Value Engineering: A Mindset Not A Toolset

It seems like a simple concept, convince a client that your innovative game-changing software can create value for their business. With hundreds, if not thousands, of books, courses, blogs, and apparent experts at our disposal in an “always on” world, one would think that most technology sales professionals are selling value in their sleep.

Newsflash: they aren’t.

For those reading this who have spent the past 20+ years in the enterprise software space, you are likely rolling your eyes, knowing the topic of value selling has served as a source of endless ammunition for consultants, authors, and academics alike to cash in on over the years.

And for those new to the party, your challenge will be filtering through a mountain of content available via your smartphone or network of ambitious MBA peers accepting glamorous jobs as account executives with SFDC, Meta, or [insert tech firm here].

Assuming most sellers are educated, well-informed, and capable professionals, we are left questioning why this Level 1 Wordle frequently takes a back seat during a sales cycle.

Rise of the “Value” Practice

Value Engineering, Value Management, Value Advisory - the list goes on.

Almost every forward-thinking software company which has crossed the $50MM revenue gate has launched a dedicated practice of ex-management consultant types who are hired to help bolster how sales teams discuss the topic of “value” with clients.

These practices date back to the early 2000s when companies like Oracle, SAP, and IBM began to realize that they could insert another type of resource into their sales engagement model - the “Value Engineer” - a savvy consultant equipped to handhold the client through building their business case tied to the technology purchase in play.

Since these early days, the Value Engineer role has evolved at a rapid pace, resulting in an array of new tools flooding the sales enablement market. From ROI calculators baked into websites to business case templates being sold by the dozen, there is no shortage of VE content floating around the tech industry - in addition to several “management consultants” ready for hire, the latter often coming with a high price tag and an impressive vocabulary.

A Value Engineering Mindset

As the era of growth for the sake of growth comes to an ugly end (see #techlayoffs), you do not need to worry about purchasing expensive tools or people to establish an effective Value Engineering motion at your company.

In fact, a few simple best practices can help you infuse a VE Mindset throughout your entire organization in a matter of months. This approach can be used to elevate the skill-set of your sales organization without the need for heavy support from costly and redundant resources.

But first: why and how growing companies get ‘value’ wrong

A widespread reason sellers don’t talk value nearly as much as we’d like for them to with customers may be rooted in the word itself - “value” - which carries a definition that is often blurred, constantly re-defined, or outright misunderstood. This leaves sellers lost wandering in the open desert of feature & function where they are greeted by dozens of peers chasing that juicy quarter-end deal with a handsome commission check in tow.

All too often we see account executives worried more about delivering the perfect demo versus articulating how their solution will deliver revenue or reduce costs for their client.

Whether you’re a veteran sales leader or rookie BDR, embracing a Value Engineering Mindset is not complicated and has as much to do with the experience you deliver to your client as it does with the return-on-investment your product may (or may not) provide.

Quick win advice for leaders: inject value conversations into your process

A simple way to avoid headaches is to give your sellers the confidence to ask the client how they define “value” during the discovery phase of any transaction - a concept first introduced over a decade ago by some of the world’s largest technology companies commonly known today as Value Discovery.

This consulting-like service involves an account executive serving the role as “master facilitator” and getting all of their key client contacts in a room (Zoom or physical) for a 60-90 minute discussion anchored on a few discovery questions regarding the client’s business.

Best practices for establishing a ‘Value Engineering Mindset’ across your company

1. Start with Culture

• Don’t overinvest in a formal VE function; if you have a handful of AEs and a few high caliber presales consultants (SEs, SCs, etc.), you have more than enough to start building a value-first sales organization.

• Begin by ensuring every sales VP/director/manager (and CEO) can articulate the business value of your solution in a clear and compelling manner - changing culture starts at the top.
• Ensure your post-sales/Customer Success teams are capable of discussing business value with clients after the sale is closed to ensure that adequate value tracking/delivery comes to fruition. This includes equipping your Customer Success division with VE “cheat sheets” highlighting the ROI outcomes delivered by your core use cases, which can be used to track value realization during the post-sale cycle (leading to a culture of upsell/value-add behavior versus old-fashioned “order taking” customer support).
• Ensure your marketing organization is deeply integrated with your post-sales/CS organization to ensure that value creation data (business value/ROI achieved) is captured from clients and passed to your marketing team in near-automatic fashion; this creates a lasting culture of gathering “value data” from clients which serve as rocket fuel for case studies and reference calls down the road, the holy grail of a value-first sales organization with client success (ROI) at the helm.

2. Keep it Simple

• Don’t overcomplicate how your AEs/CSMs discuss value and build business cases with clients - help your client understand how your software helps them Make Money (increase win rate, increase upsells) Save Money (reduce FTE costs/TCO), or Reduce Risk (reduce customer/employee churn).
• Every business case should rest on one of the above “ROI themes” in order to help your client quickly understand where your software is going to have maximum impact - impacting one C-Suite metric (e.g. Revenue Growth) is better than impacting five irrelevant metrics managed at lower levels of a company.
• If your AEs are pitching grandiose transformation projects with unrealistic expectations you’re already in trouble - hit the stop button and bring in a VE advisor to help your sales organization understand the basics of value discovery, which includes everything from learning how to facilitate a Value Discovery Workshop to articulating the business impact (ROI) of deploying your software in the form of a well-documented Business Case Proposal, simple yet effective skills every AE/CSM should possess.
• Train your AEs/CSMs to conduct deep account research using 10-K annual report information; a strong value narrative starts with strong account research which means your AEs/CSMs should be developing a basic understanding of how their clients make money and what their C-Suite priorities are - aligning your solution with at least one C-Suite priority (such as taking market share from a competitor or growing sales) is paramount to building an attractive business case supported by your solution.

3. Invest in Talent

• Never stop discussing value with clients. Strong sellers expand their scope of discussion beyond adoption and dig into the client’s next set of priorities to ensure they are connecting any product recommendation to emerging objectives - this requires your AEs/CSMs to earn “trusted advisor” status with clients, a feat that requires bringing clients valuable information about their market/competition, etc. extending well beyond the day-to-day of a typical account management cycle.
• Ensure your Customer Success organization is trained on how to build and manage Value Realization Plans (VRPs) with clients. These scorecard-like documents are designed to help clients monitor and communicate how a technology solution is creating value for their business over time, linking tangible metrics to technology capabilities.
• Invest in executive presentation skills to ensure your AEs/CSMs show up like professionals, present well, and build credibility with senior stakeholders at your client accounts - you sell to who you sound like!

While the above best practices are a sampling of “things to keep in mind,” if embraced and deployed they can help you create a lasting and impactful VE Mindset across your company.

Transforming a sales organization does not happen overnight. It takes strong executive support (starting with the CEO) and cross-functional buy-in from every department to ensure optimal success.

The good news is that you can get started today with a few simple steps without draining the bank - while keeping Value top of mind, right where it belongs.