How to improve your technical win rate? And decrease costs
Just last month, I remember talking to a friend – on the technical win – no less than a debate, arguing on the bright side of it. He was sold to the idea that the technical win is the bread and butter of all PreSales activities.
I strictly say “No” to the idea of technical win being the sole determining factor for PreSales success in any organization. I only see it as a metric that compares my solution – in quality and ease-of-implementation – to that of my competition. A technical win can be further defined as not losing, which is different from winning. Business win is real because it brings revenue back to the company.
I had a really good podcast recording session with James Kaikis, from PreSales Collective, in which I spoke exactly about the disparity between Technical Win and Business Win rates. [Do listen to it in your spare time.]
Yes, improving one’s technical win rate should be a goal in the team’s list of objectives. But how you actually benefit from it, is a matter of a tiny shift-in-perspective. This is what we’re going to explore next.
What’s solution selling, in the realm of technical win rate?
A quote from Mastering Technical Sales tells us that on average the business win rate can underperform the technical win rate by 20 or 30 percentage points. And this isn’t just a lab-tested number. This is happening in the real world. The farther we’re moving from solution selling, the more disparity we’d be facing between the win rates.
When you’re selling value, your solution should match the prospect's requirements and capabilities, integrate seamlessly with their current business landscape, and also set you apart from other alternative solutions.
Your solution should not be limited to the technical criteria but also aid the business and financial criteria. Basically, you want to answer – how does your solution mitigate costs and risks, while increasing business revenue – to the C-suite decision makers.
How to use the technical win rate when you’re solution selling
Use the technical win rate as a pivot to align yourself and the team to the correct course of action. You can learn from your mistakes, and re-align yourself so the ultimate goal is reached – business win.
1) Turn your technical win to only act as an internal PreSales metric. And not as a barrier to separate the responsibilities of PreSales and Sales as the former should be equally held responsible for the business win or loss.
Also, the technical win numbers shouldn’t be provided to Sales unless accompanied by a PreSales executive who can clarify the customer's journey during the vetting process. Breakdown the numbers by region, industry, solution area, market size and competitor, and analyze the trends for a period equivalent to your average sales cycle.
2) Sometimes, you may lose the technical win but win the account. Investigate and reverse-engineer the patterns, especially around competitive pricing, executive access, leveraged partner or talent utilization, that can yield positive impact, and reduce sales cycle.
How to improve your technical win rate
Now we’re going to look at a few tactics to help you improve your technical win rate. These are time-tested and impactful ways to not just improve your numbers but resolve the flaws in your current processes, if any. Let’s get down to it.
1) Identify prospects worth your time & resources
In this fast-paced business environment with dozens of inbound, outbound, and current vendors' emails landing in your inbox every day, with dozens of RFPs landing on your doorstep every week. There isn't a shortage of opportunities, thanks to digital innovations, social media, systematic RFPs, amongst others. But here, more does not mean better.
(Source) A two-year study conducted by an enterprise software company within its EMEA operations concluded that they spent €2m per year in direct time and materials to capture €9m in revenue. However, the opportunity cost of the time was €18m (meaning potential sales made if that time had been spent selling instead of responding), leading to a net loss of €11m.
Prioritizing the most desirable and worthwhile prospects is a task, and not an easy one. You have to rely on market trends, advanced analytics & assessment, and models based on historical data to separate high-quality prospects from others. On this journey, develop a list of prospective "ideal customers" most likely to convert.
Moreover, come up with a way to score every incoming RFP. The score is to determine how likely you're to win it. This way, you can compare RFPs and prioritize your internal resources to work on the best outcomes.
Just like marketers use MQLs (Marketing Qualified Leads), and sales people use SQLs (Sales Qualified Leads) to identify quality prospects, PreSales can use DQLs (Demo Qualified Leads) to choose to engage with the prospects further.
A demo can tell you a lot of things. Set some parameters for your team to follow. After the demo, if a prospect doesn't qualify or meet the necessary requirements to move further, drop the lead until they follow up. The lines have to be demarcated by senior executives and there can't be any gray areas.
In PreSkale, we provide you the flexibility to design a custom Checklist for your organization and PreSales process. Every PreSales executive has to follow the Checklist to move the opportunities further along the stages.
2) Improve your demo-to-win ratio
Let us start by understanding what a demo-to-win ratio shouldn't be about. It shouldn't be about getting on the calls to wrap up as many canned demos as humanly possible, wishing you'd end up winning 10 out of 1000 demos per month.
It's not a numbers game, you see, except when you have an overflowing funnel of high-quality prospects. Even in that case, you'd need a strategy in place to overpower quality over quantity.
A software / product demo is your stage to showcase your solution that's going to solve your prospect's pain points. It's imperative that you first establish the ground reality that you totally empathize with their pain points, and are confident to solve them, or any of the recurring concerns they may have.
In PreSkale, we have designed our Calendar to be intelligent so you spend less time managing your schedule and more time building value with demos. Our Calendar automatically identifies meetings and auto associates it with the relevant opportunity and outcomes. You only need to configure it once and hit Sync.
Let's turn our attention to the inside of a demo call. You'd meet with a variety of stakeholders and decision-makers in the call. After paying your respects, you'd be sure to identify the decision-maker in the call (who're often not the ones using your product on a regular basis) and confront them by directly pulling out the pain point in the center of the discussion.
The decision-makers are not primarily interested in learning to navigate your product. They are there to understand how your product is going to help them reap value (money, essentially). Your goal for the demo shouldn't be to show the stakeholders how your product works, but how it will work for them.
Also, you only have the first 5-minutes to make the mark. It never hurts to have a few SMEs (Subject Matter Experts) on the call to have your back, whenever required.
3) Use data-driven insights to allocate technical resources
On closer inspection, not all qualified leads look so compelling to chase. But if they are not bid upon, due to inadequate PreSales resources, improper talent allocation, or just plain laziness, it means that you have missed catching good leads or spent more time going after less profitable prospects.
Efficient organizations don't miss out on profitable deals because they have a clear view of their priorities, and they know when to assign their best PreSales talent to the most important prospects.
Now, it's not some internal strategy that does the trick all the time. There are tools to help you achieve efficiency in your PreSales process, simplify the pipeline and allocate the best resources to the deals at the right time. Time is of critical importance.
That's why we're building PreSkale to help you organize the mess, bring all of your resources together and deliver the most impactful technical solutions. Our Reporting & Analytics is the holy grail to never-before answered questions.
We tell you the complete story with behind-the-scenes footage so you can make better decisions that save you costs and improve revenue all the same.
When you work with PreSkale, managers can take a one-quick look at the reports to assign the best PreSales executives to the highest-opportunity bids, without disrupting anyone's assignments.
You can quickly assign opportunities to an executive by looking at a birds-eye view of all your accounts, resources, and availability. You can ask questions about why the reps were spending double the time on proposal development than the industry standards.
You have the power of data-driven insights to allocate best-fit resources to oncoming bids.
To know more, please visit preskale.com/product.
Going back to my argument…
We commonly agreed to technical win being most useful for PreSales only when it’s a guiding agent rather than a decisive number. And yes, we should all strive to improve our TW rate but never forget about the one and truly one metric that defines an organization's success – business win.