Only if you want your sales process to make you a lot of money!
Almost no one does a good Joint SOW!
The truth is ALMOST NO ONE does a Joint SOW!
A joint SOW in sales is no different than a house plan for a builder and homebuyer. Someone who is going to have a home built commits a large amount of resource to the plan, the features, the look, the functionality, the cost of operation, etc. For this buyer, the home may be their largest investment ever and the center of their family life, so they want a great outcome for the money.
The idea of a builder sending the home buyer a proposal that lays out the kitchen, bathrooms, bedrooms, colors and cost without the buyer’s input borders on crazy. To propose how someone should live and how much they should spend without hours of detailed conversations uncovering specifications, cost considerations, outcome requirements and timeframes is ridiculous.
In the B2B world we do that all the time. As a selling organization we train our sales team to position themselves to provide a proposal and then to push the buyer to agree to our contract.
“Revenue Science™” and the 21st century tells us the importance of being a transparent partner, so now it is time to get very clear about exactly how a “transparent selling partner engages” with a “transparent buying partner.”
This partnering engagement model starts at the moment the seller and the buyer decide to invest enough resource (mostly time) to learn about each other to determine if they should commit to exploring the opportunity of working together.
This “moment” when the decision is made occurs in a very short period of time that is called a conceptual sell conversation. The seller determines that the buyer has a problem, which they are compelled to solve ASAP, and in which that the seller cannot only solve it but solve it in a unique way. The unique way they solve this problem meets both business and operational considers, while aligning with the buyer goals.
Think about the home seller and buyer. The conceptual sell “moment” might look like a buyer who is looking for an energy efficient home, for a family of 6, the gardens and solar to enhance sustainability. The seller may be the thought leader in sustainable family homes using local resources (sun, wind, soil, geology conditions, etc) for middle and upper middle income families. At this moment, both parties realize they want to take the next step to determine “should we work together?”
Now two organizations are ready to learn more. The way to do that is NOT for the seller to create a proposal that, in the best case, is a WAG (Wild Ass Guess), and the worst case, WRONG.
If the seller is a thought leader who brings value to the buyer, and the buyer has a problem they are compelled to solve, then the issue is do both the buyer and the seller believe that working together is the best possible way to move forward.
Since the seller performs this work regularly, and has these conversations ALL the time with prospective buyers, they need to manage the next steps. The buyer has NEVER done this before or has NEVER done it right otherwise they would not still be trying to get this problem solved.
At the moment both parties realize they want to take the next step to determine “should we work together” the seller needs to make this (Joint SOW) process as easy, transparent and buyer focused as possible.
The seller needs to restate the problem to be solved and clarify who on the seller’s team owns the business part of this problem and who owns the operational part.
The seller needs to have those two owners in the next step along with members of the seller’s team who will understand and address each of those buyer’s (financial and operational) status and required outcomes. This next step may happen now if everyone is ready, but almost always is scheduled a day of few days from now so everyone can be prepared.
The “be prepared” part is facilitated by the seller to make sure this upcoming meeting is both highly efficient and highly effective. This next meeting is really that first transparent step in a long partnership bringing value to all.
Depending on the “be prepared” and the quality of the scheduled meeting the goal is for everyone to know everything they need to know and be on the same line of the same page for both financial and operational issues. With more complex problems, the both parties will leave their meeting with homework and that homework may require follow-up phone calls or emails between buyer and seller teams to get to the same page same line of the same page.
Once everyone is on the same line of the same page for financial and operational required outcomes the seller can develop and present a proposal based on the buyer’s required outcomes and the seller’s value proposition.
Since the seller is a thought leader who knows more about this than the buyer, the seller has increased the value of the solution as a result of their knowledge, Intellectual Property and Best Practices. All of this will be demonstrated in the resulting proposal aiming to get the buyer their required financial / business outcomes within their operational realities.
Part of this proposal includes the roles of the buyers and sellers as well as the steps to arrive at the outcomes and how to measure each step.
The first step in the proposal is always a joint review of what the seller developed by the same team that was in the first scheduled meeting to be sure the proposal addresses the required outcomes for all parties.
When this review occurs the goal is to be sure those things are addressed, that the buyer’s financial and operational teams agree on is in the solution. Next, clarify among all parties any changes to the SOW / proposal and make the “go” or “no go” design right now.
Often this process results in a cost to deliver the final SOW greater than the buyers had originally budgeted. Since they had no clue how to solve the problem it is no surprise they didn’t have an accurate budget. Now they know exactly how to solve the problem and exactly what resources (money, time, buyer team effort, seller team effort, etc.) are required to make that solution real.
Part of the advantage to engaging a buyer “team” and taking days or a few weeks to complete this process is the buyer team realizes over time what the SOW is “really” about, and the requirements needed to get what they asked for. If the Joint SOW process has been done well, the buyers are getting a good idea for what solving this problem will really take. When they see the final proposal they are actually expecting that the cost will likely be different than their original plan.
When the joint team reviews the proposal, sees the required outcomes, becomes clear on everyone’s role and timetable then the cost page is next. You can expect the buyer team to say something like this fee is not what we have budgeted. You don’t need to say anything. Remember, it is their problem, their outcomes and they get the financial and operational benefits from those outcomes. You may well ask (if you don’t know their budget) “how much less is it than your budget?” Most of the time it will be over their original budget so you will ask “well if it is over your budget what would you like to take out?”
Since the buyer team now understands the problem and what is needed to solve the problem and reap the benefits they expected a final fee greater than their original WAG budget. Often they have already obtained more money, decided what they will take out or have developed a work around like part of the fee from this year’s budget and the balance from next year’s budget.
If you do B2B business, if you add value and want to be paid for value, and if you are a partner, then you need to become better and better at the Joint SOW process. You will do this both because your life is easier and you will make more money, but mostly because good prospects and customers LOVE this process.
Those who don’t love the process are sales people who don’t know or aren’t willing to do their job and companies who want to pick your brain, steal your thinking, do win/lose contracts and at best treat you like a low value vendor.
Give it a shot and develop your Joint SOW process, train your team and roll it out. Then watch your life and the life of those great customers who will love this get BETTER (they love it because it is about them).