildings Academy podcast. In this episode, we are going to be talking about strategic sales in building automation systems. So as you've noticed, every Friday we go and we talk about a topic related to selling in building automation. And the reason we do that is because there's plenty of sales training, but there's not really anything specific to strategies around building automation that I've seen out in the market. So with today's episode, what I want to do is actually be a little vulnerable and look at what we do inside our organization from a strategic sales perspective. So there's some things I can't go into due to MBAs and things like that. But I will tell you that a couple of our sales people are pursuing some really, really large sales opportunities. We're talking six figure sales opportunities. Now for some of you listening, that may not seem very large, you know, a six figure be a sales opportunity is it's pretty normal, right? But when you think about training, it's not very often that you see people making 100 200 $300,000 purchases in regards to training. And so for us to see that those are what we would consider large strategic sales. So how do we approach that? How do we go and put ourselves in the best position in order to win a large sale like that? Well, it really ties back into a lot of what we've been teaching up to this point in the podcast. And before I go any further, I do want to mention that transcripts and resources will be available at podcast at smart buildings academy.com, forward slash 261. Once again, that's podcast dot smart buildings, academy.com for slash 261. And I do want to apologize for the next several episodes, my voice may go in and out, I am dealing with a cold, and we tend to record episodes in batches. And just so happens, I'm about to go on vacation. So yeah, you're going to get sick fill for a couple podcast episodes. Alright. That being said, let's dive in. So the first thing I always ask all of our sales people, and this is critical, and it's something I don't think we think about enough. But it's, you know, what is the KPI? What is the strategic objective that our sales opportunity is tied to? Why would people want to spend 200,000 100,000, whatever on training? Why would they want to spend that I mean, that's capital that could be going to hiring employees. That's capital that could go to product expansion. In the case of some OEMs r&d, why would they want to spend that money on training. And so once we identify that, and that usually comes from HR, which brings up another point, you need to understand all the different organizational aspects of your customers, at least at a high level, like if you're dealing with healthcare, which, you know, my favorite examples are always tied back to health care. If you're dealing with health care, the CNO and the CMO, the chief nursing officer and the Chief Medical Officer are going to have very different strategic objectives and things that are important to them in the CIO, the Chief Information Officers can have even more different objectives and things that are strategically important to them. So when we're dealing with customers, we tend to look at what is their HR group from a talent management and talent development perspective. So those are the kind of KPIs we focus in on there. From the operation side, we're going to look at their CEO or their VP of Ops, and we're going to understand where their operational efficiencies, what are they trying to do there? What are they trying to do as far as increase of margin per f t? So that's full time equivalent. That's employee basically, what are they trying to do to reduce slippage? What are they looking at as far as their historical pipeline and their forecasted pipeline in regards to execution of work, and once we understand all these things, then we can tie our solution to those needs. And this is where strategic selling becomes a little different because in non strategic selling and very responsive selling, where you're dealing with the plan and spec or maybe a retrofit bid or RFP, you're dealing with a very clear scope, and you're just responding. Whereas in a strategic sale, ie there is not a clear scope. And actually that is the most difficult thing, in my opinion, is identifying a clear scope that ties to strategic objectives that keeps executives engaged among all the other Things that are competing in their mind for business. So step one, right is to identify buyers identify their KPIs.

What is important to them? Once we've identified that, then we start to identify budget. And you may be saying to yourself, Phil, why didn't you identify that they can actually buy first, before the need, while just because someone has budget allocated to training does not necessarily mean that they have the need for our training. The last thing I want to do as an organizational leader, and this is something you should look at, as well as a sales leader or as a salesperson yourself, is you don't want to sell something that is not going to meet their needs. Yes, you may make your sale in the short term. But in the long term, you're not doing them any favors, you're not helping their organization grow. And I would rather say to someone, it sounds like you need basic sales training, or it sounds like you need basic financial training, things like that, that we don't really cover, right, we do technical sales training, we do project management skills, training, stuff like that, but I'm not going to teach you what AP is, and like how to balance your books and stuff. So if I determine or if my team determines that, then I've told them, you know, do not sell something that people don't need. That's why I say understanding the budget is not as important as understanding what people need and what their strategic objectives are. Because if the strategic objective is there, and the customer, the decision maker and the influencers, right, the decision maker and the influencers, which you have to cover both, they both firmly agree that there is a need, and they can see that that need will positively impact their business budget can be found. I am of the firm belief that we are not in a limited society. I'm not to get philosophy, philosophical on you. But I believe that if you need money, and you have a cause, you can find money, I mean, a little verbal story. Early on in this business, we took out a small loan a to help us rebrand to help us grow as a business and we had no history. I mean, we had like a year of history. And basically, the the bank was like, No, you have no history don't really qualify. But I said, You know what, just let me tell you our vision, let me tell your story. Let me tell you what we're doing for the industry. And because of that story, you know, we were able to get a loan, you know, I'd like to think there was some Providence there as well, some blessing. But, you know, what do I know? I will say, though, that because of that we were able to grow, right? And we were able to find the money. It's the same thing with your customers, if the need is strong enough, there are multiple ways to pay for things. So while it's important to know that people have money, you know, you don't want to try to sell a brand new control system to a company that will never have money. It shouldn't be the most important thing. Okay, so anyways, though, back to what I was saying, We've got the buyers identified, we've got the influencers identified, we understand the key things that they are looking at, from an importance perspective, we start to understand their budget. And what we want to do is we want to tie our solution strategically, to those KPIs to those key performance indicators. And we want to show the impact. So for you from a controls perspective, that would be you know, you have a hospital and it's all pneumatic. And patient recovery is a big deal, right? Patient Safety is a big deal. If you can show studies and information that show the impact to patient healing and patient safety, then that is going to be a strong case for like a CNO. Who is concerned around Yo, how quickly are we able to move people out? How are we able to lower readmit, etc. Once you've done that, then it's a matter of going and actually steering the opportunity. And this is where it can, in some cases be a team sale.

In other cases, it's not but you have to identify all the influencers, you have to identify anyone who could potentially block it. You have to have a strategic plan to target those people cover them and sell to them. And that's one of the things I think people miss was strategic sales. If you've only been doing construction sales or only been doing retrofit sales, you could potentially Miss influencers. Because your mind doesn't necessarily think about that based on the experience you've had. So What you want to consider is how am I going to identify who could potentially impact this. And to do that I like to map things out, I like to go and map out what the account looks like. I like to understand kind of who I'm dealing with, how they make decisions. And then what is my communication plan to them? What's my coverage plan? And then I want to figure out, when do I want to close this deal? And then what steps have to happen to close that deal? And then I back into it. Another thing that becomes really important for strategic sales is procurement. So understanding the procurement process of large purchases, like how do you work with procurement. And, you know, I was talking with my wife the other day, because we're pursuing a large deal with a company. And one of the things we're going to run into is procurement. And so then when you look at procurement, you've got to look, in my experience at a strategic sale at kind of three pillars of the strategic sale. First, you've got to identify the strategic need and gain alignment, then you've got to scope it out, identify timeframe, where is the capital coming from? How is this going to execute, etc. And then the third is the procurement aspect of things. So in each one of these phases, you're going to have negotiation points, and you're going to have conversation points, you know, in the KPIs, you're going to go back and forth. And it's a lot of visioning and mind. Mine, I want to say mind storming, brainstorming with the customer in the scoping phase, and you know, finding the capital and all that that's going to be much more tactical. And you're going to be going in basically gaining alignment on clear scope and clear cost and how it's going to be paid for. And then when you move to procurement, that's all about, okay, what are our payment terms, what our terms and conditions, all of the legal aspects of performance of timeline, execution, damages, etc. And you need to be prepared to cover that as well, because you can have deals die in procurement, and you can miss out on deals in procurement. Usually, if you have higher executive level support procurements easier to work with, but do realize that they are often a separate business unit. If you're dealing with like VPS, or directors, they usually will have minimal influence over procurement. And so procurement can have a substantial impact on your strategic sale. So to recap, because I realized we went way over the 10 minute time limit that I tried to keep on these episodes. First things first, from a strategic sales perspective, we want to understand the strategic needs of the customer, we want to understand what's important to them, we want to understand why it's important to them. And we want to create a coverage map to cover the but decision makers and influencers. Number two is we want to clearly identify scope, we want to tie that scope to the strategic impact in the business. We want to figure out things like timeline cost execution, who's going to do all this stuff. And then three, we want to be prepared to work with procurement, and procurement. There's negotiation points at each point, right. In step one, we can negotiate what's important and we can gain consensus on what's important from a impact perspective. In phase two, which is scoping and pricing, we can figure out and negotiate price and scope and timeline. And in three in procurement, we can negotiate terms and we can negotiate payment terms, legal terms, things like that. So just be aware, strategic selling is complex, but it can also be extremely beneficial. And in my opinion, strategic selling is the way to go. If your organization is structured to tolerate the high cost of sales associated with it, because you are developing Greenfield opportunities that are not in the market yet, and you will have significantly less competition. Alright, if you have any questions, please go to podcast at smart buildings academy.com Ford slash 261. If you found this insightful and you find our approach to selling insightful, then I encourage you to check out our upcoming sales bootcamp. This is a nine session live course it's an About an hour a session. So over nine sessions, where we're going to go through VA s i t h vac how to sell how to scope how to estimate how to be strategic along the way my sales team is going to be involved in the training so you'll get their insight as well. And we've gotten tremendous feedback from Cohort One who went through it and we're going to have Cohort Two opening up shortly in August. So I encourage you if you are new to sales, or maybe you're even experienced in sales, but you'd like a different person active. Go and check that out. It'll be at podcasts at smart buildings academy.com for slash 261. Scroll down and you will see the link to the sales bootcamp. Thanks a ton. And I hope you have a wonderful rest of your week. Take care

Phil Zito

Written by Phil Zito

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