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  • Flip Side Whitepaper Notes: Essential Selling Competencies: The Buyers Side Perspective

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Flip Side Whitepaper Notes: Essential Selling Competencies: The Buyers Side Perspective

This week’s Flip Side topic comes from a webinar and white paper put out by The Executive Conversation and the Brandon Hall Group in July 2011 “Essential Selling Competencies: The Buyers Side Perspective”. I haven’t been able to find a place on either company’s website for you to directly download the whitepaper or listen to the archive of the webinar, so let me start by giving you a quick rundown on the whitepaper itself.

Natural Born SellerTo quote the introduction, “Brandon Hall Group recently completed a comprehensive research initiative targeting the prevalence of five essential selling attributes in sales teams and their impact on performance.” The five categories are Business Knowledge, Customer Insight, Financial Acumen, Return on Investment, and Executive Engagement. 

According to executives, business decision-makers, sales managers, and learning professionals sales people do not possess enough skills in the five primary competency areas to maximize their effectiveness.  Poor sales people. I just hope they never do a survey where they give business owners the chance to say that procurement isn’t effective enough, and to tell us how. I can only imagine those results…  in any case, let’s get back on track.

Of the five competencies, there are also notes on the specific skills within each, and I think three of the five present opportunities for procurement to benefit from sales training programs that may be in place within your organization. Reach out to your human resources or internal training group to see what they offer along these lines.

As quoted from the white paper:

  • Business Knowledge – This competency measures an individual’s ability to effectively grasp the macroeconomic factors impacting a company’s revenue, operations, value chain and overall business value.
  • Financial Acumen – This competency measures an individual’s ability to analyze financial trends and ratios to identify opportunities for improvement as well as financially justify investments.
  • Return on Investment – This competency measures and individual’s ability to quantify, discuss and present cost-return analyses of investments.

My take:

  • Business Knowledge – In order to effectively manage risk and make procurement measurably indispensable, we need to have a good understanding of the markets that influence our organizations demand for direct and indirect materials.
  • Financial Acumen – If sales can use these skills to evaluate a prospect’s likely benefit from a given solution (and resulting appetite for buying) then we should be able to use the same skills to evaluate the financial situation of a prospective supplier. Even if our analysis does not swing the award decision towards or away from a given supplier, it may identify areas of risk that can be outlined in the contract and managed closely.
  • Return on Investment – Rather than quantifying, discussing and presenting the return from an investment, I think the skills developed in this area could be used to do the same for a contract’s impact on cost of goods sold (COGS). In procurement, we have a tendency to present the results of a project or negotiation as if they exist in a silo. But what is the impact of the results (whether savings or otherwise) on the company’s overall performance and their price competitiveness? This connection is more easily made with direct spend categories with indirect, but that means that the greatest opportunity for recognition exists if procurement can communicate their benefit on those projects where the business is not expecting an impact.

As far as my other recommendations go, keep in mind that the white paper is focused on outlining for sales people where they need to develop their skills. Each of the following is an extension of one of their recommendations.

Become the decision maker… or a least a trusted advisor.

Sales people want to get as close to the actual decision maker(s) as they can. It reduces their time to sale and also prevents the need for an additional round of negotiation at the end of the sales process. If we (procurement) allows ourselves to be pegged as go-betweens, sales people will spend all of their time and energy finding ways around procurement. Even if we manage to keep ourselves in the game, our negotiating leverage will have been diminished and our value to the organization will go with it. We need to position ourselves, both internally and externally, as playing an integral part in the evaluating and decision making process.

Find out if your supplier contact is part of a direct or indirect sales force.

One of the case studies in the paper spoke of Polycom (most likely known to you for their conference room speaker phones) and their switch from an indirect (or shared/outsourced) sales force to a direct force of fully employed sales people.

My last thought goes back to the heart of the paper – evaluating sales competencies. As a buyer, what do you do if you find yourself assigned a sales rep that is not up to the task? 

For an answer, I turned to The Sales Guy, our undercover sales advisor…

The right supplier is much more important than the right sales person.  If the sales person does not have a firm handle on the key issues a call to sales management should rectify the problem.  It doesn't have to be positioned that the sales person is incompetent (even if he is).  The buyer can explain that for a critical purchase decision sales management needs to participate.  It's a bigger issue if the buyer does not want to deal with the sales person moving forward.  Then you are asking the supplier to reassign an account - that can be a touchy matter.  Suppliers do not like to establish precedents where they allow customers to dictate their sales coverage.  Of course they also don't like to lose big orders.

So, the message there, is set your expectations for reassignment according to the size of the supplier (and therefore the size of their regional sales force) and the size of your purchase. If the purchase if large enough, you could probably hand pick your account manager. If your purchase will not be that large, you are in a good news bad news situation. The bad news is, you’re probably not going to get a lot of say about who your account rep is. The good news is, you are hopefully not going to have enough contact with that supplier for it to matter. Get yourself a solid contact for the negotiation and implementation and hopefully customer service will be able to step in and fill the gaps after that.

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Comments 1

Guest (website) on Wednesday, 07 September 2011 06:51

Interesting post. My opinion has always been that to be a better negotiator on the buying side, you should understand how sales and sales channels operate and the impact that can have on your negotiation. You should also understand how sales people are trained to sell. For example the focus on understanding ROI is frequently used in value based pricing or value based selling.

If your readers want to learn more about sales and how that related to buying they can go to your drop down menu library, click on procurement blogs, then click on independent blogs and look for my blog Knowledge to Negotiate and click on that. A few posts they may want to view that relate to sales are - Channels - April 11, Value Based Pricing. Value Based Selling Dec 15, 2010, Sale use of the principals of persuasion, Sales Speak and Sales Tactics all of which were posted on Jan 17.

As to sales competencies, The Sale Guy's comments nailed it. The touchy matter he refers to is The last thing a sales person wants is to make all the effort required to bring in a new customer only to lose that account and credit for all the sales that will come from that account. The other aspect of the touchy matter is no company wants to lose someone that is good at bringing business in. If a move would impact the sales person meeting their sales goals or commissions that could happen. If you do have problems where the sales person isn't meeting your needs escalate the issue and the Supplier will usually find a way to meet them. When you are a large customer periodic management reviews helps.

Interesting post. My opinion has always been that to be a better negotiator on the buying side, you should understand how sales and sales channels operate and the impact that can have on your negotiation. You should also understand how sales people are trained to sell. For example the focus on understanding ROI is frequently used in value based pricing or value based selling. If your readers want to learn more about sales and how that related to buying they can go to your drop down menu library, click on procurement blogs, then click on independent blogs and look for my blog Knowledge to Negotiate and click on that. A few posts they may want to view that relate to sales are - Channels - April 11, Value Based Pricing. Value Based Selling Dec 15, 2010, Sale use of the principals of persuasion, Sales Speak and Sales Tactics all of which were posted on Jan 17. As to sales competencies, The Sale Guy's comments nailed it. The touchy matter he refers to is The last thing a sales person wants is to make all the effort required to bring in a new customer only to lose that account and credit for all the sales that will come from that account. The other aspect of the touchy matter is no company wants to lose someone that is good at bringing business in. If a move would impact the sales person meeting their sales goals or commissions that could happen. If you do have problems where the sales person isn't meeting your needs escalate the issue and the Supplier will usually find a way to meet them. When you are a large customer periodic management reviews helps.
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