I have always disliked the
concept that Sales Engineers are responsible for winning the technical sale
and
gaining the Technical Win. During my pre-MTS career as a presales leader anyone
in my organization who spent a lot of time talking about The Technical Win (TW)
was generally met with a withering glare and a statement like “Where in your compensation plan does it say
that you get paid on the Technical Win?”. It’s an intermediate point in the
sales process – at best.
Has the Technical Win become
redundant in the modern world of Solution Selling? Ask any group of Sales
Engineers to define their job, and the phrase “we’re
responsible for winning the technical sale” is mentioned. Many SE
organizations measure and publish their Technical Win Rate for RFPs, Proof of
Concepts and Trial/Evaluations. This month I will examine the Technical Win
(TW) and determine if it is real, if you should care, and what the metric tells
you.
A VP of Sales Engineering at a large
software company told me his POC Technical Win rate was 82%, yet the Business
Win rate (generating revenue) was only 59%. I asked if his team was directly
compensated for a Technical Win. They are not. My point exactly. But you can
learn something from the statistics.
The Technical Win
The strict definition of a TW is when you are
informed, in writing, that your solution has been accepted and judged
superior to that of your competition. For example, you may have scored a 13/14
on a POC evaluation compared to an 11/14 by your competitor.
Most SE organizations have a far looser definition,
which may only require you to complete a POC or trial by meeting the success
criteria. Acceptance may also come in verbal fashion. Recording of the TW may
be as simple as checking a box on a screen in salesforce with no proof. An
exasperated Regional VP of Sales based in Hong Kong once told me that in his
opinion the TW was the equivalent of not losing – which is very different from
winning.
By contrast, the Business Win is definitive
and measurable – as it will result in the generation in revenue flowing from
the customer to your company, and eventually, one hopes, into your personal bank
account. You are paid to generate business that will cause a purchase order to
be issued.
Should You Care About The
Technical Win?
Another way of looking at the TW
is that it says to everyone that the SE organization did its job and the sales
force did not. This is hardly the best way to promote teaming between sales and
pre-sales. I have always believed that pre-sales is also responsible for the
Business Win, just as sales has some responsibility for the Technical Win.
Given the incredible focus that
most organizations currently have on Selling Solutions instead of Selling
Products it is hard to rationalize the justification of a Technical Win in that
environment. Selling value means that you continually need to link your
achievements in a proof, trial or evaluation to not only the technical
criteria, but also to the business and financial criteria. Put simply, how does
your solution increase revenue; decrease costs or mitigate business risk better
than the other guy’s stuff? Technology and Business are inextricably linked.
It is an unpleasant fact (small
startups aside) that the TW rate will always be higher than the BW rate. Companies
can decide to do nothing, lose or move funding, make an acquisition, change
market strategy, fire your internal champion or base their decision upon
boardroom or golf course politics. The BW rate can underperform the TW rate by
20 or 30 percentage points.
The most important aspect of the
TW versus the BW is why the difference occurs for each specific deal. Should an
SE team successfully complete an onsite evaluation, but then generate no
revenue because there was no executive sponsor, no budget or no agreement to
consider a purchase – then that is a sales execution problem. However, that leaves
the SE organization open to charges of execution errors every time they engage
in a perfectly teed-up evaluation and lose. It is a two edged sword.
How To Use The Technical Win Rate
1.
Measure a TW
against a tight definition – with proof required from the participating SE
team. Which means define your rules for a TW and then stick to them. No
cheating or grey areas.
2.
Make TW an
internal SE metric, which is never provided to sales unless accompanied by a fully
prepared pre-sales executive. Given a statistically valid quantity, breakdown
the numbers by geography, vertical, solution area and competitor and monitor
the trends for a rolling period equivalent to your average sales cycle.
3.
When
presented to sales, position the TW-BW difference as an opportunity to (a)
close more deals; (b) highlight competitive or regional trends and (c) operate
more efficiently.
4.
Investigate
the reverse win. That’s when the SE team loses the TW but your company gains
the BW. There are often patterns, especially around executive access or partner
utilization, that can yield positive results the next time around.
Summary
When the SE organization is focused
upon, and satisfied with, the Technical Win you are doing your company and your
bank balance a disservice. It is a useful intermediate metric, and can promote
a good discussion at the executive level, but should be selectively applied at
a field level. If you are truly focused upon selling value, then look at a
Solution Win – which is when both the business and the users accept your
solution as being uniquely qualified to solve their problems.
Because no one is
paid for a Technical Win.
