Outcome-Based Engagements

An unrelenting focus on attaining clear business goals.

Transformations are necessarily messy and complex. This is because most transformations are a collection of discrete initiatives, each of which is really complicated. This is as true of an enterprise-wide transformation as it is of an IT-led one. A typical enterprise-wide transformation can include elements as varied as trying on a new operating model, experimenting with new businesses, responding to geopolitical shifts and reacting to changing consumer demands. A typical IT transformation might include a decision to go agile, the creation of a common data strategy, a move to public cloud, a focus on the end-to-end customer or citizen experience, and a move to digital product management.

When added together, these initiatives form a messy middle in which people become enmeshed in the complexities of their chunk of the transformation, and can lose sight of how their initiative fits into the wider picture. When that happens, the initiative exists to serve itself, and the goals of the wider transformation are lost.

To truly distinguish themselves from competitors, deliver greater value to customers, and grow more profitably, B2B companies should add a powerful new approach to their business arsenal: focusing on deeply engaging with customers to get to know their unique needs, and designing and delivering a true solution—one that will help the customer address complex needs and deliver a positive business impact.

We call this approach “outcomes based management.”

Selling outcomes is the natural next step in the evolution of the traditional products business (Figure 1)—from a pure focus on products, sold as transactions on a cost-plus basis, to a suite of more robust offerings based on a value-minus arrangement requiring a deep partnership cultivated at higher levels of the customer organization. Progressing along this continuum requires increasingly more sophisticated capabilities, but can also result in stronger returns in the form of higher revenue and margin growth.

Indeed, the business case for an outcomes- based sales approach is compelling. By engaging with higher-level executives to explore the business objectives customers are trying to achieve, and creating a tailored solution focused on delivering those outcomes, a vendor becomes less vulnerable to being commoditised and competing on price, unlocks greater possibilities to sell more of what it provides, and creates a new high-margin, value- based revenue stream that augments its core product business. An outcomes-based approach also enables product companies to create more strategic, longer-lasting partnerships with customers based on shared risk and reward.

85% of big data projects fail.

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