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Selling Change Is Hard: Status Quo Bias Locks Change In A Prison Of No Decision

Michael Harris | Sep 19, 2017 82 views 3 Comments

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The value to buy your product is overwhelming and yet the customer decides not to buy. At times like these, it’s important to remember that customers are not rational decision making machines. They are human beings with built in cognitive biases that make them highly resistant to change. The status quo and optimism biases, for example, prevent customers from making the sensible decision to buy your product. To sell change, salespeople must not only climb a mountain of fear to get past the status quo bias, but they must also cross a valley of indifference to overcome the optimism bias. This is why selling change is so difficult.



Until salespeople improve at opening the gap with “WHY CHANGE,” they will struggle to close the gap with “WHY US.” Without a compelling reason to change, customers will stick with the status quo and “no decision” will continue to be your biggest competitor. To help customers buy, salespeople need Change Stories and Questions so that they can inspire customers to step into growth instead of back into safety.

STATUS QUO & OPTIMISM BIAS BLOCK CHANGE

The status quo bias is a prison that locks the customer in no decision. It’s built in the customer’s mind on a foundation of the fear of change. If customers put the status quo and new products on the evaluation shelf when they evaluate new products, then these prison walls wouldn’t exist, because the risk of status quo would counteract the risk of change. But customers are biased. They hold the status quo close to their heart, and only put new products on the shelf (see figure-1). As a result, they neglect to evaluate the risk of the status quo. This is a problem because the risks of change are real, and include such factors as: Implementation risk; ramp up time learning a new product; career risk if the product fails; financial risk if the ROI isn’t achieved; risk of being misled, and; risk of being exposed for not doing your job properly. No wonder customers build a wall around the status quo to protect them from change.

Even if the benefits of the seller’s product make it past the customer’s defensive wall, customers will discount the seller’s claims for gains. Why? The optimism bias inflates the customer’s baseline, so customers don’t believe their results can be improved (see figure-2). This is a well-documented cognitive bias where individuals overestimate their own abilities relative to others. Do you, for instance, feel you are an above average driver? I know I do, and so do 93% of surveyed US drivers. This is why telling customers your product will improve their results by 30% rarely works, because most of the time, customers just don’t feel like they have a problem. Until salespeople learn to hold up a mirror to the customer’s unexamined problems, customers will continue to have an inflated baseline. So salespeople should not be surprised when customers say their product may be great for someone else, but not for them.

KILL THE STATUS QUO & OPTIMISM BIAS WITH INSIGHT

Because of these biases, customers not only neglect to assess the risk of the status quo, but they also inflate their baseline. This creates pockets of unrecognized value for change that customers don’t see. More important, it provides the opportunity for sellers to shine the light of insight on the root causes of the customer’s negative biases so that they can expose these unrecognized pockets of value. By working backwards from their product, sellers can create these insights by showing the problems, costs, and risks to the customer’s business in the absence of having the seller’s unique capability.

KILL THE STATUS QUO BIAS: By performing a risk assessment of the status quo, customers will be motivated to change because they will realize that the risk of the status quo is now greater than the risk of change (see Figure-1).

KILL THE OPTIMISM BIAS: By performing a baseline reality check, customers will be motivated to change and ready to be rescued by the seller’s product , because customers will discover they are no longer ankle deep in problems but out in the middle of the lake drowning in problems (see Figure-2).

DELIVER INSIGHT THROUGH CHANGE STORIES & QUESTIONS

It’s difficult to deliver the message that customers are not operating optimally without getting a black eye. To protect their self-esteem and guard themselves from the risk of change, the buyer’s confirmation bias motivates them to select evidence in favor of the status quo or reject evidence supporting change.

So instead of trying to force insights through the buyer’s defensive wall, sellers should deliver their message via a story, because they’re about someone else so they are nonthreatening (see figure-3). Without feeling attacked, customers can now relax and take in the seller’s story. And if the story is insightful enough, they may start to tell themselves a new story where new choices make more sense. So put your change message inside a story and, like a Trojan horse, it will make it over the customer’s defensive wall.

RESETS THE STATUS QUO AUTOPILOT WITH CHANGE STORIES

Change messages don’t just need to make it over the customer’s defensive wall; they must also reset the customer’s automatic pilot. How many times have we read a self-help book and still not made any changes? For the most part, people don’t change unless they experience a crisis or an insight that sinks so deep it speaks to the subconscious and resets the autopilot. Change Stories can manufacture a crisis and deliver insight so that we can reset the customer’s automatic pilot. Because Change Stories don’t just speak to the conscious mind, they also speak to the gut. They are experiential. They virtually transport customers to a concrete point in time when another customer realized the status quo was broken and could no longer be duct taped together. Suddenly, your prospective customer realizes that their problem is bigger and riskier than they previously thought and they now need to change. (see my HBR article When to Sell with Facts and Figures, and When to Appeal to Emotions).

CHANGE STORIES MUST BE MADE BY SALES

You can’t rely on your marketing team to produce change stories, because new customers won’t engage with marketing until they achieve results. When they finally do achieve result, customers will have either forgotten why they decided to change or the competitive landscape would have changed so much that the reasons they changed are no longer relevant.

Salespeople, on the other hand, already know why customers bought, because they won their business in the first place. Customers are also more likely to share the reasons they changed privately with salespeople because they will have already established a trusting relationship.

Sales can create this content by having each salesperson record his or her key customer wins as Change Stories. This is a useful exercise because salespeople use the same skillset to uncover why a past customer bought as they do to determine why a future customer will buy. Not only will peer feedback improve each individual story, the group will also gain from their pooled knowledge when Change Stories are shared in sales meetings.

Once sales have convinced customers that they’re drowning with change stories, sales can then use success stories as proof to convince the customer that their product will rescue them (see Why Sales Fails at Selling Change with Success Stories).

LEARN HOW TO CREATE CHANGE STORIES & QUESTIONS

To implement this strategy, it is critical for salespeople to improve their storytelling skills. They must learn to share only the essence of why a customer changed or bought. If they include everything that happened in the deal, they’ll drown out the message. Sales will also need to know how to convert their stories into discovery questions so that salespeople can alternate between sharing stories and asking questions during a call, just like in a natural conversation.

In conclusion, we’ve shown why selling change is so difficult, because salespeople must not only climb a mountain of fear to get past the status quo bias, they must also cross a valley of indifference to overcome the optimism bias. This is why selling change is so difficult. Until salespeople improve at opening the gap with “WHY CHANGE,” they will struggle to close the gap with “WHY US.” Without a compelling reason to change, customers will stick with the status quo and “no decision” will continue to be your biggest competitor. To help customers buy, salespeople need Change Stories and Questions so that they can inspire customers to step into growth instead of back into safety.

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3 Responses to Selling Change Is Hard: Status Quo Bias Locks Change In A Prison Of No Decision

  1. Andrew Rudin September 20, 2017 at 2:42 pm (231 comments) #

    Hi Michael: I believe the status quo bias as you’ve defined it is your prevailing experience, but it just hasn’t been for me. I find the theories that are offered to salespeople about customer reticence to change are largely misleading. For decision makers, maintaining stasis or status quo is an option that is frequently (though not always) on the table.

    Stasis is a decision, so labeling the absence of a purchase as no decision simply isn’t the way many decisions come down. Salespeople might not like it, and they might attribute the outcome to buyer fear, but in my experience, it is not. I don’t question that it happens, but in over 30 years, I’ve never been involved in a project initiative where the committee has been handcuffed into not making any choice out of fear or confusion.

    What does happen – at least in the IT world where I work – is, in fact, a rational analysis that determines the new initiative (i.e. ‘change’) doesn’t make the cut by not returning value to the company that exceeds a required hurdle rate (often set by the CFO, or established by the project team). Sure, emotions are mingled in there, but largely, it’s a straight up, full-on dollars and cents matter. “Sorry, pal, but your proposal just didn’t light up the financial scoreboard.”

    On the project teams I’ve been involved with, the opportunities and risks from adopting a new technology or capability is weighed against the costs and risks of stasis. And when the new thing doesn’t make the cut – a decision results: keep doing what we’re doing. It happens a lot.

    Meanwhile, the rep goes back and reports to his or her boss that the prospect dragged their feet and couldn’t decide. Nothing could be further from the truth. The prospect decided. But representing the outcome as ‘no decision’ feeds a myopia that you referred to in your first paragraph. What seems perfectly sensible to the rep might not be very sensible to prospects.

    Salespeople must get past that bias if they’re going to learn how projects are vetted, and decisions are commonly made.

  2. Michael Harris September 21, 2017 at 6:49 am (16 comments) #

    Andrew Rudin- thanks for contributing an interesting, intelligent and contrary view. I’ve worked with thousands of salespeople from SAP, Epicor and other technology companies over the past 12-years, and yes my experience is different, but it doesn’t mean it’s correct. And that’s why I love hearing different view from experienced people like yourself.

    You position the customer as a decision making machine that makes rational choices and I position them as human beings who have inherent biases. Based on my understand of your argument, and I may be wrong, you’d say salespeople should get better at positioning a stronger ROI instead of blaming the status quo bias. I’d say their existing ROI is fine as it is and they should get better at helping the customer better see the risks of the status quo and how the customer isn’t operating optimally today. ROIs are often very high in favour of change that I have seen. The art is helping the customer believe them.

    I don’t go on a diet by someone selling the spectacular benefits of their system until I walk past a shop window and see a non-flattery image of my body and i realize I’m getting fat. It cuts through all of the lies I tell myself to support my ego. As long as I think I’m just slightly overweight, you could try to sell me the best ROI until you’re blue in the face, and all I’m going to think about is how good my ice cream will taste after dinner:)

    Anyway, that’s my view and I really appreciate your view. Maybe the truth is somewhere in-between or something else. I can’t wait to hear more from you or someone else.

  3. Andrew Rudin September 24, 2017 at 2:36 pm (231 comments) #

    Hi Michael: In an article I wrote a few years ago, I said that a flowchart of most B2B buying processes would more resemble the subway map of Tokyo, Japan, rather than the often-depicted linear left-to-right progression that starts with Need Awareness and ends with Purchase. That comment was based on my opinion that marketers oversimplify what happens in prospect organizations when projects and solutions are vetted.

    For the same reasons, except in rare circumstances, I would never offer machine as a metaphor for how customers buy. Tipsy pedestrian on the way to the pub seems much closer to my experience. My position on no decision’s role in thwarting purchases is the same: it happens, but very rarely. And I find in sales, pundits exaggerate its frequency and its importance.

    But let’s go with no decision for a moment, and say it does happen in prospect decision making – say, 65% of the time. Suppose further that this 65% figure is a documented fact based on sound research: the prospect literally could not decide. Could not decide for Proposal A, could not decide against it. Just . . . couldn’t . . . decide . . . period!

    There’s still a problem, because calling no decision a “competitor” is semantically illogical. No decision is an outcome. It makes as much sense as prepping a football team for a game by telling them their biggest competitor is ’21’ – the outcome if the team’s opponent scores three touchdowns. What does that even mean? How does it help them prepare?

    When I entered the sales profession in the 1980’s, I was told the same thing about “no decision” being a rep’s “biggest competitor.” Because it was a vague abstraction, it made little sense to me at the time. It was not useful. Here was a “competitor” with no name, no resources or funding, no motive, no strategy, and no tactics. It makes no sense today, either.

    What’s more accurate in a sales/marketing context is defining a competitor as any person or persons who promote an agenda or goal that undermines the outcome the rep wants. Yeah – that’s a longer mouthful, and it doesn’t fit into PowerPoint bullets very well, but it would have been infinitely more valuable for me to understand things that way, rather than going up against a monolithic “competitor” like “no decision” – which is an outcome (or result) anyway.

    Back to the frequency of “no decision”: I recommend clients examine how many of their sales engagements really terminated when the prospect flat-out couldn’t make up their mind versus the prospect pulling the plug on a project, reallocating investment capital, changing strategy, or re-prioritizing objectives. All of which are . . . decisions. That’s what makes “no decision,” “losing to no decision,” and “no decision as the biggest competitor” a gross misrepresentation of what actually happens in many instances.

    When reps – and their managers – have weak understandings of customer decision processes, and little insight into why an opportunity didn’t result in an order, “no decision” provides a convenient catch-all designation.

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