The New Power Base Selling (Book Summary)

The New Power Base Selling by Jim Holden and Ryan Kubacki

Overall Review

• The Good
  • Provides a good deep dive into how to identify and engage people with high organizational influence, independent of authority”
  • Great reminder to provide unexpected value throughout the sales process
  • There was no self-promotion
• The Bad
  • With all due respect to the authors for their insight and effort, I found the book a tedious read due to overly drawn out hypothetical examples. 
  • As with most other books written by sales training firms, the authors rebrand familiar concepts and present them as new.  For example: “power base” = authority; “foxes” = champions; “political value” = personal value; etc.

Part 1: Sales as a Management Science

CHAPTER 1 Seeing the Invisible

• The best sellers win because how they sell increases the value of what they sell.
• Without insight into politics and competitors, it is almost impossible to get a sense of the larger issues that will determine your ability to improve your customer’s business, deepen loyalty, and win deals.
• From the customer perspective, a seller must evolve from the role of an information provider who shows up with extensive PowerPoint presentations, along with an eagerness to conduct product demonstrations, to that of a Customer Advisor.
• The best sellers:
  • 1. Start with a focus on customer politics by identifying influence and going beyond the tangible authority of organization charts to know who to call on.
  • 2. Provide unexpected customer value that goes beyond the stated and expected value associated with a sales opportunity to significantly advance a customer’s business, while differentiating [from the competition]
  • 3. Formulate a sales strategy that leverages the largely invisible elements of influence, unexpected customer value, and sales cycle timing, along with Competitive Differentiation and vulnerability, to build on the more traditional sources of competitive advantage and decisively win business.
• This book presents how to see and manage these three invisible intangibles — politics, unexpected value, and strategy

CHAPTER 2 The MBA of Selling

• The Holden Four Stage Model
  • Stage I: Emerging Sellers – focused on products & services
  • Stage II: Solution Sellers – Stage I plus value positioning
  • Stage III: Compete Sellers – Stage II plus adept at building political support
  • Stage IV: Customer Advisors – Stage III plus broader deal strategy
• Stage IV Customer Advisors achieve the pinnacle along five dimensions:
  • Intent – Customer Advisors work hard to establish themselves as thought leaders with their customers, often providing Unexpected Value that earns them insider status.
  • Focus – Look beyond the product, customer, and competition to center in on the customer’s customer and [the customers’] competition.
  • Relationship- The two companies depend on each other and often share a common set of values that produce a degree of cultural fit.
  • Value – Provide value at all levels = product options & information, solution selling based on operational aspects & business value, and political/cultural contribution.
  • Knowledge – Discern what information is important to developing insight, as well as how they can effectively use and apply that insight. This is wisdom.
• The 3 most critical competencies are:
  • Political Advantage
  • Value Creation
  • Competitive Differentiation

Part 2: Politics

CHAPTER 3 Influence and Authority

• You must gain insight into how the relationship between influence and authority shapes the customer organization’s decision-making process.
• An organization’s political structure is its Power Base, and the people in the Power Base are those who have political strength and influence.
• It is a mistake to assume that those with authority can automatically influence a decision, and it is an equally serious error to believe that people who lack authority have no influence.
• Determining who has influence is not easy.
• Degrees of Influence
  • 1. Foxes are the center of influence within the Power Base.  Foxes work behind the scenes to prewire or shape decisions, often long before they are made.
  • 2. The Power Base is a network of individuals within an organization who all have one thing in common: influence.
  • 3. Those outside of the Power Base are individuals without influence as it relates to your sales opportunity.

CHAPTER 4 Foxes The Heart of the Power Base

• Foxes are high-integrity individuals who place their organization first.
• Never mistake style for substance.
• Foxes drive collaboration within organizations through direct and indirect influence
• Qualities that typify Foxes:
  • Integrity
  • People-Oriented
  • Calculated risk takers

CHAPTER 5 Power Base Types and Implications

• Organizations have multiple Power Bases — because organizations have multiple Foxes.
• it is absolutely crucial not to make general assumptions about who is in or out of a Power Base.
• Selling to someone outside of the Power Base is like driving in a heavy fog without knowing it. Things seem to look okay. You’re moving ahead and you know that the sales campaign is progressing, but in what direction?
• Types of Power Bases:
  • Enterprise Power Base = the group that sets the entire organization’s direction and priorities, while also shaping its culture.
  • Business Unit Power Base = each distinct unit or team of people will have its own Fox and, therefore, its own Power Base.
  • Situational Power Base = dynamic Power Base pulled together by a Fox; Situational Power Bases often extend horizontally across many organizational lines, crossing from one department to another.

CHAPTER 6 Fox Hunting and Power Base Mapping

• Many types of change shine a light on power structures
  • New strategy announcements or significant changes in company or departmental direction
  • Reorganizations
  • Promotions and demotions
  • Key new hires
  • Mergers and acquisitions
  • Shifts in budget allocation
  • New product introductions
  • Company awards and special recognition
  • External communications
• Rather than asking, “What are your goals?“ a Fox-Hunting question would be, “Given that your CEO announced that customer privacy is a top priority, how will that impact your goals to grow your online advertising business?”
• Generally, the most effective types of “how“ questions solicit the person’s perspective on connecting a cause-and-effect relationship. For example, “How does the recent decision to broaden your business model to include services impact your goal of 10 percent market share gain in China?”
• Foxes are often shown subtle acknowledgments of respect by others.
• Foxes have a history of exerting influence outside of their department, division, or business unit.

CHAPTER 7 Gaining Political Advantage

• Three personal motivators that add value to Power Base members:
  • Upward mobility: Your product worked well, and its success launched Ray on a path to success. This initial opportunity to provide value and be recognized for it then led to other opportunities and other successes
  • Balanced lifestyle
  • Winning Power Struggles
• Stage IV Customer Advisors have a process and method for characterizing customer relationships.
  • The Ally
  • The Supporter: Some Supporters are passive, sharing information with you and coaching you along the way. Others are active, publicly endorsing your solution and willing to take on risk to help you succeed
  • The Non-Supporter is neutral
  • The Opponent
  • The Competitor Supporter or Ally
• Relative superiority is a function of Political Advantage, which is determined by the types of relationships that you have with people and how much power or influence those individuals possess.
• Build your Support Base Map early in the sales cycle, as it will shape the trajectory of your sales campaign

Part 3: Unexpected Value

CHAPTER 8 Moving Up the Sales Value Chain

• To identify your competitive differentiation:
  • Make a list of the most significant reasons why customers buy from your company.
  • Now, look at the list you just created, crossing out anything that your competition could also say is a reason that customers would buy from them. For example, if you wrote down that you’re “reliable, “but your competitor can also claim reliability, cross it out. If you included a certain capability that your competition also has, then cross it out.
  • Next, go back and look at the original list of reasons. Circle the ones that you know your customer’s Situational Power Base recognizes and accepts.
• Four stages or types of value that constitute the full Sales Value Chain.
  • Product being sold
  • Business value, expressed in terms of value and total cost of ownership
  • Political value, generally expressed in terms of leveraging the Power Base Principle and advancing an individual’s Personal Motivator.
  • Cultural value, which is often referred to in terms of accepted business norms or behavior within an organization.
• Supporters and Allies are established most quickly in any sales campaign when you provide them with Unexpected Value
• Stage IV Customer Advisors know that by generating business and political value in a manner that is consistent with an organization’s norms, values, and beliefs, they can maximize the total value perception.
• You must personify whatever defines the customer’s culture in all that you do — the more, the better. The more you visibly align with and support it, the more a customer will value your solution.

CHAPTER 9 Building Expressions of Customer Value

• The E-M-O Model of Value Relevance
  • Executive Value: When considering or approving a particular supplier, executives base their view on how a solution will affect the fundamentals of the business: revenue, profit, market share, customer satisfaction, strategic investments, earnings per share, and so on. Executives consider how a solution will better position them in the future relative to the business fundamentals they consider important.
  • Management Value: Managers will often compare the return on investment (ROI) of your potential solution versus that of your competition or even against in-house alternatives. When evaluating a supplier solution, managers tend to focus on business and operational value, along with total cost of ownership and cost/benefit, or ROI.
  • Operations Value: Operators want to understand and test the features and functions of your proposed solution and often feel most comfortable with proven solutions, as they present lower risk for them to recommend
• Value Statements refer to qualitative expressions of value, whereas Value Propositions are quantitative expressions of that same value.
• The credibility of your Value Proposition is only as good as is the level of influence of the customer who assisted you in formulating the assumptions behind it.
• Value Statements consist of four components: (ex: point-of-sale software solution)
  • Critical Business Issues (ex: increasing stand-alone movie theater profitability by at least 10 percent)
  • Area of Improvement (ex: increase the number of customers each theater can serve at the concession stands)
  • Business Impact (ex: total cost of ownership)
  • Credibility (ex: similar successful installations)
• In most cases, you will not arrive at a completed Value Proposition in just one or two meetings. It is typically the result of collaboration with the right people over time.

CHAPTER 10 Creating Demand to Displace Competitors

• There is no budget. You need someone powerful enough to create the budget or pull it from someplace (and someone) else.
• There are two opportune times for creating demand.
  • The first occurs when a Fox who moves into a new position with a different company drafts you.
  • The second opportune time takes place when you need to penetrate a competitively held account.
• Set four objectives when preparing for an executive meeting
  • 1. Establish your credibility early in the meeting by using your intel.
  • 2. Demonstrate that you are able to contribute as a thought leader, suggesting unconventional possibilities to advancing the customer’s business.
  • 3. Initiate a relationship; talk about what you and your company believe in to establish a cultural fit, if it exists. If it does not, look for common personal ground where you may have overlapping interests.
  • 4. Gain the executive’s explicit sponsorship and support to work together to further develop your draft Value Statement and then form the right set of assumptions that will lead to a sound Value Proposition.
• Build Your Support Base Map to include the following:
  • An Executive Sponsor
  • A Financial Supporter
  • An Operational Sponsor
  • End User Supporters
• Penetrating a competitively held account is all about quietly establishing a proof of concept.

Part 4: Strategy

CHAPTER 11 Introduction to Compete Strategy

• Combine strategy with unexpected customer value, politics, and other traditional sources of relative superiority — like product — to form Compete Strategy

CHAPTER 12 Competitive Differentiation

• You must know how your solution and company are differentiated from those of the competition in order to formulate a strategy
• Nothing produces more Competitive Differentiation than moving north up the Sales Value Chain and providing customers with the Unexpected Value
• Stage IV sellers are assertive, innovative, and respectful but never arrogant toward customers
• Two major principles apply when you are gathering competitive intel:
  • 1. Keep the questions you ask about the competition tightly focused and recognize that asking closed questions is appropriate and necessary. “Tightly focused “questions are halfway between open and closed. An open-ended question might be, “What is my competition proposing? “A tighter question would be, “What is it about my competitor’s solution that you find interesting? ”
  • 2. Complete the analysis from the perspective of your customer’s Power Base. How do you and the competition fare on the prospect’s buying criteria?

CHAPTER 13 The Direct Strategy

CHAPTER 14 The Indirect Strategy

• With an Indirect strategy, you work to change the ground rules by which your customer will make a decision. You identify unexpected customer value in your Attack box and work with the customer Power Base to make this the primary buying criteria for the decision.
• Timing is critically important with the Indirect approach, in terms of Upfront Speed. It requires that you quickly identify unexpected customer value and align it with the Situational Power Base early in the sales cycle.
• Back-end Surprise: It requires that the seller hold back on proposing Unexpected Value to a customer until a specific point late in the sales cycle.

CHAPTER 15 The Divisional Strategy

• You go Divisional when you can’t overpower the competition and take all the available business.

CHAPTER 16 The Containment Strategy

• The purpose [of the containment strategy] is to delay the customer’s decision, therefore buying you enough time to gather strength and win the business with an Indirect approach. The two strategies work seamlessly in tandem with each other.
• A good place to start is to arrange a meeting with someone of stature from your company whom the customer will perceive as bringing new insight worthy of knowing before they make a decision.

EPILOGUE Helping Others Elevate the Sales Profession