Episode 359: Navigating Procurement and Building Strong Relationships

Intro

0:00:18 – (Bob Woods): Welcome to the Making Sales Social podcast featuring the top voices in sales, marketing, and business. Join Brynne Tillman, and me, Bob Woods, as we each bring you the best tips and strategies our guests teach their clients so you can leverage them for your own virtual and social selling. This episode of the Making Sales Social podcast is brought to you by Social Sales Link, the company that helps you start more trust-based conversations without being salesy through the power of LinkedIn and AI. Start your journey for free by joining our resource library. Welcome to the show.

0:00:57 – (Stan Robinson): Welcome to the Making Sales Social Podcast. I’m Stan Robinson, Chief Coaching Officer here at Social Sales Link, and today we have the pleasure of speaking with Mike Lander. Mike is a former procurement director and now the CEO of Piscari Limited where he specializes in helping B2B agencies and professional services firms improve their sales negotiation strategies, especially when it comes to dealing with procurement teams.

0:01:32 – (Stan Robinson): He’s got over 26 years of experience and has negotiated deals worth over 500 million pounds. I believe I read that right. Which does that translate over to? $600 million?

0:01:44 – (Mike Lander): Yeah, that’s about right. That’s an aggregate across all the deals.

0:01:48 – (Stan Robinson): Yep, yep. Mike offers deep insights into the challenges that sales professionals face when dealing with RFPs, client briefs, and procurement experts. His focus on negotiation skills, sales consultancy, and procurement insights have made him a go-to advisor for business leaders looking to improve their commercial deals. Mike, welcome.

0:02:13 – (Mike Lander): Dan, thank you for inviting me. Looking forward to this very much.

0:02:17 – (Stan Robinson): Yes, same here. Same here. So the first question that we ask all of our guests is, what does Making Sales Social mean to you?

0:02:29 – (Mike Lander): Well, I think to me it’s a very human thing, which is, you know, as, as long as, as, as mankind’s been on the planet. Yeah, We’ve, we’ve interacted with each other, we’ve told stories to each other, we’ve engaged with each other, we’ve formed relationships with each other. Selling in many ways is no different if you’re trying to build a relationship. What’s changed is the medium. So, you know, social selling now. Yes, LinkedIn is a key platform for me.

0:02:58 – (Mike Lander): I don’t do much selling on other social platforms because most of my audience is on LinkedIn, but I also think conferences, conferences, breakfasts, and workshops. Effectively you’re inviting People that you have a loose relationship with into an environment where you want to build a closer relationship with them. And that in my book is a kind of social selling.

0:03:22 – (Stan Robinson): Yes, exactly. We are on the same page in terms of that and the importance of LinkedIn as a tool for that.

0:03:31 – (Mike Lander): Exactly.

0:03:32 – (Stan Robinson): Because we focus on building relationships and LinkedIn is simply a tool that you can use to find the right people, start to engage with them on the platform, start to develop that relationship which you will eventually take off of LinkedIn.

0:03:46 – (Mike Lander): Yeah, exactly. Because you want to own your list. You know, I think, as we both know, Stan, if you leave your marketing in the hands of an algorithm, well, don’t be surprised when things change.

0:04:01 – (Stan Robinson): Very well said. Very well said. Good. Well, I was looking forward to speaking with you because your background is somewhat unique you have an extensive procurement background and are now helping sales professionals deal with procurement. Can you just talk a little bit about your, journey from procurement into the coaching, training, and teaching side consulting?

0:04:31 – (Mike Lander): Yeah, so I was, I mean, back in the day, Stan, I was an engineer. So I started life as an engineer building technology solutions and then got into banking and then got into consulting. From when I was in consulting to only a few years ago, I was very much on the buy side. So I ended up as being a kind of procurement consultant or a strategy consultant but involved in lots of kind of procurement activity in all sorts of guises.

0:04:59 – (Mike Lander): I was also a partner in a consulting firm. I and a colleague ran our consulting firm that was in procurement. So lots of buy side experience. Because if you look at what a procurement person does, so what is the role of a procurement director? Because many of your audience may not meet them yet, but as they scale then they will. Well, if you looked at all of the costs involved in a big business, then you’ve got headcount cost is a very large part and then you’ve got all of the non-headcount cost.

0:05:31 – (Mike Lander): Some of that’s direct goods and services. So if you’re, if you’re a supermarket, then your direct goods would be apples and bananas and oranges and potatoes and you know, all sorts of stuff. And that’s what we would call direct procurement. You’re buying direct goods and then there’s all the indirect stuff. There are marketing services IT infrastructure building infrastructure and hr and all those are called indirect.

0:05:55 – (Mike Lander): They’re indirect because they don’t directly touch the customer. So they’re indirect. And so people like me would get involved in managing that indirect spending. All of that marketing IT infrastructure, HR infrastructure, all that kind of stuff.

0:06:13 – (Stan Robinson): Okay, okay. And what made you decide to change from the buy side to helping the sales community?

0:06:25 – (Mike Lander): So that kind of poacher, or that gamekeeper termed poacher as some people like to call it. So I’ve gone from one side of the fence to the other. And what happened? Well, I’d been involved in procurement for 20, 25 years, whatever it was, and was looking for a change. And I was talking to my wife one day who’s a very talented marketing CMO, an ex-agency leader, and we were just talking and she said, well, why don’t you work with sellers?

0:06:55 – (Mike Lander): Sellers are always interested in how buyers work. And I thought that’s a good idea as most of my wife’s ideas are far better ideas than mine. So I can relate. Yep. So I decided to start a consultancy specializing in working with salespeople, giving them insights into how buyers work. And although yes, I see things through a procurement kind of stakeholders lens, obviously it’s wider than that. So I see things very much as a buyer because all of my work was involved with people who owned the money.

0:07:30 – (Mike Lander): So let me explain, Stan. A lot of people think procurement, if they’re involved in a process, it’s their budget. Well, it’s not, it’s the stakeholder’s budget. So it might be the HR directors or it might be the IT directors who come with the marketing director’s money. My job is to help them manage a process that allows us to procure the best supplier to deliver the outcomes that we need and solve the problems that we’ve got in the most cost-efficient and the most low-risk way whilst driving innovation, quality, diversity, inclusion, and sustainability.

0:08:11 – (Mike Lander): So I’m the kind of the guide and the governance person to the stakeholder whose budget it is who’s got a problem they need to solve. So whenever people out there are selling into a, more complex stakeholder environment, just remember, that procurement doesn’t own the money, but we are very influential. So if you, if you avoid us, if you ignore us, if you pretend we don’t exist and the deal’s bigger, like over $150,000, then that’s probably going to go wrong at some point.

0:08:50 – (Stan Robinson): Okay, okay. You have covered a lot just in that given what you’ve said, what do sales professionals need to know about the mindset and thought process of someone on the buying side? You mentioned a number of considerations, but the question is what do salespeople need to know and are there common mistakes that you see that you can help them?

0:09:22 – (Mike Lander): I think if I Look at it from a buying kind of community perspective, then I think one of the first things is around risk. Let’s assume, Stan, that you’re selling into a bigger organization. Let’s say it’s over 100 million of turnover, it’s over $100 million of turnover. It’s probably got procurement people in the organization. It’ll certainly have functional heads and it’ll certainly have bigger budgets to spend on bigger services.

0:09:49 – (Mike Lander): So if you look at, and maybe it’s a private company, maybe it’s a public company and if you think about that just logically, if we were sat down having a coffee stand, I’d be talking about, well, obviously one of the problems is risk. One of the problems for big organizations is how to manage risk. Could be an operational risk, it could be a financial risk, could be a reputational risk. There are all sorts of risks involved.

0:10:16 – (Mike Lander): So the job of that buying community is to yes, pick a supplier that can solve the problem and deliver the outcome, but also at a manageable level of risk. Risk. Because it’s no good picking Stan Robinson Inc. Who’s a one-man band to solve a particular problem that’s got a big impact on the business. Because if Stan’s, you know, if Stan falls ill or if Stan, you know, goes off and does something else or he gets distracted or he’s not available for two or three weeks, we’ve got a problem.

0:10:50 – (Stan Robinson): Yep.

0:10:51 – (Mike Lander): So I’m not about to bet the business on Stan, the one-man band for a deal that might generate $50 million worth of revenue. If it was your business, would you? No.

0:11:06 – (Stan Robinson): You? Probably absolutely not.

0:11:08 – (Mike Lander): So just thinking about things as a salesperson through the buyer’s lens of risk management might start to give people different insights about how they approach deals. For example, if they haven’t worked with the organization before and this is their first deal, and let’s say it’s a billion-dollar company, not a $100 million company. The better way to start is probably in a lower-risk way. Find a niche, find a very specific problem that’s quite difficult to solve, and work with your stakeholders on the client side to scope out a project that solves that problem for a 50k fee.

0:11:53 – (Mike Lander): So you take something relatively low risk with a lower value outcome, but gives you both time to find out how you work together. And then when that’s worked, you can start talking about bigger deals.

0:12:09 – (Stan Robinson): Yes, yes. So, you help to manage the risk by improving their comfort level in dealing with you and showing that. That way they get to know you, you get to know them and you can eventually move to bigger projects as long as you do a great job on the initial low-risk project. Yeah, great. Can you talk a little bit about using, say tools like LinkedIn or Sales Navigator to identify the stakeholders beyond procurement? Because you mentioned that there’s the procurement, but they’re the people who own the budget as well.

0:12:49 – (Mike Lander): Yeah. And there’s also the users. Yes, there’s a user community. I’ve been involved in many deals before whereby we’ve been buying something and it’s been big and we’ve got all sorts of people involved because users obviously touch the product we’re going to buy and if the users don’t like the product, then clearly that’d be a bad purchase. So I think just like just even some basic stuff, Stan like you go onto LinkedIn.

0:13:15 – (Mike Lander): I mean, sales Navigator is better. So you can go into Navigator, you can look at, well, look at the company. And obviously, companies are complex. The bigger they are, the more complex they are. If you type in IBM into Navigator, you’ll probably get, I don’t know, hundreds of IBMs come up because all sorts of divisions within IBM do different things. So first of all, make sure you’re thinking about the right component, the right function, the right business unit within your target brand, and then just start to work your way through and go, okay, who are the senior people? How are they connected?

0:13:50 – (Mike Lander): You know, we’re selling an IT solution. So who’s the IT director? Well, who’s the customer? Customer Experience Director. Because they might be involved if it’s an IT solution for solving customer problems, who’s the procurement person, who’s the finance person? Because if it’s a big deal, finance is going to get involved and you start drawing your stakeholder map. And then you work out, who do I know, who don’t I know, who do I know, who do I know that knows someone?

0:14:17 – (Mike Lander): And then you start working your way around your stakeholder map.

0:14:21 – (Stan Robinson): Okay, okay. One thing you did mention about, the danger of ignoring procurement. You may have good relations with all the other stakeholders. Are there certain things that salespeople need to avoid doing? That may either raise a red, red flag with procurement or for lack of a better term, turn them off. So they may have great relations with everyone else, but they may do something that, you know, kills the deal from a procurement standpoint?

0:14:59 – (Mike Lander): Yeah. So let’s take an example. So let’s say the deal’s worth $250,000 and let’s say we’ve been. Yeah, someone’s been working on it for a year. So salespeople’s been working on this person, on this deal for a year. They’ve been meeting different stakeholders, they’ve been engaging with them, they’ve been building solutions and they think now they’re at the stage of, there’s a problem that needs solving.

0:15:22 – (Mike Lander): This supplier has got a solution that can solve that problem. They’ve proven it can deliver value and they’ve talked a bit about risk and they’ve worked all that through. And finally, the budget holder says, I think we’ve got something here that maybe we could do together. But of course, we’re a large incorporated company in the us. We’re a listed company. We can’t just award the contract because it’s $250,000.

0:15:47 – (Mike Lander): So you’d have to go through procurement at that point. I’ll introduce you. So if I was the HR director, I’d introduce you to procurement, and all of a sudden you’re going to go to procurement and go, hi, I’ve been sent by the IT director. We’ve agreed this kind of deal. He said, I need to come and see you, or she said, they need to come and see you and work out what to do next. So imagine if you were the procurement director, Stan, how would you feel at that stage?

0:16:16 – (Stan Robinson): I’m just now hearing about this.

0:16:18 – (Mike Lander): Yeah, exactly. Exactly. I’m just now hearing about this. Oh, and you look like a supplier we already work with. You look like 10 suppliers we already work with. And they’re on my preferred supplier’s list. And you’re not on my foot. I’m pretty busy. Bye.

0:16:43 – (Stan Robinson): Wow. Okay.

0:16:46 – (Mike Lander): And that’s it. Now I might give the IT director a ring and go, this. This person turned up. They said that they’ve done a deal with you and that I was just kind of like to discuss with them. What’s going on? That’s not how we work. You know, it’s not how we work. We’re a listed company, we’re big, we’ve got processes to follow, we’ve got governance, we’ve got risk to manage. And I then have a conversation with them.

0:17:24 – (Mike Lander): It wouldn’t normally get to that stage. One of my key roles was to build relationships with the internal budget holders. So we work in categories, Stan. So, like, I’d work in professional services or I’d work in IT services. And what part of your job is to build relationships with your stakeholder community? That’s part of the role of procurement and Then you don’t get these problems because then when they’ve got a problem they want to solve, I say to them, if you’ve got a problem you want to solve, give me a ring, drop me an email, we’ll have a discussion, let’s see how I can help.

0:17:56 – (Mike Lander): And that avoids, you know, lots of confusion, lots of sales cycles going out the window, lots of ghosting that salespeople complain about. So although it sounds counterintuitive, if it’s a bigger deal, if you’re a new supplier and it’s a bigger deal and you’ve not worked with that company before, I’d say to them, you know what, what we found in this kind of environment when this happens is if we get to the end of this cycle and let’s say it’s six or nine months, we go and meet procurement and then it all goes wrong.

0:18:35 – (Mike Lander): So why don’t we meet them at the beginning, let’s just do a meet and greet, tell them what we do, have a conversation, and let’s see what they’ve got to say. Because ultimately they’re the ones that are going to raise or instruct someone to raise a purchase order. They’re the ones that are going to negotiate a contract. They’re the ones who will negotiate the schedules the KPIs and the SLAs. Let’s get them involved early on.

0:19:02 – (Stan Robinson): Yep. So get procurement involved early.

0:19:06 – (Mike Lander): Yep.

0:19:08 – (Stan Robinson): The salesperson, just in terms of, in terms of the flow, is it best for the salesperson to ask the stakeholder that they’re dealing with? Hey, who’s your counterpart in procurement and why would you set up a follow?

0:19:24 – (Mike Lander): Up, Just introduce us, fire an email and we’ll have a conversation. There is a time when you wouldn’t get procurement involved, Stan. And I’ve seen this work for people which is, let’s say it’s only a $20,000 piece of work. The budget holders probably have discretionary spending.

0:19:44 – (Stan Robinson): Okay.

0:19:45 – (Mike Lander): And they can probably issue what we used to call a side letter agreement, which is like basically a one-off deal work with a supplier. You don’t go on the preferred suppliers list, but you can get paid. Yeah. As long as it’s a legally binding side letter agreement that’s been endorsed by procurement. Thresholds have all been agreed and you’re not. Yeah. And the stakeholder’s not doing it every week because that would be in breach of our governance rules.

0:20:12 – (Mike Lander): Then that is a way in which you don’t need to meet procurement. But just check with the stakeholders if we don’t work with procurement, and we do a bit of work with you on a side letter. How do we get paid? Normally procurement or the purchasing department, depending upon how mature the organization is, could be called sourcing, could be called procurement. Someone’s got to raise a purchase order and then someone’s got to say, yes, we can get paid when we send an invoice in.

0:20:40 – (Mike Lander): How does that work?

0:20:42 – (Stan Robinson): Yep, good to be aware of that upfront because I imagine otherwise you’re.

0:20:46 – (Mike Lander): Going to invoice a company and find that you can’t get paid because no one’s vetted you as a supplier, checked that you’re working ethically and that you meet all of our standards. If no one’s had a chance to do that and you just raise an invoice, well, you won’t get paid. Not for some time.

0:21:09 – (Stan Robinson): Okay, great. There are multiple questions that I would love to ask, but I have to be cognizant of the time. One, in your experience, you have a lot of experience working with RFPs. Yeah, but not every purchase involves an RFP. They’re depending on what. Can you give any advice to salespeople who are working with RFPs and make the distinction between, okay, if it’s an RFP that I’m dealing with, what are some things I need to do versus, okay, this is a purchase that does not involve an RFP?

0:21:57 – (Stan Robinson): What do I need to do in. In there?

0:22:00 – (Mike Lander): So a good friend of mine, a guy called Blair, ends, who’s in Canada, he does win without pitching. He wrote a book called Win without Pitching. So people want advice on how to win without going through an RFP and without pitching in a pitch panel. Read Blair’s book, which was all about winning without pitching. They win without pitching a manifesto, I think. But if you take the one whereby it is an RFP, do some basic stuff first. So qualification your biggest success factor with an RFP driven purchasing decision is qualification.

0:22:41 – (Mike Lander): So take an example, Stan. So the first thing the salesperson gets is this RFP turns up. So the RFP turns up from someone that they don’t know, but it’s a reputable company. They’ve checked the company out, it’s reputable. And it’s more than reputable. It’s big and it’s. And it’s a big trophy brand. The salesperson wants to bid for it. It’s a big trophy brand. However, that RFP has gone to, let’s say, five suppliers.

0:23:09 – (Mike Lander): The first one is probably the incumbent supplier. The second and third suppliers are probably ones that we know of, already have worked with, know of are trusted. The fourth and fifth ones are randoms, probably off the Internet, maybe via referral from a friend, via someone, or a podcast. Could be all sorts. If you’re in four or five, you know what your chances of winning are. If you’re the fourth or fifth supplier.

0:23:40 – (Stan Robinson): Selected, say less than 10%. And that may be generous.

0:23:45 – (Mike Lander): Yeah, it might be generous. I’d say about between 3 and 5%. You might want to say we don’t know in the organization. It’s arrived randomly, it’s a great brand. Let’s not bid, but let’s not bid in a very specific way. Let’s go back to them and say we appreciate being selected as part of the bid process. Thank you. However, in our experience, if we know no one in the organization at this stage in this kind of deal, we tend to win one in about 30, so respectfully, we’re going to decline to bid.

0:24:20 – (Mike Lander): What we’d like to do though is we’d like to give you some insights into the problem you’re trying to solve and a different way of solving it. And we’d like to give you maybe some ideas about market pricing. Would that be helpful?

0:24:34 – (Stan Robinson): That is brilliant.

0:24:37 – (Mike Lander): Okay.

0:24:38 – (Stan Robinson): Okay.

0:24:40 – (Mike Lander): So you’ve not spent 30 hours writing a proposal. You’ve not raised expectations at the board level of who that we’re going to win a deal with XYZ brand that’s a Fortune 100. But you have started to build a relationship. You started social selling, building trust with a third party that maybe one day you’ll do business with.

0:25:04 – (Stan Robinson): Yes. Wow, that is brilliant. One of the things we talk about is that social sales links are slowing down the outreach to speed up the income. The outcome rather, and this is, it’s long term because you know that you’re not going to win, you know, that deal. But as you said, it’s an opportunity to start a relationship if you do it right.

0:25:36 – (Mike Lander): Yeah.

0:25:36 – (Stan Robinson): So that, that is brilliant. Last question. And I reserved the right to see if we, may be able to do, a sequel episode at some.

0:25:46 – (Mike Lander): Point in the future because this is done thoroughly. Enjoyed.

0:25:48 – (Stan Robinson): Awesome. There we talked about the RFP and the other types of purchases that don’t involve an RSP. Any advice there for sales professionals?

0:26:01 – (Mike Lander): Yeah. So I would. So I was trained by KPMG many, many years ago. I was trained by McKinsey, I was trained by PwC and I learned huge amounts about consultative sales about how you work with a client on a consultative sales approach. We used to call it issues-based consulting. Stan, what that was was for the non-RFP-driven stuff. The way, the best way to start is to start with a good discovery call.

0:26:32 – (Mike Lander): My biggest tip to your audience. In a non-RFP-driven purchasing approach with a potential client, you’ve got a set of questions that you’re going to ask. Don’t make it too long, maybe you know, five to 10 questions, but make those questions insightful, make them think them through really hard. Make, make the client think about something they’ve never thought about. Give them an insight that they haven’t thought about.

0:27:10 – (Mike Lander): So I was talking to a guy this morning called Andy Bounds. Andy Bounds is a very, very, very clever sales consultant and he said to me, try three things when you’re doing that kind of discovery. Tell stories, teach, and give a timeline. So tell a story about it. I’ve solved this problem before. We solved it in this kind of way. It looked like your kind of problem. So I’m credible. Then teach them something they don’t know.

0:27:39 – (Mike Lander): When we solved that problem, we found three or four really big issues. These are the big issues. You may not have seen them yet, but they’re coming your way. Thirdly, typically implementation goes in three stages. It goes with a diagnostic, a design, and then a rollout. And that typically takes between 12 and 18 months. Okay, so you started to shape something and you found out, is it a problem that they’ve got?

0:28:08 – (Mike Lander): They now know that you’re credible, they’re now inquisitive, they’re thinking, maybe I should have a follow-up conversation.

0:28:17 – (Stan Robinson): Yes, yes. So that requires a good deal of preparation and thought on your part beforehand so that you can bring some insights that they have not thought of before. And that’s how you position yourself as a resource and distinguish yourself from competitors.

0:28:35 – (Mike Lander): If you’ve got 20 minutes with someone, it’s the first time, you better make it an impactful 20 minutes. I’ve got to remember, Stan, when I’ve dropped the call and it’s a week later, there’s something called, as a last tip for your listeners, have you ever heard, Stan, of the Ebbinghaus forgetting curve?

0:28:56 – (Stan Robinson): Ah, I have, but I’ll let you go through it. I just remember, you know, you hear, learn, or somehow are exposed to something. And how long, how much of it you remember? A day, a week, a month later?

0:29:10 – (Mike Lander): Correct. So that’s exactly it. What Ebbinghaus found in 1887, I think was that within four days of learning something, whatever it might be, you’ve lost 80% of what you learned. So when you’re on that sales call and your audience is talking to someone a week later you have forgotten 80%. So the key is the 20% they remember has to be outstanding. Has to stick in their mind and make them think differently.

0:29:49 – (Stan Robinson): Awesome. Awesome. Great. Well, that is a great point and place for us to wrap up, Mike. I. I appreciate your time. As I said, I could keep asking questions. Yeah, for quite some time.

0:30:02 – (Mike Lander): Great, Stan. We could have a great conversation over a coffee. That’d be brilliant.

0:30:05 – (Stan Robinson): Yes. This has been extremely insightful for our listeners, Mike, who would like to learn more about you, your business, how you can help them, and where would you like to direct them. Be it the LinkedIn website.

0:30:20 – (Mike Lander): So I think there’s three things. The simple one is LinkedIn. Go on LinkedIn, follow me on LinkedIn, and message me. The second one is our website. So piscari.com you can sign up for our Insight series. You know, every fortnight we send out an email with some interesting insights in it. And then thirdly, I’ve got a podcast. So listen to me on my podcast, which is called Higgle. H I G G L E Colon. The B2B Sales Club podcast.

0:30:49 – (Stan Robinson): Ah, okay. Thank you for spelling higgle for me because that was not intuitive. And Piscari is P I S C A R-A R I.com Correct. Wonderful.

0:31:03 – (Mike Lander): Great.

0:31:04 – (Stan Robinson): Well, Mike, again, thank you so much. I know our listeners will get a lot of value from the insights that you shared, and I look forward to the next time.

0:31:14 – (Mike Lander): So do I. Thanks, Dan. Always up for another time. Definitely. Thank you.

0:31:17 – (Stan Robinson): Okay, bye now.

0:31:19 – (Mike Lander): Bye now.

Outro:

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