These Researchers even went so far as to calculate the Calories

The experts who contributed to Simple Heuristics have come up with an answer. Their research suggests that one of the built-in decision heuristics people use is an innate capacity to calculate the "rate of return" for their efforts, particularly as they pertain to the group as a whole. In other words, hunting or a whale or a wooly mammoth has a bigger ROI for the tribe than hunting a Rabbit does. These researchers even went so far as to calculate the Calories required to kill a whale compared to the Calories the community will get from that animal, then calculated the Calories expended versus the Calories obtained for other prey. The result:The whale was by far the best investment of the tribe's energies. Leave a comment and also follow my blog.

Estimating the Rate of Return

For thousands of years,the Inuit people of Alaska and Canada have hunted whales as their primary source of food. They go out into the ocean in small boats, and pound on drums and the side of their boats to drive the whales toward shore(whales have very sensitive hearing, you know). Then, when the whales are in shallow water, they attack and kill them. Now they use harpoon guns and more advanced weapons, but they used to do it with little more than spears. Now why on earth would they do that? There are much simpler and less dangerous game they could hunt-geese,rabbits,seals,walruses even. They could fish. Why go after the largest, most powerful mammal on earth? For that matter, why did primitive humans hunt mastodons? We've all seen the "artist' recreations" of a tribe of scantily clad Neanderthals surrounding a wooly mammoth the size of a beachfront condo,attacking it with little more than sharpened sticks. Okay. So why did they do that? Why not pick on something your own size?

Highlight your proposal

It is a good idea to highlight your proposal so the customer can quickly find the high-value content that directly addresses the factors he or she thinks are important. For proactive opportunities, customers tend to search on their own key criteria until they find a differentiator. Then they stop and make a decision. This implies that it's vital that we organize our sales presentations and proposals to focus right away on the criteria that the customer thinks are most important. Often, these factors will address issues such as: # 1. Are we getting what we need? Does this solve a significant business problem? Will the proposed solution work in our environment? # 2. Can this vendor really do it? Do they have the experience and resources to perform on time and on budget? Are they competent? # 3. Does this represent good value for the money? Is the proposed pricing fair? What kind of return on our investment will we receive? Don't forget to post your comment.

What does this mean for our sales effort? Answer #3

we need to differentiate between opportunities where we are acting to the customer's request for a proposal and opportunities where we are offering a solution proactively. When we submit a proposal in response to an RFP, we must recognize that our first job is to avoid elimination based on some arbitrary or trivial issue. That means following directions carefully, answering all of the questions and requirements, and making our compliance to the bid as obvious as possible. An effective tool in this area is the compliance matrix, a table in which you list each of the client's requirements, give your level of compliance with that requirement, and possibly offer a brief comment or explanation.

What does this mean for our sales efforts? Answer #2

We can uncover the decision criteria of our prospects rather simply. We just have to ask:
#1 "When you compare different vendors, what is the most important factor for you in choosing one?" #2 "The last time you made this kind of decision, what factors did you use to guide your decision? What did you look for? Did that work for you?" So the second answer according to the title says: This technique opens up opportunities for us to help the decision maker during the sales process. An inexperienced or a naïve customer may take a simplistic approach, looking only at price. By using the sales process to educate the buyer, we can introduce other factors beyond price that may be more helpful to the buyer in making a good decision and that may give us more of a competitive position. Follow my blog. Welcome once again!

What does this mean for our sales efforts?

Finally, decision makers sometimes go a step further and develop a limited set of criteria by thinking back over several situations in which similar decisions were made. Which criteria produced the best results? Which didn't work? This heuristic, called "taking the best," assumes that some criteria will produce better results than others. What does this mean for our sales efforts? First, it suggests that during our sales contacts with a prospect, we should probe to find out what factors they will use to make a decision. Join our community and don't forget to suscribe to my posts.

What is using the last? You may ask

A slightly more sophisticated version of single-factor decision making involves asking ourselves what criterion we used the last time we made the same or a similar decision and wether that produced a good outcome.This is called "using the last," and some examples might be: # "Whenever we've hired a vendor who has done the same kind of project before, things have turned out pretty well." # "The last time I entered the office pool, I chose teams by flipping a coin and I won $20. I'll do the same thing again." # "When we bought our annuals for planting last spring, we chose specimens with dark green leaves and they did really well in the garden." make sure you come back to receive more updates and don't forget to register with us and again I would like you to leave a comment.

Minimalist Criteria

At the simplest level, the customer may use what the experts call "MINIMALIST" criteria, but which we might call arbitrary. The programmers who work at my company provided a rather amusing instance of this kind of decision making when it comes to choosing a lunch destination. They used to waste a sizable portion of their lunch period arguing and debating about where to go. Finally, they resolved it as only programmers would-they wrote a piece of software that makes the decision for them. At first, it was a random lunch generator, but then they got a bit more sophisticated. Now they enter a single factor, such as proximity or price, and click the mouse. The system generates a lunch destination based on that factor. And off they go, content with the choice.

There are three varieties of single-factor decision making

Even if your customer has not issued an RFP, he or she will probably evaluate competitive offers on the basis of a key criterion. It might be price. It might be timeline. It might be references or relevant experience or the "business fit" of your solution. What if you and your competitor are roughly equal on the first criterion? Then the customer moves on to a second and compares. If you are roughly equal there, the customer will choose a third. But decision makers seldom go beyond two or three factors before reaching a decision. There are three varieties of single-factor decision making that your customer may use.

The recognition heuristic in action

For example,suppose a company issues an RFP and receives twenty proposals in response. Someone at that company has to sort through those submissions to quickly eliminate most of them. At this stage of the evaluation, there is not much in the way of careful analysis, no real weighing of the evidence. An initial set of "no names" will be discarded. That's the recognition heuristic in action. Then the evaluator will begin to apply a decision factor or two. For example, some of the proposals will be eliminated because they did not follow the RFP instructions. Some will be cut because they did not answer all of the questions or indicated by their answer that they were noncompliant with a key requirement. The decision process will move very quickly until the evaluator has the pile down to something more manageable.