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Russian Scientists & the B2B Sales Process

February 27, 2009

What Can a Tough Russian Scientist Teach Us About B2B Sales Process?

In his groundbreaking book “The Goal”, Dr. Eliyahu M. Goldratt tells the fictional story of Alex Roga who manages a metalworking plant that is at risk of being shut down because of its inability to efficiently drive products through the manufacturing process. Goldratt uses this story line to explain his Theory of Constraints (TOC) thinking process and how Alex could use it to dramatically improve the efficient flow of products.

For those who have not yet been exposed to Dr. Goldratt, he is a highly intelligent individual, with a heavy Russian accent and a direct communication style. He seems to bristle when asked how competing systems management theory – Total Quality Management (TQM) compares to TOC; “it’s a nice theory but unfortunately it does not work”.

 TOC postulates that ‘every organization has at least one binding constraint which limits the organization’s performance relative to its goal’. TQM’s major am is to reduce variation from every process so that greater consistency of effort is obtained. So we have one doctrine that basically says ‘realize optimal efficiency by relieving the single major constraint in the system’ the other doctrine says ‘maximize each component of the system for maximum efficiency’. Which makes more sense? In The Goal, Goldratt Advises Alex that any resources leveraged against a non constraint will be wasted since the system will just bottleneck once the product gets to machine that is the primary bottleneck.

B2B sales is very much like a plant that ‘manufactures’ closed revenue opportunities. Leads and new opportunities flow into the sales ‘system’, they hit different sales stages and produce a certain amount of closed deals. Each sales stage in the system can be analyzed for velocity, volume and conversion. And a primary constraint can be determined. Of course getting that information in an efficient manner can be painful, but that is a topic for another article.

Have you analyzed where your sales funnel constraint is? There are many companies whose sales strategy is to hire the best sales reps they can afford. Great field reps tend to shine at the bottom end of the funnel, but are not s great at prospecting. If the constraint is at top of the sales funnel then the company may be allocating resources inefficiently; it may be better to invest in the prospecting or marketing team until there are enough leads to make that expensive hire.

Randall Isaac is the CEO of Bluetide Management. Bluetide builds software products that support B2B sales people in their efforts to achieve quota. Sales Clarity is an AppExchange certified Sales Forecasting Software that helps B2B sales managers track, inspect and guide sales activity in real time. More information at www.bluetidemanagement.com

Written by admin · Filed Under Features, Salesforce.com News 

Sales 2.0: Why the Recession is Making it Imperative To Change the Way We Sell

February 13, 2009

More and more continues to be written about the shift to Sales 2.0 in this difficult economic climate. With the Sales 2.0 Conference coming up in San Francisco on March 4th, I thought I’d share this great article I received today from Anneke Seley, coauthor of the new book: Sales 2.0: Improve Business Results using Innovative Sales Practices and Technology. I’ve published it here:

Sales 2.0: Why the Recession is Making it Imperative To Change the Way We Sell

Though the slow economy is having a negative impact on sales in many companies, an improved approach to sales called “Sales 2.0” can help companies avoid disastrous business results in the coming quarters.   Sales 2.0, defined as “the use of innovative sales practices, focused on creating value for both buyer and seller, and enabled by Web 2.0 and next-generation technology” reduces cost, increases productivity and improves sales effectiveness.

Sales 2.0 produces measurable business results. One software division that is part of a $1 billion company increased its sales 12% while decreasing headcount 17% and increasing its sales team’s productivity 15% after reinventing its sales organization using Sales 2.0 practices. After embracing a Sales 2.0 philosophy, a medical device company increased its qualified lead volume by 20% and generated over $7million in incremental revenue, while increasing its average sales price by 25%.

Sales 2.0 requires a change in mindset and then a rethinking of strategy, an assessment of sales people’s skills and the implementation of a measurable sales process, enabled by technology. A Sales 2.0 mindset includes recognizing that sales is not just an art – it can be a measurable, predictable “scientific” business function when the right processes are implemented that focus on what our customers need to achieve by buying our products.

Data from CSO Insights’ Sales Performance Optimization Report (source: csoinsights.com) show that surveyed Chief Sales Officers in companies that practice Sales 2.0 are the best-performing companies in terms of percentage of company revenue achieved, percentage of reps making their sales quotas, and percentage of deals won.  Sales 2.0 practices include implementing consistent, dynamic sales processes, establishing long-term, trusted relationships with customers, and using the Internet in the sales process. Venture-backed companies with Sales 2.0 business plans are also having an easier time securing investments from venture capitalists. Gordon Ritter, founder and general partner at Emergence Capital, says, “Those companies employing Sales 2.0 practices give me the confidence I need to provide initial funding as well as continued investment.”

Furthermore, in many business-to-business companies, the cost of selling traditionally, using expensive field sales forces that travel, is no longer justified when many customers prefer to research and even buy products using the Web and phone.  One highly-effective Sales 2.0 strategy is partnering face-to-face salespeople with inside sales professionals that serve customers in the early parts of a sales cycle and build a pipeline of qualified leads.  This frees up the field sales professionals to work with only the largest, most profitable customers that are most likely to buy.  In this way, Sales 2.0 decreases costs and accelerates sales cycles, which improves revenue and profit.

IDC’s 2009 Sales Barometer and Top 10 Predictions report (source: idc.com) highlights the need for organizations to adopt Sales 2.0 best practices quickly. It states,  “savvy organizations will use the economic downturn as justification to replace direct sales “laggards” with well enabled inside sales. Customer (and employee) satisfaction and sales productivity will rise accordingly.”

Sales 2.0 – a rethinking of sales strategy, people and process, and enabled by technology – is a proven approach to improving business results especially in slow economic times.

Anneke Seley is the CEO and founder of Phone Works, a consultancy that helps large and small businesses build and restructure sales teams to achieve predictable, measurable, and sustainable sales growth. As the 12th employee at Oracle, she designed the company’s revolutionary inside sales operation. Her book, Sales 2.0: Improve Business Results Using Innovative Sales Practices and Technology, is available at online retailers including amazon.com, bn.com, booksamillion.com, and borders.com. For more information, visit www.sales20book.com.

If you’re interested in the Sales 2.0 topic, you may want to join one (or all) of these these LinkedIn Groups:

Written by admin · Filed Under Features 

Salesforce.com’s New Look: new site in beta

February 10, 2009

I just noticed a link at the top of Salesforce.com’s site that takes you to a new beta site they are testing.

Looks pretty cool and is obviously focused on the concept of Cloud Computing.

What do you think about the new look?

Written by admin · Filed Under Salesforce.com News 

Salesforce.com Spring 2009 Released: Major New Features

February 10, 2009

Salesforce.com released the 28th generation of its on-demand CRM today: Spring 2009 edition is here!

In the past year alone, Salesforce.com has added 200+ features to its already robust platform. Spring 2009 does not disappoint with an additional 50 features being rolled out.

Among these features are two major upgrades involving service and sales. In the area of service, Salesforce looks to reduce costs for its customers by leveraging expertise taking place in the cloud. In the realm of sales, SFDC is taking things to the next level with a new level of collaboration between sales, marketing and customers.

The Service Cloud

Built on Force.com, the service cloud brings together Google, Amazon, Facebook and others to capture every conversation and leverage every community expert in the cloud in order to empower companies to deliver expertise to their clients regardless of location or device.

The Sales Cloud

  • Opportunity Genius: OG connects various sales representatives so that companies can tap the collective wisdom of their sales teams to close more deals by giving reps access to best practices and the best knowledge to close each deal.
  • Content Assembly: CA gives SFDC users the ability to use existing marketing collateral to construct new presentations within Salesforce.com. A simple drag and drop interface allows users to easily find the slides of information they need from one presentation and then drag and drop this information into a new presentation.
  • Content Delivery: CD will streamline the delivery of video, audio, text and graphics by allowing users to send customers external links and view content outside of Salesforce.com. No more need to send large bulky files through email.
  • Content Tracking: by delivering content via hyperlink, marketing users will be able to track who downloads their content so they can follow up immediately.

More on Spring 2009 to follow. Please post your thoughts on the Spring 2009 release to comments.

Written by admin · Filed Under Salesforce.com News