Thoughts On Selling

What is the Compelling Event?

2011-12-07T18:44:00.001-05:00

Google “What is a sales opportunity” and you will find some five hundred million pages to view. Conversely, if you Google “What is a compelling sales event”, you will find less than four million results.

With sales teams, the results are similar. Most will have a plethora of sales opportunities; many fewer will be able to identify the compelling event that will cause their sales opportunity to move forward with velocity.

The absence of a compelling event does not rule out the possibility that the prospect will take action. Organizations frequently take action based on a risk/reward analysis. I change the synthetic oil in my cars every 7,500 miles whether or not the engine is making abnormal sounds; indeed I pay a premium for synthetic oil and change it regularly to reduce the likelihood of abnormal sounds and engine damage. For the oil change, my compelling event is the identification of a spare 30 minutes on a Saturday morning. If it’s sunny, the oil change is deferred and the bike gets ridden. In this scenario, if the deferral goes on long enough, I decide that the oil change cannot wait any longer and it gets a higher priority than the bike ride.

On the other hand, the end of a car lease is a compelling event. If the lease is over on February 28, the car must be turned in by February 28. (This begs the question as to whether anyone changes the oil on a leased vehicle).

Similarly in sales, most responses to the question “what is the compelling event” driving this opportunity initiates a conversation about the symptoms or factors that may drive a risk/reward decision. “The system is performing poorly.” “We’re running out of space/power in the data center.” “Profitability is down.” “The CIO thinks our stuff is cool.”

None of these will cause the organization to act. How long can the company continue to run with a poorly performing system, without any spare space/power in the data center, with low profitability? Many function for years in this environment, choosing to invest in other, higher priority activities or to make no investment (all too common over the past couple of years.)

A workable definition of the compelling event is as follows:

A compelling event has an economic owner, a defined date and is a direct response to a business pressure. The action is expected to deliver a significant business result (either improving opportunity/capability or reducing pain). The compelling event defines the reason for the economic owner to act.

The compelling event, or its absence, is a strong leading indicator for the probability of success regarding the opportunity.

The symptoms described above may well be contributing to a risk/reward decision. I coach sales teams to look beyond the symptoms (and the technical owners of those problems) and identify for the economic owner. If that economic owner has chosen to address the issue, he or she will have a project plan with milestones and actions. The technical owners will hold the pieces of that plan but may not be able to identify the underlying plan. Once the sales team connects with the economic owner, a discovery process will determine whether the opportunity is real, the “fit” between seller and buyer, and ultimately the likelihood of success.

It’s time to surgically remove the sales person’s “happy ears” (“they think our stuff is cool…I have a deal!”) and train them to focus on issues of real importance to their customers…issues that have significant business value when addressed.

Happy Selling!

Lee

Why Johnnie Can't Buy

2011-03-16T12:33:00.005-04:00

Corporate IT buyers report that completing a typical enterprise IT purchase takes more than five months, two months more than they would prefer. While they blame their vendors for contributing to just over a quarter of the delay, they acknowledge that their own faulty buying processes contribute to two-thirds of the delay (source: IDC 2011 Buyer Experience Study).

What’s going on here? Why can’t buying teams be more efficient with their enterprise IT purchases?

It’s not their fault…mostly.

Many, perhaps most buying teams are assembled on an ad hoc basis to address a specific business issue. They may have little or no experience in working with one another and limited (if any) experience in evaluating, purchasing and implementing the specific product or application. After all, this is probably a one-time exercise for them. As a result, they lack the structure and processes necessary to identify and prioritize critical business requirements, application and service criteria, implementation challenges and more.

Typically, the members of the buying team with repeat buying experience include those from IT, Finance or Procurement. These participants tend to focus the discussions on either technical or cost details…not where most vendors want to focus (or where the buying team should focus!). Few buying teams include formal facilitators with deep process experience who can extract the critical business requirements and develop consensus among the members of the team.

Selling teams, on the other hand, engage with buying teams every day. They work with multiple organizations and handle the same set of questions, concerns and objections over and over. They see the patterns across these organizations. Based on these repeated experiences, the selling team should know what’s important to the individual buyer and be able to propose a well-thought out evaluation and decision framework.

While the selling team is in a unique position to guide their prospect through the consideration and evaluation process, most don’t. They either don’t believe that it’s their job to do so or out of habit they defer to the buyer’s (flawed) processes.

Top salespeople will identify the void in the buying team’s experience and assist them in identifying and prioritizing critical business requirements and in developing consensus among the members of the team. They do this naturally and without specific attachment to individual outcomes. If the fit isn’t right, they disqualify the prospect and move on to other opportunities. A few large vendor organizations incorporate engagement project managers on their enterprise account teams to help ensure this focus (and the delivery of the appropriate resources at the right time throughout the engagement process).

B and C level sales people, on the other hand, work within the buyer’s flawed processes, searching to match their assets with what appears to be important to the buyer. Since the critical business requirements are a moving target in this environment, the sales person will never really connect. Purchase decisions are made on faulty assumptions and the desired business results may never be reached.

Enterprise buyers place tremendous value on the consultative capability of their vendors. They know that their vendors work with a wide variety of organizations and can bring deep and broad implementation and business expertise to the table. It’s up to sales management to ensure that this expertise is developed and offered as a primary benefit of the relationship. It also requires a shift in focus from “solution selling” to true consultative selling. (See Buyers Don’t Want Solutions for a deeper discussion of why solution selling is bad.)

In adopting and fostering this consultative approach, the vendor will move from simple (and fungible) “vendor” to “trusted advisor” status and enjoy higher sales productivity, share of wallet and customer satisfaction.

Resources: I’d strongly suggest the book entitled Mastering the Complex Sale by Jeff Thull. Jeff has developed a formal process for managing consultative selling opportunities, one that helps to surface the key decision criteria and to gain consensus on the value and weight of those criteria. You can purchase it here on Amazon.

I'd also recommend taking a look at the emerging vendor LeveragePoint. A spin-out of the Monitor Group, LeveragePoint provides an environment that assists sellers in surfacing and validating the handful of key decision criteria and in weighting those criteria to support optimized pricing on a deal-by-deal basis.

Best,

Lee

Marketing Plans and Sales Executes

2011-02-11T16:46:00.001-05:00

Marketing plans and sales executes.

Okay, so it’s not quite that cut-and-dry, but in considering the roles of the two organizations, we find some key distinctions.

Marketing - Step 1

Marketing sets the “tone” in the market before sales engages with individual prospects. Marketing identifies the “best prospects” based on market size, competitive environment, and product or service capabilities. Marketing establishes the overall value proposition – “our products solve this problem”, the positioning, pricing, etc. Marketing creates the sales assets used in developing individual opportunities.

Selling - Step 2

Sales follows through to establish the relevancy of the offering for individual prospects and converts prospects into customers.

I’m simplifying a bit…

In this model, step 1 naturally precedes step 2. You sand before you paint. You scramble the eggs before you cook. You date before you marry. Step 1 is necessary for the success of step 2.

A change in step 2 requires changes in step 1. Cooking paella requires different preparation than that for cooking an omelet. To transform sales, you must create a new set of preparations in step 1 (marketing).

Results are what matter

We don’t actually care about sales transformation; instead we care about the results of sales transformation. In this conversation, we don’t even care much about the short term results of sales, what we’re focusing on is building a more robust, healthy business, a qualitatively better set of results.

Selling is a means to this end -- the creation of profitable, long-lasting relationships between buyers and sellers. These profitable, long-lasting relationships generate the highest shareholder value. And what shareholders really care about is shareholder value (not this quarter’s sales).

Unfortunately, our current set of preparations (in marketing) doesn’t usually lead to that end. If measured using the Six Sigma scale, selling is at best a one sigma activity. Buyers complain that less than a third of their sales people show up “very prepared” for sales calls. Buyers cite a poor relationship with their vendor as a primary reason for switching vendors. More than 50% of all reps failed to make quota last year. (Source IDC 2010)

Vendors are failing miserably to meet the relatively low expectations of their buyers. In talking with senior executives at Global Fortune 500 companies, I repeatedly hear stories of sales people driving to a deal rather than building relationships. One executive at a global financial services firm described a storage rep who, despite being invited to coordinate a brainstorming session, essentially showed up with an order pad and an expectation of booking something that day. The damage to the relationship by his actions can be measured in the millions of dollars of lost revenue.

Most vendors mean well. They want their sales people to do the right thing. They hope that their sales people are doing the right thing. They need their sales people to be doing the right thing. But wanting and hoping and needing don’t constitute a strategy.

To create more productive, profitable relationships between buyers and sellers that actually drive shareholder value for both sides, both parties must commit to change. Both parties must invest in the relationship. If vendors do not make this investment, buyers will treat them as commoditized suppliers rather than value-adding partners.

Where to start?

A good place to start is to evaluate the needs of your best customers. What value do you provide these customers? What other organizations have similar needs? How should your engagement process change to enable more value creation and transfer? What else must change within your organization to ensure consistency?

If you undertake sales transformation with the goal of improving relationships with your customers and actually make the changes necessary to ensure this transformation, you will be rewarded with higher share of wallet, longer, more profitable relationships with your customers, higher revenues and profits, and increased employee satisfaction.

Seems like a no-brainer to me!

Best,

Lee

Sales Transformation Starts in Marketing

2011-01-31T16:05:00.006-05:00

Five years ago, I launched a consulting practice at IDC with the express goal of “fixing how the technology industry sells.” We made a lot of progress over the years, developing a formal sales productivity framework that provided a context for the conversation, identifying specific improvements for selling and related processes and changed team roles. Many of the practice clients have made substantive improvements in their sales productivity.

Today, however, most organizations remain stuck in their old paradigm – “let’s get what we can from our customers now”, or “we’ll get to transformation later, right now we have to keep the lights on.”

And I know why.

For most, what they’ve been doing is “good enough.” It has kept the lights on, engineering fed, sales people paid, investors or shareholders happy. Few technology organizations want to believe that their approach to selling is broken, that it’s damaging to long-term (and sometimes short-term) relationships, that the adversarial relationship that they create with prospects and customers is simply unhealthy for both organizations.

But “good enough” is crap.

It’s "short-term, this quarter" thinking, it serves nobody, and it robs the company of the opportunity to build real profitability and shareholder value into the relationship for everyone.

My ongoing research supports this perspective. Buyers willingly switch suppliers at the drop of a hat because they see no real engagement or commitment on the part of their suppliers. Buyers report that sales people continue to show up unprepared for the conversation with their key prospects. They do this not because they’re lazy or stupid (far from it!), but because it’s accepted by their own company. Sellers simply don't invest in the processes and resources to create the possibility of a powerful, productive, profitable relationship.

Sure, buyers have some culpability here too, but that’s a different conversation, one that led me to create the concept of a “Buyer-Seller API” a few years ago. For now, let’s focus on the sellers. While the buyers may have the upper hand with regard to the availability of information, it is the sellers that have the goods. And buyers need these goods to improve their productivity or competitiveness or customer service.

So let’s consider the possibility of creating powerful, productive, profitable buyer-seller relationships. Sure sounds better than fixing something that’s broken.

What do powerful, productive, profitable buyer-seller relationships look like?

We’ve all experienced great transactions…when I asked this question during my keynote at an executive lunch seminar in the fall, most of the audience indicated that they had recently experienced positive, productive transactions as buyers.

But transactions aren’t relationships…transactions can lead to relationships, or conversely, relationships can lead to transactions. For example, last summer Diane, a senior IBM executive, was clear with me – she had neither budget nor need for my services. What she was looking for was information, a conversation with a similarly minded person that might help her to do her job better.

Most transaction-oriented sales people would simply have moved on; I engaged in the conversation she needed to have and started to build a relationship of trust with her. Several months later I received a call from another senior executive, a referral from Diane that led to the first formal agreement between IBM and my company. And through that transaction, I'm starting to build a relationship with the person Diane referred to me.

How do we create powerful, productive, profitable buyer-seller relationships?

I’ll sign off with this teaser – it begins in marketing. Not in sales, where the dysfunction is so visible, but in marketing, which is tasked to provide both the Voice of the Customer and the overall direction for the company. Nowhere else do the market inputs and outputs meet so concisely; as a result, it’s up to marketing (with the necessary blessing and support of the executive team...and the active participation of sales) to drive sales transformation.

My next post will explore this question…stay tuned.

Best,

Lee

Buyers Don't Want Solutions

2010-10-29T09:14:00.007-04:00

Given the amount of work spent on creating solutions this year, it seems that 2010 will be the “Year of the Solution Sale”.

Except we have two minor problems.

First, technology organizations have been talking about…and building…solutions as a marketing and sales strategy for several decades. In fact, John Patterson, of National Cash Register, may have invented the technique (or at least first published a solution-oriented sales Primer, see right), in the 1880s. So the concept of solution selling is nothing new.

Second, and more importantly, buyers don’t want solutions. They want whatever solves their problem. If a vendor’s particular bundle of products and services (their solution) solves the buyer’s problem, that’s fine. However, most buyers view solutions as “off-the-shelf” bundles of existing products that are convenient or profitable for the vendor to sell, but don’t necessarily solve the buyer’s business problem.

After all, how could a pre-configured bundle solve the unique problems of a given prospective buyer, with his or her unique set of challenges, internal issues, infrastructure, needs, wants, desires, timelines, budget constraints, goals, milestones, targets, partners, constraints and more?

In fact, buyers don’t even use the word “solutions” in their conversations. A few years ago at IDC, we analyzed buyers’ language and the word “solution” never appeared. Buyers just don’t think that way. And as one Fortune 100 CIO told me, when he hears the word solutions, he thinks “McDonalds’ happy meal”…a bundle of burger or chicken nuggets, fries, drink and toy that’s guaranteed to put a smile on every child’s face.

While happy meals may work in fast food, this formulaic approach to addressing buyers’ needs is simply not appropriate for engaging with buyers and addressing their complex problems.

Today, the savvy buyer wants an answer to the following question:

“Given what you know about my organization, with our specific set of challenges and opportunities, what should we do?”

Not what should we buy…but what should we do? The buyer wants assistance in co-creating the response to his specific problems. In a recent HBR article, Venkat Ramaswamy and Francis Gouillart state that over the past decade, dozens of companies, including Cisco, Dell, P&G, Sony, Starbucks & Unilever, “have embraced ‘customer co-creation.’” (“Building the Co-Creative Enterprise”, Harvard Business Review, October 2010). Co-creation as a selling process warrants a separate conversation; stay tuned.

Fortunately, for the knowledgeable sales person, most senior buyers are open to learning…to discovering not only what they don’t know, but what they don’t know that they don’t know. They do know that this new awareness can help them avoid significant business challenges or problems, challenges that would otherwise catch them both unaware and unprepared.

So we’ve arrived at the next level of selling. Some call it consultative selling; others refer to it as provocation-based selling, or selling with a Point of View. The sales person must be well-informed about the customer’s individual and industry problems and be willing to take a stand for the customer, whether or not the result is a sale of that sales person’s offerings.

The Late Apex is the Fastest Line to the Sale

2010-07-09T17:16:00.004-04:00

In auto racing, the fastest line through a corner is usually a “late apex.” Rather than braking, turning early, and then accelerating after the corner, a late apex takes a straight line deeper into the corner, braking, turning and taking another straight line through the corner and out. It’s typically faster because the car is at speed longer down the straight and faster through and out of the turn.

In sales, the late apex is also the preferred line. Most sales people, as soon as they sniff an opportunity, start “turning into” it (the early apex). They give up on the initial line of discovery – learning about the prospect, their needs, pains, challenges – and turn into it – pitching and presenting. This pitching and presenting takes the salesperson off-track and the sale is lost.

Experienced salespeople will continue on the initial line of discovery until they find the right moment to turn in (the late apex). At this point, they know where they are going with the conversation and it may well be a straight line through the corner and on down the track…or in sales terms, they have found a good match between the prospect’s key issue and their ability to address that issue. At this point they are “co-creating” the solution with the prospect in a linear way.

This way of driving (or selling) feels odd at first. It doesn’t follow the natural contour of the road (or sales conversation). It requires intestinal fortitude to drive deeper into the corner and then turn, or to continue to probe on issues without talking about capabilities or features.

With experience, this different approach becomes more natural. You enter the corner later, you spend less time in the turn, and you accelerate out of the turn more quickly. Similarly, you develop a better understanding of the prospect’s challenges and environment and once you move to develop the solution, it’s a straight line to complete the process…often with the prospect asking “how do we get started?”

Music to every sales person’s ears!

Winning in 2010

2010-01-01T10:32:00.002-05:00

While 2009 was a difficult year, 2010 represents tremendous opportunity. Early indicators suggest that the economy is on the mend. While I don't expect budgets and activities to return to 2007 levels, executives have stopped behaving like ostriches and are increasingly considering how to build and improve business operations.We're seeing this in both our own client base and in our daily conversations with hundreds of IT decision makers.

I've called the fourth quarter of 2009 the most important quarter of the decade. Hopefully, you ended the quarter strongly and are well positioned for success in 2010 and beyond. This new quarter will also be critical -- market share is still up for grabs and as you solidify your position within accounts and markets, you will be ensuring future profitability for many years to come.

Weaker competitors are still sitting on the sidelines, wondering what has happened and whether their fortunes will ever change. Agile competitors have already launched new tactics to gain market share in well defined target segments.

To help you move forward strongly, I'll provide some context and the sales productivity framework Tom Barrieau and I developed at IDC. The framework includes the following five major levers of sales productivity:

Talent Management
Sales Management
Sales Methodology
Sales Enablement
Customer Intelligence

Each of these five levers incorporates a number of elements. In the interest of time, we won't go into those today. Additionally, we're going to leave off the discussion of the heart of the framework itself -- the issue of sales productivity.

Sales productivity is a meaty issue. Most B2B organizations have some definition of sales productivity and in our experience most of those definitions lead to one rathole or another. (Hint -- it's not the number of calls a rep makes or the amount of revenue delivered in a given time period).

For an initial discussion of sales productivity measures, please see the IDC best practices report I published in 2008 on sales metrics and KPIs. This report will help you to start thinking about how you can collect the sales metrics and KPIs that allow you to measure true sales productivity and leverage that knowledge into action that improves your productivity.

That's an important big picture discussion, but not one that will help you to improve your performance next month. You need to balance the important and urgent tasks (See the Covey matrix to the right). If you ignore the important tasks, they will eventually become urgent...and how most sales organizations manage sales productivity is becoming urgent.

Today, however, the urgent tasks are becoming even more urgent. The steps to ensure improved revenue performance over the next two quarters boil down to the following:

Sales people must have the right conversations with the right prospects at the right time!

It seems so simple. Yet most larger B2B sales organizations are still working on organizational realignment, tactics to extract more revenue with their existing customers or what to do about a competitive threat. While these are useful discussions, they must not form the basis of your market development strategy.

If you can get past those discussions, here are the steps to take. They map to the three levers listed above in italics:

#1. Target the Right Prospects and Customers at the Right Time (Customer Intelligence)

This is simple. You have useful data in your customer and prospect databases. Ask a couple of your best and brightest business analysts to answer the questions:

Which of our prospects said "no" to us six to nine months ago?
Which of our prospects has contracts coming up for renewal in the next three months?
Which of our competitors is having a tough time in the market?
What is the buying profile of our customers? After they've bought something from us, what is the next most likely purchase, and when does that purchase typically happen?
What triggers signal buying intent?
Which of our prospects is growing fastest?
Which of our clients is growing fastest?

Once you've completed this analysis (and you should be conducting it at least quarterly), you'll have a series of lists of sales targets and a good set of "stories" as to when and why a particular target will buy. Work with field marketing to deliver targeted messages. Work with sales operations to parse out the targets on a controlled, measured basis. Monitor the results carefully -- some of these segments will respond better than others, and you will want to shift your marketing and sales resources to the most productive segments.

#2. Deliver the Right Conversations (Sales Enablement)

As part of this initiative, you will need to rearchitect the sales conversations. What are the key "care-abouts" of a given client or prospect? Why should a given prospect buy now? Why should a client upgrade now? (Hint, it's not because you need the revenue!). Deliver these new sales conversations as scripts for territory reps and channel partners. Deliver them as podcasts for enterprise reps and channel partners. Validate those conversations by asking for feedback. Congratulations, you've now just improved your sales enablement capabilities.

#3. Ensure the Right Behaviors (Sales Management)

You've got a secret weapon in your sales organization. This secret weapon can be used to significantly improve sales performance and results, yet in most organizations this resource is spending most of its time filling out reports to deliver to management. Oops.

This secret weapon is your first line sales manager. When the manager spends most of his or her time coaching reps, rep performance soars. In the short term, lighten up on the managers' reporting responsibilities. In the longer term, rearchitect this role so that it is a coaching role rather than a data management role. For a deep discussion of the first line sales manager role and related best practices, take a look at this recent IDC report.

Effective sales management also ensures the application of the appropriate resources to specific pipeline development activities. While few organizations expect their highly paid enterprise reps to be conducting marketing activities, these same reps may be expected to both cold call new opportunities and to manage existing relationships. Savvy organizations disaggregate the sales function, applying specialized resources to specific tasks. (I'll cover this issue in detail in an upcoming newsletter).

Good luck out there. And please, take these issues on with the sense of urgency that they require.

And let us know how we can help you to be successful in this process.

P.S. Please also visit my personal blog on fundraising for cancer research

Open for Business or Hoping for Business?

2009-12-21T10:25:00.004-05:00

The leading indicators are encouraging – FedEx Corp recently reported higher shipping volumes and raised its earnings forecast. Oracle announced both higher top and bottom line results for its most recent quarter. Corporate IT buyers are once again starting to talk about strategic initiatives rather than cost cutting. Marketing organizations are spending left-over year-end dollars and sales organizations are once again hiring new sales people.

2010 is promising to be a challenging year even as the economy slowly improves. Few analysts are expecting a return to robust growth anytime soon; those organizations that wait for calm waters and steady winds in this market will find themselves left on the beach.

The winners in 2010 will continue to hone their market definition, development and selling processes. Market leaders are:

Defining markets more narrowly
Prioritizing opportunities more systematically
Building deeper intelligence about individual organizations
Targeting marketing and sales assets more precisely
Analyzing the interim and final results more carefully

Measure What You Manage

The net effect of this work is two-fold. First, these organizations are finding higher ROI on their marketing and sales investments. While not all investments provide equal and high returns, the increased inspection of the process and results provides better and faster opportunities to modify and improve. Secondly, the organizations conducting this level of analysis and management are outdistancing their peers. Simply put, the right sales resource delivering the right sales conversation to the right prospect at the right time is vastly more compelling than a rep reading from a script or dragging a prospect through the corporate presentation.

As a buyer, which would you prefer – a sales person who talks about your purchase in the context of your use case or one who assumes that his or her product is right for you just because of your physical proximity?

We’ve all been there – we’ve been in both buying and selling situations in which everybody clicks and the process goes smoothly and quickly to the benefit of both parties. We’ve also suffered through situations in which it’s clear to almost everybody that the conversation is going nowhere.

Some marketing and sales executives have told me that they have chosen not to undertake this work because the underlying data is not available or that the process development and management appears difficult. They’re partially correct – the data is not easily available and the work is hard. This is what separates the leaders from everyone else. The leaders have chosen to take on this work and they are already enjoying the results.

Approximately a dozen technology companies have deeply invested in this work. Another couple of dozen are in some stage of investigation and implementation. These companies will be rewarded with higher top line revenue growth, profitability and customer satisfaction.

What Will be Different?

I’ll leave you with a challenge – what will you do to improve the efficacy of your marketing and sales activities in 2010? Do you still believe that what you did in 2008 and 2009 will work in 2010? What are you willing to do differently in 2010 to improve your results?

The Shiny Object

2009-11-20T20:26:00.005-05:00

So I’m in the Admiral's Club on Friday evening at SFO after a long week at Dreamforce, salesforce.com’s annual user conference. In his opening address, Marc Benioff, CEO of salesforce.com, mentioned that some 19,000 people were attending Dreamforce this year…and the lines for coffee and restrooms fully supported that claim.

Dreamforce is an interesting dichotomy of people, process and technology. The people range from senior sales executives to junior IT managers, marketing people, finance and operations – anyone with an interest in running salesforce.com applications in their organization. The processes covered during the event span sales, marketing, customer support, development and many others. The technology coverage is similarly broad.

From my perspective, Dreamforce does the sales profession a disservice with its laserlike focus on technology to the near-exclusion of consideration of business needs and process improvement. In his opening remarks, Marc rolled out a new set of features soon to be available (maybe) in the salesforce.com environment, features that add “Facebook and Twitter-like” utilities to the SFA environment.

Why? Because they can. Because the company has been in love with consumer-type apps and Facebook in particular over the past few years. Because it’s cool. Because Marc wants to be notified anytime an opportunity is updated.

Salesforce Blather

This new set of features may be launched in the spring (or maybe not, depending on some unidentified factors), called Salesforce Bla ^h^h^hChatter. Just what I want – my people spending more time typing and networking with one another rather than engaging with prospects and customers.

I’m not taking a potshot at the company…I’m a firm believer in the salesforce apps and the value that they provide to sales organizations. I’m also a firm believer in process before technology, and I’m at a near total loss to understand the value to salesforce.com’s primary users (sales people and their managers) of this new functionality.

They’re Not Alone

In the Expo Hall at Dreamforce, I was heartened to see many new exciting applications that advance the science of selling. Many of these applications quantify and present the results of selling and marketing activities, allowing for substantially better understanding of the performance of the organization. Yet in the Expo Hall, these offerings were arranged in a bazaar-type format, with little rhyme or reason to their placement. Attendees wandered the aisles browsing from one booth to the next, listening to the pitches of each, without building any context of how they might work together, or the relative importance of the problems to be solved.

Without context of the overall organization, these offerings seem like so many more shiny objects to be collected in one’s basket and taken home. In too many sales organizations, technology is selected in the absence of underlying process. Many select the apps without having laid the groundwork of good process and as a result, the technology merely automates chaos.

As we approach 2010, the sales organizations that invest in better processes – focusing on sales force specialization and performance, better interaction between marketing and sales, and increasing investments in customer intelligence – will be rewarded with higher growth rates than their peers.

The market has been ruthless over the past year, culling the weak from the market. It will be no different over the next few quarters and beyond, and those most adaptable to change (ref Charles Darwin) will be rewarded with not only survival but increasing success.

It's People-Process-Strategy

In many conversations with fellow sales executives, marketing executives and others involved in the selling and marketing processes, I found a general awareness of and focus on the triumvirate of people-process-strategy (Execution: The Discipline of Getting Things Done, Bossidy). Buy Execution on Amazon

If we work together to solve the problems of sales productivity, we have the opportunity to truly solve our customers' business problems, as opposed to baffling them with irrelevant talk of features, specifications and plumbing.

Selling is Dead

2009-11-13T15:38:00.012-05:00

A good friend of mine, a senior sales executive at Oracle, questions the need for field sales people. And he’s right, the outdated activities carried on by many field reps no longer have a place in this new economic environment.

The selling function has gone bipolar, but not in the sense first conjured by that word. What we’ve seen over the past few years is that the interactions that assist a prospect in completing a transaction have polarized in one of two camps – value or convenience. High touch or high efficiency. Human or automated. Face to face or the web. In person or in pajamas.

When was the last time you went to a bookstore? If you know what book you want, it takes fewer than 50 keystrokes and perhaps 2 minutes of your time to summon the book to your doorstep or inbox. On the other hand, if you want assistance in selecting a new bicycle, you’ll invest a couple of hours at your local bike shop talking with an expert about the relative merits of carbon fiber versus titanium, Campy versus Shimano, DuraAce versus Ultegra or Record versus Chorus.

You’ll still do your homework on the web prior to venturing out to your LBS. You need to show up prepared, to look smart, to avoid being bamboozled by a fast talking sales rep pushing a spiffed product on Saturday afternoon. But once you get there, you will find a rep that you like, someone you’ve decided that you trust (using the elaborate methodology outlined by Malcolm Gladwell in Blink) and you’ll count on her to guide you through the decision making and implementation (fitting) process.

Even smart, well-informed buyers can benefit from experienced, value-adding salespeople. As a cyclist with 35 years and countless thousands of miles under my belt, I once took a vintage cyclocross frame to a local shop (Hot Tubes) to be repainted. When I asked Toby, the shop owner and builder, about painting alternatives, he pointed out that the frame was two sizes too large for me. I had mistakenly assumed that cyclocross frames fit just like road bike frames. The frame went back up on ebay and Toby built me a beautiful custom cyclocross frame, fitting me perfectly and finished in my favorite shade of blue.

As a consumer, I knew what I wanted and I thought I knew what I needed. Toby, as an expert sales person, didn’t go the easy route and accept the frame for painting. Instead, he educated me about proper fit and helped me to conduct a cost benefit analysis of refinishing my (poorly fitting) current frame versus engaging him to build a (properly fitted) new frame.

Buyers selecting sophisticated technology products or services fare no better. Many technology initiatives fail not because of the inadequacies of the product, but of the lack of preparedness of the organization. Buyers think they know what they’re getting into, but simply put, they don’t.

And many sales reps will book the order without helping the organization to understand the processes required to ensure success of the implementation. Most sales people manage to get away with this once with a particular organization; a few manage to do it twice. However, it’s the reputation of the vendor rather than the sales person that is tarnished in the process. And today few vendors can afford to book individual sales at the expense of their reputation and standing in the user community.

So What’s a Savvy Vendor to Do?

You must act now. With the economic pressures easing a bit and budgets starting to loosen somewhat, the imperative to change is lessening. In my research on organizational dynamics, I’ve found that it takes a “big bang event” to ensure the success of a strategic cultural change initiative. (It also takes role and behavior clarity, but that’s a separate conversation.)

The Sales Productivity Framework I developed at IDC incorporates five key productivity levers – people, management, methodology, sales enablement and customer intelligence. How would you assess the capabilities of your sales organization for each of those levers? Are you sending your sales people out unprepared or ill-informed? Are you forcing high value sales engagements on customers looking for simple acquisition efficiency?

Andy Grove, former CEO of Intel, said that only the paranoid survive. In my experience it’s the world class sales organizations who focus most on improvement. In contrast, most of those stuck in the middle of the pack continue to hope that things will get better. We all know that hope is not a strategy, and we further know that if you’re in the middle of the pack, and not moving up, sooner or later (and probably sooner) you’ll find yourself spit out the back.

Don’t Let this Perfectly Good Crisis Go to Waste

When we come out the other end of this recession, we are not going back to what we wistfully have been referring to as “normal.” Sketchy is the new normal. Uncertain is the new normal. Tight budgets is the new normal. Discerning prospects is the new normal. CFO or CEOs signing off on small projects is the new normal.

Your customers will have less patience for game playing, for unprepared sales resources, for timewasters, for uncertain ROI, for projects that don’t deliver on their explicit promises. If your message is not crisp, if your sales teams are not professional and polished and consultative, “below quota” will be the new normal. And nobody wants to live there.

The Chief Sales Officer

2009-10-09T17:34:00.005-04:00

Peter Drucker said that "the purpose of marketing is to create a customer."

But just as the title of Chief Marketing Officer grew from the ascendency of the marketing role in the 1990s, sales is now in its own ascendancy. As marketing becomes more complicated with customers informing themselves via the Internet and social media, selling as a function (finally) has risen to a high level of importance in most B2B organizations.

Today, the strategic purpose of selling is to create clarity for a customer, helping them to answer the question "what should we do?"

As a result, the selling function has risen to the other "C-level" functions. The title is only now catching up.

It's still an unusual title, almost non-existent a few years ago. Do a search on Google or any of the career sites and "VP Sales" dramatically outnumbers "CSO." I've run across this title only a few times:

AMD and Intel have CSOs
Don Grantham, recent addition to HP, uses the title
Mary Delaney was CSO at CareerBuilder before she became president of Personify, a CareerBuilder subsidiary
Paula Shannon has been CSO at Lionbridge for some time
Scott Rudy, former VP of Sales at salesforce.com, is now CSO at Savo Group

I expect the title to become more common (and embarrassingly, I should have posted this particular blog entry before I assumed the title!). Sales is now a critical function of any B2B organization and the sales organization needs a seat at the executive table, with operations and finance and marketing and people (what had been called HR).

With sales at the executive table, customers have a direct pipeline into strategic decision making. Sure, marketing organizations are chartered with collecting and delivering the "voice of the customer" but there's nothing like the voice of someone who has voted with his or her budget and has substantive input.

As a newly minted Chief Sales Officer, I'm learning the responsibilities inherent in delivering this input from the field. As a simple cost center, sales was less accountable for the results of their demands. With this greater visibility comes the responsibility of making the best decisions for the company and the customers.

I expect that my fellow CSOs are finding similar responsibilities. At the table with the rest of the executive team we represent the view from the outside. At the same time we have visibility into other company activities in a way sales never had before.

Personally, I welcome that responsibility. Together we are stronger!

This Fourth Quarter

2009-10-01T16:36:00.000-04:00

This fourth quarter is the most important of the decade.

Two weeks ago Ben Bernanke stated that the recession is probably over. Housing starts are up. The leaves are turning (at least in New England) and business people are starting to believe that the light at the end of the tunnel may be something other than an oncoming train.

We are all breathing a collective sigh of relief. It has been a difficult year...and for many, with the official unemployment rate scraping 10%, challenges remain.

Yet a sense of optimism is evident. And just as I predicted early in the year, budgets are now starting to open up. Mostly marketing and sales budgets, by the way. There hasn't been a general unleashing of capital investments or discretionary spending. That will come later, in mid-2010 and beyond. For now, the increased spending is coming from organizations that want to position themselves for success in 2010.

And that's why this quarter is the most important of the decade. The results of this quarter will drive discretionary investment decisions in 2010. If you want to have a good 2010, you must deliver the goods this quarter. Success in this quarter will help to ensure access to funding for the next quarter and the quarters beyond that. Mediocre or poor results this quarter will cause a significant rethink of sales and marketing strategy.

Many C-level executives and corporate boards are thinking: "Okay, you've had a year to figure out the current environment and to make the necessary mid-course corrections to ensure a reasonable result by the end of the year." Prove them wrong and your successor will be working on a very different action plan, one that involves wholesale shedding of divisions or organizations, cuts that go far deeper than the 5-20% layoffs we've seen already.

There hasn't been a single more important three month stretch this decade than perhaps the fourth quarter of 2001 for the travel industry. At the time I managed a business that built and sold technology services to road warriers. Road warriers were grounded on September 11th and my business went poof. The entire travel business was reshaped in that quarter and the airline industry is very different today as a result.

Your opportunity is to prove, in the next three months, that your business is both viable and thriving. With a focus on "co-creating" value with customers, you may have a chance. Customers today don't want to be sold to...they demand consultative sales people who work with them to boost profitability, reduce costs, increase shareholder value, make a difference in their world.

The critical success factors are simple and straightforward:

Focus exclusively on the prospects and customers who value and need your specific value proposition, your differentiator.
Narrow this focus to those who are committed to short term improvements in their business.
Ensure that your sales people fully understand the business processes and challenges of the individual prospect, not the group in general.
Commit to value-adding rather than transactional behaviors. You may think that hard selling will work in this market. It hasn't for years and it certainly won't now. You might "win" a few deals but you're destroying the relationships that bring long term profitability.

Focus on making a difference in your customer's world.

Lee