As we move further into the Networked Society businesses can expect a larger share of their sales to be solution based. With solution sales comes a scenario where procurement processes meet sales of complex solutions. Sales strategies for solutions sales is a great art to master.
Procuring system solution involves is a sophisticated process. Today specialized procurement organizations drive advanced models. Vendors match the advanced procurement strategies with advanced system sales models.
A solution sales strategy has an element structure like a set-up of bowling pins. The business role each of the elements play has similarities with rows of bowling pins. The four rows in your solution strategy likely address the following key roles:.
- What you will win the deal with – a vital part of the solution that you must have to play.
- What you will have to deliver early on as part of the solution – complements necessary to make the initial solution offering complete.
- Where you will earn bulk of money – your differentiators where customer needs and a superior offering meet.
- What you can expect as upselling potential – solution sales opportunities open up for business not visible from start.
If you map out a good strategy on these four pillars and keep them tied together you have paved the road for a business strike. The role each solution element play, can support you in defining differentiated margin ambitions. The first two elements fit together. Third parties can provide parts of the solution in the second row. What you win the deal with can vary between product and services and your primary business strategy. The third row is likely where you have your real competitive differentiation. Finally the fourth row allow you to leverage the full breadth of your capabilities once selected.
The bowling pin analogy also makes it clear that winning the first two rows is a must. Securing initial business comes before bringing in earnings and maximizing long term upselling potential.
Good questions to ask yourself and how your organization addresses these kinds of problems are:
- Do we structure our deal strategies around which roles different elements play? – An alternative is to view all solution elements as equals.
- Have we quantified margin expectations for different solution element types in our offerings? – To secure that the strategy makes it all the way out to where prices.
- Do we have a clear business model for the whole offering to match customer needs? – The broader the solution the more complex the business models is likely to become.
For additional insights on this topic please refer to the following sources:
- The Kraljic Portfolio Purchasing Model [BLOG] – by MindTools
- Differentiate with your business model [ARTICLE] – by StickyBranding
- Ten proven pricing models for start-ups [BLOG] – by Cayenne Consulting
- The price is rights – 5 pricing models explained [BLOG] – by Vistage
- Best fit IT pricing models with mutual benefits for service providers and customers – [WHITEPAPER] – by Mindtree