Part Two of a five Part Series.
Without business acumen, you can’t provide meaningful perspective.
In my last article, I discussed Perspective selling, and its cousins, insight & Challenger selling – and how powerful they are. First, I described perspective: knowledge or insight that expands a customer’s understanding of one or more business issues. When a seller provides perspective, they apply customer-valued (not just any) insights and expertise .
To consistently provide perspective, sellers need to predict – then introduce – then validate – a customer-valued outcome. Importantly, part one detailed three techniques for presenting perspective: three ways to stimulate a prospect to visualize an outcome. In summary: asking value-oriented questions, re-framing a prospect’s viewpoint via credible instruction, and storytelling all engage parts of the brain that simple “selling by telling” does not.
Perspective Takes Three Kinds of Acumen.
Here’s the thing: those three techniques require a strong foundation in three areas. World-class sellers need three types of acumen in order to generate useful perspectives regularly.
The three underlying elements of acumen:
- Business Acumen
- Customer Acumen
- Solution Acumen
With apologies, let me bring the old “three legged stool” metaphor out of storage. Thus, each type of acumen represents one of the three legs, and the stool needs all three legs to support world class performance.
Today’s topic: Business Acumen
One of my most popular articles ever discussed the importance of business acumen. It makes the point that you can’t know your customer’s business until you know business. Rather than repeating that article’s point, the “why” of understanding business, I’d like this article to address the “what” and “how”.
First, there’s good news for non-“mathletes. Understanding the numbers in a target company’s financial statements probably won’t get you as far as concentrating your time elsewhere (unless you’re in a field like finance or accounting). While financial acumen isn’t a waste of time, just remember: financial statements describe financial health of a company, while a salesperson is usually more interested in operational health. It’s more important to know how an operational change will affect the financial statements that it is to be able to analyze a financial statement for needed operational changes.
Business acumen is critical regardless of your role in your organization. This series of articles focuses on seller roles (any role that faces the customer). Nonetheless, if you’re a business leader trying to focus your company on delivering customer-perceived value, your whole organization should be business-savvy.
Perspective selling, becoming a trusted advisor, requires a seller to know their customer’s business well enough to give valued insights. Thus, many sales leaders realize that building business acumen for sellers and customer-facing roles boosts sales performance. Because of this, several Fortune 100 companies put their entire sales organizations through a mini-MBA program.
What Does Basic Business Acumen Cover?
If I had only one day to work with your people to build their business acumen I would organize a workshop covering a few key topics:
- Treacy and Wiersema’s three value disciplines; how a company sees themselves differentiating in their market.
- Understanding current trendsin a company’s market: your own and a customer’s.
- Perspective sellers are attuned to their customers’competition:direct and indirect / substitutes.
- Business professionals know how to find any company’s top management priorities. Can they leverage this knowledge into insightful interactions with a customer?
- Businesspeople should know how to uncover major business risksfaced by any company, and articulate ways to address them.
- While I don’t advocate strongly for mastering financial ratio analysis, I am big on understanding cost structure: fixed vs. variable costs, and break-even point. Know how to impact each of those items, and how you product /service impacts a customer’s cost structure.
- Sales people should be able to break any company down into its component processes and activities…then identify key processes.
- Your people need to be able to identify key process inputs/resourcesa company uses.
- Business professionals should understand how key partners, alliances, and complementary offers build into complex ecosystems..and how these players add value to each other.
- How does a company define their customers,and why?
- Business people, especially sellers, should understand market channels:different kinds, how they work, their value, their challenges, and how customers use them to buy.
- Business acumen helps identify different revenue streams, and understand what value (besides revenue and profit) each stream produces.
- Professionals should be able to pick out a company’s value propositions. They should also distinguish propositions from value presumptions and statements, and know the dangers of the latter two.
How Business Acumen Shapes Perspective Selling
Business acumen enables sellers to look at a prospective customer’s business insightfully. Demonstrating a deep understanding of the prospective prospect’s business builds needed credibility. Without credibility, sellers risk being just another annoying know-it-all spewing a misdirected “credibility deck” in a prospect’s direction. Value messaging turns into old-fashioned “telling” if the perspective is not anchored in customer insight.
In summary, business acumen is needed to discover value that is hidden to average sellers. It opens up a more detailed “map” of all the places where your differentiated value can impact a customer. I often help clients identify completely new personas and roles within their target companies. Having insight into how a customer’s company really works helps anticipate everywhere a seller’s differentiation generates value. A tool I’ve developed called “value networks” builds this world-class selling practice into a repeatable system for entire sales teams.
Fee free to comment below or to share this article. If you would like to talk about building the business acumen of your organization, let me know. I’d love to help you build that organizational capability.
To your success!