„We are not fit to lead an army on the march unless we are familiar with the face of the country – its mountains and forests, it’s pitfalls and precipices, its marshes and swamps.“
Sun Tzu, The Art of War
B2B buying decisions are driven by nine influences with their individual weight depending on the value stage the decision is made on: the Buying Process, Formal Approvers, Technical Buyers, the Economic Buyer, Power Bases, Corporate Culture, Reward, Risk, and the vendors’ Proposals.
On Commodity level, e.g., when buying notebooks, the Buying Process is highly formalized, can be even fully automated. Technical Buyers can refer to industry or corporate standards while the Economic Buyers only get involved for committing budget. The size of both Risk and Reward do not justify a Power Base to get involved and Proposals only differentiate in price and convenience.
On the highest value stage, the Strategic Alliance, the weights are completely different.
The Buying Process has some milestones and a formal approval process that goes up to the executive board but starts from scratch as on this value stage the nature of the agreement is unique.
Technical Buyers not only define and check requirements, but also get highly involved in building the business case.
The Economic Buyer is an executive board member, and they might even have to collect budgets from other board members to fund the investment.
The Enterprise Power Base is involved due to the strategic relevance of the decision. In large organizations multiple competing Situational Power Bases will emerge fighting for attention by the Enterprise Power Base.
The buyer’s Corporate Culture significantly impacts risk acceptance, decision implementation (top-down enforced in centralized, bottom-up in decentralized organizations), and the vendor preference ranging from aggressive and innovative to conservative and risk averse.
The Reward must be sizable to justify the significant Risk of the decision stemming from the multi-year impact on the top and/or bottom line the Strategic Alliance is projected to drive.
The technical and commercial features of the vendors’ Proposals are outweighed by their brand, financial stability, experience, and personal relationships.
A Disruptor must have a clear understanding of how the value stage positioning of their offering affects the weight the influences will have in the buying decision. E.g., without a positive customer experience they will lack the trust required on Solution Level to overcompensate the perceived Risk with their Proposal's value proposition. In this case teaming with a partner with a successful track record will fill the void and increase the chances of winning.
For additional information refer to this Executive Summary.
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