January 9, 2018

How to Win Megadeals that Drive Growth

By David Levitch

While relationships have always been important in sales, here’s a surprise: they’re even more important now in the digital age – but not necessarily in the way you think.

What’s different now is that, for megadeals, relationships are more complex. Sales teams get to “Who do we know at company X?” but often don’t do the analysis of relationships that can be the difference between a successful deal and spinning your wheels. In the same light, there is often not much rigor in managing the sales team itself in terms of making sure the best people with the right skills have the support they need to succeed.

Here are four ways you can address these issues and win more deals that drive growth.

1. Think about relationships in a much more scientific way.
Regardless of industry, relationships drive sales – but many top executives rely too little on their relationships or assume too much about them. This issue persists because most sellers “manage” such relationships in their heads and rarely assess the strength of those relationships.

Companies that manage relationships well use deal-relationship maps to understand who matters – as well as what matters – to each party: price, quality, and service. The map can then be used to develop the right solution to pressure-test and refine pricing terms and conditions and ensure the right messages reach the right people throughout the deal cycle.

The map should identify not just the usual suspects (e.g., CFO, CIO, and COO) but also those who hold informal power for awarding specific sales contracts, such as the procurement lead or the prospect’s external partners.

2. Appoint an overall leader and standardize processes.
A frequent complaint from senior leaders is that they lack people with the full range of skills required to win big sales contracts. It’s easy to see why: there are relatively few such deals to apprentice on, and training people to lead sales of, say, trains or aircraft can take a decade or more as they rotate through various roles.

One thing that can help is to identify one or more high-caliber sales-team leaders to manage all big contracts and to help junior salespeople learn the ropes. One CEO we know held out for six months to find the right person to fill the team-leader role, such was the standard he set. Strong support processes are a second important enabler. Each deal is different, but there are often common processes, forms, collateral, etc., that can be developed ahead of time to simplify the sales team’s job.

3. Keep selling even if you lose a deal or choose not to pursue it.
Deal teams should not walk away from potentially valuable relationships just because they fail to secure a deal. By staying engaged – e.g., following up with people at the client team, finding time to understand their issues – it’s sometimes possible to pick up adjacent business. Our experience is that about 20 percent of lost deals produce significant dividends over the next two to three years.

4. Don’t forget the role of the CEO.
More often than not in our experience, companies benefit when CEOs imagine a broader role for themselves, extending their own relationships in the company. Above all, it’s the CEO who can be most effective at helping teams caught up in the exhilaration of a deal to focus, front of mind, on their ultimate purpose: creating value for their company.

Winning deals is not just about tactics – it entails a new way of thinking that values the long-term health of a company over winning, and that includes the internal and external relationships. The job of embedding this message throughout the sales team starts with the CEO.

David Levitch is an associate partner in McKinsey & Company’s Marketing & Sales Practice.