3 Environmental Analysis Tools to Scale Your Sales

By Janice B Gordon | Sales Motivation

Mar 26
Scale You Sales Environmental Scanning 3

Sellers certainly, do not deeply research the macro and micro-environment to understand the drivers impacting the competitive customer environment, so they end up making too many assumptions of what is going on in the customers’ world. I find many sellers do not do nearly enough research on the individual buyers, decision-makers and influencers that they need to engage. Sellers then do not engage the breath relationships within the customer organisations.

Sellers cannot rely on past experiences or software aggregators to do the work. Sellers must turn the complexity and ambiguity of the glut of data into insight to be able to ask relevant searching questions. Buyers are bored with sales professionals’ solution selling their way to finding a problem to their solution. Instead map buyers and influencers, actively listen and research the macro environment and micro supply and value chain.

Buyers know the symptoms but do not always know the underlying and connected problem and need help articulating the impact and visualizing the outcome.

Sellers must help buyers, help their customers, increase their revenue and develop the next innovation that creates competitive advantage. Information as insight is a powerful means for gaining access. Sellers must find something relevant that the buyer does not already know that will give them a reason to discuss their issues with you.

Scale You Sales Environmental Scanning 1

The Confederation of British Industry (CBI) research found that 42% of companies report that the decision for Britain to leave the EU (BREXIT) had negatively affected their investment decisions. Macro-environmental factors cut across many customer markets and environments. If it is the thing that keeps your buyer and customers awake at night, then it is a concern for you too! Whatever your buyers’ issue, what can you do as the seller to mitigate the negative impact on their businesses, otherwise why would they listen to you?

Brexit has implications on employment and services, Operating standards, Import/export and logistics, Taxes and money, Manufacturing, Information technology, Data and many other unknowns. Your role in sales is to provide stability, certainty and confidence and therefore the more you know and understand the more help and guidance you can give your customers. All customers are facing increasingly dynamic environmental challenges that sellers must follow to develop suitable courses of action. Buyers are not interested in seller product solutions; they need simplicity, stability, clarity, confidence and insight.

It is hard to think outside of the usual norms, and I use environmental scanning exercises to get sales professionals to research beyond what they know or assume to know.

The Scale Your Sales system uses these tools to help sales professionals navigate the volatile, uncertain, complex and ambiguous macro environment.

Scale Your Sales Three Tools to Assess and Analyse Your Customer Environment

PESTEL Analysis

PESTEL helps sellers to understand the many variables and the degree of impact on your customers’ business. The PESTEL analysis is a framework of macro environmental factors that are important for strategic analysis. It describes Political, Economic, Social/Cultural, Technological, Environmental and Legal drivers of change. It is a vital tool for understanding the drivers of market growth and decline, the business position, opportunities and direction of travel. PESTEL analysis should be reviewed quarterly or annually as the volatility of the situation demands.

It is essential to have a diversity of people challenging the assumptions of the impact of macro environmental changes. Sellers need a breath of perspectives on the variables involving industry experts, cross-functional team members and most importantly customers in scrutinizing the situational.

Scan common PESTEL factors to avoid assumptions, missing obvious areas needing analysis and then dive into periphery areas of the industry, market or customer environment.

Porters’ Five Forces

Another tool is Michael Porter’s Five Forces; he identified five irrefutable forces that play a part in shaping every market and industry in the world. These five forces measure competition intensity, attractiveness and profitability in any industry and market:

1. Competition in the industry;

2. Potential of new entrants into the industry;

3. Power of suppliers;

4. Power of customers;

5. A threat of substitute products.

Five Forces is a business analysis model that helps to explain why different industries can sustain levels of profitability. Although industry strength will vary, with all five forces are considered together, they determine long-term profitability within the specific industrial sector.

Understanding the sustainable profitability of your most valued and strategically important customer is critical to the growth and success of any sales organisation. The key to customer success, and thus the key to the model, is analyzing the changing dynamics and continuous change between and within the five forces. Environmental scanning is a critical practice that all sales professionals should master.

It’s essential when undertaking PESTEL, and Five Forces analysis that factors affecting the customer is assessed from a low too high impact on the organisation. The result of these assessments must be used to identify threats and opportunities as part of a SWOT analysis to move the challenges into insight.

The SWOT Analysis

The SWOT is an excellent tool to bring together analyses of all the factors affecting the customer organisation. Using PESTEL and Porter’s Five Forces along with the internal environment supply and value chain, and resource analysis to identify key strengths and weaknesses.

Sellers use the SWOT analysis to distinguish between where your customer is now and how the current challenges may impact prospects.

Remember the strengths and weaknesses refer to the controllable internal business while the opportunities and threats are uncontrollable external. The goal of the SWOT analysis is to capitalize on the customer strengths, help them overcome weaknesses, exploit opportunities, and counter the threats.

Janice B Gordon Environmental Scanning

Creating Insight from Information into Opportunity

Sellers must take the highest ranking identified strengths, weaknesses, opportunities and threats and answer the following questions to form a basis for asking further searching question of their buyers and customers:

1.   How can the customer use their strengths to take advantage of opportunities?

2.   How can they overcome weaknesses preventing them from taking advantage of opportunities?

3.   How can their strengths reduce the probability of threats?

4.   What can the seller, do about their weaknesses to make the threats less likely?

As you answer these questions, you will begin to understand the external forces that your customer contends with and how you can help your customer tackle them with innovative solutions and insight.

Now your, the seller is better able to serve your customer and provide new insight into the present or future problems that the customer may not have considered. In the context of identifying the implication of the many macro and micro drivers and potential opportunities relevant to your customers business objectives. Recognize the most critical issues and use this not as a conclusion but as a basis for further inquiry with the customer to develop the next level of inquiry:

•   Whom do you need to talk to within the customer organisation?

•   Whom do you need to engage and influence?

•   Whom do you have a relationship with?

•   Who stands to gain from this insight?

•   Who would advocate internally?

•   Who internally is already on this path?

I find many customers do not do this thorough analysis of their macro and competitive environment. However, when a seller does the work not only does it impress the customer, but it can be a game changer. The seller must give buyers a reason to provide access and selling a solution is not even in the same ballpark! Sellers must position themselves as the trusted source of relevant insight, bring them one step closer to the honorary position of the customers trusted adviser.

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About the Author

Janice is a Visiting Fellow at Cranfield School of Management. She is passionate about helping companies adapt their sales approach to the economic, social and technological challenges. This has led her to create the popular the sales enablement system, Scale Your Sales. Janice is the international Strategic Account Sales Speaker, author and consultant, achieving many noted accolades including Sage Top100 Global Business Influencer 2017. Contact Janice today about Scaling your Sales