Often, I challenge clients with the following: “In your initial meetings with your prospects/customers, you can’t talk to them about your products or solutions! Even if they ask you?”
The question inevitably arises, “Well what do we talk to them about?”
And this is the critical issue. Can we only engage our customers in the things we want to talk about, our products and solutions? Or can we talk to customers about what they care about, their business, challenges, problems and opportunities?
Our prospects and customers care the most about the latter. But can we hold our own in these conversations? Do we even understand them and their businesses? Do we really understand their problems?
Most of you will recognize what I’m talking about is business acumen. But many of you are probably asking, “Why should I care?”
We have at least a decade’s worth of data showing, customers prefer rep free buying experiences. If they can buy without a rep, they will. If they can defer engaging reps, they will push it to the latest point possible. Increasingly, it’s when they have a preference and the only deciding question is, “What’s the price, how much are you willing to discount?”
And today’s buyers are, increasingly, leveraging AI, further distancing them from needing salespeople.
And if this were working for buyers, that would be the end of the story. We don’t need sellers.
In spite of all of this, buyers continue to struggle. We see increasing rates of No Decision Made. Currently the majority of buying decisions end in No Decision Made (65%+). What’s left for us to split with our competitors are the 30%+ of those that do make a buying decision.
And for those making a decision, the data shows over 70% have regret. According to Gartner, this has increased dramatically with AI.
And sellers aren’t being very helpful. All they are equipped with is the ability to follow a script, steps in a playbook, pitch and demo their product.
They can’t connect to customers in understanding their business or the problems they face. The only thing we know is our products. But what they care about is their business.
This is why acumen is so critical.
Our inability to talk to them about their business impacts our customers and their success.
Our inability to do this impacts our ability to achieve our goals.
So what is acumen?
The dictionary defines it as “skill in making correct decisions and judgments in business or a particular area of business.”
My definition is: Knowing their business is the input. Acumen is what you do with that knowledge.
Knowing what, who, and when to ask about an issue. Knowing what matters to each person you engage. Having the ability to help them think through their process. Even helping them learn more about their business.
When I look at business acumen, I like to segment it into 3 interrelated categories.
The first is customer acumen. Customer acumen enables us to talk with them about their world.
Customer acumen includes understanding the customer’s business, markets, competitors, strategies, workflows, critical performance metrics.
Developing customer acumen means understanding the work the key personas in our ICP do. What are they responsible for, how are they measured, how do they get work done, how do they spend their time? It looks at workflows and how they fit into the overall organization, who depends on them, and who they depend on.
While it may seem trivial, understanding their “language” is critical in engaging them in discussions about their business. Different industries/markets have different language. In SaaS people talk about ARR, CAC, renewals. In an industrial products organization, it may be bookings and CPOD. In a professional services organization, it’s contracted project revenue, utilization and more.
Years ago, my team managed to get a meeting with the top design engineers at GM. We started talking about some of the challenges in automotive design. One of my people started talking about “aerodynamics.” The chief design engineer stopped the meeting, saying, “come back when you understand our business.” It turns out in automotive design the concept is called “flow lines.” “Aerodynamics” is used in airplane design.
That small language error was important in our ability to connect credibly with the top design team at GM.
Customer acumen includes industry and market acumen. It’s understanding the trends and challenges facing everyone in the industry. It’s understanding who the top performers in the industry are and what sets them apart.
Let me move to problem acumen. Where customer acumen is more functionally, organizationally, and industry focused; problem acumen is more narrowly focused.
Some will argue, “We know what problems our products solve!” In reality it’s a statement about your solutions, not understanding the problem. “Our solutions improve customer service by X%,” is about your product. It says nothing about the customer service issues that require them to make the change.
To engage our customers in problem focused conversations, we have to understand the problems the way the customer looks at them. Things like, how the customer recognizes they have a problem, how they define it, its impact, who the problem impacts. Other things might include whether it should be addressed or can it be deferred? What are the risks they face in not solving the problem, what are the risks involved in solving it?
It’s important to understand, in complex B2B, the customer may have never faced the problem before. They may not have great “problem acumen” themselves.
Understanding the problem from a customer’s perspective enables us to help them better understand the problem and navigate the problem-solving process.
Problem acumen can become very important in reducing no decision made and buyer regret. With problem acumen, we can help build their understanding and confidence they are doing the right thing.
There’s one final aspect to business acumen, it’s financial acumen. It’s understanding how they make money, how they assess problem costs, where/how they choose to invest, how new projects get funded. It is the ability to create an ROI case meaningful to them.
A client I worked with was struggling to close a deal with a large grocery retailer. The CIO and everyone else had approved, they just couldn’t get the final approval from the CFO. After about 30 minutes of analysis, I asked them to get a meeting with their CFO. After the intros, I made the statement, “Do you realize you are paying your suppliers $15B a year to put their products in the green dumpsters behind your store?”
It was a provocative statement. But I had enough understanding of the fundamentals of the grocery industry, I had enough understanding of problems they have in supply chain management. Industry data, at the time, said waste was roughly 15% of gross revenues. I leveraged my financial acumen to determine the impact on this organization.
The CFO asked me to support the claim. I walked him through my assessment. He paused, went to the whiteboard and started scratching some numbers. A few minutes later, he turned to me and said, “Dave, you’re wrong. My estimate is that it costs us over $20B a year. How can you help?”
In 45 minutes, leveraging the business acumen, but particularly the financial acumen, we moved a deal that had been stalled for months. The team had solved the CIOs problem, but they hadn’t focused on the financial side of the problem and that’s where the payback was.
These three acumens overlap. All are critical to our ability to effectively engage our customers in conversations that matter to them.
Business acumen isn’t important just to sellers. It is critical to all parts of our GTM organization. It shapes what and how marketing communicates, how we engage customer digitally. It impacts enablement, customer service, product development and other parts of the company.
Some of you may be thinking, “This is a hell of a lot of work and takes time! Does it matter?”
We’ve been working with clients in developing all aspects of business acumen. We begin with the challenge I started with: “You can’t talk about your products in your first meetings, even if the customer asks you.”
Working with them, win rates are at least doubled. No Decision Made is down by as much as 23%. Customer buying cycles are reduced by 30-40%.
In this process you are building trust and credibility with your customers. As you look to expand your business with the customer, they will invite you in because they know you understand them and what they want to achieve.
Some of you are saying, “That’s a lot of work!”
We develop our acumen in every conversation with our customers. This doesn’t that much time.
As an example, over the past 4 years, we’ve been conducting a project with Dr. Howard Dover at UT Dallas. He’s used one of our customer acumen tools in his digital prospecting class. Students are expected to interview a number of business people in the semester. They choose a role, for instance CRO, and interview at least 10 CROs each.
We analyze their acumen across 9 factors. In the first interview, acumen scores are very low. By about the 7-9th interviews, their acumen is very high. Through these interviews, they are learning and becoming much more confident in their ability to have these conversations.
What this teaches experienced salespeople is that every conversation with customers about their business, their challenges, and their problems, builds acumen. All it takes is to stop talking about what we sell and start engaging the customer in conversations about what they care about.
AI provides us another capability to help build our acumen. We can leverage AI tools to help us better understand industries, markets, and even specific customers. They give us some background, and help us prepare for meetings. But the most critical thing is the ability of the person to actually have the conversation.
As I wrap up, some of you are probably still concerned with my opening challenge, “You can’t talk about your product even if the customer asks you.” You are thinking, “Aren’t I disrespecting them by not answering the question?”
Here’s the challenge. We have endless feature function lists. Without understanding the customer and what they are trying to do, how do we know what’s most important to them? How do you know the parts of your solution they don’t care about?
We can’t really answer their question until we know more about what they are trying to do. Simply say, “I’d like to first understand more about what you are trying to do and why it’s important to you. Once I understand that, I can talk to you about how we can help you achieve those things.”
Acumen; customer, problem, and financial; is foundational to our ability to engage our customers in high impact conversations. Through this, we build trust with our customers. We help build their confidence in the decisions they are making, by leveraging our experience with hundreds of other customers solving similar problems.
The only question that remains is:
If your salespeople couldn’t talk about their products in the initial meetings, would your customers find them worth talking to?
Afterword: For more about the programs and AI tools we use to help our clients develop their acumen, reach out to me.
Afterword: Every time you read this, I’m raving about the quality of these AI based discussions. They consistently take what I’ve written about and develop powerful stories illustrating what I’m trying to communicate in these posts. Be sure to listen to this, enjoy!
