Situation: A CEO is reviewing options for introducing a new offering. The target customers are small companies or projects within larger companies. The offering includes both an initial product and follow-on services. Education or training will be a component of the offering. What is the best way to roll out a business opportunity?
Advice from the CEOs:
It is best to position the offering as a straightforward proposition at launch and develop proof of concept. This will provide experience and an income stream to fund more complex offerings based on the initial model.
It will also provide insight on how to sell the product and service in different markets – manufacturing, service, and software.
Leverage this experience to pursue more complex models.
Build a portfolio of case studies before pitching to paying companies.
Use companies with whom relationships already exist as the proving base. These will become references for new clients.
Develop data to show actual cost savings from the use of the product and services.
Establish a relationship with an existing company for which the offering is complimentary and cross-offer products and services on an ad hoc basis.
Trial the product and service with one of their clients in return for a royalty or share of the profit.
Ask that company to make the introduction.
Target start-ups – offer an initial package for a low price. Offer the product to start-ups for free and get them hooked as long-term customers.
What would be needed to roll the offering through growth equity firms or venture capitalists?
This will require some proof that the offering increases the ROI to growth equity and VC portfolio companies and funds.
Note that the portfolio companies of growth equity firms are larger and farther up the growth curve
In current economy the key message to prospects may be that the offering will help them to “right size” their company.
Take a closer look at the offering and determine whether it is configured appropriately for the current environment.
Situation: A company currently has inside and outside sales teams, and coordinates efforts with SalesForce.com software. Their strategic initiatives are to double inbound leads, create a triage approach to new leads and to lower the cost of sales. How do you optimize your sales organization?
Advice from the CEOs:
When outside sales claims that they have limited band width, it is necessary to find how they are spending their time.
If they are not spending most of their time developing and closing sales, adjust the system so that they are concentrating their efforts in these two areas.
Decide what the sales teams are selling – set up the organization so that it complements the sales goals and objectives. Below are alternatives used by others.
One company has evolved “product managers” who are like sales engineers but more experienced. They are highly paid and highly skilled. They are business oriented, with good communication skills, well rounded, and have successfully closed sales.
In contrast, the role of this company’s “salespeople” is to follow up. Lower level salespeople are tasked with generating leads for the product managers
Another CEO observed that what the company has done up until now all has worked well. The question now is how to mature their system?
This company’s solution has been to use outsourced Inside Sales Support (ISS) based abroad to find prospects.
ISS personnel are teamed with and managed by the company’s salespeople. Salespeople develop their own system. The ratio is 1/1, but outside personnel are ½ time for each salesperson.
This allows the company to reduce services quickly if they become overwhelmed.
A third company uses a 3-tier system:
Inside sales for lead evaluation.
Outside sales – get hot leads from inside sales, develop, close.
Consider this alternative: instead of a shotgun approach, target three accounts – Elephants. One company did this with an intense 6-month focus. The President and CEO drive these sales. The result: they have closed one, one is pending, and a third is likely to close.
Another CEO observed that the essential issue appears to be an efficiency problem.
Too much of the outside sales time adds limited value to marketing or the company.
Redirect their efforts to hunting.
Once an account is closed, sales is out of the picture. The customer transitions to the customer service organization for additional sales and service.
Situation: A CEO and her staff are struggling with a difficult employee. This individual fails to send invoices on a timely basis, doesn’t provide required reports to management, and doesn’t return vendor calls. The CEO has spoken to the employee, who acknowledges the issues but then rapidly defaults to old habits. How do you manage a difficult employee?
Advice from the CEOs:
Ask for specific weekly/biweekly AP/AR reports, and be very clear as to everything that this should cover as well as the required deadlines. Make it clear that these deadlines are mandatory and that there will be disciplinary consequences for failure either to meet the deadlines or to create the report as specified. Address issues with timely mailing of invoices and timely return of vendor calls the same way. Make all three standard operating procedure.
This is not an at-will employee so assure that there is very good and complete documentation over a period of time to demonstrate that the employee is not meeting required job responsibilities.
Tell the employee that he has 90 days to demonstrate that he can consistently meet required responsibilities, and that there will be a retain or termination decision at the end of this period.
Update policies that are not being following so that they are clear.
Check with a human resources expert for advice on what needs to be done. Regulations are shifting, so this will assure that the company is following regulatory requirements.
If the final decision is to retain this employee, adjust responsibilities to mitigate potential future damage.
Given the current challenges, why is this employee’s behavior being tolerated? What message is this sending to other employees?
Situation: A company recently terminated their lowest performing sales representative. Prior to surrendering the company computer, the employee sent a goodbye email blast to the company and customer email lists. This action was a breach of company confidentiality policy. How do you respond to a breach in company policy?
Advice from the CEOs:
Have the human resources manager send out a company-wide message specifying how this misconduct violated company policy and the potential impact on the company. In the same message, re-emphasize company confidentiality policy and the importance of complying with policy. Follow-up with conversations between managers and employees about the importance of company confidentiality.
Consider having all employees sign a new company confidentiality agreement every 6 months. This should be accompanied by explanations of company policy and conversations to reinforce the importance of complying with policy.
As a follow-up to this situation, be proactive by informing affected clients that this individual has left the company and let clients know who their new sales representative is.
Be aware in your internal communications that this action may have been an honest mistake, not intended to harm the company. If this is the case and your internal response is too strong, this may have a negative impact on other employees.
If the individual goes to work for a competitor, send the new employer a copy of the termination agreement signed by the employee and put them on notice that you will prosecute any violations of prior confidentiality agreements.
Interview with Mari Anne Vanella, CEO, The Vanella Group
Situation: High tech companies need a more effective, higher level approach to prospect accounts. This means capturing sales intelligence more meaningfully, and aligning marketing approaches with customer needs based on prospects’ experience. Traditional transactional lead generation methods must be replaced by a deeper methodology that enables salespeople to speak to the personality of the business buyer. If all of this is true, how do you revamp your lead generation process?
Advice from Mari Anne Vanella:
Executives are so busy that their schedules are overloaded. If you want to reach them, you must engage them at a meaningful, more situationally fluent level.
Executives aren’t disinterested in new vendors and opportunities to gain efficiency or save money; they’re just hard to reach. Therefore, it is critical to develop sufficient knowledge prior to initial contact so that you can quickly engage the prospect, and equally quickly re-engage them on follow-up calls as they progress through your sales pipeline.
Companies must mature beyond volume-based marketing and sales. The traditional model calls for up to three or so telemarketing center contact attempts to a large number of leads.
Current research indicates that 80% of leads are matured into prospects after 5 or more contact attempts. More effective approaches call for 7 to 10+ contact attempts to reach busy executives and managers. This requires greater skill and persistence than the traditional approach.
Re-engineer the process through which you contact leads and follow-up on prospects. Most deals fall out of the pipeline through mismanagement.
The focus of sales and marketing transformation should be on new metrics to boost success rates, as well as communication skills and pipeline management.
It is critical to understand the individual buyer’s purchase process. Sales close at varying rates. This requires listening closely to the prospect’s timeline and the next steps in his or her consideration process. If you agree on a follow-up date, honor it. Attend to the smallest details.
A lost deal calls for a deeper de-brief than a simple note of “sale lost” or “lack of prospect interest.” Marketing needs to understand why deals don’t happen to optimize processes.
The implication of these observations is broad. Most sales and marketing teams are held strictly to results, expressed as numbers that can be taken to management and the Board. This serves a function, but if it dominates sales and marketing processes it may undermine results. Understanding the realities facing prospects calls for a more technical marketing organization and an empathetic customer approach based on an intense understanding of the prospect and their needs.
Interview with Sanjay Sathe, President & CEO, RiseSmart.com
Situation: RiseSmart’s top opportunities are to increase visibility and gain market share. What are the most important strategic components of an effective marketing program?
The best marketing plans don’t start with your company, product or service, They start with a focus on your customers, and the benefits you can deliver to them.
That means your first step should be to identify who your customers are.
This can be challenging in B2B businesses. For example, with RiseSmart’s outplacement solution, Transition Concierge, we have several possible customers: the HR department at the company seeking outplacement services; the CFO at these companies; the HR department at companies seeking good candidates; and the individuals who are going through outplacement and seeking new positions.
Each of these audiences has different objectives, priorities and approaches. To succeed, we need to connect to each of them where they are.
After you have identified your target customers, the next step is to develop messaging and message delivery systems that capture and maintain their attention.
Your messaging must express a differentiation that is easy to grasp – something that clearly sets you apart from your competition. In technology marketing, Apple’s 1984 Super Bowl commercial, with its man-versus-machine contrast, is one of the most famous examples of this.
Your campaign must consistently touch your potential customer base. Research suggests that this requires a minimum of 4-5 touches to effectively gain customer attention and communicate your message.
Accompanying the messaging and the increased visibility that you seek, you must have an effective way to respond promptly and directly to customer interest or inquiries. Rapid and responsive follow-up are critical to success.
Situation: The CEO was just promoted from COO. During the transition, the CEO is responsible both for past and new duties. There is an extensive list of Company priorities. How should the CEO prioritize this list for action?
Advice from the CEOs:
Focus on Executive Committee roles first – the roles of your leadership team.
Select your leadership team carefully – the team that will implement your agenda. They will help you make key choices and implement changes and programs. It is essential that this team present a united front as you roll out any changes.
As CEO, you are now accountable for the success of the company.
Put issues on the table.
Gather input and advice from your team.
Make your decision on how to move forward.
Delegate responsibility and accountability.
Rally the team around your decision.
Follow-up to assure that things are getting done.
Be focused. If you only had the resources to do three things, which would these be? What will bring the greatest short and long-term value to the company?
Avoid micromanaging assigned responsibilities.
Bring in a consultant to assist you in implementing organizational changes that are necessary for the company.
Defining new roles and responsibilities.
Correcting behavior of team members that does not benefit the team.
As soon as possible, promote, or hire someone to take on your old roles. You will have your hands full as CEO.