session 3 - pain chain analysis

How to Sell Microsoft Dynamics ERP. Pain Chain®

Microsoft Dynamics Partner Academy

1


Trademark Notice

The following trademarks and service marks are owned by Sales Performance Holding

Company (DBA: Solution Selling® Inc.) and licensed by Sales Performance International,

LLC. Any questions concerning the use of these trademarks or whether a name that does

not appear on this list is in fact a trademark of Solution Selling® Inc. should be referred to

Sales Performance International, LLC in the United States at the following address:

Sales Performance International, Inc.

4720 Piedmont Row Drive, Suite 400

Charlotte, North Carolina 28210 USA

Phone: 704.277.6500 FAX 704.364.8114

[email protected]

www.spisales.com

Solution Selling® and Situational Fluency Prompter®, Pain Sheets®, 9 Block Vision

Processing Model® and Pain Chains® are registered trademarks and service marks of

Solution Selling® Inc. All other referenced marks are those of their respective owners.

mailto:[email protected]

http://www.spisales.com/

2

1. Why growth is not linear

1. Main Pain Chains® for ERP

2. Pain Chains® by Industry

3. Knowledge Check

4. Summary

Pain Chain®


3

Formula for a Successful Sale

KEY FACTORS

PAIN X POWER X VISION X VALUE X CONTROL

4

Basic Principle of Sales

NO PAIN NO CHANGE

5


Critical Business Issue: PAIN

ERODING: Profit, Market Share, Service, Quality, Growth

INCREASING: Costs, Competition, Errors, Return, Employee Turnover

COMPLIANCE: Government regulations, Industry standards

6


Basic Principle

PAIN FLOWS

THROUGH

AN ENTIRE ORGANIZATION

7

The Pain Chain®

Job Title: CEO

Pain: Earnings per share decreasing

Reason A Eroding profits

Job Title: VP Finance

Pain: Eroding profits

Reason A Missing new account revenue targets

Reason B Increased operational costs

Reason C Increasing credit write-offs

Job Title: VP Sales

Pain: Missing new account revenue targets

Reason A Sellers spend too much time with existing customers

Reason B Increased operational costs

Reason C Increasing credit write-offs

Reason D Not enough referral business

Job Title: CIO

Pain: Current system does not meet the needs of sales departments

Reason A Legacy systems don´t allow for growth

Reason B Disparate databases limit information flow

Reason C Manual processes

The New Solution Selling: The Revolutionary Sales Process That is Changing

the Way People Sell by Keith M. Eades. McGraw-Hill © 2004

1. Main Pain Chain® for ERP

B

8

Three levels of Buyer Needs



the Way People Sell by Keith M. Eades. McGraw-Hill © 2004

A

Vision of a Solution

Latent Pain

Admitted Pain

9


Three levels of Need: Definition

10

Meet the Pain Chain®

Establish a Pain Chain®. "Pain" is the Solution Selling® (SS) term for things that are going awry. Sales are down - that's a pain.

Expenses are up - ditto. SS is very specific about one thing: there is no technical pain. Your PDA cannot

synchronize with your calendar tool - that's not a pain. That's a cause of pain, or maybe a symptom of

pain. The pain in this case might be: “Your employees are missing too many meetings" or “You couldn't

get the PDA synchronization feature into the last release."

A Pain Chain® is a set of pain descriptions, along with the reasons for them. In each case, a link in the chain has as one of its reasons a pain from a lower level. Thus, the VP of

Software Development may have "We miss too many ship dates" as a pain entry, while the SQA director

has "Our QA cycle is too long". The SQA pain is a contributor to the VP's pain.

The objective of the Pain Chain® is simple. To get commitment from the upper echelons of the organization. If the sales team can show a simple

visual aid that ties the VP of Software Development down to the Integration Test manager, then the VP

will be committed to helping the manager.

This commitment means that there is an increased likelihood of the organization successfully

implementing the solution that they buy. It's hard for a test manager to impose restrictions on a

development lead, especially one who claims they’re running late.


A

11

Pain Sheets®

The Pain Sheet®, or the Situational Fluency Prompter®, documents specific

control questions for salespeople to use when diagnosing buyer pains and

creating buying visions.

You can find this document and more information in the following book.


the Way People Sell by Keith M. Eades. McGraw-Hill © 2004.


A

12

Main Pain Chain® for ERP


Unable to respond to changing business conditions

Difficulty in Connecting Customers, Partners and Employees

Difficulty in Managing Organizational Growth

Low Productivity of People and Processes

A

13

CEO Pain: Low company

productivity prevents taking

advantage of growth potential

CFO VP Sales

VP Marketing

Reason 1 : High costs of

operations

Reason 2: Can´t compete

successfully

Reason 3: Technology is a

cost center, not a productivity

factor

Reason 4: Marketing is

costly and not producing

results

Reason 5:Unproductive

business practices

Reason 6: Inefficient

manufacturing processes

Reason 1: Lack of real-time

insight into key financial

metrics

Reason 2: Difficulty managing

financial accountability and

compliance.

Reason 3: Expensive,

ineffective business

processes.

Reason 4: Unfavorable

margins

Reason 5: Admin. staff need

to create and maintain the

books

Reason 6: Overwhelming

need for repeated data entry

Reason 1: Lack of real-time

insight into key sales

metrics

Reason 2: Difficult for sales

people to access customer

information

Reason 3: Sales cycles too

long

Reason 4: Inability to

respond quickly to new

customer needs

Reason 5: High cost of

operations is preventing

effective price competition

Main Reasons

Pain: High cost of

operations Pain: Can’t compete

successfully Pain: Marketing is costly

but not producing results

Reason 1: Lack of real-

time insight into key

marketing metrics

Reason 2: Hard to

measure performance of

marketing campaigns

Reason 3: Difficult to

identify opportunities and

emerging needs


Low Productivity of People and Processes (I)

A

14

CTO VP Operations

VP Manufacturing

Reason 1: Redundant data

entry still necessary

Reason 2: No

personalization features for

users

Reason 3: No integration

between business

management system and

other applications

Reason 4: IT burdened with

inefficient tasks, such as

producing simple reports

Reason 1: Duplication of

efforts and data entry

Reason 2: : Difficult to do

business within the company

efficiently

Reason 3: Service delivery

not responsive enough to

customers

Reason 4: Employee

frustration with company’s

inability to change course

Reason 5: Lack of

automation and efficiency

tools

Main Reasons

Pain: Technology is a cost

center, not a productivity

factor

Pain: Unproductive

business practices Pain: Inefficient

manufacturing processes

Reason 1: Supply chain

management not flexible

to accommodate growth

and increased demand

Reason 2: Difficult and

costly to make changes to

BOMs and customer

orders

Reason 3: Business

technology not supporting

efficiencies


Low Productivity of People and Processes (II)

A

15

Low Productivity of People and Processes (III)

Role Tailored

User Experience

Alerts Integration

Between Finance, SCM and CRM

Analysis Tools


Capabilities of Microsoft Dynamics ERP

A

16

Pain: Company not an

industry or market leader

CFO VP Sales

VP Marketing

Reason 1 : Sales lag behind

competitors,(with Marketing

not filling the sales pipeline)

Reason 2: Technology not

helping gain on competitors

Reason 3: Not financially

performing any better than

the competition

Reason 4: Difficulty in

maintaining productive

customer and partner

relationships

Reason 5: Manufacturing

unable to adjust to changing

business conditions

Reason 1: Not enough sales at

reasonable cost and margin

Reason 2: High cost of

acquiring customers

Reason 3: Business and

manufacturing processes not

economical

Reason 4: Not all management

decisions financially sound

Reason 5: Competitors

successfully diminishing

revenue stream

Reason 1: Ineffective

marketing support

Reason 2: Poor

understanding of business

trends

Reason 3: Difficult for sales

staff to access customer and

transaction information

Reason 4: Remote sales

offices not tied into business

processes

Reason 5: No self-service

capabilities for customers

Main Reasons

Pain: Not financially

performing any better than

the competition

Pain: Sales lag behind

competitors Pain: Not filling sales

pipeline successfully

Reason 1: Difficulties in

assessing opportunities

and planning activities

Reason 2: Unable to

respond early to new

market trends

Reason 3: Brand

presence and equity not

strong enough

Reason 4: Partner

marketing not efficient

Reason 5: Company lacks

clear direction


Unable to Respond to Changing Business Conditions (I)

CEO

A

17

CTO VP Operations

VP Manufacturing

Reason 1: Business data too

hard to get to and work with

Reason 2: No easy way to

share information with

partners, customers, and

vendors

Reason 3: No system-wide

updates when inventory,

shipping, and order data

changes

Reason 4: Business

management system too

difficult to use

Reason 5: IT too absorbed

with support and maintenance

Reason 1: Service delivery

not responsive enough

Reason 2: Poor customer

communications

Reason 3: Not open for

business at all times

Reason 4: Partners having

difficulty doing business with

the company

Reason 5: Unable to

support customers in foreign

languages

Main Reasons

Pain: Technology not

helping gain on competitors

Pain: Difficulty maintaining

productive customer and

partner relationships

Pain: Manufacturing unable

to adjust to changing

business conditions

Reason 1: No

understanding of

changing customer needs

Reason 2: Too difficult to

plan supply and demand

Reason 3: Manufacturing

processes inefficient and

expensive

Reason 4: Lack of

automation

Reason 5: Hard to adjust

changing workloads


Unable to Respond to Changing Business Conditions (II)

A

18


Unable to Respond to Changing Business Conditions (III)

Exception and Changes

Graphical

Production

Schedule

Order Processing

and Fulfillment

Multi-language, Multi-currency, Multi-location

Data Analysis and Reporting


A

19

Role Play: Case 1


• Create groups of 3 people: customer, salesperson, and

observer.

• Take a couple of minutes to prepare.

• Practice, remember this is not an acting test.

• Be realistic, not too nice, not too hard.

• Ask if the person wants to receive feedback.

Receiving feedback

• Don’t be defensive…..reflect & look

for themes.

• Accept this as a legitimate view of

the person offering it.

• Be open to doing something

different, ask for suggestions.

Giving feedback

• Ask the person how he thought he did.

• Start with what went well.

• Describe the behavior.

• Be honest and balanced.

• Check that the other person

understands your feedback.

A

20

1. Why growth is not linear

1. Main Pain Chains® for ERP

2. Pain Chains® by Industries

3. Knowledge Check

4. Summary

Pain Chain®


21

Introduction

2. Pain Chain® by industries

• During the sales cycle, you need to know a priori the specific pains of the sector or

industry of the company in order to be able to define and establish the Pain Chains®

and identify which capacities of Microsoft Dynamics you need to show them.

• Knowing these critical business issues by industry shows sales excellence and

leadership and it is key to achieving success.

• Specific information for the ERP key industries (Manufacturing, Distribution,

Professional Services, and Specialty Retail) can be found on:

https://mbs.microsoft.com/partnersource/marketing/campaigns/vertical/MSDindustryvert

ical02.htm

A

https://mbs.microsoft.com/partnersource/marketing/campaigns/vertical/MSDindustryvertical02.htm





22

Chemicals Manufacturing


Industry Value Chain

Produce (Demand to Availability)

Manage (Manage the Business)

Staff (Manage Human Capital)

Su

pp

lie

rs/C

on

tra

cto

rs

Service (Consumption to

Replenishment)

Cu

sto

me

rs

Formulate (Concept to Opportunity)

Sell (Order to Cash)

Buy (Produce to Pay)

Prospects

C-Level CEO, CFO, CIO, COO, CTO

VP Level Finance, Operations,

Manufacturing, Supply Chain,

Engineering

Upper

Management

GM, Plant, Materials, Quality,

Compliance, Supply Chain,

Engineering

SIC Coverage 2812-13, 2816, 2819, 2821-24,

2833-36, 2841-44, 2851, 2861,

2865, 2869, 2873-75, 2879,

2891-93, 2895, 2899

Gross

Revenue per

Annum

$50M-$2B USD

Number of

Users

50-2000 Stratascope Inc.

A

23

Key Pain

Chemicals Manufacturing

Operating Costs Out of Control

Varying Product Quality, Traceability

Poor On-Time Delivery and Throughput

Failure to Meet Compliance Standards


A

24


Profound Experience

in Process

Manufacturing

Industry-specific Features

Flexibility in the

Implementation


A

25

Industrial Equipment Manufacturing


Industrial Equipment Manufacturing Value Chain




Su

pp

lie

rs/C

on

tra

cto

rs


Replenishment)

Cu

sto

me

rs

Design (Concept to Opportunity)



Prospects


VP Level Finance, Operations, Manufacturing,

Supply Chain, Engineering

Upper

Management

Plant Manager, Materials Manager,

Engineering Manager, Supply Chain

Manager

SIC

Coverage

3433, 3511, 3519, 3523-24, 3531-37,

3541, 3542, 3544, 3545, 3547, 3549,

3552-56, 3559, 3561, 3563-69, 3581-82,

3585-86, 3589, 3593-94, 3596, 3599,

3699, 3743,3799

Gross

Revenue per

Annum

$50M-$2B USD

Number of

Users

50-2000

Stratascope Inc.

B

26

Key Pain

Improving cost management

Industrial Equipment Manufacturing

Meeting customer demand for products, pricing, and services

Enhancing operational efficiency

Improving

financial control

Making data

accessible/visible


B

27


Meet Demanding

Customer Needs

Improve Operational Efficiency

Reduce Costs

Improve Financial Control

Provide Access to Centralized, Current Data


B

28

Automotive Supplier Manufacturing






Su

pp

lie

rs/C

on

tra

cto

rs


Replenishment)

Cu

sto

me

rs

Design (Innovation Management)



Prospects (Automotive Suppliers)


VP Level Finance, Operations,

Manufacturing, Supply Chain,

Engineering

Upper

Management

Plant, Materials, Engineering,

Supply Chain

SIC Coverage 3465, 3519, 3592, 3647, 3694,

37xx

Gross Revenue

per Annum

$50M-$2B USD

Number of

Users

50-2000

Stratascope Inc.

B

29

Key Pain

Automotive Supplier Manufacturing

Improving Operational Control

Improving Customer Service

Managing a Complex Supply Chain

Leaner Manufacturing

Production of Unauthorized Parts

Increasing Time-to-market Demands


B

30


Industry-specific

KPIs

Lean Manufacturing Capabilities

Build Connections to

Suppliers and

Vendors

Develop Profitable Customer Relationships


B

31

Professional Services


Deliver (Engagement Management)


Su

pp

lie

rs/C

on

tra

cto

rs

Maintain (Non-project Revenue)

Cu

sto

me

rs

Develop (Relationship Management)

Sell (Account and Opportunity

Management)

Resource (Talent Management)


Prospects (most Professional Services organization

prospects are mid-size firms)

Top Level

Executive

CEO, Partner, Owner

Other Executive

Level (Title may

be Principal, VP,

or C-level)

Operations, Global Services or

Service Delivery, Sales or Market

Development, Finance and

Administration

Upper

Management

Marketing, Information

Technology, Human Resources,

Training and Development,

Customer Service

Stratascope Inc.

B

32

Key Pain

Professional Services

Managing and Reducing Costs

Managing Dispersed or Virtual Engagement Teams

Gaining Deep, Real-time Insight

Meeting Stringent Customer Reporting Needs

Ensuring Compliance Aligning Skills

and People with Customer Engagement


B

33


Project

Management

Financial Reporting

Financial Management


B

34

Specialty Retail


Plan (Demand to Availability)



Su

pp

lie

rs/C

on

tra

cto

rs


Replenishment)

Cu

sto

me

rs

Collaborate (Concept to Opportunity)



Industry Value Chain Prospects (Automotive Suppliers)


VP Level Sales, Marketing, Merchandising,

Operations, IT

Upper

Management

GM, Operations, Sales, Marketing

SIC Coverage 5211, 5231, 5251, 5261, 5271,

5611, 5621, 5632, 5641, 5651,

5661, 5699, 5712-14, 5719, 5722,

5731-32, 5734, 5943-48, 5961-63,

5983-84, 5992-93, 5999, 7699

Gross

Revenue per

Annum

$50M-$2B USD

Number of

Users

50-2000 Stratascope Inc.

B

35

Key Pain

Specialty Retail

Merchandising Requirements

Competition from Other Types of Retail Stores

Outdated IT Resources

High Levels of

Staff Turnover

and Need to

Minimize Staff

Training

Increasingly Demanding Customers


B

36


Delivering forecasts

and purchase orders directly

to the retailers’ supplier

Connecting

retailers’ demand requirements

to manufacturing, wholesale,

and distribution operations

Starting up new stores quickly,

with fast implementations of POS

Shortening re-order cycles by integrating

replenishment requirements with suppliers’ systems


B

37

Use of Sales Guides

A

• Read the hand out https://mbs.microsoft.com/downloads/partner/campaigns/Chemical_Manu/Chemicals

Mfging_SalesGuide_partner.pdf

• Would you use these guides?

• What makes this useful?


38

4. Summary


2. Pain Chain® by Industries

3. Knowledge Check

4. Summary

Pain Chain®


39

Knowledge Check

Which of the following are PAINS for ERP?

Difficulties connecting customers, partners and employees.

In 2009, the company grew 5%.

Low productivity of people and processes.

Support 50% more employees without increasing servers.

3. Knowledge Check

B

40

Knowledge Check - Answer

Which of the following are PAINS for ERP?

Difficulties connecting customers, partners and employees.

In 2009, the company grew 5%.

Low productivity of people and processes.

Support 50% more employees without increasing servers.

3. Knowledge Check

B

41

Knowledge Check

In a distribution company, which of the following could be a key pain?

Merchandising requirements.

Lack of visibility to control inventory and costs.

Competition from other types of retail stores.

Chemical manufacturing industry-specific features.

3. Knowledge Check

B

42


In a distribution company, which of the following could be a key pain?

Merchandising requirements.

Lack of visibility to control inventory and costs.

Competition from other types of retail stores.

Chemical manufacturing industry-specific features.

3. Knowledge Check

B

43

Knowledge Check

In a professional services company, which of the following could be a key

pain?

Lack of aligning skills and people with customer engagement.

Starting up new stores quickly, with fast implementations of POS.

Difficulty managing and reducing costs.

Delivering forecasts and purchase orders directly to the retailers’ supplier.

3. Knowledge Check

B

44


In a professional services company, which of the following could be a key

pain?

Lack of aligning skills and people with customer engagement.

Starting up new stores quickly, with fast implementations of POS.

Difficulty managing and reducing costs.

Delivering forecasts and purchase orders directly to the retailers’ supplier.

3. Knowledge Check

B

45

The group should put themselves in the CEO’s shoes in the scenario described

in each exercise.

For each exercise, explain the reasons behind the problem for each department

affected and how it would be resolved.

Group activity 3. Knowledge Check

B

46

Exercise 1

Suppose you want to make your business grow but the implicated costs and

complexity would make it practically impossible to access new markets and

sources of income. Your company’s technology doesn’t follow the rhythm of your

business plan and as a consequence you are faced with the problem of your

business growing, with the potential risk of operating inefficiently, or maintaining

your current level of activity and running the risk of loosing opportunities, or

even an eventual decline in activity. Your wholesale customers and strategic

partners would like to see you grow, for their own interests, but this doesn’t

happen. You simply don’t know how to make your business grow.

How does this affect your business and you personally? How would you

resolve this?


B

47

Exercise 2

Suppose your customers and partners have difficulties in contacting your

organization, although they are one of your wholesale suppliers or preferred

commercial partners. You would like to give them more information and access

to company activities, but it will be difficult to achieve this without putting the

integrity of confidential company information at risk. As a consequence,

business data is protected but also limited in terms of its business value as it is

only available in a limited way. Customers don’t generate as much business as

you would like and it is possible that partners will start to think about revaluating

their business relationship with you.

How does this affect your organization and you personally? How would

you resolve this?


B

48

4. Summary



3. Knowledge Check

4. Summary

Pain Chain®


49

Role tailored

user experience

Order processing

and fulfillment Scalability Web portals

Alerts

Multi-language,

Multi-currency,

Multi-location

Flexibility to

change Web services

Integration

between finance,

SCM and CRM

Exception and

changes

Cost-effective

implementation

Intercompany

functionality

Main

Capabilities

of

Microsoft

Dynamics

ERPs

Pains

1 2 3 4

Summary

Low Productivity

People and

Processes

Unable to respond to

changing business

conditions

Difficulty in Managing

Organizational Growth

Difficulty in Connecting

Customers, Partners

and Employees

Analysis tools Data analysis

and reporting

Technology

roadmap

Drill-down

capabilities

4. Summary

Pain Chain®

A

50

Difficulty gaining

a clear picture of

demand

Meeting customer

demand for

products, pricing,

and services

Operating costs

out of control

Increasing

time-to-markets

demands

Lack of visibility to

control inventory

and costs

Enhancing

operational

efficiency

Poor on-time

Delivery and

Throughput

Managing a

complex

supply chain

Improve execution

with suppliers and

customers

Improving cost

management

Varying product,

quality, traceability

Leaner

manufacturing

Key Pain

By

Industry

Industry

1 2 3 4

Summary

Distribution Industrial Equipment

Manufacturing

Chemicals

Manufacturing

Automotive Supplier

Manufacturing

Upgrade growth

with improved

customer service

Improving

financial control

Failure to meet

compliance

standards

Production of

unauthorized parts

4. Summary

Pain Chain®

Managing and

reducing costs

Merchandising

requirements

Managing

dispersed or virtual

engagement teams

Competition from

other types

of retail stores

Aligning skills and

people with client

engagement

Increasingly

demanding

customers

5 6 Professional

Services

Specialty Retail

Gaining deep,

real-time insight

High levels of

staff turnover and

need to minimize

staff training

A

4. Summary

Recap: Keys of ERP Pain Chain®

1. Several Pain Chains® could seriously impact the customer, such as:

a.) Low productivity of people and processes.

b.) Unable to respond to changing business conditions.

c.) Difficulty in managing organizational growth.

d.) Difficulty in connecting customers, partners and employees.

2. In addition, each customer is different depending on the industry it’s in. Their key

pain are also different.

3. Microsoft can help customers realize the capabilities of their ERPs.

52


Review Learning Objectives

• Understand the main Pain Chains® when selling an ERP solution, the impact

of each pain on decision-makers and the capabilities Microsoft Dynamics ERP

solutions bring to customers.

• Understand the main Pain Chains® (needs) for specific industries and how

Microsoft Dynamics ERP solutions help address them.

© 2009 Microsoft Corporation. All rights reserved. Microsoft, Windows, Windows Vista and other product names are or may be registered trademarks and/or trademarks in the U.S. and/or other

countries. The information herein is for informational purposes only and represents the current view of Microsoft Corporation as of the date of this presentations. Because Microsoft must respond

to changing market conditions, it should not be interpreted to be a commitment on the part of Microsoft, and Microsoft cannot guarantee the accuracy of any information provided after the date of

this presentation. MICROSOFT MAKES NO WARRANTIES, EXPRESS, IMPLIED OR STATUTORY, AS TO THE INFORMATION IN THIS PRESENTATION.

53

session 3 - pain chain analysis

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