Sales Co-Creation

SALES CO-CREATION

Discover 8 ways sales organisations can co-create value with their customers.

SALES CO-CREATION is part of the SALES 2020 research project which

started in 2010 in collaboration with:

The aims of the project was to:

•  Identify the differences between value based selling and value co-creating •  Identify how sales organisations can apply the principles of

value co-creation in their sales organisation.

WHY DO WE NEED A NEW SALES APPROACH?

…because sales people are finding it increasingly difficult to add value

to their customers.

See our Sales 2020 presentation for

more information.

As a result their products are considered commodities making

the price the main factor for differentiation.

One of the reasons is due the way in which we define value.

For most organisations value is created by producing products and services which customers

want to buy.

Customers are considered as targets …

… which need to be persuaded to buy their products and services.

Selling is therefore considered a cost, needed to distribute products and

services into the market.

This view is highly product centric.

WHAT IS VALUE FROM A CUSTOMER PERSPECTIVE?

“Value for customers means that after they have been assisted by a full or self-service

process they are or feel better off than before.”

Chris&an Grönroos

This implies that value is created when the customer uses or consumes

a product or service.

As a result products are merely vehicles to produce a service helping

customers to get their job done.

This means that the role of sales people is to help their customers to get their

jobs done and provide them with a good experience.

This implies that by getting involved in their customer’s jobs, sales people will

co-create value with their customer.

WHAT ARE THE

4 PRINCIPLES OF VALUE CO-CREATION THAT SALES EXECUTIVES

NEED TO KNOW?

Principle #1

FOCUS ON THE END AND NOT ON THE MEANS

“… here are the tools you asked for. Good luck with them!”

“… thanks for coming to show us how to use the tools to get our job done.”

The process lasts until the customer obtains the value

the sales person promised them.

USE Value

The Long Sales

Funnel

SALES

Sales Approach

Co-Creation Approach

Principle #2 TURN THE

CUSTOMER INTO AN ACTIVE PARTICIPANT

“… Let me tell you what we need.”

“Let’s figure it out together.”

Value Co Creation Approach

Co Creation requires customers to actively participate in the process.

Sales Approach

Co-Creation Approach

INTERVIEW DIALOGUE

ASSEMBLY CO-DESIGN

INTERNAL CO-DEVELOP

Information Gathering

Solution Design

Solutions Development

INFORMANT PARTNER Customer Role

REACTIVE PRO-ACTIVE Use

Principle #3 DEVELOP VALUE

PROPOSITIONS BASED ON ORGANISATIONAL

CAPABILITIES.

“These are our products and services.”

“These are the capabilities and know-how that we have.”

How can we combine our capabili0es and

know how?

How are my products solving

your needs?

Co-creation is about merging capabilities

together to create value.

Principle #4 FOCUS ON LEARNING

“The more we repeat our approach the better we get at doing it.”

“Each time we co-create with our customers we develop new capabilities.”

Co-Creation is not about increasing efficiencies but about learning and

increasing capabilities.

LEARNING

CAPABILITIES ACTIVE PARTICIPATION EXPERIENCE

WHAT ARE THE

8 FORMS OF CO-CREATION THAT SALES ORGANISATIONS CAN USE

WITH THEIR CUSTOMERS?

FORMS OF VALUE CO-CREATION

Crowd Sourcing

Mass Customisation

Peer to Peer Network

Shared Resources

Open Innovation

Joint Ideation

Experience Centres

Product as a Service

Icons: h0p://thenounproject.com

Crowdsourcing is the practice of obtaining needed services, ideas, or content by soliciting

contributions from a large group of people.


Example

Customer: CEO of a large organisation

Functional Job To Be Done by the customer: “CEO’s want to compare their business outlook of the future with that of their peers.”

Social Job To Be Done by the customer: “CEO’s want to impress their customers, suppliers and partners by participating in the survey. ”

Emotional Job To Be Done by the customer: “CEO’s want to feel less uncertain about their business outlook. ”

Many management consulting organisation solicit their customers to share their business outlook with them. After consolidating these outlooks, they produce their global yearly business reports. Based on this information they offer their customers the opportunity to benchmarking their business outlook with those of their peers.

Example: http://www-935.ibm.com/services/uk/en/ceostudy.html


What could you source from your customers and partners to create new insights to help your customers with?

Mass Customisation is a process which combines the benefits of

large-scale production with those of customisation.


Example

Customer: CIO and IT project managers responsible for implementing ERP solutions in their organisation.

Functional Job To Be Done by the customer: “We want an ERP system which can be tailored easily to our specific needs”

Social Job To Be Done by the customer: “We want to impress the users of our ERP system.”

Emotional Job To Be Done by the customer: “We want less stress when implementing and maintaining our ERP system”

ERP software systems consists of different modules which customers can adapt to meet their specifc needs. These systems rely on smart configuration engines which assits the customer in their decision making as well as automate the configuration tasks for the system. The production efficiency is highly increased because the customer is direclty involved in the configuration of the final solution.

Example: http://www.sap.com


How could you co-design solutions with your customers.

Peer to Peer networks are decentralised networks whereby

all people act as both suppliers and as consumers to share some

resources (often information).


Example

Customer: Engineers that use Caterpillar’s equipment.

Functional Job: “I want help to solve some engineering problem with my equipment.”

Social Job To Be Done by the customer: “I want to share my knowledge and experience with others.”

Emotional Job To Be Done by the customer: “I want feel like I made a difference to others.”

The Caterpillar online community is an online B2B forum where professionals who work with caterpillar equipment can exchange information, find answers and get expert advice from their peers. People can give each other “kudos” on input they valued. They can also identify the response that provided the best solution to move the discussion further or end it. You do not have to be a caterpillar customer to joint the forum. The objective, according to caterpillar, is to bring the people in their industry closer together. Source: forums.cat.com

Example: http://forums.cat.com


How could you network your customers together and leverage

their individual capabilities to help each other.

Open Innovation is the practice of innovating with partners inside and outside the organisation and

sharing risk and rewards with them.

Source: wikipedia

Example

Customer: Production managers in the textile industry.

Functional Job To Be Done by the customer: “I want to continuously improve our quality, manufacturing performance and efficiency.”

Social Job To Be Done by the customer: “We want to show our customers that we are at the leading edge in terms of technologies used in our production process.”

Emotional Job To Be Done by the customer: “I want feel successful at my job.”

Bekaert is a world market and technology leader in steel wire transformation and coatings, offering a very wide range of advanced steel wire products in many sectors around the world. For the textile industry, Bekaert manufactures card clothing products used for carding of staple fibers in short staple, nonwoven, woollen, semi-worsted and worsted applications. Bekaert developed with a science agency a new carding technology. This technology platform was tested and further developed in close collaboration with a number of customers.

Example: http://www.bekeart.com

Could invite your customers to collaborate in joint innovation

projects with other partners and customers?

Shared Resources is a practice where suppliers and customers

share resources in order to co-create value.


Example

Customer: Retail Manager or Purchasing Manager of a supermarket chain.

Functional Job To Be Done by the customer: “We need good information to make good decisions.”

Social Job To Be Done by the customer: “We want to to shows our customers that we have the best meet in our supermarkets.”

Emotional Job To Be Done by the customer: “I want feel less stress managing our meet counters.”

Many product manufacturers in the fast moving consuming industry perform regularly all sorts of consumer base research. This information can be very valuable for large retailers helping them to better predict future consumer behaviour and demand for specific products. By sharing this information with the retailers the account managers of these product manufacturers are able to participate in their customer’s product planning process.


Which resources, such as market research information, can you share

with your customers in order to jointly create new insights.

Joint Ideation is a practice where suppliers and customers come

together to brainstorm new ideas.


Example

Customer: Business Executives .

Functional Job To Be Done by the customer: “We need to implement our strategy and ideas quickly.”

Social Job To Be Done by the customer: “We want to involve all the stakeholders in the exercise.”

Emotional Job To Be Done by the customer: “We want to feel less stress in getting our strategy up and running.”

Many system integrators developed business tools and methodologies to help their clients to structure their ideas and strategies and translate them into projects. One popular service consists of helping organisations to translate their strategies and ideas into a project roadmap.


How could you facilitate joint ideation sessions with your

customers to come up with new business solutions?

Experience Centres allow customers and suppliers to engage

and interact with products and services in a sensory ways.


Example

Customer: Business and IT Executives within large organisation.

Functional Job To Be Done by the customer: “We need to analyse how new IT innovations can help us to increase our competitiveness.”

Social Job To Be Done by the customer: “We want to be seen in the market as modern and innovative organisation.”

Emotional Job To Be Done by the customer: “We want to feel less uncertain when adopting new technologies.”

One example are CGI’s (former Logica) SPARK centres were executives can come and can have a real experience with new innovative IT technologies and brainstorm on how these could help them to be more competitive. Because the technology is so new, customers need to come and see, touch and feel the technology in order to imagine what they could do with it.

Example: http://www.cgi.com


How could you provide your customers a sensory experience in

order to generate new insights.

Product as a Service is the practice whereby customers pay for the use

of products or services.


Example

Customer: Truckers Organisations.

Functional Job To Be Done by the customer: “We need to keep our trucks running with as little interruptions as possible.”

Social Job To Be Done by the customer: “We want our customers to see that we outsource non core activities to strong partners.”

Emotional Job To Be Done by the customer: “We want to feel less stress managing our trucks.”

Michelin is a French tire producer who launched a tyre outsourcing service for its road transportation customers. This means that for a monthly fee Michelin does not only supply the tires but also maintain and repairs them. Such a service requires a vast geographical presence, which is needed to provide the required maintenance and repair work. This is achieved by converting Michelin’s distribution network into a service network, which will perform the maintenance and repairs on their behalf. For this solution to work three parties must collaborate, the customer, the distributor and Michelin, the manufacturer.

Example: http://www.michelintransport.com


How would your customers react if you would change your pricing model from

ownership to pay for use or pay by outcome?

WHAT IS YOUR DEFINITION OF VALUE?

DEFINITIONS OF VALUE

PRODUCT CENTRIC

Value is created by producing products

Customers are targets

The role of the sales force is to distribute products and

services into the market

CUSTOMER CENTRIC

Value is created by using products.

Customers are partners

The role of the sales force is to help customers in getting

their jobs done.

Source: Vargo and Lusch, 2004, “Service Dominant Logic”

Remember: “People don’t want to buy a quarter-inch drill.

They want a quarter-inch hole!”

Theodor Levi0

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