How Does 3 Minutes Equal $24 Million?

Arithmancy: the magic of numbers!

 

Some years ago, there was an explosion of interest in electronic health record (EHR) software, driven partly by government regulation and incentives. EHR software is what you see on your physician’s computer screen that lists your medical history, medications, test results, and similar information.

 

During discovery conversations, doctors confirmed that by using these EHR systems they could easily trim a few minutes from writing-up and entering their notes after each patient visit. A Delta of three minutes was often the agreed-upon amount of improvement. Amazingly, many (many!) EHR sales were based on saving these three minutes per doctor-patient interaction.

 

Just three minutes: That can’t yield significant gains, can it?

 

Oh yes, it can!

 

In the U.S., a typical doctor might see fifteen patients a day. If three minutes are saved with each interaction, that amounts to recovering 45 minutes each working day. At 220 working days per year, that’s 165 hours per year, per doctor.

 

The average U.S. hospital has about 135 doctors, so 135 doctors x 165 hours/doctor = 22,275 hours saved per year for that hospital. There are about 1875 working hours per year, giving us 22,275/1875 = ~12 doctors. That’s like getting twelve “free” doctors without any additional hires!

 

The average doctor’s salary in the U.S. is ~$200,000. Assuming a (very low) burden of 50%, each doctor costs the hospital $300,000 annually. So, the ability to gain 12 “free” doctors amounts to avoiding spending $3.6 million annually.

 

That’s right: 3 minutes saves the hospital $3.6 million through avoiding the need to hire 12 additional physicians!

 

That’s a cost-avoidance approach. A second, incremental revenue approach is even more compelling: Each doctor generates about $2 million annually. So, the equivalent of twelve additional doctors generates $24 million in incremental revenue, without adding a single new physician.

 

Abracadabra: the magic of numbers!

 

The 3 minutes saved with each doctor-patient interaction generates an additional $24 million annually! 

(That’s a big rabbit you just pulled out of your hat!)

 

Resources:

 

Let’s Talk About Value – Uncovering the Delta

https://greatdemo.com/lets-talk-about-value-uncovering-the-delta/ 

 

Doing Discovery:

https://www.amazon.com/Doing-Discovery-Important-Enablement-Processes/dp/B0B8RJK4C2/

 

Whose Value Numbers Are Most Believable?

Those that come from your prospects’ lips!

 

Consider: which of these are believable?

 

·      Feature Approach: Nope, it’s just an empty claim from the vendor.

·      Advantage Approach: Better, since the numbers (in theory) came from another customer and are therefore a bit more believable.

·      Benefit Approach: Best, without question, because the numbers came from your prospect!

 

Newly minted vendor customer-facing folks tend to start with feature statements. Vendor staff with more experience seek to avoid feature statements and focus on advantages and benefits. Seasoned veterans know that benefit statements have the most influence and guide their conversations accordingly!

 

Fundamental Principle: Benefit statements require discovery of specific elements of value!

 

Let’s examine the value statement from a previous post, “If you implement our software, it looks like you will reduce your project completion time by 20%, you can redeploy 4 FTE to other more valuable tasks, and you will save over $750,000 annually, based on the numbers you provided.” 

 

This is a benefit statement, since it is clear that a discovery dialogue uncovered both the need and the associated quantified value for this prospect. Best of all, these numbers came from the prospect’s lips as opposed to the vendor’s.

 

The best benefit statements communicate tangible value in the form of specific prospect-derived numbers. These quantities enable the buyer to build and present their internal cost justification materials with a reasonable expectation of success. This is the most effective, most compelling, and most useful way to communicate value!

 

So, how do you uncover prospect value elements like these above? Though discovery, with a specific objective to capture meaningful value metrics.

 

Resources:

 

Let’s Talk About Value – Uncovering the Delta

https://greatdemo.com/lets-talk-about-value-uncovering-the-delta/ 

 

Doing Discovery:

https://www.amazon.com/Doing-Discovery-Important-Enablement-Processes/dp/B0B8RJK4C2/

Communicating Value: Words or Numbers?

 

Sales, presales, and other customer-facing staff are repeatedly urged by their managers to “communicate value.” Some players fail completely and only present features: “We have this fabulous Biframulator function!” This is representative of a far-too-large population of customer-facing staff.

 

Others try to communicate value, but their statements are vague and meaningless, such as, “With our Biframulator feature you’ll save time and money!” While slightly superior to the first group, these statements are useless in enabling prospects to buy your offerings.

 

A smaller, wiser population of vendor staff offer benefits statements that match capabilities to prospect needs. For example, “And you told us that this Biframulator capability is an important part of the solution you need.” This type of communication is better, because it shows that some amount of discovery was completed and acknowledged. However, this value statement is still insufficient to support buyers’ internal cost justification requirements.

 

Solution Selling, CustomerCentric Selling, and other sales methodologies define the differences between features, advantages, and benefits as: 

 

·      Features are descriptions of the capabilities offered in a product or service.

·      Advantages are the gains or improvements that a customer might enjoy but are communicated without any confirmation of need on the part of the prospect (they are pre-discovery statements, accordingly).

·      Benefits represent the value a product or service can provide that includes your prospect’s confirmation of the need or desire (post-discovery).

 

With this in mind, here are three examples of communicating value following these definitions:

 

·      Feature Approach: “If you buy our software, you’ll save time and money…!”

·      Advantage Approach: “Some of our other customers have saved thousands of dollars with our solution.”

·      Benefit Approach: “It looks like you’ll save over $750,000 annually, based on the numbers we discussed.”

 

How are you communicating value?

 

 

Resources:

 

Doing Discovery:

https://www.amazon.com/Doing-Discovery-Important-Enablement-Processes/dp/B0B8RJK4C2/

The Magic of Numbers in Communicating Value

Which of the following vendor statements has more impact?

 

“If you buy our software, you’ll save time and money…!”

 

Or

 

“If you implement our software, it looks like you will reduce your project completion time by 20%, you can redeploy 4 FTE to other more valuable tasks, and you will save over $750,000 annually, based on the numbers you provided.”

 

The difference between these two approaches is striking and has a huge impact on your prospects’ perceptions of value!

Demos: What You Don’t Know Is Hurting You!

Here’s a truly frightening realization: Many seasoned demonstrators don’t know how much they could improve! They have reached a point where they believe they are “at the top of their game.” That’s a dangerous mindset: It precludes getting better!

 

Most presales and sales managers similarly have a limited idea of what improvements are possible within their teams. They know they want more effective, more compelling demos, but generally only see small, incremental improvements in their teams’ practices: just a tiny twitch of the needle.

 

How many times have you heard managers implore:

 

“Wrap a story around your demo…”

“Remember to communicate the value…”

“Show more passion…!”

 

The needle vibrates but doesn’t advance.

 

Great Demo! methodology enables large, substantive improvements to demonstration practices: a major swing of the needle! Training is not simply “polishing the pathway” but rethinking the entire process, from qualification and discovery through final proof.

 

Intriguingly, Great Demo! and Doing Discovery methodologies are not for everyone! If you are comfortable with your current practices and the results, don’t change. If you seek a few “tips,” but have no desire to reengineer your practices, stay where you are. Your competition will thank you!

 

So, what’s the value of better demos? 

 

For those who are happy with their current results, not a thing. But for those of you who seek major advancement in your skills and outcomes, better demos are exceptionally valuable!

 

Most practitioners and managers focus on style in demo delivery, seeking small improvements in word choice, energy and related, but they ignore the larger, higher-impact topics:

 

-       When demos should be presented, and 

-       What content should be presented

 

And, frankly, these two themes represent the real opportunity. Perhaps it’s time to get better…!

 

 

Resources:

 

Suspending Disbelief: A Collection of Sales, Presales, and Marketing Stories (and Lessons Learned)

https://tinyurl.com/yc7rsrmy 

 

Doing Discovery:

https://www.amazon.com/Doing-Discovery-Important-Enablement-Processes/dp/B0B8RJK4C2/

 

Great Demo! Third Edition:

https://www.amazon.com/dp/B0C9SNKC2Y/

 

Training

https://greatdemo.com/training/workshops/great-demo/ 

Want Better Demos? Delivery Tips!

“I don’t even know where to look!” said the prospect.

 

Mousing and pointing are often taken for granted by vendor teams, but prospects are frequently frustrated by Zippy Mouse Syndrome, imprecise pointing, and the failure of vendors to communicate what their prospects are actually seeing. Vendors have seen their own software screens hundreds of times, but they forget that this is the first time their prospect has seen them! 

 

As an exercise, review a few of your recorded demos:

 

-       Are you clearly communicating what the audience is seeing, 

-       How it helps them solve their problems, 

-       And the value associated with your solution? 

-       Is your mousing smooth, deliberate, and precise, or are you another victim of Zippy Mouse Syndrome?

 

Great Demo! teaches specifically how to point in both face-to-face and over-the-web delivery scenarios, as well as what needs to be communicated. This results in audiences “getting it” the first time, improving conversion rates and reducing the need for POCs and other expensive forms for proof.

 

Great Demo! Workshop participants learn to apply advanced techniques to make their demos truly remarkable, through the use of props and visual aids, whiteboard techniques, structured movement, real storytelling, and other skills (see Chapter 14 on page 332 of Great Demo! Third Edition for a rich discussion of storytelling in demos).

 

 

Resources:

 

“That’s a Zippy Mouse!” Story

https://tinyurl.com/yc7rsrmy 

 

Remarkable Demos: What Makes a Demo Truly Memorable?

https://greatdemo.com/remarkable-demos-what-makes-a-demo-truly-memorable/ 

 

Bite-sized Is Better: The Power of Chunking in Software Demos

https://greatdemo.com/bite-sized-is-better-the-power-of-chunking-in-software-demos/ 

 

Rescue – From the Tyranny of Traditional Demos

https://greatdemo.com/rescue-from-the-tyranny-of-traditional-demos/

 

Let’s Talk About Value – Uncovering the Delta

https://greatdemo.com/lets-talk-about-value-uncovering-the-delta/ 

 

Why Structure Demos Like a News Article?

https://greatdemo.com/why-structure-demos-like-a-news-article/ 

 

Are you Buying It Back?

https://greatdemo.com/are-you-buying-it-back-2/ 

 

Great Demo! Third Edition

https://www.amazon.com/dp/B0C9SNKC2Y/

 

Doing Discovery:

https://www.amazon.com/Doing-Discovery-Important-Enablement-Processes/dp/B0B8RJK4C2/

 

Training

https://greatdemo.com/training/workshops/great-demo/ 

 

More Supporting Articles

https://greatdemo.com/learn/articles/ 

Want Better Demos? Do Better Delivery!

 

“I’m overwhelmed and confused!” said the prospect.

 

What was going on?

New hires in software firms are told to “learn the demo” and often need to prove proficiency by showing each of the steps in a traditional overview demo. Their delivery style is generally dry and wooden as they struggle to simply follow the prescribed pathway.

 

As practitioners grow more seasoned, they become comfortable with the software and develop their own personal delivery style, generally defined by (and generally limited to) word choice, presence, energy, pace, and a few personal experiences.

 

This is partly relevant in our equation, but not sufficient.

 

Far too many seasoned veterans (as well as new hires) show screen after screen after screen without actually presenting the screens. Prospects struggle to take in what they are seeing while the presenter works through their “talk track”: A net zero in terms of successful communication.

 

Similarly, traditional demos emphasize showing as much as possible in the time allowed, severely reducing or eliminating any chance for interactivity. Prospects perceive these demos as firehose deliveries, furiously flinging features and functions, frantically overfilling prospects’ craniums with a copious cornucopia of confusing capabilities. (Yes, I had fun with this sentence and hope you did too…!)

 

Great Demo! practitioners learn how to clearly, crisply and compellingly communicate what the audience is seeing on the screen, how prospects can solve their business problems using your tool, and how much value can be enjoyed by making the change.

 

The methodology enables a real conversation to take place by “Peeling Back the Layers,” encouraging interactivity by chunking, avoiding “pre-answering” questions, and the use of frequent summaries to stimulate dialog. These demos are perceived by prospects as engaging and focused on their interests, yielding a true dialog, resulting in fewer demos to move the process forward and secure the order.

 

 

Resources:

 

Bite-sized Is Better: The Power of Chunking in Software Demos

https://greatdemo.com/bite-sized-is-better-the-power-of-chunking-in-software-demos/ 

 

Rescue – From the Tyranny of Traditional Demos

https://greatdemo.com/rescue-from-the-tyranny-of-traditional-demos/

 

Let’s Talk About Value – Uncovering the Delta

https://greatdemo.com/lets-talk-about-value-uncovering-the-delta/ 

 

Why Structure Demos Like a News Article?

https://greatdemo.com/why-structure-demos-like-a-news-article/ 

 

Are you Buying It Back?

https://greatdemo.com/are-you-buying-it-back-2/ 

 

Great Demo! Third Edition

https://www.amazon.com/dp/B0C9SNKC2Y/

 

Doing Discovery:

https://www.amazon.com/Doing-Discovery-Important-Enablement-Processes/dp/B0B8RJK4C2/

 

Training

https://greatdemo.com/training/workshops/great-demo/ 

 

More Supporting Articles

https://greatdemo.com/learn/articles/