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Welcome to Goodbye Information, Hello Intelligence, a monthly coffee chat hosted by leadership at Cipher Systems to uncover nuggets of wisdom from the world's foremost competitive intelligence leaders.

The following are notes from Goodbye Information, Hello Intelligence: Episode 02. The goal of these informal interviews is to spotlight various experts in the world of Competitive Intelligence.

In this episode, John Booth—VP of Marketing at Cipher—and Peter Grimm—President of Cipher Consulting—speak to Ellen Naylor. Ellen is a pioneer in competitive intelligence analysis and the author of Win/Loss Analysis. You can learn more and connect with Ellen Naylor on LinkedIn.

Watch the video conversation here, or check out the summary or full transcript below.

The Value of Win/Loss Analysis to an Organization

The biggest value is that win/loss analysis exposes blind spots. Companies often think that they know how they’re coming across to their customers, whether they win or lose deals. That is often not the case. This analysis illustrates not only why you win or lose but how you are coming across and how your competition is coming across. If you’re willing to listen, there is a significant amount to learn.

Ellen often recommends beginning with a win/loss program with as few as 10-20 interviews. This itself can provide an early win. Especially if companies haven’t done win/loss, it can be very enlightening. Ellen describes a scenario with a client in which they quickly learned, after this kind of analysis, that they needed to add a new product. It became apparent, after talking to the sales force and the customer, that the company needed to occupy a new space. Much can be uncovered through win/loss that isn’t discoverable through other means.

How to Start a Win/Loss Analysis

There are a lot of online resources that can help internal teams craft preliminary win/loss analyses. It’s important to create an approach that isn’t threatening to sales. In fact, the sales team should be solicited for feedback and involved in the process. Everyone wants to learn from the customers.

Additionally, product marketing, management, executives and a broad array of concerns and challenges should be collected and included in the list of questions to ask. Often, this brings up cultural issues. 

It’s also important to create a strategy that incentivizes customer participation. There are often industry standards for compensation for this. Some businesses immediately dismiss win/loss if the customers don’t accept the calls. That’s simply an error and oversight of the right offer to encourage response.

In addition to assembling internal information and an external process, it’s important that goals are clearly defined. What do you want to learn from win/loss analysis? What is the insight you hope to gain? Your goals will refine the questions themselves and methodology of distribution.

The pandemic has actually encouraged lengthier interviews, as people are ready and willing to share.

What Do Many Teams Get Wrong in Win/Loss Analysis?

Many teams want to just interview about losses, not wins. They have a perception that, “we know why we win; we really need to learn why we lose.” While that is important, this is an unbalanced formula. Through win/loss, you want to learn both what you are doing right and what you are doing wrong. Valuable testimonials can be obtained this way.

If all you are going to do is pull data about losses, you risk discouraging your sales team. It’s important to get good news and learn what you’re doing right. Even this may surprise you.

Cipher specifically counsels clients through the pros and cons of leveraging a third-party analyst. A big reason for this is bias. When companies perform win/loss themselves, human dynamics can muddy the waters. Customers may not relay accurate information for fear of upset. This can be mitigated by enlisting an outside consultant for win/loss.

2021: The Year of CI

Forecasters predict that 2021 will be a year of major changes within the CI community. The biggest change Ellen sees is an increase in empathy. Adoption of enhanced interpersonal skills is becoming more prevalent. 

In terms of the discipline of CI, AI will be all the more important. That will likely move forward and be leveraged more often. When married with human skills, AI will put CI professionals at a competitive advantage.

DIY Win/Loss Analysis Resources


Episode Full Transcript

John:

Welcome back to another episode of our Goodbye Information, Hello Intelligence series. Today we have with us Ellen Naylor and Ellen is a pioneer in competitive and literally wrote the book on win-loss analysis and no joke, we'll have a link to that. So I just wanted to welcome you Ellen and Pete, I will hand it off to you.

Peter Grimm:

Yeah. Thanks, John and Ellen everyone for being with us today. We'll do our best in these weird COVID times dealing with bandwidth and lags and so forth, but hopefully everybody can hear us. Okay so Ellen, thanks for joining us. It's a privilege as always to speak with you today. And I think maybe if we just kind of start off, we've been talking a lot here at Cipher and you and I have had a couple of conversations recently about sort of how things are changing across the landscape of marketing competitive intelligence and we've had some conversations recently about win-loss work that we're each doing with clients and the importance, kind of the enhanced importance of those insights in times like these. So maybe Ellen, would you mind just kind of starting off as a baseline, how do you think of the value that win-loss can provide to an organization?

Ellen Naylor:

Well, I think the biggest value is it exposes blind spots, you're talking to your customers. And companies often think they know how they're coming across to their customers, whether they win or lose deals and that's often not the case. So it's a really great way to learn how you are perceived, not only why you win and lose deals, but just how you're coming across, how your competition is coming across, what your competition is saying to your customers. There's just so much you can learn if you're just willing to listen. And it's often a really good first win, I often recommend those that I'm mentoring that they might want to start with the win-loss program, even if it's just 10 or 20 interviews, it could be an early win for them and their program, because it does, especially if companies haven't done win-loss, it really can be very enlightening.

Ellen Naylor:

I know one case I did last year, pretty early on, we realized the customer should be adding another product to their mix and they were meant to be vendor agnostic and they had kind of put all their eggs in one barrel. And it became quite apparent both from talking to the sales force and the customer that the company needed to get into this space. So there's a lot you can uncover in win-loss that really doesn't come up through other means and doesn't give you the kind of confidence that your customers do.

Peter Grimm:

So if a company hasn't done win-loss before, how do you advise them to get started aside from obviously buying your book?

Ellen Naylor:

Well, yeah, buying the book helps. I have a lot of free stuff on my website as well. I think you really need to consider what your company culture is and considering how the sales force is going to feel about this and thinking about an approach that is not going to be too threatening to sales, to let them know what you're doing, why you're doing it and to solicit their feedback, have them involved and what would you like to learn from your customers? Because they all want to learn something from their customers as well. But it's not just sales, you want to talk to product marketing management. You want to talk to your executives, you want to get a broad array of concerns and challenges that the company faces and include that in your list of questions that you want to ask the customers.

Ellen Naylor:

So I'd say a lot of it's the cultural sorts of issues, and also thinking about your customer, how well will they take to it, will they give you the time for an interviewing? Do you need to figure out some form of compensation for them to participate? What are your industry standards for that? I know I was at a conference some years ago, one of our skip conferences and a gentleman from a very major software fir. Who's still in business in a big way said, "We just couldn't do win-loss, our customers wouldn't accept the calls." So you need to think about all those factors.

Ellen Naylor:

And obviously number one is you want to figure out, what's in it for me to do win-loss? What do I want to learn? What are the issues that are troubling me? Or maybe they're troubling me. Maybe I want to expand into a new marketplace, what are the issues there? So there's a lot of different ways you can use it. And I guess, lastly, just thinking about, who would I distribute this to? How will I get the customers to say yes obviously is another big one, right? That probably is the biggest challenge today in these COVID times because people are very stretched thin, especially during the school year when they have children at home.

Ellen Naylor:

But I noticed also on the bright side that if people do agree to an interview, they're kind of lonely, they're in a different place than they were pre-COVID and so a lot of times that interview will go a little longer and they'll tell you more. So you might have more trouble actually setting up the interview, but once you get there, people are actually very good about sharing. And they'll share things that you didn't even ask about that the company ought to know about, like operational things. So that's a little guidance for getting started.

Peter Grimm:

I think we've certainly seen that where during these COVID times, it has been trickier to get people, to agree to do an interview and actually show up and be part of that process. But I totally agree with you, once we have somebody on the phone or in a video conference like this, the insights are deeper, people are, you're right, lonely so that's contributing to this. What do you think that is maybe the biggest pitfall or something that people often get wrong with respect to doing win-loss?

Ellen Naylor:

What do people often get wrong when they do win loss analysis?

Ellen Naylor:

I think the first thing is they often want to interview just losses, not wins, and they have this misperception that we know why we win deals, but we really need to learn why we're losing the deals. And that's very important to learn, but it's just part of the formula and it's very unbalanced because what you also want to learn in win-loss is what you're doing right and so you can build on it and perhaps find some testimonials from these customers as well. I'm always looking out for those for my customers when I do win-loss, I had one just earlier this week where I was just like, this guy is the perfect testimonial, he even has a good voice, which you don't always get that.

Ellen Naylor:

So I'd say that's probably the biggest single thing that I get from customers is we just want to interview our churn, we want to interview our losses. And the other thing you need to think about is if that's all you're going to do, it's pretty depressing for your sales force. And since they are a cog in the wheel that's quite important, you need to make sure that you include some good news in there, some positive feedback for the company and learn what you're doing right because it's not just what you think you're doing right. A lot of times, it's things that come up that you just didn't realize. And the other thing I find often amusing is that folks will tell me we won or lost and blah, blah, blah but I'm not really sure who the competition was, the customer went quiet on me. I mean, I know you've heard this, Peter and you're just like, well, okay, I wonder if they'll even accept the interview, right?

Ellen Naylor:

And so you get through and an interview and you find out, well, the reason they went cold was you weren't a finalist, you were on the short list, but they had a shorter yet list and you weren't on it and you find out the people that they thought that won the deal were not the winners of the deal and the reason they won the deal wasn't the reason you thought at. So it's just interesting. Whereas other times, sales is right on and they give me really good information to get going and they do tell me who the competition is. I can ask better questions then, right? So what's been your experience, Peter.

Peter Grimm:

Well, we always counsel our clients that we spend time with many of them talking about the pros and cons of leveraging a third party so someone like you or like our firm or the others that are out there that do the same work versus trying to do that themselves. And so we always counsel them that in our opinion, the pros of using a third-party partner to do this type of work outweigh the cons in most instances. Primarily I'm curious what your thoughts are on around, we talk a lot about when companies try to do this work with their own customers, you get a lot of sort of bias introduced into the process because the customer, it's human dynamics, right? And just interpersonal relationships, they're reticent to hurt feelings. Often, they'll tell you that it was the price, because they don't want to tell you that your product is not as good as somebody else's or what have you. So that's an area where we spend a fair amount of time counseling our clients. I'm curious what your thoughts are in terms of kind of pros, and cons of trying to do this work yourself.

Ellen Naylor:

Well, I think if it's a very technical area that very few people could effectively take on as consultants that they ought to do it themselves, that's probably the biggest reason. Also, if they think the customers would be less likely to talk to a consultant, that can be the case sometimes too. And of course we don't do it for free so those are the cons. But I think the pros in general outweigh the cons because we are a third party, they don't have a relationship with us, the person we're talking to, although it's a warm interview, I almost always get an introduction one way or the other, but they don't know who I am, they can tell me whatever they want, it doesn't matter.

Ellen Naylor:

It's interesting though, because they know I'm giving this to the customer, I'm very transparent about that. But yet, since I'm a third party, they'll tell me how it is. And I think that's probably the biggest thing, it's just telling you how it is and they'll go on and on too sometimes. I don't think that is easy for folks internal because of the politics, the relationship, they want to keep the relationship there, they don't want hurt your feelings. Well, if they talk to me, they don't have to worry about hurting my feelings, it doesn't matter. So I think you get the good news and you get the bad news both a little bit more directly and a little bit more in depth once the person is comfortable with you in a business call, which usually doesn't take too long since we do it all the time. But it depends on the person.

Peter Grimm:

Sure, sure. Okay. Well maybe just to close out here, I mean, you've been generous with your time today, if we think of the next year, if 2021 is to be sort of the year of CI or a year of major change in our community, what are a couple of things that you think need to take place in the community within sort of the discipline of competitive intelligence?

Ellen Naylor:

Well, I think the biggest split I'm seeing this year, and I sure hope it extends into next year and actually becomes a more permanent practice is that we, as competitive intelligence, have more empathy for those we are collecting from, our customers, not be ramrods, be considerate, be cooperative. I see those sorts of factors that are going to move us forward on a interpersonal skill level. On the CII level in terms of technology, I see that AI is going to be all the more important moving forward, people have had time to think about it, and people have had time to learn who who's good at AI, who isn't and I just hope that it moves forward and that people figure out how to use AI to their advantage, along with the people skills that are needed to help out and then combine and marry that with the human. I see that as being a really key thing going forward that isn't as strong as it could be today and I think companies that can do that will have a competitive advantage.

Peter Grimm:

Yeah. Yeah. I certainly agree with that.

Ellen Naylor:

What do you think, Peter?

Peter Grimm:

No, I agree with you, Ellen, I think I've done a fair amount of talking about the impact of AI in our profession, in our discipline and I do think that the fluency of the various tools and the capabilities and the limitations of these technologies is important in our profession in ways that it hasn't been as much in the past. So I talk about sort of the CI analyst of the future being more of someone who is fluent in the technology and fluent in the data, understands where the data lives, how the data needs to be analyzed in order to get to the insight that you're seeking.

Peter Grimm:

And that applies across a variety of different data sets, whether it's sort of secondary work or even with human, how can we leverage some of these cutting edge technologies to do some of the work for us and allow us to spend more of our time as human analysts supplying those capabilities that only humans have and machines may certainly have not yet replicated and may never? So I think there's a lot of change of foot, but I view it as a really positive trend for the profession.

Ellen Naylor:

Yeah. And I see collaboration, I didn't quite use those words. Collaboration-

Peter Grimm:

Yeah. Yep. Yep. I agree. I agree. Well, Ellen, listen, I appreciate it.

Ellen Naylor:

Kind of being all the more important with the human side, the networking side, the AI side, just people collaborating more than they have because if they don't, they're not going to be able to stay in business too. I think people realize that.

Peter Grimm:

Sure. Yeah. I agree. I agree. Well, Ellen, listen, thank you very much for spending a little time with us today. I've really enjoyed, as always, the opportunity to chat with you and hopefully the folks that'll watch this video have got as much out of it as I did. So thank you very much. I hope you have a great holiday season and we're looking forward to moving into an exciting new decade.

Ellen Naylor:

Well, thank you, Peter, always a pleasure to be in your presence. Thank you for inviting me to join you today.

Peter Grimm:

Thanks so much, Ellen.