Trends in the Value Selling of Software
By Tom Cissell

A Move Towards Collaborative Justification
The trend towards customers requiring justifications for the purchase of capital financed solutions has been going on for some years.  There is quite a variety of practices among buyers but there have been some swings in momentum over these years.  Initially, as customers adopted more rigorous buying practices, they retooled their capital funding request processes.  As providers caught on, they began to provide justifications for their solutions using spreadsheets or third party proprietary tools.  Some providers were better than others at tailoring their business cases to the individual customers, but there continued to be limited acceptance of these canned business cases because they were not in the format required by the buyer and had a built in bias for the provider’s solution.

The next wave was the use of research based tools which quantified benefits based upon surveys that determined the value users were receiving from specific categories of solutions.  The use of third party research, particularly from recognized research firms, created a perception of independence and objectivity.  The problem with strictly research based justifications is that they did not take into account the specifics or differentiation of a providers solution.  This resulted in a justification that either overstated or understated the benefits of the solution depending on the supplier.  Research is still being used but in many cases is now just a component of a justification.

Currently, suppliers are increasingly engaging their customers in a collaborative justification process.  This typically involves the supplier or their sponsored consultant working directly with the customer utilizing the customer’s capital funding process, but providing them with guidance and labor to produce a business case.  This way, the justification follows the customer’s internal format, meets all of their requirements and ends up being perceived as a justification produced internally rather than provided by a supplier’s tool.  Cisco, for example in 2004 began routinely hiring consultants to assist their prospects in justifying their solutions. While paid by Cisco, the consultant appears to the prospect as more objective third party.  Cisco resists the use of proprietary tools (in house or third party) because they feel that CFOs in particular perceive the results as subjective supplier propaganda. Cisco’s consultants usually end up using MS Excel and MS Word to produce a business case to the client but the format as well as the content is specific to a customer’s process.