What the Customer Wants You to Know: How Everybody Needs to Think Differently About Sales

Ram Charan is outstanding at presenting the customer's perspective in the sales process. Often times sales people get hung up selling themselves, their company and on product features rather than focusing on customer needs. Turning things around and having sales people focus on how they can help a customer solve improve their business or process can change the sales process completely. Consultive selling is greatly appreciated by nearly all customers.

I have not read all books written by Ram Charan, but picked up this one since it was show-cased as "New Arrivals" in my neighborhood bookshop. I started with the expectation on relationship management, but found it is intended to be different. Nevertheless, the topic is very much relevant, and should be read by everybody concerned with some kind of sales (direct or indirect).

Mr. Charan brought out one very crucial point that reflects the change in sales process: The sale is not a pure bid game anymore. The sales person needs to graduate himself/herself to the level of a consultant where he/she should be able to understand what the customer desires. In case when the customer is also a seller (Ram picked up the example of retail stores as customers of the manufacturers), it's important to understand the customer of the customers and align the products accordingly.

One aspect of sales I thought missing in this book was the sales through the vertically integrated organizations. Let's take an example of textile fiber manufacturer. It takes polyester as input. The polyester in turn takes ethylene glycol as input. Ethylene Glycol is the byproduct of petroleum refine process. Technically speaking, all these are to be separately run factories and hence can be run as separate companies. How these companies will sell to its downstream counter parts? The situation may get a little simplified if a conglomerate starts owning the entire vertical chain, but still capacity balance issues may pose some interesting challenges.

However, the book has been a good reading. I have already purchased the next book of Ram Charan (The Game Changer). Hopefully, I will learn more about innovation this time, and will return back to let you know how it feels!

In this short and instructive text on how to move away from commoditization and low price selling, author and respected business advisor Ram Charan uses storytelling, real business situations, and instructional examples to explain Value Creation Selling (VCS).

Charan starts by declaring the traditional sales method - representative calling on purchasing agent - a broken process; it relies to heavily on a single point relationship and only considers the cost side of the customer equation. The fix is VCS, which requires that you become a partner with your customer. To become a partner you need to know the following:
1) The customer's set of opportunities and the anatomy of the competitive dynamics
2) The customer's customers and the customers competitors
3) How decisions are made in the customer's organization
4) The customer's company culture, its dominant psychology and values
5) The customer's goals and priorities, both short-term and long-term, clearly and specifically
Thus, it is the quality and breath of understanding and not just the quantity of customer data that is needed in order to present your value proposition and its business benefits for the customer.

In explaining the how-to for moving toward a partnering approach, Charan addresses both the change management aspects of this paradigm shift and the mechanics for involving the broader organization in preparing a customer Value Account Plan for making the sale. By doing so, Charan demonstrates his grasp of practical business management issues and makes this book worth the read. If your business is pursuing something more than a low-price strategy, but still using sales approaches that rely on the your rep `winning' the business, this book is for you.

Dennis DeWilde, author of "The Performance Connection"

I feel this book provides an excellent "road map" for selling solutions to the customer. With global competition for all business development operations, the author's concept of Value Creation Selling should help any organization re-invent its sales force and sales strategy. I would recommend this book be required reading at any company, from the CEO down the frontline sales person.

Peter Drucker first described the importance of helping customers be more successful in serving their customers as a strategic issue. As such, most students of business leadership and management have favored analyzing what you as a supplier can do to help customers succeed, adding new capabilities that fit those customer needs, and focusing on customers where you can add the most value. More recently, Michael Porter has developed quite a reputation for spelling out some of the sources of potential advantage to pass along to customers in serving their customers.

The principles behind this book have been employed for over a century by many consumer products companies (such as Procter & Gamble) who knew that retailers wouldn't succeed if consumers and users didn't gain demonstrable advantages from their offerings. Industrial products companies have often been slower to adopt that perspective. Why? Many times their customers felt like they knew more than any supplier and didn't want to be bothered to hear suggestions.

Ram Charan argues that customers are more open than ever to letting you propose and implement valuable improvements to their operations that accelerate sales, increase profit margins, reduce capital needs, and lock out their competitors. He offers no proof for that proposition other than a few case examples of companies that have implemented his approach. My own experience is that it is difficult to get customers to tell you enough about their needs to propose what they actually need. My clients tell the same story.

Curiously, he ignores the whole question of learning more about customers' needs to serve customers to set a corporate vision and strategy. Indeed, his approach seems to assume that you stick with the same customers. Now, in most industries there are more unserved potential customers than actual customers for a given company so I don't know why he assumed that.

In most companies that take such strategic stances, the data gathering and strategy setting occur at the senior level. Then, the sales process is adjusted to reflect the new realities.

Mr. Charan, by contrast, feels that the senior people can train the sales people to find out what customer needs are in serving their customers and to coordinate responses to meet those needs. My own sense is that it depends on the capacity of the salespeople and the relationships they have with their customers.

But if you are convinced that salespeople should drive your strategy, this book is a pretty good resource for spelling that out and telling you what to do. The book combines a fable with case histories and process suggestions.

The book is completely silent on the following subjects:

1. How to use the sales force to check out what can be done to make customers more successful by making their customers' customers more successful.

2. How to select the customers where you can have the greatest advantage over competitors in serving with this approach.

3. Using feedback from customers to direct development activities.

In a sense, it's as though Mr. Charan tried to write the equivalent of The Balanced Scorecard and The Strategy-Focused Organization . . . but by putting sales people at the center. I think the title was mainly chosen to follow along with his book about CEOs, rather than reflecting the topic suggested by the title.

Unless you are committed to this approach, you can skip this book.