Displacing the Incumbent

One of my constant themes regarding business development is the need for discipline: Budget your time. Pick your best opportunities and give them appropriate attention. Don't waste your time on proposals you have little chance of winning.

Given this philosophy, you might expect me to discourage pursuing a client where there is a seemingly entrenched competitor. Not necessarily true. For one thing, the incumbent might not be as unbeatable as you imagine. For another, in this economy you're only going to grow your business significantly by taking work from competitors. Are you up to the task? 

Why the Incumbent's Advantages Might Not Be Insurmountable

Of course, the incumbent firm has many advantages—relationships with key decision makers, a track record of success, inside knowledge of the client's business. But there's cause for hope:

• One survey found that over half of clients are open to switching their A/E service providers.

• Another survey concluded that only 16% of clients gave their A/E service providers an A for service.

• Still another survey indicated that less than one quarter of clients would recommend their top professional service providers.

Then there are our own experiences. Nearly all of us who have been in this business several years have worked for that long-time incumbent firm that got displaced at one point, or the firm that pushed the incumbent out (or both). It's clear that the prevailing 80% repeat business rate in our industry is not a wholesale endorsement by clients. The reasons for not switching may have more to do with convenience than real satisfaction. Therein lies your potential opportunity. 

Assessing the Opportunity

The time to decide whether you should try to unseat an incumbent is not before you even talk to the client. Nor is it after the RFP is on the street. Unfortunately those are the two circumstances when many firms make a decision. They either write off the client before ever meeting with them. Or they decide to propose on a project (with an incumbent) they knew little to nothing about before the solicitation was published.

In both cases, the mistake is not talking to the client at the right time. The right time is before the procurement process is underway, when clients are generally more open to exploratory meetings with other service providers. You want to contact the client when you're in position to offer help without appearing motivated purely by the RFP. You're also likely to get a better assessment of the incumbent's position when the client isn't concerned about generating a good response to their solicitation.

How to Displace the Incumbent

I find it interesting that market research across multiple industries has found little correlation between customer satisfaction and loyalty. The vast majority of customers who switch products or service providers indicate they were satisfied before they made a change. 

So why did they change? Because they found something they thought was better than what they had been using. That's the simple secret to unseating the incumbent. Sure, changing A/E firms is not as easy as changing toothpastes. But demonstrating a difference in your favor may not be as difficult as you thought. Here are some suggestions:

Don't contact the client until you've uncovered a need. The basis for your initial contact (and subsequent ones) should be to offer your help—typically in the form of information, insight, or advice relating to a specific problem or challenge. If you don't know how you might help, the client has little reason to talk with you. So use your network, the internet, or any other sources to learn all you can about the client before making the first call.

Offer your help unconditionally. Even your offer to help (your entree) may be met with reluctance if the client is reasonably satisfied with the incumbent. It may be viewed as merely a ploy to gain an audience with the client. You want to convince the client otherwise. Imagine the client says, "We're already working with another firm." You could respond, "That's fine. If I can be helpful, that in itself makes it worth my time if it's worth your time. Helping people like you is why we're in business." Your response should allay fear that your desire to meet is motivated primarily by self-interest.

But look for signs of mutual interest. Besides delivering the help you promised, the goal of your initial meeting with the client is to determine if there's interest in continuing the conversation with you. The best way to confirm this is to try to schedule a follow-up meeting to provide further help. Of course, agreeing to keep talking doesn't necessarily mean the client is open to a change. 

With each subsequent meeting, you should be seeking increasing commitments on the client's part, helping gauge their interest in a possible business relationship. These commitments might include things such as introductions to other decision makers, a visit to one of your clients' sites, a meeting at your office, a strategy workshop, etc.

Seek opportunities to fill a void. One of the first steps in displacing the incumbent is often helping the client in areas where your competitor isn't. In talking with the client, actively seek to uncover unmet needs. The support you provide in this area will initially be part of the sales process, but eventually could lead to contract work. Once under contract, you are then much better positioned to overcome some of the incumbent's advantages.

Above all, out-serve the incumbent. Many clients feel that their A/E service provider isn't as attentive or responsive as they'd like them to be. In my experience conducting client surveys, inadequate communication is the number one client complaint. See an opportunity?

Once you have gained access to the client by consistently offering something of value, you can begin outworking the incumbent in serving the client. It's often not that difficult. But it does demand discipline and focus—which brings me back to my core philosophy of business development. Pay attention to the details of client service and watch your sales opportunities multiply.