Tag Archives: Vertical

How Do You Focus on Doing Things Right? Seven Recommendations

Situation: A CEO is concerned that her company is not as efficient or effective as it could be. Of the key activities where the company is focused, few have any obvious connection to the customer or the customers’ needs. How do you focus on doing things right?

Advice from the CEOs:

  • Create a set of cost graphs to parallel the company’s revenue graphs. If these are put side by side, does it indicate that the company is doing some things that add relatively low value and profit? What happens if resources are shifted away from less valuable activity?
  • Concentrate resources on doing one profitable thing well. Become best in class at this one thing. This may both increase the value of the firm and help to focus future development.
  • Bring in a senior level marketing research person or marketing manager with marketing research experience to determine what the customer wants, how should the company compete, and what current customers may be willing to pay for its software.
  • Strengthen the primary product – it represents 90% of sales. This is where the company has the best understanding of both its customers and the market. Look at what it takes to become enterprise wide with the company’s largest customers. Expand vertical capabilities and build $1 million accounts to $5 million a year.
  • The company already has a diverse group of clients, many of whom are huge.
    • How deep is the company in each of these clients? It may be easier and less expensive from a sales standpoint to go deeper into these clients than to bring on new clients.
    • Look for ways to make current $1 million clients $5 million clients by selling what the company currently sell to more of their divisions and locations.
    • The key to executing this strategy is to listen closely to what clients’ needs are and adjust or customize the offering to better meet their needs.
  • Focus on solutions and reduce the cost of solution implementation. Consider becoming more vertical in one key implementation and become the best at that.
  • Create a relevant framework for the company’s strategy. For what purpose is it necessary to do the right thing? If the purpose is to exit in 2 to 3 years, this yields a very different strategy than if the objective to dominate the company’s market in a 5 to10 year period.

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How Do You Expand the Sales Funnel? Six Solutions

Situation: A company has strong technology and good top customers. However, the CEO is concerned that the company is too dependent on a few large clients. She wants to increase business among mid-tier clients. How do you expand the sales funnel?

Advice from the CEOs:

  •  Get very crisp in identifying who your core customer is and focus on them near term. Look at what you offer that your competition can’t match and create appealing offers for new clients.
  • Simplify and clearly define your market position.
    • Here’s an example: First to market with the best, smallest, fastest solution.
    • This clearly defines who you are. Focus the company on delivering this.
  •  In each high potential market find one company to whom you can offer a significant advantage.
    • Their current market position might be number 2, 3 or 4. Offer them a solution to gain an advantage on #1 and shift the playing field. This is a win-win for both you and them.
  • Horizontal business expansion could be the best near-term strategy. This lets each vertical market solve their own problems of technology direction, logistics, etc. Seek customers who have the resources to manage this in their respective market places.
  • Tailor contract minimums and pricing according to customer order commitments. Be willing to sacrifice price and some margin for committed purchases that match your timelines and resources.
    • Buyers often overstate their anticipated needs because they don’t want to be caught with short supply.
    • You can meet and promise lower prices for higher volumes because they rarely order them. However, combine this commitment with higher prices for the lower volumes that they are more likely to order.
  • Look across markets and focus on promising targets.
    • Use a call center to queue up prospecting telephone calls.
    • Have sales people conduct scripted qualification calls with prospects by telephone.
    • Only send sales people out to talk to qualified prospects. This saves travel expense and increases the productivity of in-person sales calls.

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