A pan European medical equipment provider’s existing strategy adequately pushed sales but didn’t promote sustainable growth for the business. Their sales force presented characteristics and benefits of the service offering to the customer but lacked a real understanding of customer needs and was therefore not able to highlight the company’s competitive advantage. The service sales force typically explained their customers ‘lack of budget’ as the person they spoke to only had limited buying power and simply forwarded the proposal to the purchaser without being able to justify the value.
The service sales force presented characteristics and benefits of the service offering to the client but used very few ‘hooks’ to effectively highlight the company’s competitive advantage. They frequently spoke to someone other than the decision maker who had different needs. Further, in most cases their approach was reactive rather than proactive; i.e. the customer calls in with a query, or just before their warranty expires.
This resulted in the service sales force encountering issues relating to their client’s ‘budget’ as the person who called only had limited buying power and simply forwarded the proposal to the purchaser without being able to justify the value.
The root cause here was that their approach was not proactive and not customer driven; there was a lack of attention to the customers’ critical business issues. Consequently, a common vision with the decision makers on how to really address critical business issues could not be developed. This customer buying vision is essential however because it defines the value of the offering and the urgency to do something about it.
Working with this medical equipment provider, we started transforming their sales approach to embrace customer centricity. The approach required getting a good understanding of client needs and challenges, which is only possible by developing the skills of customer-facing staff so that they can have informed discussions and get a good understanding of the customers’ business. Ensuring that the teams had the necessary capabilities to have such insightful conversations with customers was a specific challenge we addressed before improving the sales process.
A key step here was to train the company’s field service engineers to act as trusted advisors so that they could develop a better understanding of their customers’ needs. They were trained to recognise opportunities for sales which were then communicated to dedicated sales teams
We designed a new go-to market strategy for each service, launched very specific sales campaigns and set up a dedicated service sales teams that proactively followed up leads and were able to articulate the value of a service in the context of customers’ needs.
That was done by researching customers’ service requirements. The company did have a good understanding of what customers were expecting in terms of product features and quality. However, they had very limited knowledge of how the products were being used. It turned out that there was no such thing as “The Customer” as groups of customers with similarities in the use of the product and in the expectations of the expected benefits could be segmented by typical customer service needs. Customer service needs were further categorised into product related needs and customer business needs. The product related services needs can typically be satisfied by specifying the service performance characteristics in service level agreements. E.g. performance metrics such as uptime and response time were the key metrics in the SLA but could still be different for each type of customer.
The customer service business needs were a lot more difficult to identify. Customers had nontechnical needs such as needing help to optimise the workflow in a laboratory or wanting to pay for the products based on their actual usage (Pay per Use) and leave the technical management to the provider. One segment of customers went so far as to demand that the product provider also manages the entire end-to-end process for a combination of laboratory instruments together with the staff of the customer.
In just one year the service revenue and EBIT have grown by more than 20%. The strategy forged the path for the development of a range of new products and services, as well as expansion into other market segments. These results would have been impossible without an underlying focus on what has become the defining factor of sales: customer centricity.
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