3 Ways to Strengthen Customer Relationships in the Era of Bad News

If you're in sales, I have no doubt you’re tired of giving your customers bad news. And if you're a consumer of technology products that have been impacted by the supply chain drama of the last two years, I know you're tired of getting bad news.

It is no exaggeration to say that the situation is dire, with no immediate end in sight — particularly for hardware affected by the chip shortage. Yet we must forge ahead. To do so, we have to answer one seemingly simple question:

How can we get our work done and build stronger relationships with our customers in the era of bad news?

I've been thinking about this a lot over the last several months, and I've concluded that to overcome the challenges that have been largely caused by external factors beyond anyone's control, we need to refocus our efforts on three key things that we can control — transparency, listening, and co-planning. Let's discuss.

1. Radical Transparency

There are certain reindeer games that are common within the world of large-scale procurement and sales. You know what I'm talking about. Good salespeople and buyers strive to be forthright and honest with each other. But we're all human, and let's just say that in our weaker moments, it can be hard to trust one another. Salespeople may be tempted to understate a really long lead time that could cost them a sale, and clients might be tempted to overstate their order quantities to lock in a lower unit price.

As business relationships mature, much of this gamesmanship subsides as people learn to trust each other (or chose to work with another company). But there can be a lengthy courtship period before getting to this point, and to be candid, we just don't have time for a full chess match anymore. We need to fast-forward our relationships past the misdirection and manipulation. Basically, we have to be truthful with each other from the start.

For salespeople, this means being the first person to tell prospective clients the truth. Boil the message down and make sure clients understand the what and the why. The reality is that most of today's severely delayed tech products are being delayed due to a relatively small number of key components that are only produced in a handful of factories worldwide. And if one top-tier supplier of whatever your client needs is delayed, it's likely that all of them are delayed. So be the first who doesn't fudge the delivery date. Tell the client what the lead time truly is. Trust them with that information, and tell them the exact reason for the delay. Armed with the truth, they will be able to ask better questions of other vendors who may be promising delivery dates that seem too good to be true. Trust me — being honest faster is what it takes to win.

Clients need to reciprocate that same level of transparency, because in a tight market, quantities matter. While getting a quote for 10,000 units when you know you'll likely need less than half of that quantity might reduce your per unit cost, the larger quantity may also limit your options. And here's why: If fewer than 10,000 chips from X supplier are available right now, you've reduced your per unit cost, but you'll have to wait 6 months to get any of them. When clients are fully transparent, salespeople and suppliers generally have more options and avenues available to solve the problems at hand.

2. Listen and Innovate

As salespeople, it is more critical than ever that we actively listen to our clients, look for clues, and take the time to parse the information. Problem-solving is a big part of sales, and we all want to raise our hand first and slam down a solution. It's tempting, but in the current climate, I think a more iterative and disciplined approach is warranted. Take the time to explore the root causes of challenges or the needs driving the procurement, and look for ways to brainstorm and ameliorate the pain.

The worst thing we can do is just drop bad news on a client and let it sit. More often than not, creative solutions are just a good brainstorm away.

3. Co-Plan

Supply chain challenges continue to put us all in a terrible bind. Lead times of some key components have gone from 2-3 weeks to 24-29 weeks, for example, and the delays rolled out quickly and unpredictably. We were all blindsided — not just by the delays, but that the delays were of such magnitude. Huge, keystone projects like new data centers and entire buildings have been delayed for months. The result is that many of us have been on tilt ever since, operating in reaction/triage mode.

What's obvious is that being in a reactionary position in this market is simply untenable. We have to stop reacting and start planning together for a much longer timeline than we've ever had to deal with before. To have any success mitigating the supply chain headwinds, the sales organization and the customer must become strategic partners with aligned strategies looking ahead 12-18 months. With that level of visibility, many workarounds are possible — and the chances of a successful outcome are exponentially better.

Tired of Reacting? Prioritize and Revise.

Immediate needs are difficult to address in the current climate, and I don't see that changing anytime soon. As we cannot wave a magic wand to fix the supply chain, we can only relocate ourselves relative to it by extending the runway leading up to our projects.

For this year to be less stressful than the last, salespeople and customers must work together to prioritize the most important projects that are 6-18 months out, and start having those hard conversations now. Through being honest with each other, really listening, and co-planning solutions well in advance, we can find creative solutions that achieve great business outcomes and steadily mature our relationships into strategic partnerships.

I'm the Vice President of Global Enterprise Sales at Cisco, and I enjoy writing about the intersection of technology and leadership. Feel free to leave a question, comment, or join the conversation below.