How businesses buy tech solutions: crafting great proposals
#186 - Sep.2024
You negotiate all the time.
You're constantly negotiating, whether at work, at home, or even at a store. Negotiation is not just a business skill—it's for everyday life.
In this post, I want to focus on business proposals, specifically proposals for technology solutions. But many of the ideas will help you improve how you present your value to others, no matter the context.
For many years, I worked as a pre-sales consultant at a technology firm. My job was to design tech proposals. Some worked. Some were met with a painful "No, thanks."
After working on over 100 proposals, I've learned a few things. Things that separate good proposals from great ones. I'd like to share them with you.
You don't simply write a proposal. I believe you need to craft a proposal.
I would say that is almost an art. Good proposals are memorable. They build trust. They stand out from the competition.
As in any craft, it's a skill that you need to practice. A lot. Learn what works for your industry and iterate.
I'm not going to get into specific templates or step-by-step. Instead, I'm going to share principles that I believe are common in successful deals.
A Promise
A proposal is a promise to solve a problem, grow a business, or reduce costs. It's a promise of change. Moving a business from point A to point B.
The foundation of a good promise is trust. Without trust, they won’t buy from you. Simple as that.
I've seen people rush to show their technical expertise but forget that behind every buying decision are people—people with doubts, egos, and biases. You can't ignore them. Instead, work with them to improve your value proposition.
Leading change
If you want a business to trust you, you need to understand how change works. A great proposal shows how you, as a professional or company, will lead this change.
Michael Beer’s framework for leading change is simple and helpful:
- Dissatisfaction: What's wrong with the current situation? This is the status quo you want to change.
- Vision: What’s the future state once you fix the problem? This is the positive picture of the future.
- Process: What are the steps to get there? This shows the path towards the vision.
- Cost of Change: What are the barriers or costs to making this change? This is the natural resistance to change.
The framework is simple. The dissatisfaction, vision, and process should be strong enough to overcome the resistance to change.
Many of my proposals that didn't work were because of the lack of one of these elements.
Putting the framework into practice.
You need to start with a clear understanding of the problem you want to solve. You can't offer a solution for something you don't understand. Using customer journey maps to identify key pain points is an effective way to do this (if you want to learn more, check out this free e-book).
Great proposals offer a bold vision. Make it simple, clear, and measurable. Use storytelling to paint a picture of the future.
Many proposals fail not because of a lack of a vision, but a lack of showing the process. This is one of the most important parts of building trust. It’s where you demonstrate your expertise and approach.
Managing resistance is challenging. People perceive value intuitively. Most will argue that buying decisions are based only on data. That's not true.
The truth is that many people make their decisions fast during early interactions. You need to make these interactions count. Focus on showing that the value and the process to get to the vision are worth it.
And by "worth it" I'm not talking about only pricing. Is committing to a journey with you to make the change they are looking forward to.
What game are you playing?
Knowing how change works will give you the building blocks of your proposal.
Now, you need to understand which game are you playing. Businesses in search of technology solutions generally fit into one of these:
- Transactional. These are short-term engagements. They are looking for the best product in the market. Either looking for the lowest price or differentiation.
- Customized products & services. They look for a wide product portfolio and services. They search for solutions customized to their business and value the power of a strong network of expertise.
- Strategic long-term partners. These are the businesses that want a partner for a foundational change. It might require exclusiveness and long-term commitments.
In your early discussions, figure out what your customer is looking for.
A high-priced custom solution won’t work for someone looking for a basic, low-cost option. Same way, selling a commodity to a business looking for a customized solution will break the deal.
As a professional or company, you need to segment your customers based on the value proposition they need.
Technology adoption
The technology adoption curve is a popular model that shows how people react to new technology. There are innovators, early adopters, the majority, and laggards.
But regardless of this, I have found that the most effective way of demonstrating the value of technology is by showing.
The best way to demonstrate the value of technology is by showing it. Proof-of-concepts (PoC) or demos can be powerful tools to connect the tech to the real needs of the business.
Systemize how you create demos, and you’ll have a big edge over your competitors.
Make it a practice. A mandatory part of your engagement process with customers. Remember the vision element of change? Demos and PoCs help materialize this vision.
Decommoditize
Make it unique.
Make each proposal unique to your client. Show that you understand their problems, share their values, and have a unique approach to solving their needs.
This is where your craft shines.
Businesses see value by comparing alternatives. A great proposal feels unique and answers the deeper question, “Why us?”
Great proposals are genuine. They show that while you may not have all the answers upfront, you’re ready to walk the journey together.
The more you offer your value to customers, the better you get at it.
Crafting great proposals is a constant learning process. People's and businesses' expectations change, and your approach should adapt to these changes.
Remember: is people making decisions. It’s all about human connections.
¡Saludos!
