As a manager, you have probably seen your sales and marketing representatives in the following scenario.
They're trying to convince a potential customer that your company's great products or services will solve the customer's most pressing problems. To prove the point, they explain precisely how their solution will work.
Mr. Potential Customer listens carefully, asks many questions and takes copious notes. Everything is running smoothly. The customer nods and says all the right things, and the rep leaves convinced that the sale is in the bag.
The problem is, when they call to close the sale, Mr. Potential Customer is nowhere to be found. Later, you hear from your rep that the customer has decided to buy from your top (and less expensive) competitor.
You've seen this play out dozens of times; frustrated, you ask yourself, “Where did this go wrong? Why didn't I see it coming?”
What really happened is that once again they've fallen prey to an all-too-common trap: unpaid consulting. This is another painful reminder of how these scenarios play out… unpredictable forecasts, lost sales and reduced margins.
Unpaid consulting starts when the rep crosses the line between diagnosing the problem and explaining the solution. When sales or marketing reps start designing solutions, they begin acting as unpaid consultants.
In past decades, this was not a monumental issue. Generally, there was limited competition in complex sales. If your reps figured out the problem and designed a unique and valuable solution for a customer, the sale was almost guaranteed and the rep was rewarded for his consulting effort.