Perhaps the best reason for setting expectations correctly is so you can be confident you can deliver on your promise. There is nothing worse as a customer than to find out that what you expected cannot be executed.
Then of course there are those situations where the salesperson allows you to have an unrealistic set of expectations clearly knowing the vendor cannot meet them.
One of the problems I had to frequently deal with in my software businesses was the unrealistic expectations created by sales staff. Sales people are keen to get the deal signed and will stretch the truth somewhat about the products and services in terms of capabilities, timescales or costs. Sometimes, by the time you find out what has been promised, you are well into the contract negotiations and it is difficult at that point to reset the expectations. The result is normally a lost sale. However, if you don’t, you are setting yourself up for failure.
A clear definition of product features and functions and a well documented method of use will generally contain the expectation risk, providing this is communicated to the customer before the purchase. However, you don’t want to confront your customer with 20 pages of instructions for something which is inherently obvious or simple.
As a vendor we have many opportunities to communicate to prospective customers what we expect the outcome to be using our products or services. We can use our website, marketing collateral, sales staff, help desk enquiry service, testimonials, case studies and so on. A major task of our marketing activity should be to ensure our prospects come to us with the right expectations. This ultimately will have a major influence on our ability to create satisfied customers and good customer experiences, essential ingredients for long term success.
Setting expectations for complex products or services can be difficult, especially where the customer is not sure of their need or of the outcome they seek. This is especially true where the customer is unfamiliar with the firm, its products and services or has never had a similar experience. However, there are a number of ways to deal with these situations.
Customer testimonials, case studies, reference calls and site visits can go a long way to providing the customer with an understanding of the likely outcome. The closer the reference is to the customer’s own circumstances, the higher the degree of confidence the customer will have in achieving a satisfactory outcome.
Another technique which can be used to instill confidence and to set expectations is to break a large project down into stages where each stage has its own pre-planning and post-review activities. The expectation is set, not on the final outcome, but on the manner in which the project is managed to achieve an acceptable outcome. That is, we set the expectation on the process itself being able to deliver an acceptable outcome.
In some cases, an actual outcome is not known at the start of a project as the project itself has a discovery stage or several incremental discovery stages. Again, setting the expectation as to the manner in which the project progresses is critical. It is essential that the customer buys into the overall process and has confidence that the process will deliver an acceptable outcome, even if the outcome cannot be predicted at the outset.
The key questions are:
- What is the customer expecting?
- What would the measure of success be from the viewpoint of the customer?
- How do we ascertain that our view of the likely outcome is the same as the customer’s?
- Are we confident that we can deliver the expected outcome within the price, timescales and customer and vendor actions?
- Where the outcome is uncertain, how do we set the expectations and then manage to them?
Tom McKaskill is a successful global serial entrepreneur, educator and author who is a world acknowledged authority on exit strategies and the former Richard Pratt Professor of Entrepreneurship, Australian Graduate School of Entrepreneurship, Swinburne University of Technology, Melbourne, Australia. A series of free eBooks for entrepreneurs and angel and VC investors can be found at his site here.
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