Scopes of Work

Send the highest-level decision maker you contacted a Scope of Work sheet to review before generating your proposal. Send it via fax, postal mail, or e-mail (do not invest an in-person sales call on a Scope of Work that a customer has not had time to review yet). This informal proposal is an outline that lists the details of customers' goals, measurable benefits, and conditional commitments, and explains how features of your products connect to them.

Encourage customers to review the connections and edit anything that does not meet their requirements. If any discrepancies surface, correct them before making your formal proposals. Scopes of work allow customers to perform one last check before you make your final presentations and proposals. As always, the final decision makers' comments count most. If sales opportunities involve advocates or gatekeepers, the FDM will contact them if he or she thinks their review is necessary.

Although scopes of work do not include pricing, you let customers know they satisfy their conditional commitments. You highlight that fact in the budget section. A scope of work combines the Q sheet from Chapter 6 with the Connecting Value sheet in this chapter. You explain that you will firm up pricing once they confirm that the current product(s) and feature selection(s) achieve their goals. Without firm prices to squabble over, you avoid the "one from column A, two from column B" quagmire that wastes everyone's time and effort. If pressed for cost details, verbal pricing works. A sample of a scope of work cover letter and a scope of work checklist follow in Exhibits 7-7, below and 7-8 (page 214), respectively.

Exhibit 7-7: Scope of work cover letter.

Scope of Work Checklist
Positron Requirements	FutureTech Comments	Positron Comments
Primary goal: Prevent production stoppages from 18 hours to 9 hours annually	Can do it with it with Predicto Services	q What can we do to reduce downtime to six hours?
Downtime costs: $40,000 per hour	Confirmed costs using your past records	q Let's review your calculations again
Projected savings: 9 hours decrease save $360,000	Confirmed savings using your past records	q Let's shoot for six hours
Start date: November	No problem if order released by September 15th	q No problem
Finish date: December	No problem if project begins by November 15th	q What happens if we run into the holidays?
Budget date: Not to exceed $1,080,000	Current selection of products fit within this budget figure	q What will the actual price be?
Payback: Three years or less	Current selection of products fit within this payback figure	q Did the survey indicate that there might be a way to lower our payback to two years?
General notes: Very similar situation that we have encountered on four other projects.	General notes: Survey really documents some significant opportunities to decrease downtime.	General notes: Still want to see some sort of guarantee on the savings.

Solution Selection and Review
Measurable Benefits	Product or Service	Feature and How It Works	Benefits of Features	FutureTech Comments	Positron Comments
Prevent production stoppages from 18 hours annually to 9	Predicto Services	Variance Alerts prevents unscheduled breakdowns by warning operators of impending failure	It ensures uninterrupted shipments to your customers and saves money from lost production.	Only company in industry that provides this type of service	How come no one else offers it?
		Tolerance Checks prevents unscheduled breakdowns by electronically analyzing critical components for wear and tear on a weekly basis	Same as above	By increasing tolerance checks to a daily basis, your records indicate that you can reduce downtime to six hours	What will that do to both cost and payback?
General Product Selection Notes for FutureTech: Suggest you visit a working installation.			General Product Selection Notes for Positron: Great idea. Which one will best resemble our operations?

Exhibit 7-8: Scope of work checklist.

Note

All the templates shown in this chapter can be down-loaded from www.measuremax.com.

Although Steven still has questions that need answers and issues that need resolving, at least he and Olivia are working together to solve them. (See Exhibit 7-8.) In addition, note that you need only one or two features to achieve the measurable benefits of a customer's goal.

Case Study

Continuing the case study from Step Four: Purpose and Summary, and after resolving all the issues from the scope of work, Steven reconfirms that Olivia's goal is to reduce downtime from eighteen hours to nine hours a year. He also verifies that her conditional commitment requires a three-year payback and a price not to exceed $1,080,000. He also confirms that a lost hour of production costs $40,000. His explanation begins with her goal of reducing downtime. Watch for the goal-benefit-feature-explaining pattern.

• Steven: Olivia, you want to reduce downtime (goal) by nine hours annually to save $360,000 in lost production time (measurable benefit). Our Predicto Services use variance alert monitors (feature). They warn of impending failures if the equipment is working outside its normal operating range to prevent breakdowns (benefit).

  Furthermore, variance alert monitors (feature) could have prevented four failure instances last year for a savings total of three hours, which represents production savings of $120,000 (measurable benefit). Olivia, have I explained it where you can see how it does that? (Steven verifies that Olivia understands how feature connects to measurable benefits—and lets Olivia know that he takes responsibility for making sure she understood his explanation.)

• Olivia: It makes sense.

• Steven: (Steven then connects the second feature that achieves this goal.) In addition, our service includes tolerance checks (feature). They analyze critical components on a weekly basis for wear and tear (benefit). There were two cases last year where this service could have prevented production stoppages totaling five hours, or $200,000, in lost production (measurable benefit).

Steven then would proceed to a second goal, if there was one, or to another benefit or feature of the first goal.