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Avoiding the Disintermediation Trap: How to overcome Assumptions and Become more than a Commodity in the Eyes of the Buyer - Tom Kosnik
- 1. Avoiding the Disintermediation Trap: How to overcome Assumptions and Become more than a Commodity in the Eyes of the Buyer Tom Kosnik 312-527-2950 tkosnik@visusgroup.com
- 2. Avoiding the Disintermediation Trap Power in the Supplier - Buyer Relationship Strategy, Core Competencies & Planning Sales Methodology Assumptions 2 3 41
- 3. Transformation Process Input Outputs Feedback Loops PEOPLE SALES RECRUITING MARKTING TECH BACK OFFICE
- 6. Disintermediation: the reduction in the use of intermediaries (staffing companies) between contractor/temps and Buyers where Buyers may choose to bypass the middlemen and pay less.
- 7. Power in the Supplier/Buyer Relationship
- 8. Tip: To avoid the disintermediation trap, we must position ourselves in a balance of power with our buyers
- 9. Strategy If you don’t have a strategy then your clients and competitors will choose one for you
- 10. There are three dimensions to strategy 1) Strategic Intent 2) Strategic Planning 3) Core competencies
- 11. Strategic Intent • Low cost • Focus • Customer Intimate • Product Innovator • Growth • Diversification • Vertical Integration • Turnaround
- 12. Strategic Planning Is a process that the leadership of a company goes through to determine their best possible strategic intent.
- 13. Core Competencies That which your clients and competitors cannot duplicate, replicate, copy or steal.
- 14. To avoid the disintermediation trap, we must position ourselves in the balance of power with our buyers by having a strategic intent and core competencies that truly differentiates us.
- 15. A Staffing Company is what Kind of Company? ???
- 16. 2016 Sales Relationship/Process MatrixTM Trusted Partner Strategic Contributor Solutions Consultant Preferred Supplier Approved Vendor Random Process Informal Process Formal Process Dynamic Process Performance Level 3 30% of Firms Performance Level 2 44% of Firms Performance Level 1 26% of Firms For study data collected and analyzed in 2016
- 17. What Does a Sales Methodology Look Like? Sizing up the Opportunity People in the Account Action Steps
- 18. Sizing Up the Opportunity • Having a realistic goal range with a close date • Establishing a single achievable objective that the team can focus on • Aligning with my established ideal client profile • Understanding the competition & my place against the competition
- 19. People in the Account • Who can say “no” when everyone else says “yes”? • Who is going to use our solution? • Who is trying to weed us out of the account? • Who in the account wants us to succeed?
- 20. People in the Account • What is the disposition of the key decision makers in the account?
- 21. People in the Account • What are the results the key decision makers are seeking to obtain? • What are the personal wins of these decision makers?
- 22. Action Steps What are my strengths What are my weaknesses
- 23. Action Steps What is the next best tactical action step? And who is going to do it and when is it going to happen?
- 25. Conclusion: How to Avoid the Disintermediation Trap?? 1. Advisable to have strategic intent & core competencies 2. Advisable to execute on a state of the art sales methodology 3. Advisable to put our personal assumptions under the microscope
- 26. Avoiding the Disintermediation Trap: How to overcome Assumptions and Become more than a Commodity in the Eyes of the Buyer Tom Kosnik 312-527-2950 tkosnik@visusgroup.com
Editor's Notes
- - Servicing the industry for 20+ years 100% of my business is coaching and advising staffing firms Certified OD Professional PRT + Advisory Services + Project work + a small cadre of professionals
- My GOAL: To get you to think about this subject of “disintermediation” differently, from an OD perspective To give you a few tips that I have seen work for other staffing firms.
- - Why ME? What makes me credible to address this topic of avoiding disintermediation? I view the world from a unique perspective - How does an Organizational Development Consultant view the world / look at businesses? - Competencies of an OD Professional = observe + discover patterns + suck out the slack = change management
- Why ME? All my clients are dealing with disintermediation? I am in it with them
- Why ME? I have been tracking this issue for years. I am published on the subject
- We all might not agree on the definition, but we all know what it feels like. It is, still today, a highly emotional issue. Operative word in this definition = and pay less Disintermediation is all about cutting out the middle man. And if the middle man cannot be cut out, then it is about reducing margins. History = Y2K
- The first thing I want you to think about is this concept of the use of POWER in the Supplier / Buyer relationship There is the great game of business. It has a scoring system…, profits Suppliers believe that a buyers money is better had in the supplier’s bank account Buyers believe that a suppliers money is better had in the buyer’s bank account How does this economic winning and losing take place? By each party exerting their power over one another. Example = Walmart Example = GM What is a rate card? It is a tool for a buyer to exert power over a supplier for economic gain What is a rebate? It is a tool for a buyer to exert power over a supplier for economic gain Example = AIG TIP: someone in your organization has to be thinking this stuff through…, has to be thinking the dynamics in these relationship through.
- READ the slide The Question is “ HOW” HOW does a staffing supplier best position themselves in the balance of power
- This is not theory…, we do not want to be disintermediated…, we want hold to our allocation of power in the buyer / supplier relationship…, YES? Then your firm has to have a STRATEGY. All companies have a strategy If you don’t have an articulated strategy then your strategy is 100% “REACTIONARY” = Incremental Change
- Here are a few examples of strategic intent: This is not a complete list And some companies will combine two strategic intents Low Cost = Large LI staffing firms doing business at 9% GM Focus = Berean – PeopleSoft Consultants Customer Intimate = Product Innovator = ShiftGig or WorkN Growth = Malone Workforce Solutions Diversification = Many of the large independents or Vertical Integration = Turnaround = CDI and CTG
- This is the engine of your company. The secret sauce. That which differentiates your firm + enables you to retain power in that buyer / supplier relationship. Why did Randstadt acquire Monster? They now have a tool in their fulfillment process that their clients and competitors cannot replicate Why did Zero Chaos acquire Workforce Logic?
- EXAMPLE: Matlin Silver = 30mm to 90mm in annual revenue in three years. What is the secret sauce? Strategic Intent = we only work in a VMS and VMS’ where we have direct contact to the hiring managers Core Competencies = fulfillment machine = really good management + realistic performance metrics + tools + sourcers + fantastic comp plan + training the toon of 500k a year EXAMPLE: LaSalle Network = What is the secret sauce? Strategic Intent = Customer Intimate Core Competencies = sales reps are 100% BDM + recruiters are account managers + 60 Sourcers in Chicago + dynamic fun culture + Social Media Geniuses EXAMPLE: Compass Group What is the secret sauce? Strategic Intent = Focused = biotech on the operations end Core Competencies = Senior Senior Senior level recruiters
- We talked about strategic intent – yes you need to get an edge up on disintermediation We talked about strategic planning – Advisable, but not necessary. You do need a Sales Plan We talked about core competencies - yes you need to get an edge up on disintermediation Here is the TIP: You need to develop core competencies on the fulfillment side of the house And the Sales side of the house. The key Differentiators are: Not the people, but the fulfillment process The sales methodology
- CSO Insights is a leading Sales Research Organization for Sales Leaders They have been tracking this “Sales Relationship Process Matrix for 10+ years. From reps free wheeling it TO leads are generated, organized, scored & prioritized From mgrs. track activity only TO mgrs. are using dashboards + tracking against leading indicators From SME little to no briefing on opportunities TO collaboration + research + pipelining From proposals are generated individually TO formal proposal template / playbook From reps = lone wolves TO Collaboration + team work + Social Media support +
- Why are there some behaviors that we just don’t seem to be able change? In Short: we have assumptions that motivate our behaviors that we never question or look at or put under the microscope. We have assumptions about contractors, about clients, about employees, about disintermediation We have to stop thinking about disintermediation as something that happens to us. We need to start assuming that we have a role, that we can effect the power balance, that we can develop long-term win-win relationships.