There are several approaches that I feel would be helpful for the
sales forces of technology companies in order to improve sales.
The first, and most important, is to gain a strong understanding of
the prospective customer's needs and how the technology they are
selling will address them, preferably in financial terms. I offer a
discussion of this technique, known as consultative selling, at
http://answers.google.com/answers/main?cmd=threadview&id=222171.
While more time-consuming and expensive than simply walking up to a
customer and asking for a sale, this approach is more likely to result
in a sale in the current environment because it builds trust between
the parties and establishes financial measures to justify the
purchase.
The second is to offer more flexibility in pricing. And I don't just
mean lowering the price, although the days of upfront licenses in
excess of $5 million are unlikely to recur anytime soon.
Traditionally, software has been sold on the basis of a large upfront
license expense for a number of seats and a variable price based on
resources used for its implementation. In the current environment,
companies are reluctant to spend a large amount upfront and commit to
an open-ended consulting arrangement for implementation long before
they see any results from the project. Innovative suppliers are
offering pay-per-use type arrangements, such as IBM's on-demand
computing initiative. Fixed-price implementations are also becoming
more common. Also, payment may be based on achievement of specific
objectives reached at various phases of the implementation, with
bonuses or deductions based on the results achieved and their
timeliness. Finally, financing arrangements such as leases or low
interest loans can be used and may not be overly expensive for the
vendor given the low interest rates currently prevailing.
The third, which ties in with the second, is to break up the
technology and/or project into smaller pieces so that it can be
gradually implemented over time to spread out the payments and
minimize risk. Instead of turning on an entire ERP system all once
after two or three years of work, potentially causing great
disruption, it may be much more attractive to the customer to turn on
a single module every six months or so and getting it working well
within the organization before paying for the implementation and usage
of the next one.
I hope you find the above information helpful. I would be happy to
respond to your clarification request with respect to the subject
matter contained in this question or your previous one.
Sincerely,
Wonko |
