Outcome engineering is an approach to technology investment that is gaining momentum in the ever-increasing “as-a-service” economy. Customers invest not because of the features-based sales tactics of the past but on providers’ ability to map customer services to clear, measurable business outcomes – primarily increased profitability, reduced cost and reduced security risk.
This shift in customer demand requires a distinct upgrade in the skills of salespeople to partner with customers to identify, track and measure outcomes that are a far cry from selling feature-function-benefit. From the early days of typewriters and cash registers sold in volume, technology was sold up front based on product features. Sales were transactional: sell a product made competitive with as many features as possible, then move on to the next feature-packed option and then move on again. Service was a customer-demanded add-on, not a strategy.
Fast forward 100 years to the “as a service” economy where software-as-a-service and platforms-as-a-service are the norm and we have customers investing in technology not based on features so much as lifecycle support and business outcomes; the measures of profitability, cost and risk. The traditional approach, still ingrained in some sales organizations today, was about sales involving large sums of money up front with the customer left holding the bag when providers didn’t deliver as promised, with business value unfulfilled. As-a-service platforms are forcing vendors to reevaluate their sales and delivery/services approach and become experts in outcome engineering.
Today the customer’s message to providers is, “Don’t just sell capabilities and features – what about the service so I’m enabled to run my business seamlessly, with low risk?” Customers spending a lot of money demand that their partners provide excellent service and consulting over time. And if they pay monthly, it is easy to cut their losses and switch to another vendor.
XaaS (X as a Service) offerings from companies such as Salesforce.com and Amazon Web Services have challenged existing models, and all providers are on the hook to rethink their approach by delivering the following:
- Offerings focused on Key Performance Indicators (KPIs) mapped to desired business outcomes developed through intense consultation with customers.
- Concrete measurements identified with related mechanisms for tracking and reporting.
- Verticalization to understand their customer’s businesses in depth, how technology can increase profit, reduce cost and improve security/reduce risk in different businesses (salespeople conversant in each customer’s industry).
- Gaining buy-in and commitment from everyone who touches the end users, the stakeholders, the executives – are they on board with change or resistant to the new lifecycle approach?
- A technology lifecycle mentality selling through the project so that the customer is supported beyond initial sale through full service, evolving needs and consulting for future technology decisions.
- Recognition that not all customers will choose the outcome engineering approach (customers choose partners, but partners need to choose customers, too, and map the sales solution to the customer’s mindset).
Mindset and expectations have changed, but opportunities exist. Revenue continues throughout the lifecycle and there’s greater opportunity to gain revenue in the long run, even if it’s now exchanged in chunks, rather than a large sum up front. Outcome engineering is a way to excel because you’re no longer just selling the promise, you’re delivering on the promise.
Adapting to the new model takes resources, commitment and training to upgrade skills for a sophisticated lifecycle approach and an understanding of business outcomes, but it offers a great opportunity to work more closely with customers to nurture business relationships and develop “stickiness” to net more business and revenue over time because you don’t stop selling. Change takes work, but you know the old saying, “If you don’t like change, you’ll like irrelevancy even less.”
Outcome engineering is here. Providers need to get moving on the opportunity to help customers consistently achieve targeted business outcomes to meet their business goals.
What is your experience with outcome engineering and lifecycle support? Share your thoughts and questions.