Don’t worry; this post isn’t about algebra or calculus. This week we’re going to look into the value proposition and how salespeople can use the principles of influence to make sure their product or service offering shines.
First, let me say my introduction to the value proposition came nearly 20 years ago when John Petrucci joined State Auto. I learned more about sales from John in his first year with the company than I had in my previous 10 years in the industry. One concept he shared with me, and others throughout the company, was the following formula for the value proposition:
V = WIG/P
Value equals What I Get divided by Price
Let me illustrate. Let’s say currently you can buy 12 widgets for $6. That means the value of each widget is 2. At some point in the future, if you can get 18 widgets for $6 then the value of each widget is 3. Or, maybe you can get still get 12 widgets but now they’re only $3, which makes the value of each widget 4. In each case the value of the widget has gone up which is a better deal for you!
Conversely, if you can only get 12 widgets but the price has gone up to $8, then the value of each widget is only 1.50. Perhaps the price stayed at $6 but now you can only get six widgets. The value you get from widgets has dropped to 1. In both cases, not as good a deal as it once was.
Bottom line; if you can get more and pay the same OR if you get the same but pay less, you’ve received more value. On the flipside, if you get the same and pay more OR get less but pay the same as you always have, then you’ve received less value.
Oh if life were only so easy as a formula! If it were, we would just plug in the numbers and always make the best choice. But here’s the problem – rarely do things play out in real life like they do in the classroom or on paper. Most of the time what we’re offering, be it a product or service, has many components that become hard to value in a formula. Here’s an example from the insurance industry. Many people assume one automobile insurance policy is like another. To some degree that’s true but here are factors that may account for much of the price difference:
- Coverages – Not all policies have the same coverages and not all have the same coverage limits. More coverage or higher limits means paying more.
- Bells and whistles – Many policies have extra coverages that are intended to make the policy more valuable. While these may be free (you can’t remove them and save money) they add value to the policy.
- Claims – Not all companies handle claims the same. Those with better claims service usually charge more because they have more and better staff.
As you can see, it becomes hard to measure value when there are so many factors involved. However, if you’re in sales you’d better know how your product or service is different from your competitors. Your offering may not appeal to everyone but you may have a niche market you go after. That usually makes highlighting value easier.
So how you do use some of the principles of influence to highlight value? Here are three easy-to-incorporate examples.
Authority – People look to experts for guidance when they’re not sure what to do. Can you point to unbiased sources that show the superiority of your product or service in certain areas? Can you fall back on your expertise (years in the business, training, breadth of experience) to make a potential customer feel more comfortable?
Consensus – Humans are essentially pack animals. The vast majority of people feel better knowing what others have said about a product. Can you incorporate information about what the masses think about your product? Is there an opportunity to narrow the focus to people just like the person you’re trying to sell to?
Scarcity – People are much more motivated by what they may lose versus what they might gain. Talking about saving $100 (if your product is less expensive) will not be as effective as telling the prospective customer what they’ll will lose out on by overpaying.
Most people only have a vague idea about the value of what they’re getting even when they do a little research. For more on that just go back and reread my article on buying something as simple as an iron. Do we really know the value of the work done on our car? How about buying a lawnmower? Hiring a personal trainer? The list could go on and on with products or services where we can only “ballpark” to get an estimate of value.
A good salesperson will ask lots of questions to identify someone’s needs. From there they’ll begin to point people to products or services that best meet those needs. While doing so they will look for ways to ethically incorporate authority, consensus and scarcity to the degree that each is available. Doing so will help highlight the value of their offer and lead to a better buying experience for the customer.
So remember, even if you’re not a math whiz, V = WIG/P is a formula you want to know cold if you hope to succeed in sales.
Brian Ahearn, CMCT®
Chief Influence Officer
Chief Influence Officer
influencePEOPLE
Helping You Learn to Hear “Yes”.
Helping You Learn to Hear “Yes”.
I work with lots of people in different roles when it comes to teaching ethical influence. Over the years I’ve worked with senior leaders, middle managers, supervisors, claim reps, underwriters, field sales reps, insurance agents, business owners, financial reps and many others. I’m always amazed at how often people try to persuade without a clear goal in mind.You may think a salesperson always has a clear goal; i.e.,to make the sale. True enough, but that’s still a little vague in my book. Let me share an example to help you see what I mean.During the Principles of Persuasion Workshop© we have an activity where participants work in teams to come up with a persuasive argument to get a high school student, Jimmy, back in school after he’s been expelled for foul language and insubordination. Participants generally do a good job at applying the principles of influence to persuade the school board to let Jimmy back in but very few clearly state when they want Jimmy back in school. That leaves the final decision up to the school board, which could opt for another week or two out of school. Participants would do much better to say something like this at the conclusion, “It’s our sincere hope that you’ll let Jimmy back in school tomorrow.” Why is this so important? Because if the board says no there is a moment of power the teams can leverage.Studies show when someone says “No” to you, if you make a concession and ask for a smaller request immediately your odds of hearing “Yes” are much better. This is an application of the principle of reciprocity because when we give a little, people often feel compelled to give a little in return.Robert Cialdini had his research assistants run an experiment that shows how powerful this concept can be in real life. These students randomly asked people around the Arizona State University campus if they would be willing to be a chaperone on a day trip to the zoo for a group of juvenile delinquents. As you might expect, very few people wanted to spend a day at the zoo with those kids so only 17% said they would be willing to help.At a later date the research assistants roamed the campus and started with a bigger initial request. They randomly asked people if they would be willing to be a big brother or sister to some juvenile delinquents. They made sure people knew this was a weekly commitment of two hours and they were looking for people to sign up for two years. No one was willing to give up that much time. As soon as people said no the research assistants would ask, “If you can’t do that, would be willing to be a chaperone on a day trip to the zoo for a group of juvenile delinquents?” So basically they were asking for the exact some thing they’d asked for earlier but this time 50% said yes – triple the initial response rate!Two things were at play during the second scenario. First, the contrast phenomenon came into play. By comparison, a day at the zoo is nothing compared to a two-year commitment so it’s much easier to say yes to the zoo after thinking about being a big brother/sister. The second thing was the principle of reciprocity was engaged by way of concessions. When the research assistants counter-offered immediately, many people felt compelled to do the same.Let’s go back to the scenario with Jimmy. By clearly stating what the team wants – to have Jimmy back in school tomorrow – they will be more effective persuaders. They might hear a “Yes” to the initial request but if they don’t they can make a counter offer that’s very likely to be accepted. This is a far better approach than leaving the timing up to the board.How does this work for you? Two ways. Clearly state what you want. Think about the times when you’ve not clearly stated what you wanted and left if to someone else to decide the outcome. Perhaps you interviewed for a job but didn’t clearly state the salary or benefits you wanted. Or maybe you were trying to make a sale but didn’t make the first offer.Don’t censure yourself. For example, you want a job and would like to earn $95,000 but inside you’re thinking they might say no so you ask for $85,000. If you hear no then you might end up at $80,000 or less. Ask for $95,000 because you might just get it but if not you can retreat to $90,000 and are more likely to get that than if you’d started at $90,000 or $85,000.Next time you go into a situation where you’re trying to persuade someone don’t just focus on building your persuasive communication. Give lots of thought to what your ultimate goal is. What would you like to have happen if everything worked out as you wanted? But don’t stop there; clearly communicate your desired outcome. Be ready in case you hear “no,” which means having multiple fallback positions ready. This allows you to leverage the moment of power after “no.” Do these few things and you’re on your way to becoming a much more effective persuader.
Brian Ahearn, CMCT® Chief Influence Officer influencePEOPLE Helping You Learn to Hear “Yes”. 
Often it’s the little security issues we overlook that hurt us the most. 
By: Brand BarneySecurity cameras? Check. Guards? Check. Locked doors? Check. Privacy monitors? Umm . . .When it comes to data security, many health organizations don’t always worry as much about the physical aspect. While many foundational security issues may have been addressed, organizations are likely to have overlooked details such as
TweetMalicious entities (hackers) strike quickly, take what data they can and leave with little to no trace. In this case, data thieves take advantage of the lack of physical security in healthcare organizations. Here are some issues that your organization may not have considered.Taking devicesThe main problem offices have with devices is a nurse and a client use the same type of mobile device, such as an iPad. A thief could walk in, take an iPad off the reception desk when no one was looking, and walk out, all within five minutes. Would you stop someone if they were walking out of your office with an iPad? Probably not, because you would assume it was theirs. But within a few potential minutes, that hacker has access to the network and whatever data or PHI is on that iPad. This type of theft can and does happen, and sadly it’s not limited to your office, hospital, etc. Many workforce members work long hours and take devices with PHI on them home, stopping at a grocery store or a child’s school on the way home from work. Theft is quite likely if a device is left alone and unsecured in or out of the workplace, and that breach can cause quite a bit of heartburn.See also: Balancing Mobile Convenience and PHI SecurityLeaving devicesYou don’t often think of thieves leaving something behind, but for hackers, an easy way to further the data heist is to leave behind malware. Here’s an example: A receptionist at a large hospital notices a flash drive was left on the desk. It’s labeled “HR,” so the receptionist decides to just drop it off at the Human Resources Department. The person in HR takes it and plugs it into a computer without a second thought. But that flash drive was full of malware and now the hospital’s system is infected and likely losing data.Be suspicious of any unfamiliar hardware or device that randomly appears.Windows and peeping eyesOften a thief doesn’t have to enter an office to steal information. They can look through a window and see information on the computer screens of workers. This can be remedied simply by putting up blinds in offices that have sensitive information.Follow for more data security articles like thisReception desks reveal more than you thinkReceptions desks are filled with tidbits of information and loose PHI that cause data thieves to grin. Things like passwords written on sticky notes, computers without privacy monitors, and patient records lying out in the open are all fair game for social engineers.Reception desks also get the most traffic, which is why they are typically the first target. Social engineers can steal a lot of information without being noticed. It’s critical to the safety of your patient’s data that your receptionists are properly trained to handle social engineers and aware of everything that’s going on.See also: Healthcare Reception Desks: Breeding Ground for HIPAA Compromise
Check-in and check-outKeeping track of clients coming in and out may seem insignificant, but it can help discourage thieves and provide information should your data get stolen.Having check-ins helps your staff to acknowledge and remember the clients that come in, making it harder for social engineers to slip in and out unnoticed. Make sure all clients/vendors that come into the building sign in and out when entering secure zones (like a data center, or networking areas/server areas), and always assess who really needs access to those very sensitive areas.Unlocked doors: a social engineer’s paradiseSocial engineers love an entity that doesn’t pay as much attention to physical security. It makes their jobs that much easier, and if you aren’t paying attention to these areas, what else might that attacker poke around at? A social engineer can go into a hospital, walk into an unlocked office, sit down on an unlocked computer, steal phi, and then leave all within ten minutes.But if the office door is locked, then the social engineer usually won’t bother.Hackers and thieves are often lazy. Why go to a lot of trouble to get past a locked door if there’s an unlocked one down the hall? By locking office doors and computers, you deter many data thieves (what’s crazy is this very basic concept translates to all areas of security).Fighting back: it’s surprisingly easyMost of these risks can be prevented with little effort. Here are some suggestions:In risk analysis, look for physical security risksLock all office doors when not in use day and nightRequire passwords to access computers and mobile devices (encrypt your data or don’t have data on devices)Use screensavers and privacy monitors on computersInstall and use blinds in all office windowsKeep logs of who goes in and outKeep track of devices that go in and outHave policies in place for stolen equipment (Make sure to have a good Incident Response Plan and know your Breach Notification Policy front and back.)Train staff against social engineeringLimit access to PHI through role-based access.Have staff report suspicious people and devicesMake sure all reception desks protect PHI from prying eyesSee also: Common HIPAA Violations: HIPAA Quiz/HIPAA TestMost social engineering and data thefts can be prevented by following these simple practices. If your organization is taking into account the smaller issues, a social engineer, or a thief will be less likely to bother you because it’s not worth the effort.It’s the greatest benefit from the littlest effort.Brand Barney (CISSP, HCISPP, QSA) is a Security Analyst at SecurityMetrics, has over 10 years of data security experience, and will totally geek out if you mention Doctor Who. Brand loves to play jazz piano and daydreams about being as great as Dave Brubeck or Thelonious Monk. Connect with him on Twitter or check out his other blog posts.