Winning in 2010

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 we 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.


Thanks,

Lee

Open for Business or Hoping for Business?

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?

Thanks,

Lee