Value Selling Business Solutions

Robert Turek's Blog

• Most Project Management Office (PMO) Models are Wrong

  2007 Sep 29

  Recently, I finished a great book by Gerry Kendall and Steve Rollins, Advanced Project Portfolio Management and the PMO. It’s great because it reveals a very high-value transformation that most companies can take advantage of resulting in increasing ability to execute strategies. The value of a PMO is debatable, and therefore doubted, only because the target PMO model is wrong. Kendall and Rollins clearly point out that most PMOs are formed in crisis and therefore emphasize cost cutting; the result is almost always doubt about the PMO’s value and disbandment of the PMO when the crisis is over or the next budget cut occurs. A PMO that emphasizes throughput (quicker delivery of the right projects that help execute strategies) gains much higher value and cost control. Interestingly, this PMO model is largely based on Eli Goldratt’s Theory of Constraints principles, which are not intuitive. Executives get over the intuitive barrier using simulations of what happens when projects are placed into the system without regard to constraints like strategic resources. Why aren’t more companies adopting throughput focused PMOs? Mainly, because they are “new”, not intuitive, and perceived to be another layer of management. None of these perceptions is true. What is true is that companies that have deployed throughput focused, "execute strategy" PMOs have gained seemingly impossible, transformational benefits.
  

• The People vs. The System

  2007 Jul 08

  An experienced lean consultant introduced me to the fact that the system is responsible 95% of the time something goes wrong. A training exercise called the parable of the red beads is often a prelude to lean 101 training that reveals this “truth”; once understood, it changes how people respond to being managed and how people manage. The organization, arguably part of the system, is also a key element in that it must fully support accomplishment of the responsibilities of the individual. If the system and organization are not up to par, the individual is made the cause of any problems that occur, often resulting in demotions, ill advised reassignments, and even firing. In such a passionless environment it is tough to get anything done. Think about how your system, and your organization, supports or hinders your workforce. Then take steps to demonstrate your understanding of the “95% rule” and start a system and organization continual improvement program.
  
  

• Project Managers Must Learn How to Value Sell to Executives

  2007 Mar 13

  Many, many times we in the consulting profession lament about lack of selling skills in our prospect's organizations. The problem is of our own making because generally we sell "solutions" without understanding the problem--i.e., solution sellers vs. problem/value sellers. C-levels want to know how to move ahead and make money. Managers want to know if they can implement the solution in a reasonable period of time and go on with their lives. If we are C-level value sellers who want to be successful, we understand the clients business first and the potential value of solving problems way before the detail solution comes into play.
  
  The Project Manager is a curious animal who must play all sides and, in many cases, hope someone sees the light so they can get the budget and resources to start a much needed project. It's a wonder anything ever gets done with all the conflicting messages and lack of true value based selling- both external and internal. This chaos can be harnessed but by only the best Project Managers who indeed know how to value sell to their executive team. In other words, the Project Manager has the best positioning to value sell internally. See the article "Getting the Budget You Want for Your Project: Lessons from a Software Vendors Value Selling Process" on this web site.
  

• Where's the Wisdom in Manufacturing Best Practices Today?

  2007 Mar 10

  A very good friend of mine, who happens to be a brilliant manufacturing expert, traded information with me on best practices. These conversations are the “gold” of my business as they define better and better ways to handle age old issues. Believe it or not he is not up to speed on the latest lean terminology- after he said “oh, that’s what that means” about five times he finally concluded that he’s heard most of this before but with different terminology. I reminded myself that the best consultants could care less about what you call it but are extremely adept at applying experience-based best practices from many seemingly different disciplines; lean, Theory of Constraints, and JIT are examples of bodies of best practices from which the best manufacturing consultants create their successes. Bottom line- look for the consultant who carefully applies elements of all these in a way that innovatively and positively impacts your company.
  

• "If My Solution Improves Thru-put, WIP, and Lead Time by 30% Why Can’t I Value Sell It?"

  2006 Jul 20

  Why don’t people buy-off on a business solution that can make them money? Assume you have a "same industry" reference with proven quick value, low cost, and a willingness to share how they did it. Implementation time, cost, and value barriers seem to be eliminated. Why wouldn’t an IT or Materials Director buy? Too many projects, think they can build it in-house, don't care about value. A high value solution must be sold in the right way to the right person- the C-level executive.
  
  This blog, my books and articles teach you how to be comfortable selling a high-value solution to a high level executive. Read about value selling in "Are You Really Value Selling?" and "Preparing a Value Selling Presentation Using the Problem-Solution-Value Approach" followed by the book Value Selling Business Solutions.
  
  An example of a high value solution is Rapid Priority Management (RPM) winner of the Innovation Award from the Association for Operations Management; read the article "The Planning and Execution Gap: Is Rapid Priority Management the Answer?" and then the book Working the Plan to understand what a value solution is.
  
  
  

• Drive-By Lean Kills Lean Programs

  2006 Jul 05

  Conversations with two long time lean manufacturing experts reveal they are avoiding “drive-by lean” projects because of their role in the 90% lean failure rate. Drive-by lean, often followed by abandonment of lean programs, is popular because of the deceptively simple and fantastic short-term results. Apparently the big bang of a kaizen event is not in and of itself sustainable and can even lead to attacking it's success and applicability to the rest of the operation.
  
  Recently, a lean instructor presented the classic “house of lean” with lean “modules” and value stream map stairs. The problem is that the "house" focuses on big impact items while ignoring the underlying sustaining power of a lean program- the many small efforts to be perfect that recoup small victories. The enablement of small efforts, through training “hands on” workers in areas like problem solving and supervisors in work area assessment, sustains a lean program. To illustrate further, the instructor drew two parallel stair steps. One had big stairs that represent high benefit short-term efforts like kaizen events. The other stair steps, really an almost straight, bumpy line, represent the very small improvements that every employee can be doing every day. Both stair steps should operate in parallel in order for lean to take hold.
  

• Value Selling Drives Lean Software Product Development!

  2006 Apr 27

  One of the most challenging product development processes is software development in enterprise software companies. Over time programming and product management staffs grow and become siloed requiring design, development, and testing times to increase; WHAT to design into "standard" product is often confused by client customization consortiums and the latest prospect needs. The amount of change introduced into the process by the "heavy" staffs who are paid for their creativity creates a chaotic situation. Value to the client is often lost in the shuffle. One of the pillars of "lean" thinking is hearing the "voice of the customer"- i.e., concentrate on what is valuable to the customer and get rid of all else. With a value selling focus the sales and consulting teams sell value assessments related to what the customer thinks is valuable which results in a focus on the high-value business processes enabled by the software. Value analysis should be done on all current product development projects to prioritize WHAT should be worked on followed by "leaning" the entire process (read the post on lean programming/agile software development below- lean and software development are great partners).
  
  Bottom line- more flexible and quicker software development focused on customer value can occur when value selling approaches are teamed with lean thinking.
  

• Can ERP software be value sold?

  2006 Mar 29

  One reason ERP software presents a different value selling challenge is that it covers many business processes and thus a lot of value items. This is good and bad; one risk in value selling is a tendency to put too many value “line items” on the table, thus destroying the credibility of the overall value- particularly the bottom line, profit enhancing “hard dollar” value. Value items that are not “hard dollar” (e.g., improvements in inventory, time-to-market, productivity) don’t have the same impact on executives that a “hard dollar” item can have (e.g., reducing purchasing spend due to new strategic sourcing business processes). Additionally, the well known value of successful ERP implementation is eroded by equally well known failures. One solution to this dilemma is to focus on a few high-value business process areas within the ERP solution framework. An example is a food and beverage industry trade management system that might help cut trade spend by 5%; another is a logistics system that could drastically cut freight costs. With a focused value assessment effort the value obtained from these types of solutions can justify an entire ERP solution and it’s implementation; this approach can impress an executive so much that they will beg for more information on the “softer” value items. This moves you towards "trusted advisor" status thereby increasing the gap between you and your competition.
  

• The "Problem-Solution-Value" Statement is the Heart of the Value Sell

  2006 Feb 20

  The “PSV” or “problem-solution-value” statement is a simple yet very effective way to reveal your clear understanding of the business of your prospect, a potential solution, and the solution's value in hard dollars. At first the PSV is heavily reliant on a “same industry reference” but over time develops into a detailed statement of the client’s position that is “owned” by the client. One aspect of the seemingly simple PSV is the emphasis given to the “P”, the “S” and the “V” in specific presentations to the prospect. If you are meeting with a clearly value oriented person, the “V”, with a heavy dose of the “P”, is emphasized. With a manager-director level the “S” becomes more important because what the solution does and how hard it is to implement overrides the value. The “value” type doesn’t want to hear about solution details- rather they just want to know that there is a solution and somebody, preferably a competitor, has implemented it and obtained the value. Conversely, the “solution guy”, commonly called “seymour”, will probably get angry with a “value” emphasis. So- which of the following PSV emphases would you use with the C-level value guy? PsV or pSv? Take that to your next meeting!
  
  

• Lean Operations, Agile Software Development and Value Selling are Related

  2005 Oct 18

  My fascination with lean operations continues after reading a “lean programming” article comparing lean manufacturing principles to agile software development methodologies (www.poppendieck.com/lean.htm). Some key points made are:
  
  1) lean manufacturing’s twin values of rapid product flow and built-in quality lead to high quality, low cost, short lead time products,
  2) this, combined with total quality management’s emphasis on teamwork and long term, trust-based relationships with suppliers, mirrors agile development’s focus on flow, frequent "built-in" testing and trust in the people who are doing the job,
  3) the most difficult part of implementing lean (manufacturing or programming) is the paradigm shift required,
  4) lean programming requires that every “consumable” be scrutinized for it’s value-add to the final product and that it is the most efficient way to add value,
  5) the “inventory” of software development is documentation that is not a part of the final program,
  6) in software development the ability to make decisions as late as possible provides a competitive advantage,
  7) a key problem is the assumption that it is possible to generate a detailed set of documents that correctly define customer requirements, and that those requirements will not change,
  8) scope will take care of itself if the domain is well understood and there is a well-crafted, high-level agreement on what the system will do in the domain.
  
  Bottom line- agile methodology projects require a focus on business value attained that exceeds costs, monitored frequently during a project that encourages change, versus focus on attainment to an original plan/software design that in fact discourages value-added changes. This value focus opens the door to value-based selling approaches to higher level executives to introduce agile software development projects into organizations.