The March issue of Agency Sales magazine featured a profile of a MANA-member agency (The Integral Corp, Conroe, Texas) where the practice of a solution sales approach has paid dividends.

The timing of that article is perfect for a follow-up describing how several years ago another MANA member went way more than the extra mile to anticipate and more than meet the needs of one of its customers.

According to Dan Walsh, National Technology Sales Engine (NTSE), Chicago, Illinois, here’s what transpired and here’s what he and his agency needed to do to ensure that they strengthened relationships with a customer for years to come.

“More than 30 years ago I was an independent representative with Zenith’s $3-billion computer division as my number-one line. In the course of conducting business I took an order from the Wisconsin Department of Transportation (WDOT) for approximately $1 million in computers to replace 500 aging IBM systems department wide. The purchase was encumbered using state and federal funds and the promised delivery date was 45-60 days.

“After more than 90 days and following a number of ‘conversations,’ the principal’s worldwide vice president of sales finally let me know that the order would not be deliverable anytime soon — as in maybe six months or more. This was unusual in that they had always delivered in 15-60 days in the past. To say this put the customer in a jam is an understatement.”

Running the Clock

Walsh continued that given that the government fiscal year had just expired, the customer was now working on a 90-day hard clock to get delivery and close the purchase order. “Had WDOT known earlier about the problems they would face, they could have cancelled the purchase order and made the purchase elsewhere. As things transpired, however, they could not. The governmental system under which they were working wouldn’t let them re-encumber funds from state and federal sources from the previous fiscal year. As a result, if the purchase wasn’t successfully executed, WDOT would not only not receive the product they wanted/needed, they would also lose the last-year-money, never to have it return. There you have it, a million dollars gone! Heads would roll and people would be fired.”

In addition, as the customer explained to Walsh, several things would then be triggered:

• “The customer would never buy my number-one brand again (and very probably, never buy me again).
• “The customer would bad-mouth Zenith to every other Wisconsin state agency. That represented a $10 million annual account for me for 10 years running.
• “The customer would bad mouth the principal to every other state DOT — probably all 50 of them. Adding to the possible fallout is the fact that 25 of the 50 state DOTs represented approximately $50 million annually in the principal’s overall business. Also, 25 of the 50 states (all of their departments) represented more than $150 million annually. And, finally the remaining 25 states were strong prospects for future business.”

Facing Early Retirement

According to Walsh, “If I didn’t fix this problem, this whole situation was a less than ideal form of early retirement for me at the age of 30. The WDOT had been super hesitant to purchase non-IBM products in the first place. Now, finally after more than five years of effort, Zenith had the equivalent product quality with low risk. I had worked hard to earn the order. In addition, besides the Wisconsin business, I had also started, won and handled the governmental contracts for Illinois, Indiana and Michigan; so the possible fallout was considerable. What remained for me to do was to dig into the issue that was causing this problem.”

Walsh explained, “It turns out that by emergency edict within Zenith, 130 percent of all factory capacity and production was guaranteed and promised to the United States’ military for Operations Desert Shield and Desert Storm in Kuwait, Iraq and Saudi Arabia. Normally, if I had known that ahead of time I could have sold that fact to WDOT and others that the principal was supporting the troops, etc., but now after the fact and with the money itself going bye-bye, that wasn’t going to work.”

Employing the aforementioned sales solution approach, Walsh goes on to explain how he solved the problem — “But, it took a minor miracle.”

Looking for a Fix

“Staying on message with MANA’s ‘Reps Fix Problems’ philosophy, the solution took the full weight of the rep-principal relationship that had been forged over many years. Without that approach I would have been doomed.

“Here’s the solution that we executed. I called a friend who owned a computer stocking reseller firm in Minneapolis. It was a mom-and-dad-daughter-two sons-12-employees type operation. I had gotten them tickets to a popular band in Las Vegas not long before. That reseller (which sold Zenith, but did not carry IBM) purchased approximately 500 IBMs (any model, any price would do, adding up to $1 million gross) and drop-shipped them to WDOT with an ‘on behalf of Zenith’ packing list, all within 20 days at a low margin (vs. 30 percent) to the Minneapolis family. Zenith issued a $1 million manually typed purchase order to the Minneapolis firm to purchase IBM.

“Literally, I watched them type in a label on a typewriter. Their IBM mainframe computers could never issue that purchase order — impossible.”

The work wasn’t completed yet, however. “Now that the computers were delivered, I sat in the office of three vice presidents and the chief legal officer of Zenith while they manually typed an invoice to WDOT for delivered goods. One million dollars, net 60 for Zenith xyz model systems at xxx per unit, substituted with equivalent gross value IBM model zyx’s, per customer pre-approval.”

Swallowing the Pill

Walsh recalled that at that time “IBM was the chief competitor of all other computer manufacturers. They were number one by a large margin and if you didn’t buy IBM, you’d likely lose your job. Getting Zenith to sell their number-one competitor’s product to our customer on our purchase order was not exactly an easy pill to swallow. On the other hand, however, it was easier than giving up maybe 80 percent of $150 million per year for years which translates into more than $1 billion in lost revenue.”

Once all this heavy lifting was completed, Walsh notes that “the client-repair job was easy:

• “Just some begging and groveling that WDOT would never buy Zenith again.
• “They would never bad-mouth Zenith to the rest of Wisconsin, nor any other state.

“With all that damage control, I’d say we reached a stalemate. I didn’t exactly get ‘thanks’ from WDOT, but I did from other customers. Word still got out in a neutral positive form.”

Putting Relations First

As was related in last month’s article on solution selling, Walsh agrees that all the steps he took to address the needs of the customer “were based more on taking care of the long-term relationships I had worked so hard to develop.”

He continues that perhaps “the most important thing I learned from this entire experience is how important it is to be honest and forthright with the customer. And, it underlined the critical importance of digging in to determine what it is that they truly need. Over the course of my career, it happens sometimes that a customer will resist my approach and perhaps want to talk more about products than anything else. What I’m after, however, is to provide the solution to their problem. Unfortunately, there might come a time when I find that the customer isn’t ready to understand how unprepared they are to identify what their true needs are. Sure, when that occurs I can just provide them with a product but my real job is to double check everything and work to solve their problem then and for the future. If they are truly resistant, then I might even have to go to a customer’s board of directors and let them know that my job is do something for them that’s truly going to work. If the guys at the ‘C level’ are resistant, this can be difficult, but if I’m to fulfill my role as a trusted advisor — I’ve got to go the extra mile.”

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