A MEDDIC Sales Process Review and Best Fit Analysis

Highlights

  • MEDDIC is a highly specialized sales methodology applied at the beginning of the sales cycle. It is focused on the qualification process.
  • It brings structured analysis to qualification and objectively scores sales leads.
  • It empowers the seller to make a Go or No-Go evidence-based sales pursuit decision. It further applies the gathered information for downstream sales strategy and presentation.
  • Many experienced sellers use this process for the qualification and discovery sales cycle steps but use other sales methodologies for the rest of the sales cycle.
  • This method is a remedy for salesforces that incur an excessive number of no-decision sale opportunity results.
Johnny Grow Revenue Growth Consulting

About the MEDDIC Sales Process

The MEDDIC sales process was created by Dick Dunkel and Jack Napoli while at Parametric Technology Corp. (PTC) in the mid-1990s. It was born from a need to bring process improvement to PTCs complex sales cycles. Following its creation, PTC achieved over 40 quarters of continuous growth and increased revenues from $300M to over $1B in four years.

What sets it apart from other sales methodologies is a focus on the qualification and discovery processes. It's a structured approach to quickly identify the buyer's decision-making criteria and process. It then answers the question, how real is the deal?

Poor qualifications are a pervasive sales problem and create a cascading effect of poor customer intelligence which leads to inaccurate or incomplete sales strategies. These factors contribute to low sales win rates.

On the flip side, strong qualifications keep sellers in deals they can win, gather better customer intelligence to produce higher quality sales strategies, and achieve higher close rates.

The MEDDIC sales process is an acronym that prescribes a six-part account discovery procedure.

MEDDIC Sales Process
  1. Metrics measure the economic impact of the proposed solution. They define how the customer will measure success. The most common metrics are revenue improvement, Return on Investment (ROI), payback period, cost savings, time savings or possibly risk avoidance. Metrics are successful when the customer agrees they are the measures for success and deliver overwhelming payback.

Buyers will often use the metrics in their business case or business justification document. Overwhelming metrics create competitive differentiation, keep sales cycles on track and reduce discounting later in the sales process. Without metrics purchase decisions are at risk of stall or cancellation. Even for technical sales, it's important that metrics are stated in business terms (i.e., time and money), not technical terms.

  1. The Economic Buyer is the final decision maker. While this person may delegate the decision-making process to somebody else or a purchase committee, they are still accountable and approve the decision. In this step, the seller should identify the Economic Buyer, verify whether this person also owns the budget for the purchase, and will be held accountable for slated benefits. Many times, this role can be evasive but it's critical to meet this person to verify decision making criteria, purchase process and expected benefits. In fact, not meeting this role will materially reduce your probability to win the sale opportunity.

One caution point. Sometimes this role is misrepresented to sellers. It's not uncommon for technical buyers, or the person who has been delegated the purchase process to inaccurately represent themselves as the decision makers. While small or moderate purchases may be decided by managers, larger purchases will find the Economic Buyer further up the company hierarchy.

  1. Decision criteria are the factors that will determine the final vendor. These factors are usually formal, but sometimes informal. They are generally, but not always, measurable. Cost is always a decision criteria factor, but seldom the most important. Cost is more than just the cash outlay and can be influenced by more than just the amount. For example, financing can play a role or showing buyers (particularly public companies) how to shift the purchase price from an operating expense (OPEX) to a capital expenditure (CAPEX) can lessen the impact to the Profit & Loss statement and ease or accelerate the purchase decision.

There are normally multiple types of decision criteria. Procurement, legal and technical criteria may include compliance requirements and are often pass or fail. Business criteria tend to align with Metrics, allow the customer to rank multiple vendors and are more influential in the final decision. Veteran sales professionals don't just identify the buyer's metrics, they drill-down and influence the decision criteria for their benefit.

Also, for complex sales, it's important to recognize that decision criteria will change over the course of the sales cycle.

Buy Criteria by Phase

As illustrated in the above graph, buyers tend to first focus on finding solutions for their needs. They then shift to evaluating multiple products and finally shift again to reducing risk. At each stage, the decision criteria are different. Veteran sellers recognize this progression and satisfy the current stage while leading the buyer to the next.

  1. Decision Process is the buyer's multiple step timeline and roadmap to making their decision. A successful seller will identify each step and then drill-down to identify the activities, outcomes, person in charge, people involved and estimated duration for each step. For unusual or infrequent purchases, where the buyer is unsure of the process, the seller may inquire about how the company has made decisions with prior projects. Decision dates timed to align with a compelling event are much more solid than artificial decision dates.
  2. Identify Pain is a step to identify both the impetus or triggering event that launched the purchase process and the primary problems that must solved. Veteran sales professionals know that the real pain is seldom provided when asked and therefore drill-down to get past the symptoms and find the root causes. Once the pain is truly discovered, they then pursue a line of questioning to identify the consequences of not solving the pain.

Occasionally buyers pursue purchases to capitalize on a business opportunity rather than resolve a pain. While this may be legitimate, it's also a red flag. There's an old sales quote that pain pills outsell vitamins by a factor of 10 to 1. Vitamins are preventative, optional and more of a nice to have than need to have. They are also much more price sensitive.

Pain pills are instead considered necessary and not so price sensitive. You don't see pain pills on sale very often. This analogy shares why solving pain is generally more solid than capitalizing on an opportunity. The most successful salespeople don’t sell features, functions or capabilities, they sell something that removes pain.

Along with identifying the true pain, you want to know who owns that pain and make sure you get access to this person. A lack of pain is indicative of a purchase process that will stall or get cancelled. The status quo is always the easiest decision. No pain = no decision.

Only when the pain of same is greater than the pain of change will a purchase decision be made.

  1. The Champion is an influential advocate on the buyer team that favors a seller's solution. The Champion is often the person most affected by the Pain identified in the prior step. This person may also apply slightly different Metrics and Decision Criteria than identified by the broader purchase committee.

In other sales methodologies such as Miller Heiman Strategic Selling this person may be referred to as the coach. Sellers align with Champions and Champions sell internally on the seller's behalf.

Seasoned sellers strive to always find at least one Champion, and hopefully more than one. Once identified, the seller nurtures the relationship, confides in the Champion and tests the Champion's ability to relay key information to the rest of the purchase committee. The difference between a Champion and an internal supporter is that the Champion has both influence and a willingness to advocate on behalf of the seller.

MEDDIC is an easy to remember checklist. It facilitates getting the right information early and completing an objective qualification analysis. Unchecked or incomplete information point the seller to necessary steps. Getting complete information aids the seller to make an evidence-based Go or No-Go sales pursuit decision.

There are several variants to this sales method. MEDDICC with an additional "C" at the end is for Competition and includes an additional step for gathering competitor information. MEDDPICC with a "P" in the acronym stands for Paperwork or Paper Process. This step is designed to understand Procurement or Legal paperwork requirements, so the deal doesn't incur an unexpected delay.

To maximize effectiveness this sale methodology should be integrated with a defined sales process. Technology helps and for CRM integration, there's a MEDDIC app on AppExchange for Salesforce.

The app does a great job at visualizing gaps, showing progress or status with traffic light indicators, and providing guidance to improve qualifications.

MEDDIC Sales Process App

Unfortunately, I'm not aware of packaged integration with other CRM systems. When creating MEDDIC integration for my clients using other CRM apps, we typically create a custom form on top of the sale opportunity object.

When to Use the MEDDIC Sales Process

This sales methodology is designed for sophisticated, complex or enterprise-level sales cycles. It's ideal for salesforce's that have outgrown BANT (Budget, Authority, Need, Timeframe) for qualification or need to lower the number of sale opportunities resulting in no-decision.

Many sellers are optimists and view their sale leads through rose colored glasses. This method brings structured analysis to qualification and objectively scores sales leads.

More thorough qualification results in weeding out unqualified sale opportunities, thereby, allocating more time to deals that can be won. This also drives an increase in sales productivity, close rates, forecast accuracy and a decrease in cost per sale. For sales management, it ensures a profitable return on sales efforts.

Use this process when:

  • The sales team incurs countless hours pursuing the wrong deals; that is sale opportunities that cannot be won. Tell tales of this problem occur when buyers delay, defer or fail to complete purchase decisions. Common excuses include a change in the budget or more pressing competing priorities.
  • There is an increasing trend of forecasted opportunities getting pushed to future periods.
  • There is an increasing trend of missing sales forecasts.
  • The buyer changes their purchase process or decision criteria during the sales cycle.
  • Price discounting is on the rise.
  • You incur an increased trend of delays between the time being designated the winning vendor and getting the deal closed.

The most successful sellers routinely mix sale methodologies. For most clients we advocate this approach and we've helped several clients implement MEDDIC in concert with the Challenger Sale and Strategic Selling methodologies. MEDDIC's focus on qualification fills a much-needed gap with other sales methods.

See the MEDDIC sales process review with strengths, weaknesses and recommendations where this sales methodology best fits.

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