pain chain
DESCRIPTION
An effective methodology to track a problem’s impacts right through an organisation to create a truly compelling sales value propositionTRANSCRIPT
THE PAIN CHAIN
An effective methodology to track
a problem’s impacts right through
an organisation to create a truly
compelling value proposition
THE PAIN CHAIN IS A GREAT SALES TOOL BECAUSE
• A Pain Chain helps you:
Understand the full impact a
problem is having on an
organisation
Widens your base of contacts in
an organisation
Help you qualify an opportunity
by having a deeper perspective
Prepare a powerful value
proposition and sales proposal
Improve your negotiating
position
DOMINO EFFECT
• All the people and functions
within an organisation depend
on each other
• An impact in one area will have
impacts on other areas
• When exploring a problem in an
organisation, a key question is
“Who else does this affect and
how?”
FOLLOWING A PROBLEM WIDENS YOUR CONTACTS
• Today organisations buy
collaboratively
• The sales challenge is to identify
everybody with a say in the
decision
• Following a Pain Chain will take
you to everybody affected by a
problem
MORE CONTACTS MEANS BETTER KNOWLEDGE
• Talking to all the people affected
by your proposal will result in
better information and
perspective
• Understanding all the solution’s
impacts in an organisation helps
you qualify the opportunity
better
• Being able to propose a
thorough value proposition
differentiates your solution and
increases its value
HERE’S HOW THE PAIN CHAIN WORKS…
PROBLEMS, REASONS, IMPACTS AND EFFECTS
• A PROBLEM is caused by a
REASON
• A Problem has an IMPACT –
probably financial – on the
person you’re talking to
• A Problem also has knock on
EFFECTS in other parts of the
organisation
REASON
PROBLEM
IMPACT
EFFECTS
THE PAIN CHAIN IS A POWERFUL TOOL
• The Pain Chain often looks like an organisation chart, but it’s not
• Problems at one level become reasons at the next level up
• Use it as a living document to plan and refine a pursuit
• In meetings, the Pain Chain can help diagnose a problem’s impacts
• In presentations, the Pain Chain can show the end-to-end effects of a problem
• The Pain Chain is a great basis for internal sales reviews
FOLLOWING A PAIN CHAIN
• Chief Information Officer
Problem and Effect
The marketing function are
unhappy because they can’t
implement new promotions
quickly enough
Reason
“The booking system is old. It’s
hard to make changes and they
take a lot of time”
Impact
The old system is expensive to
maintain and that’s costing £n
FOLLOWING A PAIN CHAIN
• Chief Marketing Officer
Problem and Effect
Sales are reduced because we
can’t get attractive offers to
market
Reason
“We’re losing market share
because we can’t introduce new
booking promotions fast
enough”
Impact
We’re having to spend more to
promote the offers we can make
and that’s costing £n
FOLLOWING A PAIN CHAIN
• Chief Sales Officer
Problem and Effect
“I’m getting grief from the CFO
because sales targets aren’t
being met”
Reason
“We’re losing business
customers because our offer
isn’t exciting enough”
Impact
The sales team isn’t as effective
as it could be and that’s costing
£n
FOLLOWING A PAIN CHAIN
• Chief Financial Officer
Problem and Effect
Missing quarterly revenue and
profit forecasts
Reason
“The sales targets aren’t being
met”
Impact
Our revenues are reducing but
our costs are constant so our
profitability is reduced by £n
FOLLOWING A PAIN CHAIN
• Chief Executive Officer
Problem and Effect
Earnings per share is falling
Reason
“We’re missing our quarterly
revenue and profit forecasts”
Impact
Shareholder value is falling
because market capitalisation
has reduced by £n
THE COMPLETE PAIN CHAIN
CEO Problem: Decreasing earnings per share Reason: Missing revenue and profit forecasts
CFO Problem: Missing revenue and profit forecasts Reason: Sales targets not being met
CSO Problem: Sales targets not being met Reason: Selling offers not exciting enough
CMO Problem: Selling offers not exciting enough Reason: Can’t introduce new promotions fast enough
CIO Problem: Can’t introduce new promotions fast enough Reason: Inflexible booking system
EVERY LINK IN THE PAIN CHAIN HAS A FINANCIAL IMPACT
Problem Reason Financial Impact CEO Decreasing earnings
per share
Missing revenue and profit forecasts
Reduced market capitalisation - £?
CFO Missing revenue and profit forecasts
Sales targets not being met
Lost revenue and margin - £?
CSO Sales targets not being met
Selling offers not exciting enough
Increased cost/sales ratio - £?
CMO Selling offers not exciting enough
Can’t introduce new promotions fast enough
Increased marketing costs - £?
CIO Can’t introduce new promotions fast enough
Inflexible booking system
High maintenance costs - £?
AND THE VALUE PROPOSITION BECOMES…
• The new booking system will enable you to:
Reduce your current IT costs by £n as result of having a more flexible booking system
Increase your market share by being able to implement new promotions faster whilst reducing current marketing costs by £n
Sell more by having more exciting frequent offers and increasing sales productivity by £n
Increase revenues and margins by an estimated £n
Increase earning per share and stop decline in market capitalisation
SUMMARY
SUMMARY
• The Pain Chain
Gets you wider access in an
organisation
Helps you shape a stronger value
proposition
Enables you to build stronger
relationships
• As you talk to people, recognise
Problems are caused by reasons
and have a financial impact
The reason at one level becomes
the problem at the previous level
HELPFUL?
• If you’ve found this helpful and
want to learn more, now
schedule an hour’s sales
coaching with me to help you
apply the principles to your
situation.
• Go to Sales Coaching at Sales
Success and More!
• Mike McCormac founded Sales Success and More to help professional sales people selling high value services achieve more. He has an MBA and his sales background includes over 15 years success selling IT services and outsourcing. Mike works mainly in the UK and Cyprus.
• Connect on LinkedIn
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• Email me
• Call me +357 99 860725