Where is the ROI?

supply chain management consulting

Working with a prospect the other day, I was part of an amazing conversation that usually never happens as sales people are too timid to press their prospects.  In my call with them I found out they recently implemented a web based tool with the idea to remove cost from their process.  I asked them if they were able to measure the impact of their vendor’s product.  They said yes, and when I asked what it was, no one could define the real value.  All that was given were talking points from the vendor’s original proposal.  At risk of making my prospect angry, I responded by saying, “hey that’s great but what really happened after you put the process in production?  Were you plus x% or minus x% of the targeted goal.”  No one said anything.  I then asked, either to break up the awkward silence, or because of my need to be cruel, “did you get a hard dollar ROI in the proposal?”  Answer: “Yes.”  “Did you achieve the ROI?”  Answer: “Yes.”  “Did it reflect in plan against budget?”  Silence turned to a group of people all talking at the same time in an effort to avert blame for something that no one, up to now realized they could be held accountable for.  The group split up into teams.  One team had erected a makeshift fortress of denial, quickly advising everyone in the room that they were happy with the solution… Move along folks… Nothing to see here.  Then team opportunity sensed they’re in the sun moment was at hand, and started asking team denial all sorts of questions.  I could have hung up and no one would have noticed I left the meeting.

What’s the point to this?  Why do companies hire consultants to assist with projects?  Because in battle, the plan of attack is lost after the first shots are fired.  In a project where internal employees are the acting managers of the implementation, and are still responsible for their other deliverables to the company, will run at the first shots in the battle.  They change the objectives to deal with the chaos of the new product implementation.  The objective of the project is lost.  A reasonable steady state becomes the objective.  Victory is declared and no measurable result from the vendor can be quantified.  Using an outside firm, not associated with the vendor… I’ll repeat that, NOT ASSOCIATED WITH THE VENDOR, can objectively apply a base line to the goals of the sale and assist the organization in delivering the result that was intended by both buyer and vendor.

What is the importance of measurable results? Simple, making it meaningful to the customer.  If it’s meaningful, the customer can at any time identify the impact to their bottom line.  This will allow the customer to justify the project.  To apply continuous improvement and increase project through put.   Time will only add value to the results of the project.  The vendor will become a valued partner to the buyer.

If you are selling some tool to a customer who is wavering because of internal resources.  You might want to suggest them bringing in an independent consultant to oversee the implementation.  It could help your sale and future relationship with your customer.  And for the buyer who wants to implement a new tool.  Don’t be cheap.  You will be better off and drive more savings by bringing in someone whose sole purpose is to make your project pay dividends.

 

Readers Comments

comments powered by Disqus

Contact Us

Fill in the simple form below for a free consultation and we'll get back to asap!





Our Latest Tweets

Post Categories

Where is the ROI?

supply chain management consulting

Working with a prospect the other day, I was part of an amazing conversation that usually never happens as sales people are too timid to press their prospects.  In my call with them I found out they recently implemented a web based tool with the idea to remove cost from their process.  I asked them if they were able to measure the impact of their vendor’s product.  They said yes, and when I asked what it was, no one could define the real value.  All that was given were talking points from the vendor’s original proposal.  At risk of making my prospect angry, I responded by saying, “hey that’s great but what really happened after you put the process in production?  Were you plus x% or minus x% of the targeted goal.”  No one said anything.  I then asked, either to break up the awkward silence, or because of my need to be cruel, “did you get a hard dollar ROI in the proposal?”  Answer: “Yes.”  “Did you achieve the ROI?”  Answer: “Yes.”  “Did it reflect in plan against budget?”  Silence turned to a group of people all talking at the same time in an effort to avert blame for something that no one, up to now realized they could be held accountable for.  The group split up into teams.  One team had erected a makeshift fortress of denial, quickly advising everyone in the room that they were happy with the solution… Move along folks… Nothing to see here.  Then team opportunity sensed they’re in the sun moment was at hand, and started asking team denial all sorts of questions.  I could have hung up and no one would have noticed I left the meeting.

What’s the point to this?  Why do companies hire consultants to assist with projects?  Because in battle, the plan of attack is lost after the first shots are fired.  In a project where internal employees are the acting managers of the implementation, and are still responsible for their other deliverables to the company, will run at the first shots in the battle.  They change the objectives to deal with the chaos of the new product implementation.  The objective of the project is lost.  A reasonable steady state becomes the objective.  Victory is declared and no measurable result from the vendor can be quantified.  Using an outside firm, not associated with the vendor… I’ll repeat that, NOT ASSOCIATED WITH THE VENDOR, can objectively apply a base line to the goals of the sale and assist the organization in delivering the result that was intended by both buyer and vendor.

What is the importance of measurable results? Simple, making it meaningful to the customer.  If it’s meaningful, the customer can at any time identify the impact to their bottom line.  This will allow the customer to justify the project.  To apply continuous improvement and increase project through put.   Time will only add value to the results of the project.  The vendor will become a valued partner to the buyer.

If you are selling some tool to a customer who is wavering because of internal resources.  You might want to suggest them bringing in an independent consultant to oversee the implementation.  It could help your sale and future relationship with your customer.  And for the buyer who wants to implement a new tool.  Don’t be cheap.  You will be better off and drive more savings by bringing in someone whose sole purpose is to make your project pay dividends.

 

backtotop