Cost of Inaction

Posted February 7, 2022 in
Sales Sales
Good afternoon!

I am working on a Cost of Inaction Calculator for higher education. Have any of you developed a similar tool for your companies/verticals? Specifically, my company works with colleges and universities to develop enrollment solutions. The purpose of this calculator is to help institutions understand that "doing nothing" also has a cost. 

I have a certain formula I'm using focusing on Net Tuition Revenue. Choosing to do nothing results in a (potential) continued annual loss of tuition revenue. While our industries may be different, I'm sure there are aspects of a COI Calculator that could overlap. 

Hit me up if you have some thoughts on this tool, or have a similar calculator in your company's arsenal. Thanks!
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Connor DeLaney
This is an interesting one Drew Griffin it makes me wonder if JUST making a cost of inaction calculator is the way to go here. 

I don't want to make things overly complicated, however, it seems like the cost of inaction is just one option here, but an eye-opening one as well! Can I ask what other options would be possible for those who would use this calculator? Thinking if there are ways to get the calculator to be a guided experience based on some early criteria?
Drew Griffin
Thanks, Connor! Currently, we use inaction (doing nothing) as one of three options in the process. This tool would only be used to calculate opportunity loss if they fail to act. We do have a separate pricing worksheet as well as an ROI Calculator that we use at different points in the sales process. This COI Calculator would be closer to the decision phase, rather than the initial discovery phases. 

My main concern is that the calculator makes sense to the user. I want to be sure the formula(s) I'm using to calculate opportunity loss is meaningful. I want the user to see that the pain of staying the same is greater than the pain of change. 
Tom DiScipio
Hey Drew Griffin - glad you bring this up! It opens up a couple questions/thoughts for me as well...

First, do you typically discuss the cost of inaction during your sales calls with prospects? How does that go over with them? Does it consistently move them to action? This could be a good indication of how much time and effort should go into building it.

Second, I ask the above questions because I think it's important to consider where and how something like this would be used. In my mind, the prospect needs to know the exact problem that they have BEFORE they can understand how inaction affects them. And as I'm sure you've seen... not all prospects know what problem or need they have until they talk with a sales rep or advisor like you that can help them figure it out 🙂.

Therefore, I could see this tool being less of a lead generator and more of a middle to bottom of the funnel tool that can help prospects to make the decision to work with you. Perhaps that was your intended purpose already!

Finally, if the prospect will have direct access to this tool on your website, I'd say it's important to make sure the calculator doesn't feel "Gimmicky." The last thing we want is prospect using it and saying, "Yeah right... there's no way this could be true. It clearly doesn't relate in any way to MY business." I know I've had that experience with some ROI calculators out there... They need to see how their specific inputs can produce a realistic and believable output.

Hope this helps!
Drew Griffin
Tom - thanks for the reply! I appreciate your thoughts. 

To answer your questions:

1) Currently, we list inaction (doing nothing) as an one of three options as a solution to their challenges. Honestly, most prospective clients understand that doing nothing isn't really an option for them. However, when push comes to shove, many institutions look for internal fixes rather than spending money on external solutions.

2) Your second point is right on. In fact, we don't use this as a lead generator, but more of a tool closer to the decision phase. I think as the primary decision maker sees the cost, he/she may get jumpy about spending money. This COI Calculator would be a tool to help them realize they need to make a change or else continue losing tuition revenue.

3) Great point! I definitely don't want any tool to feel like a gimmick. We are an "educated peer" guiding the institution through problem definition and solution opportunities. We say a few times that "maybe your right-fit solution doesn't include working with us". 

Again, thanks for the feedback. These are all very good points to think about.
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Tom DiScipio
Of course  Drew Griffin ! I wish I had more to share, but it sounds like you're doing a lot of the right things already 😀!

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