Selling Simulation Science and System Dynamics

It is a difficult challenge to sell and market simulation products. As a sales agent for several simulation firms, I thought I’d share some of my thinking.

I'd love to get feedback from the community.

When we’re meeting with executives, we try to focus on the challenges they are facing. It might be a desire to improve the output of an oil field or to cut operational costs in a bank by closing branches or to optimise marketing spending across a portfolio of brands.

In many cases (if not all), we're looking to release cash for the owners of the business through coordinated and integrated action across the enterprise.

On behalf of HVR Consulting Services, Global Strategy Dynamics, SDS and my other clients, I then explain that Simulation Science helps corporations:

1. Optimise strategic planning;
2. Optimise key processes across the extended enterprise so that the whole is greater than the sum of the parts;
3. Optimise the management of people to increase efficiency and generate more cash for the owners of the business; and
4. Optimise leadership by equipping them with the simulation technologies and management science that enables them to create self-reinforcing business advantage.

Fair enough, they might reply, but everyone promises that! And, here is where the "all models are wrong, some are useful" angle comes in.

Selling simulation science involves:

• Connecting with people in the account;
• Convincing them of your value via sales tactics;
• Converting them into paying clients and
• Building up and Retaining their loyalty.

Typically, I find myself talking to three types of people in an account:

• Executives and managers
• Analytical specialists
• Consultants and other influencers

Executives are not really that interested in discussions on the models other than being convinced that the dollars spent developing them will make a substantial return on the investment for the owners.

That is, executives and managers are charged with releasing cash for the owners of the business using any and all appropriate techniques.

Analytical specialists, consultants and other influencers are expected to debate and agree on the appropriate techniques to help executives accomplish that primary goal. That is, they are expected to understand why models are wrong, yet useful to helping executives manage the business.

Many models are rather poor (useless) and some are better (useful).

You can use a variety of techniques to create models. The key is then to quantify the usefulness of the model.

Techniques in the Simulation Science space are particularly good at generating large returns on modest investments (often less than £3 million).

Even more profitable are the System Dynamics' case studies.

Over the past forty years, an amazing body of evidence (a stock) has been built up regarding the success of system dynamics' models to solving complex problems.

My clients alone have over 85 detailed case studies on applying system dynamics to solving complex problems.

By choosing appropriate past projects and discussing them in some detail on how they generated their substantial returns, we usually find it possible to overcome prospects’ consequence issues relating to their investments in simulation technologies. The returns on simulation investments are usually so large that it is a 'no brainer' decision to move forward with our solutions. (These case studies are available upon request.)

Obviously, this is only part of the picture when handling major account sales strategy, but it seems clear to me that this community's techniques usually generate a positive return on the investment.

As John Sterman said when he accepted the 2002 Forrester prize:

"What prevents us from overcoming policy resistance is not a lack of resources, technical knowledge, or a genuine commitment to change. What thwarts us is our lack of a meaningful systems thinking capability. That capability requires, but is much more than, the ability to understand complexity, to understand stocks and flows, feedback, and time delays. It requires, but is much more than, the use of formal models and simulations. It requires an unswerving commitment to the highest standards, the rigorous application of the scientific method, and the inquiry skills we need to expose our hidden assumptions and biases. It requires that we listen with respect and empathy to others. It requires the curiosity to keep asking those 'why' questions. It requires the humility we need to learn and the courage we need to lead, though all our maps are wrong. That is the real purpose of system dynamics: To create the future we truly desire--not just in the here and now, but globally and for the long term."

Thoughts?
Best, Justin Lyon
© Justin Lyon, 2005– Reproduction permitted with reference to Justin Lyon.