Every person experiences Rejection at least once in his lifetime, either during education phase or his career phase. There are a lot of consequences for each rejection, few may be worst in nature creating disaster whereas few may be an eye-opener and resulting in a great success.
Rather than going into philosophy, I would like to express my views about Rejections from a Business perspective. Since I’m in Procurement profession and looking at this scenario from a customer perspective, I thought to express my views about it.
I’m writing this article for my entrepreneur friends who are managing their small business. This article is for those entrepreneurs who suffered a lot because of rejections, few of them shut down their business house.
As in the profession of Procurement, I interact with many of my suppliers and obviously, everyone doesn’t get the business every time and I have to interact with them conveying reasons for not selecting them for the deal.
In our personal and professional life, it is said that we are programmed to pursue our dream. With the same principle, every entrepreneur starts his business with some dreams which are supported by their ambitions and hard work. Like every success boosts your confidence, every failure or rejection gives a setback.
Now it’s up to us how we treat this failure or rejection, whether it is a setback or it’s an eye-opening case.
In business scenario, dealing with rejection is very important aspect from Business Sustainability point of view.
While you as a company bid for any lead, obviously there shall be many competitors in the race and only one company is going to win the deal. So there might be reasons for others not winning the deal, it may not be commercials/pricing every time. There are many other aspects considered while selecting suppliers/partners by any company.
Just to give one example, recently I was involved in one large project deal for my company and there were three partners involved, two were tier one partners and one tier two partner was involved in the project. Evaluation exercise went for almost two months where all three partners put their efforts to win the deal. The technical evaluation had many more aspects like partner approach in executing deal, response time, project completion duration, methodology used, resource quality so and so forth.
The message I want to convey here is that deal won by the L2 partner. It means the partner who was not the lowest in commercial bid but was T1 in technical parameters. (Am assuming that terminologies like L1, L2… and T1, T2…etc are known to everyone).
With this example, I wish to state here that apart from having a lower price, you need to be excellent in technical deliverables to pass thru the deal.
Likewise, every entrepreneur wins a few deals and loses a few. Now the growth of business depends upon the ratio of win over loss of deals.
Though every growing company has certain assessment criteria to increase the ratio of winning deals. But for those who are not able to improve this ratio, it is very important to assess the reasons for failure of deals or rejection by customers.
In my opinion, during every rejection by customer, an entrepreneur should strive to understand the reasons for low rating given by the customer which caused him to lose the deal. As per my experience, many entrepreneurs attempt every lead that comes in but doesn’t put effort to understand the reasons why he didn’t get the deal. If he understands the reasons, it becomes an opportunity to improve it for winning future deals.
In my opinion, entrepreneurs should consider following steps after each rejection of customer or loss of deal.
- Understanding reasons and areas of poor rating by customer with open mind
- RCA – Root cause analysis OR
- Fishbone Diagram/Analysis – Ishikawa Cause and Effect technique to identify possible causes
- CAPA – Corrective and Preventive Action
Though in theory, it looks simple to follow this process, practically to use and get impact of this process, entrepreneur needs lot of dedication, focus, employee involvement and most important – Open Mind to accept the rejection/failure.