Before anyone is ready to trust you, and before any buyer is willing to spend their hard-earned money on you, they need to know that you really understand them. This is Part 2 of the 2-part series on Understanding.
A surgical team would never find themselves in the operating room without gaining, and then sharing, a clear statement of understanding (of some type) that clarifies the patient’s situation, needs, and desired outcomes of a medical procedure. A lack of alignment or a bit of ambiguity could be devastating… even life threatening.
As I’ve mentioned previously, it’s critical to seek a deep understanding of others if you want to be worthy of their trust. If you haven’t read Part 1 of this exploration of understanding, I recommend you do so before you dig into this how-to guide focused on building a Statement of Understanding.
What is a Statement of Understanding?
The Statement of Understanding is a written—and hopefully verbal—articulation of your understanding of the prospective client’s situation, needs, desired results, and implications around those results. It is a true reflection of everything you’ve discussed, heard, and noted. Beyond simple parroting, this statement should display your interest in—and focus on—the client’s unique situation and needs that you’ve gained through conversation and research.
All too often, experts like engineers, architects, consultants, and others gloss over an explicit statement like this, preferring to shift their time and attention to the solution, Approach, or Statement of Work. Unfortunately, these don’t explicitly show the client (or the buyer) that we’ve listened to the details, that we’re focused on the most important things, and that we’re all aligned on where we’re going and how to get there.
As such, this statement should be a standalone element in a proposal or a presentation. It must have sufficient detail to let the reader know this is a bespoke narrative written 100% for them. It doesn’t contain any recommendations or anything about the consultant’s firm or expertise.
Once Again, for Emphasis… It’s All About Them
It is impossible to overstate this.
The Statement of Understanding should be completely about the client. It is not another opportunity to talk about you, your services, and your expertise. It’s not the time to start throwing out ideas and solutions. And it should never get mixed in with your recommendations.
It’s a pure, client-centric reflection of everything you’ve heard and understood about them. You’re not patronizing them. This isn’t useless “mirroring”. This is your opportunity to really show your prospective clients that you listened to them. That you really understand their situation. You see their big challenges and their pressing needs. Most importantly, that you get them.
When should I use a Statement of Understanding?
Anytime you are proposing or recommending your services, you should first lead with a Statement of Understanding. It can be used in formal situations or informal conversations.
In a formal response like a competitive proposal or statement of qualifications, this statement should lead any approach or recommendations. Often, solicitations outline specific information that you much include in the submittal, and they rarely request an understanding. Whether requested or not, an explicit Statement of Understanding that builds the foundation for your recommendations are a welcome inclusion for the reviewer.
If your situation is less formal or maybe not competitive (sole-source), you can still incorporate a Statement of Understanding. The few minutes it takes to talk through your understanding is time well spent in the first steps towards a long-term, trusting relationship.
The four critical elements of a Statement of Understanding
There are a number of ways to write a good understanding. I have found the four elements below to be a simple and logical way to develop a Statement of Understanding. This approach incorporates sufficient context, highlights the need, clarifies the desired outcome, and makes sure everyone understands what is at stake.
The Big Picture
No project, big or small, happens in a vacuum. There is always a larger context… a bigger picture that connects this immediate need to something larger than itself. All too often, I come across consultants who have no idea how the work on their desk ties into the overall organizational goals of their client. And, amazingly, some project managers in large client organizations struggle to connect their work to the big strategic plans, regardless of how small they might be.
These first few sentences clarify, for everyone involved, why this work is an important part of bigger goals. Some of the questions you can address are:
- What is the general situation at the client’s (or prospect’s) organization?
- What is the strategic plan and how does this work support it?
- Are there other parts to this work that have been completed previously? Are there other future elements?
- What other factors are influencing or impacting this situation or need?
The Inflection Point
There is always a moment in time or some event that prompts a need for change. It can be a major shift that happens suddenly or a slight deviation that occurs over time. Whatever it is, the need for change must be big enough to overcome the status quo. And the status quo is a powerful thing.
Whatever prompted the need for change must be clear and unambiguous, and a Statement of Understanding that uncovers and articulates the drivers of change helps everyone come together around the “why” of this need. Some questions that help clarify this are:
- When was this problem or need first recognized?
- What were the contributing factors that drove the need for change?
- Was this need prompted by a single event or something over time?
- Why now? Why wasn’t this address previously, and why can’t it wait?
The Vision of the Future
Once a need for change arises, it’s not immediately clear how one might resolve it. After some thought, we can start to create an image of a future state once the need has been met. All clear on the horizon. Feet in the warm sand. Success!
But getting everyone on the same page can be a challenge. Some questions to help bring success into focus are:
- What is no longer happening in this future state? Or what has ceased to happen?
- How has this change impacted our organization or the people who we serve?
- What business results/organizational goals have we achieved with this change?
The Implications of Success… or Failure
Most people and organizations underestimate what is at stake with a project of any size. We often make assumptions that success will be easy and that failure is not an option. All too often, unfortunately, efforts of all types run into issues because of a simple lack of awareness and focus.
An explicit statement that clarifies the positive implications of success—in financial, social, environmental, physical, emotional, or any other terms—lets everyone understand what exactly is at stake. At the same time, we all need to be completely clear and honest about the problems associated with failure—so everyone can do everything possible to avoid it.
And yes, uncovering real, honest implications can be difficult. It takes a team that is open, honest, and trusting to share what is at stake for everyone involved. But it is possible!
Some questions that help uncover implications are:
- How will you measure the ultimate success of this effort? What will that mean in financial or other terms?
- What will success bring to you and everyone involved in (or touched by) this project?
- What do we need to do to avoid failure? What will indicate that we’re headed for disaster?
Implementing The Statement of Understanding in your Work
Hopefully you now recognize the importance of a clear, standalone Statement of Understanding in your proposals, whether you deliver them in a document or in person. From your first conversation to the last bits of research you do, it’s critical to develop a well structured narrative that reflects back to your prospective client everything you’ve come to understand.
You can even test your understanding throughout your early conversations by checking back with your client, saying “Did I get all of this right? Did I miss anything?”
Space in documents—and minutes in conversations—are precious, so these statements should be brief. Four or so paragraphs that take up half or most of one page are sufficient. You can use bullet points when appropriate. And if you are talking through this understanding, it’s smart to summarize the document that you provide following your conversation.
A well conceived Statement of Understanding unlocks the door to your ideas and your expertise. The prospective client doesn’t need to wonder if your recommended approach was based on their unique situation and needs, or was simply pulled from the last unsuccessful proposal you wrote. If you simply get them, your prospective clients will open themselves up to your ideas and partner with you… paying you the respect and regard you and your team deserve as you help solve their challenging problems.
Wainwright Insight provides fractional sales management and sales consulting to organizations who want to take control of their pipeline and build future sales leaders—but could use a little, part-time expertise. I work with professional services firms, and the experts in those firms, who need to get better at chasing and winning big deals when the stakes are high.
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