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WHO REALLY MAKES THE DECISIONS?

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David Freedman

We have a habit of incorporating corporate-speak into our wider English language business lexicon. Sometimes this is helpful and enriching; at other times not. What we used to refer to as “selling at board level” then became “selling to the CxO”, and then “selling to the C-suite”. Not a particularly felicitous phrase, nor, as it turns out, a very accurate one. It implies that ultimate strategic decision-makers for major purchases and investments necessarily have “Chief” in their title, and that they operate from the penthouse floor of a plate glass corporate HQ, the welts of their expensive loafers or the points of their stiletto heels forever cushioned by inch-deep shag pile. Generally speaking, they do not; and to assume that every major sales campaign will end with the upturned or down turned imperial thumb is to misrepresent what actually happens in real life.

Many people are involved – formally or informally – in the decision to buy things and services. In the major enterprise contract, or strategic investment decision the ultimate client, some technical experts, a couple of lawyers, the budget holder and the people from procurement might all get to have their say somewhere along the line.

One thing we know for certain – and this may be counter-intuitive – is that there is no point going straight to the top. Apart from anything else, the odds are heavily stacked against your even speaking to anyone unless you are a peer of the prospective client’s C-suite. Research shows that for ordinary mortals, across a sample of over 29,000 calls it takes 80 calls on average to get an opportunity with a C-level executive[1]. That wouldn’t be worth the effort even if C-level were the place to start, but our own research shows that it isn’t. In fact, knowing that you have the highest-yielding investment opportunity for years, or the best service offering in the business, and having a prospective client in your sights, your ideal strategy is C-level avoidance while you work away at building a case which you (or most likely somebody inside the prospective client organisation) will eventually take to the top floor for approval, once the case is watertight.

David Freedman, Associate Director at Huthwaite International

David Freedman, Associate Director at Huthwaite International

After all, what would you do if, armed with your industry-beating proposition, you suddenly found yourself face to face with a CEO in the car park at Glyndebourne? Probably, you’d freeze, spout some talking-brochure gibberish about the product features or historical investment performance, and make absolutely certain that you never got an invitation into the expensively furbished office of that particular top dog.

The research into how organisations make buying decisions led us to divide the people you need to influence and persuade into three distinct roles (roles, incidentally which are not fixed, and might change from decision to decision). The trick is to understand – through skillful questioning – and to handle them according to who has what role in the current buying decision, what their problems, concerns, hopes, fears, previous experiences and ultimate business aims are, and to navigate to the real decision-maker efficiently and persuasively.

If your proposition (to take an example at random) is aimed at a major pension fund client and involves some ingenious and complex financial instrument, you might only have easy access to a somebody who is not directly involved in assessing asset risk and return, but has the ear of people who do. That person is the focus of receptivity (FoR) in this instance.

The focus of dissatisfaction (FoD) in this instance might be one of several people, or perhaps all of them: the compliance team, anxious to ensure new funds are in accordance with new swaps regulations after a few cases of burnt fingers with your competitors recently; the digital project manager struggling to deliver fund performance dashboards that meet the requirements of marketing; and/or the head of finance who needs commercial solutions that produce predictable and evenly accruable revenue streams.

For most of your journey around the Buying Cycle, these will be the people with whom you have to build value, whose needs you have to uncover and meet, and to whom you must make a persuasive case so that you (and they, together) can sell the ultimate case to higher authority. For the CxO, you might – if you are skilled – uncover and record needs that are about minimising the risk of a can-carrying failure that will alert the AGM, the beneficiaries and the media. Or their needs might be all about creating a narrative in which the strategic success of this breakthrough positions them as the most forward-looking and financially astute leader in the industry.

The CEO, CFO or chairman (or might not) then be the focus of power (FoP). But it’s here that the skilled seller will probably spend the least time, albeit the most critical meeting  The work you’ve done so far in building the case with the other foci (whether they are C-suite or not) will determine what happens now.

So the chance meeting with the CEO at the social event of the year might indeed turn out to have been a valuable one. On that day, she’d have been an FoR at best. You’d have done well to ask her for a right to roam among the many other influencers in the business who you need to probe in order to build your case, and then (if you feel you even need to) make an appointment to go back, much later, fully armed, when that CEO is re-born as the Focus of Power.

Don’t be blinded by the job title, or the reputation. In selling, it’s all about understanding the true buying role.

DAVID FREEDMAN is Associate Director at Huthwaite International. He has worked for Huthwaite International for 13 years, helping many of the world’s largest companies to improve their sales performance and strengthen their negotiation skills. He is currently involved in many major bids, in marketing projects and in spearheading the company’s drive into the professional services marketplace.

Huthwaite International is best known as the creator of SPIN® Selling – helping salespeople in all countries and most languages to improve their performance. Companies worldwide trust Huthwaite International, as a leading behavioural change consultancy and owner of the SPIN® trademark in over 50 countries, to deliver measurable results through its research-based models. The company provides innovative skills training and advice for progressive individuals and organisations in sectors such as IT, financial services, healthcare, telecoms, manufacturing, legal and professional services. It has a client list of 1,000s of companies worldwide and trains some 14,000 people each year. Besides the SPIN® Suite, Huthwaite International offers training and reinforcement based on its own original research models in negotiation skills, communication skills, customer service skills. Established in 1974, Huthwaite is headquartered in Wentworth, South Yorkshire and handles international projects through its national offices or associated companies throughout Europe, USA, South Africa and Asia Pacific. The company has won two Queen’s Awards in 1999 and 2008 for International trade.

[1][Research done by SCI Sales  ]

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Robinhood plans confidential IPO filing as soon as March – Bloomberg News

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Robinhood plans confidential IPO filing as soon as March - Bloomberg News 1

(Reuters) – Online brokerage Robinhood, at the centre of this year’s retail trading frenzy, is planning to file confidentially for an initial public offering as soon as March, Bloomberg News reported late on Friday, citing sources.

The California-based brokerage has held talks in the past week with underwriters about moving forward with a filing within weeks, Bloomberg said.

Robinhood did not immediately respond to a request for comment.

Reuters reported last year that Robinhood has picked Goldman Sachs Group Inc to lead preparations for an initial public offering which could value it at more than $20 billion.

Robinhood was at the heart of a mania that gripped retail investors in late January following calls on Reddit thread WallStreetBets to trade certain stocks that were being heavily shorted by hedge funds.

The online brokerage tapped around $3.4 billion in funding after its finances were strained due to the massive trading in shares of companies such as GameStop Corp.

(Reporting by Ann Maria Shibu in Bengaluru; editing by Richard Pullin)

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Analysis: How idled car factories super-charged a push for U.S. chip subsidies

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Analysis: How idled car factories super-charged a push for U.S. chip subsidies 2

By Stephen Nellis

(Reuters) – When President Joe Biden on Wednesday stood at a lectern holding a microchip and pledged to support $37 billion in federal subsidies for American semiconductor manufacturing, it marked a political breakthrough that happened much more quickly than industry insiders had expected.

For years, chip industry executives and U.S. government officials have been concerned about the slow drift of costly chip factories to Taiwan and Korea. While major American companies such as Qualcomm Inc and Nvidia Corp dominate their fields, they depend on factories abroad to build the chips they design.

As tensions with China heated up last year, U.S. lawmakers authorized manufacturing subsidies as part of an annual military spending bill due to concerns that depending on foreign factories for advanced chips posed national security risks. Yet funding for the subsidies was not guaranteed.

Then came the auto-chip crunch. Ford Motor Co said a lack of chips could slash a fifth of its first-quarter production and General Motors Co cut output across North America.

“It brings home very clearly the message that the semiconductor is really a critical component in a lot of the end products we take for granted,” said Mike Rosa, head of strategic and technical marketing for a group within semiconductor manufacturing toolmaker Applied Materials Inc that sells tools to automotive chip factories.

Within weeks, automakers joined chip companies calling for chip factory subsidies, and U.S. Senate Majority Leader Chuck Schumer and President Biden both pledged to fight for funding.

Industry backers now aim to be part of a package of legislation to counter China that Schumer hopes to bring to the Senate floor this spring. Still, all agree it will do little to solve the immediate auto-chip problem.

Headlines about idled car plants resonated with the public that had shrugged off abstract warnings in the past, said Jim Lewis, a senior fellow at the Center for Strategic and International Studies. Lawmakers, already worried that a promised infrastructure bill will not materialize this year, decided to push for quick solution.

“Nobody wants to be seen as soft on China. No one wants to tell the Ford workers in their district, ‘Sorry, can’t help,'” Lewis said. “It was one of those moments where everything aligned.”

The package includes matching funds for state and local chip-plant subsidies, a provision likely to heat up competition among states including Texas and Arizona to host big new chip plants that can cost as much as $20 billion.

The subsidies could benefit a factory in Arizona proposed by Taiwan Semiconductor Manufacturing Co and one in Texas eyed by Samsung Electronics Co Ltd, even though those factories would be geared toward high-end chips for smartphones and laptops, rather than simpler auto chips. And those factories would not come on line until 2023 or 2024, according to plans disclosed by the companies, the world’s two largest chip manufacturers.

In the longer term, a raft of U.S. companies are also poised to benefit. Any chipmakers that build factories will source many tools from American companies such as Applied, Lam Research Corp and KLA Corp.

Intel Corp, Micron Technology Inc and GlobalFoundries – which already have U.S. factory networks – will also likely benefit.

Smaller, specialty chip factories also could benefit.

“The recent chip shortage in the automotive industry has highlighted the need to strengthen the microelectronics supply chain in the U.S.,” said Thomas Sonderman, chief executive of SkyWater Technology, a Minnesota-based chipmaker that makes automotive and defense chips. “We believe that SkyWater is uniquely positioned due to our differentiated business model and status as a U.S.- owned and U.S.- operated pure play semiconductor contract manufacturer.”

Even with subsidies, the U.S. companies still must compete with low-cost Asian vendors over the long run, and the immediate auto chip troubles will probably persist.

Surya Iyer, a vice president at Minnesota-based Polar Semiconductor, which makes chips for automakers, said his factory is booked beyond capacity and has started to speed some orders up while slowing others down, to meet automakers’ needs as best it can.

“We are expecting this level of demand to continue at least for the next 12 months, maybe even longer,” he said.

(This story has been refiled to add attribution to quote in paragraph 9, add dropped words in paragraphs 10 and 17)

(Reporting by Stephen Nellis and Hyunjoo Jin in San Francisco and Alexandra Alper in Washington. Editing by Jonathan Weber and David Gregorio)

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Atlantia disappointed with CDP bid for unit, continues talks

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Atlantia disappointed with CDP bid for unit, continues talks 3

By Francesca Landini and Stephen Jewkes

MILAN (Reuters) – Italy’s Atlantia said on Friday an offer by a consortium of investors led by state lender CDP for its 88% stake in Autostrade per l’Italia fell short of the mark and asked its top managers to see if the bid could be sweetened.

“The offer falls below expectations,” the Italian infrastructure group said in a statement, adding it had mandated the chief executive and the chairman to assess “the potential for the necessary substantial improvements” to the bid.

Italian state lender CDP, together with co-investors Macquarie and Blackstone, has presented a proposal valuing all of Autostrade per l’Italia at 9.1 billion euros ($11 billion).

The consortium also requested Atlantia guarantee up to 700 million euros in potential damage claims and another roughly 800 million euros for a pending legal case, making the bid less attractive than previously expected.

One source said the consortium estimated overall pending legal claims against Autostrade at 3 billion to 4 billion euros, adding the 700 million euro cap did not mean the amount would be detracted from the offer price from the start.

Earlier on Friday Atlantia’s minority investors TCI and Spinecap had called on Atlantia’s board to reject the offer, saying it undervalued the asset.

“No deal is better than a bad deal, especially a bad deal and a wrong price,” TCI Advisory Services partner Jonathan Amouyal said in a emailed comment to Reuters.

TCI, which holds an indirect stake of around 10% in Atlantia, repeated that the value for 100% of Autostrade should be no less than 12.5 billion euros.

The board will hold a further meeting in order to take a final decision on the offer in due time, Atlantia said.

The negotiations between Atlantia and the CDP-led consortium are part of an effort to end a political dispute over Autostrade’s motorway concession triggered by the collapse of a motorway bridge run by the unit.

(GRAPHIC – Atlantia share performance: https://fingfx.thomsonreuters.com/gfx/mkt/qzjpqggjdpx/image-1614331237501.png)

The bid expires on March 16, but the deadline could be extended in case Atlantia calls an extraordinary shareholders meeting (EGM) on the issue, according to one source with knowledge of the matter.

Shares in the group ended down 0,7%, after recovering some losses, as investors waited for the decision of the board.

Atlantia, which is controlled by the Benetton family, owns 88% of Autostrade, with Germany’s Allianz and funds DIF, EDF Invest and China’s Silk Road Fund holding the rest.

The group also kept open an alternative plan to demerge and sell its stake in Autostrade per l’Italia unit and called an EGM on March 29 to extend to end-July a deadline for offers for the demerged stake.

(Additional reporting by Stefano Bernabei, editing by Louise Heavens and Steve Orlofsky)

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