Remember Maslow's hierarchy of needs? That was from the psychology course you skipped over, the one where the most basic and important human needs are at the top of the pyramid and less important needs follow below.
Some researchers at Bain Capital have studied decision-making at 2,300 companies, half of which happen to be related to insurance. The result was a modern update to Maslow's pyramid reflecting what matters in the world of B2B purchasing behavior.
It is interesting to note how closely their results mirror our own experience in selling professional services to corporations. If you're considering outsourcing a portion of your business processes to a third-party, such as tracking certificates of insurance, you may wish to consider the following criteria, presented in ascending order of importance:
7. Table Stakes
At the bottom of the list is what is considered minimally acceptable to get in the game – does the product/service (the "system") meet the requirements of the job specification? Is the price acceptable? If the candidate can't meet these criteria nothing else matters.
6. Economics and Performance
Does the system improve my top line, are my costs reduced? What about the system itself – is it a quality item? Is it scalable? Innovative?
Does the system save me time, reduce effort, decrease hassles? Will I get the information I need? Is the system transparent?
Is it readily available to use, ideally in real-time? Can I arrange the system to conform to my way of doing things or do I have to alter internal business processes to adapt to it?
Is the system responsive to my needs? Are the people behind it subject matter experts, are they committed, stable and provide a good cultural fit? If I choose a particular system, are my risks reduced?
Do I like the way the service looks and works? Is it easy to use? Will it add to my growth and development, reduce my anxiety or actually provide some levity to my day?
Does the system meet the vision of the business and reflect its goals, its long-range plans and sense of social responsibility?
We see that as we move up the pyramid we migrate from elements that are easy to calculate to those that are more emotional. As criteria become more subjective they, of course, become harder to measure and quantify. Wrapping up aspects of support, interaction and communication are more challenging to evaluate, so reputation in the marketplace is a strong point of reference for candidates under consideration.
The Bain researchers determined that ease of doing business (#6, 5, 4, 3 above) was the most significant factor in selecting a B2B vendor. In the insurance service sector, the most important elements to buyers were expertise, responsiveness and product quality. Overall, when all the elements in the survey were ranked, issues related to cost came in 27th. This is hardly surprising given the nature of the work and the risks involved.
The value chain for purchasing decisions related to professional services is clear – find the expert with a quality product who provides excellent service. If you look in the right place, it might not be as hard as you think. Even Maslow might agree...