Mind the Gap

Want an edge over your competitors?

Then: Understand your customers’ business needs and jointly work with them to find creative solutions.

Sounds simple; perhaps too simple, but…

In our latest market pulse survey, Winning Deals and Improving Margins, customers reported that:

• “Being better at understanding the needs of the customer team” is the #1 way for providers to differentiate themselves and win more deals; and,
• “The supplier team lacking joint problem-solving skills” is one of the top barriers to realizing deal value.

These findings alone suggest providers are not meeting customer expectations and there is significant room for improvement; but there’s more.

When we asked the same questions of providers, these items were near the bottom of the list of what providers thought was important to customers or was a barrier to customer value. So, not only are these attributes important to customers, but providers misunderstand their value.

This manifests in two critical stages in the deal lifecycle:

1. Sales teams lose their edge to competitors, after being down-selected on capabilities, when others can better demonstrate to customers their ability to listen, understand, and problem solve; and…
2. Providers’ reputations are damaged, impacting renewal rates, when delivery teams “solve problems” in ways that customers feel unheard or are uncreative and suboptimal.

The gaps we saw in the survey are consistent with what we see in the field — providers routinely underestimate the importance of:

1. Building organizational capabilities:  Success often hinges on individual problem-solving abilities and heroics; which means customer experiences are often inconsistent and depend on the luck of the draw of whom they interact with. This is even more so for provider delivery teams, especially for transformation projects where problems are more complex and diverse. Of course, providers each have an A-team, but those resources are often busy on the most “strategic deals” and cannot cover the “other deals” that make up the bulk of a provider’s revenue. To raise their median performance, providers need to put in place the infrastructure and the capabilities for their teams to consistently demonstrate and execute good practices with customers.
2. Converting mindset to behavior:  Knowing doesn’t equate with the ability to execute. For example, most sales teams understand the concept of “solution selling”; they may even have attended training seminars. However, executing on the idea well requires consistent honing of specific core skills like active listening, effective questioning, and strategic thinking. It also requires building an environment that is supportive of the behavior. For example, a delivery team measured on issue resolution speed is likely to default to familiar solutions, sacrificing listening with real curiosity, and problem solving with creativity.

At the end of the day, winning in a tight market isn’t just about understanding customers and solving problems but doing it better than others. For organizations that mind the gap, this turns into a real competitive advantage.

About the Report
“Winning Deals and Improving Margins” — an IT market report based on a cross-industry study of deals greater than $5M annual contract value with 163 executive leaders, directors, and managers at firms with greater than $250M annual revenue (125 Clients and 38 Providers).

To download your complimentary copy of the full survey report, click here.

To learn more about the Vantage Partners Professional Services practice, click here.

To learn more about the Vantage Partners Technology practice, click here.