Picture this – you’ve been told it’s time to approach procurement, and you’ve done all the prep work. You fine-tuned your offering to fit the customer’s specific needs, you tailored your approach to the stakeholders who care most, you prepared answers to the inevitable questions, but you’re not done yet. What lies before you now is typically the longest and most trying part – navigating through the steps and hurdles of how to reduce sales cycle when navigating the procurement process itself.
Over the past few weeks, we’ve been offering insights from our Emissary advisors on the best ways to approach and move through the procurement phase. We’ve touched on preparing your product for procurement and on approaching the human aspect of the procurement phase, but what about how to reduce sales cycle itself? In this final post of our Q4 procurement series, advisors from our community give their advice on making your way through the complex process of procurement.
Be mindful of the complexities
Emissary advisor Amy Haney, former Sr. Director of Strategic Category Procurement and current President of 3-10 Partners, says that it is important for companies to have at least some awareness of the procurement processes of the companies they are pursuing. Awareness not only enables the experience to be more seamless, it also shows the client that you are invested in working with them to meet their needs.
“It is critical for a supplier to respect and seek to understand the complexities of a large organization. A lot goes into understanding (e.g., patience, a lot of listening, asking questions while refraining from a lot of debate and frustration over “how it works…”, etc.). A seller should also recognize that it can take a lot of internal selling within Abbott, across divisions, departments and management/leadership to move an opportunity forward. This is important, ‘building buy-in.’”
By indicating that you understand the complex machinations behind procurement, you’ll earn more respect from that organization. This can lead not only to a better working relationship moving forward, but also to opportunities for future collaboration even if your product isn’t a fit for procurement on your first approach.
According to one Emissary advisor and former technology leader at a major insurance carrier:
“Regardless of company, it’s important to understand that most procurement teams are not just ‘purchasing’ – they deal with the sourcing activities, negotiation and selection of products and services as well as price negotiation. They also assist other parts of their organization in doing supplier research, specification development (RFI/RFP/RFQ’s) and contract renewals. Even if you are not actively selling into the company, they may include you in RFP’s or RFI’s that you are not aware of.”
Amy touched on this as well, saying that suppliers shouldn’t be too anxious about approaching procurement at exactly the right time in the procurement phase. In fact, she said that from her experience at Abbott, graceful handling of an approach made at the wrong time could aid in positioning a supplier for consideration in the future, or even re-consideration. To do that, suppliers need to ask for feedback, and show a willingness to adapt and cooperate with the organization in the future if a chance for procurement comes up again:
“Giving the supplier the opportunity to share feedback via a “debrief” or “feedback session” can be really helpful and insightful for everyone. Inviting the stakeholders to that discussion is also an option, which can aid in future consideration (or in some cases, a changing of the minds and business award!). Communication is key to sustaining long-term partnerships and success.”
How to Reduce Sales Cycle
Timing, cooperation, and respect for the organization’s needs can give you a major leg-up during the procurement phase, but more practical aspects weigh heavily on organization’s decision making, too. Some major factors to consider: cost, categorization, and compliance.
The organization’s potential spend on your product will likely influence what departments are pulled into procurement, and subsequently, which stakeholders need to be won over to finalize a contract. When you approach procurement, find out right away what budgetary tier you’re likely to full under so you can have a better idea of what to expect.
According to a former technology leader at a major insurance company:
“One of the primary considerations when a company buys software is the level of expenditure (software/service tiers) and associated approvals required. The procurement specialists can be your best indication of the amount of time and effort that will be required to complete final approval and contract signing.”
As soon as you have a procurement specialist or contact within an organization, ask them not only what expenditure tier you’ll be on, but also what category your product falls into. This too will impact which stakeholders and departments you’ll be working with. Arm yourself with that information right away and focus on the stakeholders who will impact you most:
“Software and services are generally treated differently in most companies and may be categorized with a variety of taxonomies (i.e. infrastructure vs. developer software, or departmental vs. enterprise, etc.). The best option is to get in touch with the procurement specialist and determine how they categorize different types of software AND how they handle contract reviews and renewals.”
Know The Protocols
The last question to ask your procurement specialist at the start of the process is what protocols you’ll need to meet to become an approved vendor. According to Emissary advisors, you should expect to prove that your product meets certain industry or organization-specific requirements, often around risk, compliance and security. Find out right away what you need to do to become an approved vendor so that box is already ticked throughout the rest of the process. According to the former Head of Data Analytics and Corporate Technology at a healthcare company:
“Not valuing protocols could become costly. If you are providing a technology solution then you have to get technology review board approval.”
Every organization will have different processes and protocols. Amy said that from her experience, it’s less important to know the exact step-by-step procurement process than it is to communicate with your procurement specialist and ask the right questions. Getting the right information from day one will make the process smoother both for you and for the organization, and will set you up for a successful partnership:
“Ask. Asking is learning. Be willing to have an open and transparent discussion with procurement. A good procurement professional will balance the need for cost transparency and cost savings (always one of the goals) with the stakeholder and supplier interests.”
Getting to know the basics of the procurement landscape before approaching an organization can give you a major advantage as a vendor, allowing you to prepare in advance for any hurdles you might encounter. But what’s even more important than knowing how the process will go from start to finish: it’s knowing how to reduce sales cycle and being ready to ask the right questions and show that you’re willing to work with the organization not just as a vendor but as a partner, both during and after the procurement phase.