The Myth of Pre-Solicitation Vendor Gatherings

“Industry days and similar events attended by multiple vendors are of low value to industry and the government because industry won’t provide useful information in front of competitors, and the government doesn’t release new information.”  So says one of the myths the White House’s procurement policy chief is trying to bust.

Daniel Gordon, Administrator for Federal Procurement Policy, has written a memo to procurement leadership throughout the federal government in an effort to debunk that and nine other myths.  Per our initial post on the topic, we’re addressing several of them one-by-one.  The “industry days” myth is a good one.

Gordon says well-organized industry days, as well as pre-solicitation and pre-proposal conferences, are valuable opportunities for both government and potential vendors.  We’re going to agree.  For government, these events provide an opportunity to communicate the same information at the same time to an array of interested parties.  They also serve as “attention getters”, somewhat similar to a marketing event.

For vendors, these events serve as a good means for getting information.  But, some of the most valuable information doesn’t necessarily come from the mouths of the government people at the front of the room.  For example, you’ll be able to see who else is interested in a procurement.  You’ll get an opportunity to size up your competition.  And, these events can be a good way to scout out potential partners.  However, you’ll only be in the partner hunt if you’ve got something of value to offer.  In fact, if you don’t have something of value to offer, then skip the meeting.

If Dan Gordon has his way, there will be more of these meetings conducted on-line.  In his memo, he suggests a strategy of using web-based technology to expand the reach of such meetings.  That may be fine, but if you’re really interested in the procurement and have something of value to offer, I suggest you be there in person.  You may find that the hallway conversations with other vendors there will lead to valuable teaming relationships.

All the best,

Rick

By the way, check out our book “Seven Myths of Selling to Government“, oddly enough published about the same time Dan Gordon published his set of myths.  Different perspectives, but you’ll see some similarities.

When Are Government Buying Meetings OK?

About the same time we were releasing our “Seven Myths of Selling to Government” book for vendors, the White House was releasing its own set of myths for government buyers.  In our earlier post, we outlined the ten myths the White House Administrator for Federal Procurement Policy seeks to debunk and promised to deal with them individually, relating them to sellers.  Let’s start with the first one…

In myth one, Daniel Gordon said it’s a misconception that federal procurement people can’t meet one-on-one with a potential offeror.  Instead, said Gordon, “Government officials can generally meet one-on-one with potential offerors as long as no vendor receives preferential treatment”.  Bottom line is that, prior to a solicitation, the government can meet with whomever it wants…as long as it gives no one preferential treatment.

“Whomever it wants” is important.  Don’t go busting down doors telling a government buyer that they must meet with you because they met with your competitor, and because the White House said they must meet with you.  Just because a meeting occurs doesn’t mean that preferential treatment is being given.  Instead, politely state your reasons for requesting a meeting.  If you state clearly how the meeting will benefit the buyer, you’ll probably get it…as long as the solicitation hasn’t been issued.  And, if the buyer says they’re not meeting with any vendors, there’s really not much you can do about it.  Even though this would be contrary to White House advice, buyers aren’t required to meet with vendors.

On the other hand, don’t think that meeting with a potential government buyer will disqualify you from participating in the solicitation.  As the White House memo says, this should not be the case.  However, if the government asks you to help write the specifications for a solicitation, you should not be allowed to participate in the solicitation.  That doesn’t mean you can’t provide your product or service specifications in the pre-solicitation phase.  You should.  That’s different from being asked to write the requirements.  (In our consulting practice, we are regularly asked to write requirements documents and always agree that we will not respond to the solicitation.)

Of course, the rules regarding meetings change dramatically once the solicitation is issued…another reason to get ahead of the RFP. A good bit of our book is dedicated to this.

So, good luck with your meetings.  When you get them, make sure you focus on making them meaningful for the buyer, not yourself.

All the best,

Rick

White House Attempts to Bust Government Selling Myths, Too

It looks like we’re in good company trying to turn around myths about selling to government.  In our book, “Seven Myths of Selling to Government“, we take exception to seven, OK actually eight, common perceptions about government contracting and selling to government.  In a nutshell, though, it’s a book about building relationships and establishing value, rather than flying blindly responding to a bunch of RFPs.

Well, the White House has come out with its own set of myths to debunk.  It comes in the form of a memo from the White House Administrator for Federal Procurement Policy to federal acquisition officers, senior procurement executives, and chief information officers called, “‘Myth-Busting’:  Addressing Misconceptions to Improve Communication with Industry during the Acquisition Process”.  Some of the facts behind the myths may surprise you.

  1. “We can’t meet one-on-one with a potential offeror.” Fact:  Government officials can generally meet one-on-one with potential offerors as long as no vendor receives preferential treatment.
  2. Since communication with contractors is like communication with registered lobbyists, and since contact with lobbyists must be disclosed, additional communication with contractors will involve a substantial addition disclosure burden, so we should avoid these meetings.”   Fact:  Disclosure is required only in certain circumstances, such as for meetings with registered lobbyists.  Many contractors do not fall into this category, and even when disclosure is required, it is normally a minimal burden that should not prevent a useful meeting from taking place.
  3. A protest is something to be avoided at all costs – even if it means the government limits conversations with industry.”  Fact:  Restricting communication won’t prevent a protest, and limiting communication might actually increase the chance of a protest – in addition to depriving the government of potentially useful information.
  4. Conducting discussions/negotiations after receipt of proposals will add too much time to the schedule.”  Fact:  Whether discussion should be conducted is a key decision for contracting officers to make.  Avoiding discussions solely because of schedule concerns may be counter-productive, and may cause delays and other problems during contract performance.
  5. If the government meets with vendors, that may cause them to submit an unsolicited proposal and that will delay the procurement process.”  Fact:  Submission of an unsolicited proposal should not affect the schedule.  Generally, the unsolicited proposal process is separate from the process for a known agency requirement that can be acquired using competitive methods.
  6. When the government awards a task or delivery order using the Federal Supply Schedules, debriefing the offerors isn’t required so it shouldn’t be done.”  Fact:  Providing feedback is important, both for offerors and the government, so agencies should generally provide feedback whenever possible.
  7. Industry days and similar events attended by multiple vendors are of low value to industry and the government because industry won’t provide useful information in front of competitors, and the government doesn’t release new information“.  Fact:  Well-organized industry days, as well as pre-solicitation and pre-proposal conferences, are valuable opportunities for the government and for potential vendors – both prime contractors and subcontractors, many of whom are small businesses”
  8. The program manager already talked to industry to develop the technical requirements, so the contracting officer doesn’t need to do anything else before issuing the RFP.”  Fact:  The technical requirements are only part of the acquisition; getting feedback on terms and conditions, pricing structure, performance metrics, evaluation criteria and contract administration matters will improve the award and implementation process.
  9. Giving industry only a few days to respond to an RFP is OK since the government has been talking to industry about this procurement for over a year.”  Fact:  Providing only short response times may result in the government receiving fewer proposals and the ones received may not be as well-developed – which can lead to a flawed contract.  This approach signals that the government isn’t really interested in competition.
  10. Getting broad participation by many different vendors is too difficult; we’re better off dealing with the established companies we know.”  Fact: The government loses when we limited ourselves to the companies we already work with.  Instead, we need to look for opportunities to increase competition and ensure that all vendors, including small businesses, get fair consideration.

There you have it.  Now you know what myths the top procurement official in the White House wants to squelch.  In effect, he’s telling buyers some of the same things we tell sellers.  Communicate and build relationships.  As Daniel Gordon says in his memo, industry partners are often the best source of information on markets, “so productive interactions between federal agencies and our industry partners should be encouraged to ensure that the government clearly understands the marketplace and can award a contract or order for an effective solution at a reasonable price”.  You can find the full memo here.

We’ll take on some of the myths one by one in future posts.

All the best,

Rick

Preparing for Government Cut-Backs

No doubt about, selling to the government is being impacted by the economy.  If you’ve not seen it in your own business, you’re either not paying attention, failing to look ahead, or ignoring the signs.  Times are tight, and government buyers at all levels are feeling the pinch.  Even if their funds haven’t been cut, there’s a threat they will be.  Plus, they know that they are being watched more closely than ever.  Of course, government won’t stop buying (well, I guess the federal government could if Congress can’t come to terms on a budget)…but, they’re buying more carefully.

So, what do you do about it?  Inc magazine says you should be proactive.  You shouldn’t wait for your government customers to come to you, it says in an April article, you should go to them with ideas for saving money.  You may find you end up with more business, not less.

It goes back to our oft-stated mantra about relationships being so very important in government sales.  You know your government customers are struggling, so help them out.  This doesn’t mean voluntarily slashing your prices.  You shouldn’t.  But, it does mean getting creative.

Is it possible that you have new products or solutions that can help provide efficiencies?  Is it possible they’re not using your products and solutions as many ways as they could?  Do you have success stories to share of other customers finding efficiencies?  Or, perhaps could you offer assistance with problems you may not even be aware of that are keeping them your customers up at night?  Why not schedule a meeting, and find out?

In other words, don’t hide behind the economy, like so many people and organizations do.  Use it to strengthen your relationships.  I guarantee you that, properly done, you’ll benefit in the long run.

All the best,

Rick

Winning Trade Show Strategies

Rick and I just returned from working a government-focused trade show for a valued client.  The show was a raving success, producing a sizable number of raw (but targeted) leads, and many strong prospects.   Though booth traffic certainly had its ups and downs, it seemed we were able to stay engaged in meaningful conversations consistently throughout the four days (of very long hours).

As the show was winding down, we naturally asked other exhibiting vendors within our vicinity what they thought of the show.  We expected them to echo our feelings regarding its success.  We were surprised at what we heard.  Most exhibitors complained the hours were too long, the traffic was inadequate and the overall lead results were simply not that great.

As “glass half full” kind of guys, were we simply looking through the event with rose-colored glasses?  Absolutely not.  Our results were solid and recognized by vendors surrounding us (frustratingly so, I think).  So why were we successful when others were not?  Here are some lessons learned over the years and applied here that can help make your next trade show experience productive and efficient.

Start with the Right Show

It sounds obvious enough, but it’s astounding how much time, money and energy is wasted by companies conducting trade shows that don’t really reflect their buyers.  Many trade shows are essentially glorified fishing expeditions, attended in hopes of discovering some hidden pocket of lucrative customers.  Rarely does this bear fruit.  Sure exploring shows can be worthwhile, but you can do that by “walking a show” the first year instead of wasting a great deal of money and time on poorly targeted events.  Make sure the shows you attend attract people who can really drive a deal.

Target Even More

Even for a well-targeted show, it’s likely a large percentage of attendees to any given show will not be real prospects for you.  Creating booth “buzz” is beneficial to some degree (we’ll discuss this in a minute), but driving visits by legitimate, strong prospects is the ultimate goal.  To address this, create a traffic driving campaign for the 40 to 50 people in your database you REALLY want to speak with at the show.  Send them something that will get their attention and make them want to visit your booth.  You may spend more per prospect this way, but you’ll be driving the precise targets with whom you want to speak.  What kinds of things will get their attention?  Creative things–read on.

Get Creative

A little creativity goes a long way in generating booth traffic.  Standard “trinket and trash” giveaways have their place, but you may find a message-reinforcing campaign will yield greater results.

As an example, to capture prospects’ attention, we sent our top 50 targets for this show a bright blue mailing tube (irresistible to opening).  Open the top, and Erector set pieces fall out on their desk (a nostalgic construction toy that fit with the demographic of this show).  A printed piece inside displayed an image of a helicopter made with an Erector set.  The headline read “Making the Right Connections Can Really Help You Rise to the Occasion”.  The piece went on to describe how our system integrator client “makes the right connections” between disparate databases and systems in order to make the prospect’s job more effective and efficient.  It also invited them to drop by the booth and pick up their own Erector set.

We successfully persuaded 40% of our highly targeted list to engage us in discussions with this campaign (many of the others were simply not in attendance).  Further, we displayed several Erector sets inside the booth.  This generated nearly as many “drive by” discussions with people wondering about the relationship between a government-oriented technology company and toys.  This was pure gold, as it gave us a chance to launch into our positioning pitch and start asking probing questions.

Lose the Table

If you’re accustomed to sitting behind the big white table provided at many shows, you should rethink your approach.  You’re likely sending the wrong message to prospects.  Tables are barriers between you and prospects.  Sure they’re nice places to stack literature, but you’re not selling literature.  You’re selling solutions to problems.  You won’t understand a prospect’s problems until you get them talking.  Tables are subtle but powerful deterrents to effective engagement.

Salespeople attending shows often assume they’re stuck with whatever show management places in the booth prior to the show.  Not so.  Drag the table into the aisle at setup time and it will magically disappear before the show begins.  If possible, rent a bar height chair and a small, round, bar-height table.  Set these to the side so your booth is open and inviting.  Though you should stand up during busy times, during slower times the bar height furniture will place you in a better position for engagement than slumping in some low-seated folding chair.  Once a prospect approaches, you should always stand when conversing.

Adopt a Consistent Lead Capture Process

This may range from those fancy badge scanners to simply making notes on business cards.  Whatever the method, make sure it’s consistent and practiced across all salespeople working the booth.  There’s nothing worse than lost leads or incoherent notes due to a sloppy lead capture process.

Leverage Vendor Events and Lunch

After standing in the booth for hours, it’s tempting to want to slip away for a quiet lunch somewhere.  However, if you’re skipping the opportunity to have a meal with attendees, you’re ignoring a great lead generation opportunity.  Over the years, we’ve had innumerable productive conversations simply by plopping down beside some stranger and striking up a dialog with them.

Overall, Be Proactive

Too many times we see salespeople sitting back waiting for conversations to come to them.  Remember why you came to the show in the first place (presumably not for the golf).  Be proactive and assertive in talking with people and making connections.  You don’t have to be obnoxious to achieve this.  Friendly, engaging questions will typically do the trick.

Chad Blackburn, one of Galain’s sales partners, (he worked the booth with us at this show) is one of the best I’ve seen at this.  He stands in the middle of the aisle ready to engage any moving target.  A simple, “Hi there.  Where are you from?” typically stops people and allows him to initiate a conversation.  Another favorite tactic of his is to bring a football to the show and toss it to people as the walk by.  Hey, whatever works.

Trade shows can be frustrating and tiring.  But they can also be a highly efficient means of prospecting and initiating a relationship.  Keep these tips in mind for your next show, and maybe your experience will be even more profitable.

All the best,

Lorin

Relationship-building Strategy 4: Increasing the Quantity and Quality of Communications

  

It’s crazy isn’t it?  Never before in the history of the world have humans been so connected to one another through so many different communications options.  Landline phones, Crackberries, Bluetooth devices, multiple email accounts, SMS, Instant Messaging, VoIP calling, Twitter accounts, LinkedIn, Facebook,…and that just describes the communication methods of my thirteen year-old daughter.   

Still, communication continues to be one of the most significant obstacles to successful relationship-building in a business environment.  So how do we create outstanding interpersonal connections with prospects in order to enhance our relationships?  There are many factors that play into this.  However, we believe there are three main components that must exist before solid communications with exchange partners can occur: relevance, timeliness and reliability. 

Relevance.    Simply providing information to prospects is not, within itself, enough to enhance communications and further the relationship.  The information exchanged must be perceived as being relevant to the respective recipients.  This is even more important in today’s world where information overload is reaching SPAMdemic proportions.  

As salespeople, we must be selective with regards to the information we attempt to push to prospects.  With every outreach, we should ask ourselves, “Will this information truly and uniquely answer a prospect question or help aid in solving a prospect problem?”  If not, you’re likely wasting your time and making little headway in cultivating a deeper relationship.  If so, you’re on your way to making a new BFF.  

Timeliness.  The timing of the information exchange is also critical to its impact on relationship development.  Really good outreach efforts at a really bad time in the life of a prospect will at best, be ignored, and at worst, create a perception that you’re self-serving and insensitive.  Many times, it’s impossible to know whether or not your communication efforts are coming at a good time or not.  So ask.  Simple courtesies such as asking, “Is this a good time to talk about this?” will be appreciated. 

Reliability.  This piece of the communications pie can only be illustrated over time.  Great communication doesn’t happen overnight, but instead improves as interactions occur over time and information exchanges are shown to be accurate and dependable.  While we may not be able to remember the details of each of these interactions, our minds appear to be able to store assessments of these various touch points.  Thus, we develop overall feelings about certain people and whether or not their word can be trusted. 

While it’s impossible to do justice to the topic of communications in the context of a blog, the simple practice of focusing on relevant, timely and reliable communications methods will help overcome barriers to personal interaction and improve overall relationship commitment and trust. 

All the best, 

Lorin

Relationship-building Strategy 3: Increasing Termination Costs

A third way to build deeper exchange partner relationship commitment is to increase relationship termination costs—that is, ratcheting up the “price” one might pay for ending the alliance.  While this strategy must be deployed with sensitivity and caution, it can be an effective method for solidifying relationship bonds.

In any business relationship, there is a cost connected with ending the association.  Sometimes, the cost is near zero, while other times the cost can be quite high. 

For example, on the low side, consider the termination costs of switching toothpaste.  While some people may defend to the death their choice of brands, for most of us, there is relatively little pain or inconvenience in switching to another offering.  From a toothpaste manufacturer’s perspective, termination costs are very low.  There is relatively little pain Procter & Gamble can inflict on you should you decide to ditch your tube of Crest for the siren call of a competing brand. 

On the high termination cost side, consider Southwest Airlines (the “company plane” for many of us road warriors) and its association with Boeing.  Southwest’s entire fleet of aircraft is comprised of some variant of the Boeing 737.  Fleet standardization is a fundamental part of Southwest’s overall business strategy as having a single-model fleet allows them to keep costs low through uniform training, maintenance, operating procedures, etc.  Imagine the “termination costs” of switching airplane suppliers in Southwest Airline’s case.  At this point, it would be nigh impossible. 

Clearly, relationship termination costs can have a strong impact on relationship commitment (though not trust, particularly).  In business, termination costs are frequently contractual, but emotional and psychological termination costs are also very real and very powerful.

Termination Costs as a Strategy

Companies and salespeople should look for ways to increase the “pain” associated with a prospect buying from another vendor, or with a customer switching solutions.  We are NOT saying salespeople should invent ways to try to maliciously punish prospects for not buying or customers for leaving.  We have seen historically, on rare occasions, an angry salesperson attempt to seek petty retribution for losing a fair deal.  This is ridiculous behavior that should never be tolerated in any circumstance.  

Instead, salespeople should make sure: 1) the rules of engagement and disengagement are clearly defined for all parties involved, and 2) such clear value and problem resolution is delivered to the exchange partner that it would be uncomfortable for them to no longer have access to it. 

One way to achieve this is through contractual agreements—a formalized approach to termination cost management (part of the salesperson’s “rules of disengagement” responsibility).  Take your cell phone provider as an example.  If you read the fine print of the contract you’ve signed, you will see it allows you to terminate your service before the contract term expires.  However, you’ll also see there’s a hefty fee to pay if you do it.  Unless you’re really miffed at the provider, you’ll probably just keep the service until the contract expires because the termination costs are too high. 

On the flip side, formal contractual incentives may also be used to increase termination costs.  For instance, some companies offer discounts for first-time buyers, or enhanced customer support options that may only be available in exchange for a renewed or extended purchase agreement.  Even government buyers don’t like passing on “deals” when they can get them.  As such, there is a cost associated with passing up these special offers, even if it manifests itself in the form of an incentive. 

Outside of the contract, there are steps that can be taken to increase termination costs.  Go back to the previous section and think about the list of possible relationship benefits we all seek:  knowledge/expertise, future gain, mutual connection, network access, fame/notoriety.  If you have been really successful in building any of these elements with a prospect or partner, then the removable of these could carry with it a certain degree of pain—clearly a termination cost.  It is actually possible for a salesperson to serve as such a valuable source of positive benefits that the exchange partner would be negatively impacted by the loss of the personal connection.

A word of caution is in order here.  You should be very careful with the deployment of this particular strategy.  If a line is crossed and the customer perceives “coercion” is taking place, you’ll weaken the relationship, not strengthen it.  The exchange partner may put up with you as long as absolutely necessary, then drop you like a hot potato at the first opportunity.  No one likes to feel manipulated or forced into a corner.  Deployed gingerly, however, increasing termination costs can be a useful component of an overall relationship-building plan.

All the best,

Lorin