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Known in Silicon Valley as "a salesman's salesman, " Thomas Siebel has created Siebel Systems to produce customer-specific brochures and presentations--and even products--on demand. This book demonstrate how Siebel Systems centers on enlarging the role of the sales rep to sales project coordinator. Illustrations.
| 1 | Finding the Path | 1 |
| 2 | Total Sales Quality | 27 |
| 3 | Making the Sale | 48 |
| 4 | The Hurried Pace of Change | 81 |
| 5 | Virtual Reality | 113 |
| 6 | Finding the Facts | 141 |
| 7 | Total Quality Marketing | 162 |
| 8 | Virtual Selling | 184 |
| 9 | Rethinking Sales Management | 203 |
| 10 | The Informed Sales Force | 221 |
| Notes | 238 | |
| Index | 243 |
Chapter 1 Finding the Path In the last few years, companies have taken such warnings to heart. They have been told they must flatten their organizations, re-engineer their processes, form "virtual" alliances with suppliers, distributors, and customers, and most of all, take advantage of the productivity leaps made possible by the rapid advances in information and communications technologies. The most successful firms in the United States, Japan, and Europe have done just that; one by one, their key operations -- their "basic building blocks" -- have been transformed. Over the last two decades, accounting and finance, manufacturing, research and development, human resources, and customer support have all been transformed by technology. They have been automated, streamlined, been made more flexible, responsive, and adaptive. Ultimately, their success has resulted in reduced costs, increased productivity, and greater customer satisfaction. We are now at the last great unautomated corporate frontier: sales. The image is a resonant one. Sales is the untamed frontier of the business world: unpredictable, passionate, theatrical, full of eccentric characters, and dangerous to the newcomer. Like the frontier, the destiny of sales is to be explored, settled, and tamed by people using the right tools and technology. But many also will perish on this frontier, because they are unprepared, unnecessarily exposed to the elements, and annihilated by quick-footed and aggressive foes. The real question is: how many bones will lie bleaching in the desert or buried on Boot Hill before the new era finally arrives? And will you be one of those victims? Sales force automation is rapidly rising to the forefront of the business computing market. According to Personal Selling Power magazine, "...whether managers realize it or not, automation has become an operating cost in the sales budget" -- a cost which may rise as high as $12,000 per salesperson. Right now, as this book goes to press, as many as 500 companies are rushing into the market offering information technology tools for sales. Their target is the 9 million salespeople in the United States, and perhaps four times more in the rest of the industrialized world. The sales automation software market was estimated to be $700 million in 1995 and is expected to reach as high as $10 billion by the turn of the century. That makes it the fastest growing market segment in the computer software business. Already, at least 2.5 million corporate salespeople have been affected in some way by automation or information sales tools. In 1993, when Computerworld surveyed the information services departments of its largest corporate readers, 58 percent said that the user department receiving most of their attention was sales and marketing -- compared to just 3 percent that named either research and development or corporate administration. Two of the largest system-integration companies in the world, Andersen Consulting and KPMG Peat Marwick, have now set up focused business practices deployed solely to deliver comprehensive turnkey Sales Force Automation solutions on a global basis to their large corporate customers. According to Phillip Tamminga, director of the Sales Effectiveness practice at Andersen Consulting, "We formed this practice in direct response to market forces. Quite simply, our largest customers are increasingly demanding a focused, highly specialized response to their growing sales automation requirements. We have rarely seen such dramatic growth in market demand." Clearly we are seeing an extraordinary market shift. In the 1970s and early 1980s companies dabbled occasionally in this area to save on costs. By the end of the 1980s companies began to deploy early sales automation tools in an attempt to increase profitability and obtain strategic competitive advantage. Now the race to automate sales has taken on a life of its own. Companies are today treating the investment of millions of dollars on sales automation tools as if it is a matter of survival. Why the rush to re-engineer sales? * Complexity: It is getting more and more difficult to make a sale. One reason is that products themselves are getting more complicated. Thanks to programmability, manufacturing and design automation, and new delivery systems, many items that used to come in a couple of models and with a handful of options may now be available in thousands of permutations. In some cutting-edge industries, such as gate array circuits, even the traditional notion of "model" has disappeared, to be replaced by a set of capabilities. Clearly the days when a salesperson could carry the company catalog around in his or her head are rapidly disappearing. Instead, salespeople will now be designing products on the spot. But that can only happen if they are both trained to do that and supplied with constantly updated information on those capabilities. That's only half of the challenge. Customers too are changing. With products becoming so complex, it is often the customers themselves who best know what they want.., and more and more have a greater understanding of their supplier's offerings than their supplier's own sales force. Faced with such an "information affluent" customer, a salesperson must have the relevant information at hand just to keep from impeding the sales process, much less drive it. Better yet, that salesperson needs the tools to enlist the customer in the product design and order process. These two forces, product indeterminacy and customer sophistication, combine to create a radically new sales environment, one that is alien to traditional sales. As The Conference Board recently wrote: Needless to say, there are few sales departments today capable of such a balancing act. * Re-engineering: One of the most obvious characteristics of the new corporation is the increasingly flat organizational structure. Many of the layers of middle management, whose historical role was to condense raw information flowing upward to top management and to elaborate on instructions flowing downward to line employees, have been stripped away. Replacing this hierarchy of managers are information networks, which automatically download new information to salespeople or present summaries to them the next time they log on to the automated information system. In practice such reorganization also means greatly expanded spans of control and increased responsibilities placed upon those managers who remain. Sales, as one of the most traditionally-organized corporate operations, is a target ripe for restructuring. But therein lies a dilemma: every minute spent by a salesperson on administrative tasks once performed by others (word processing, filing, reporting) slices directly into the company's sales. Hence, the hurry to develop tools to simplify and speed up those ancillary tasks. * Global Competition: In this age of increased international competition from nations with high levels of automation or low levels of employee pay, our need to cut costs is paramount. Agile corporations are lean corporations, with greater resources being shifted to product development (to remain ahead of the competition), manufacturing (to meet rapidly shifting demand), and customer service (to keep customers for the multiple generations it will now take to show a profit on product development). Inevitably, that means fewer resources for the other operations in the company. Internal pressures are at work as well: when resources are limited, and every department is tightening its belt, executive attention is focused on sales to become more efficient. Cost-cutting techniques using high technology are not only well-proven but also easily transferable from other operations. Not surprisingly, then, most early-generation sales automation tools have emphasized cost reduction. * Productivity: Though rarely mentioned, productivity will provide the most important impetus for re-engineering sales. In fact, so overwhelming is the leverage that results from increasing the productivity of sales that most companies will embrace sales automation for this reason alone.., or risk annihilation by their competitors. The reason for this is straightforward: sales is unique among corporate activities in that its productivity increases show up not only in terms of reduced costs but, more importantly, in increased revenues. The economic impact of increasing revenues, even while merely holding sales costs constant, is extraordinary. For example, take a corporation with sales of $100 million per year and operating costs of $85 million, leaving a pretax profit of $15 million. If, through sales automation technology, it can increase its productivity by a modest 15 percent, its revenue is then increased to $115 million. While the expenses associated with sales typically decrease through automation as well, this example will assume that they are just held constant, or offset by an associated increase in cost of goods sold. Even then, with $115 million in revenue and $85 million in expenses, the pretax profit soars to 26 percent or $30 million, a 100 percent increase in profitability. There have been few times in the history of information technology where the mathematics of using it have been so compelling. The economic returns are immediate. They tend to be greater than those expected from any other information technology investment that the company has ever considered. Think about it. When we automated finance, we were initially hoping for a 10 percent cost savings. When we first automated manufacturing, we were hoping for relatively small increases in production yields. When we implemented automation tools for general administrative office work, we were hoping to shave administrative personnel costs. The economic returns of these investments were calculated over three- to seven-year time periods just to reach the break-even point. In most cases, the improvements in profitability were almost imperceptible. Never before in the history of information technology have the economics of the decision process been quite so clear as in sales. Moreover, this payback is immediate. The impact on the bottom line is easily measurable. The focus is not on cutting costs but on increasing productivity -- directly affecting top line revenue production. And a 10 percent productivity leap is conservative, say some observers of sales automation. According to Moriarty and Swartz in the Harvard Business Review: As part of their research, Moriarty and Swartz looked at two companies that had invested in sales automation. One, a $7 billion electronics manufacturer, was a likely candidate to be receptive to the potential of high technology. But the other, an $8 billion custom printing company, was skeptical that technology could be harnessed to increase sales. Yet, Moriarty and Swartz found that both firms saw a first-year return on their sales automation investment of more than 100 percent. That was in 1989, before the advent of affordable and powerful laptop computers, before electronic data interchange (EDI), distributed and replicated data bases, multimedia, wireless computing, video teleconferencing and practical client/server software architectures to drive mission-critical applications. These developments represent nothing less than a quantum leap in technologies that are immediately applicable to sales force automation and that will be harnessed to build solutions which create an equally dramatic impact on sales productivity. All of this suggests that increased revenue resulting from greater sales productivity -- and thus increased profit -- offers corporations their greatest leverage not only for remaining competitive, but to dominate their markets through explosive growth. And yet... Despite the power of the economic model, recent surveys have found that Sales Force Automation (SFA), as the technology is now called, can only be characterized as a failure within many of the firms which have attempted to implement it. A 1990 survey by The Conference Board found that half of all companies with operational sales automation systems reported "serious" shortcomings with their systems, and nearly half, if they could start over again, would choose a different vendor. In other words, most sales force automation tools don't work. Many, in fact, make the situation worse. The tantalizing prospect of spectacular productivity leaps remains just that for many companies. Why? Because they get the model backwards. And worse, the sales automation industry has made a business out of reinforcing this error. Organizations have historically oversimplified the process of selling, viewing it as based primarily on the ability of the sales representative to create and maintain strong personal relationships with prospects and customers. In practice, salespeople are typically given little more than leads and product literature and are expected to generate revenue. However, in reality selling is a complex and information-intensive process, often requiring the salesperson to act as an expert consultant and problem solver. Most of the Sales Force Automation software that has been written and installed to date reflects this oversimplification of the sales process and uses automation as a means of cost reduction: word processors, spreadsheets, e-mail, contract managers, PIMs, and account and territory managers. The problem with such systems has been their focus on control of the sales force and analysis of sales-related information rather than on improving the effectiveness of the selling process. While some of these products have helped individual salespeople to increase their efficiency, they have done little or nothing to increase their ability to generate more revenue or shorten their sales cycle. Consequently, they have been received by salespeople with very little enthusiasm and have disappointed those in sales and executive managers who were expecting productivity miracles. Only when a corporation's managers approach Sales Force Automation in an entirely different way, examining all the steps in the sales cycle and the key barriers to achieving sales, will they properly implement technology in sales, selecting and applying it only when it supports reengineered sales processes. This transformed demand will in turn force the creation of a new generation of Sales Force Automation applications designed to increase the effectiveness of the sales representative by providing opportunity management systems, marketing encyclopedias, product configurators, and "team selling" across multiple distribution channels. These systems will support the expanded role of the salesperson as sales project coordinator, linking all departments of the corporation and their information systems to satisfy the needs of the customer. Using opportunity management systems, sales professionals will organize and track all information around the opportunity to convert a lead into a sale. Marketing encyclopedia systems will facilitate on-line access to all the product information, competitive information, sales literature, and sales tools, allowing a salesperson to create on-demand, customer-specific brochures and presentations. Product configurators will give the sales representative the ability to assemble uniquely tailored products and services to meet the specific requirements of each customer. Sophisticated computer networks, data-base replication and synchronization, and collaborative groupware capabilities in sales force automation will allow enterprise-wide team selling. Intelligent messaging will link the sales representative with the rest of the organization, expediting approvals on discounts and proposals, confirming a visit from the president, and formalizing commitments from accounting and manufacturing. With EDI technology, commitment requests will flow beyond the sales representative's own company, transmitting literature requests directly to fulfillment houses and confirming order and credit status directly to the customer. The information flow will be upward from the supporting company to the piloting sales professionals, empowering them to excel at their tasks. All of this is very exciting. Unfortunately, we appear to be heading in the opposite direction. As a result, even as these aforementioned technologies appear, they are put to the service of the wrong masters -- and thus become meaningless, even destructive. What is missing is a sense of perspective, an overall philosophy of sales that supports the salesperson, that resists the natural centripetal force of the home office, and that has an explicit, measurable goal beyond merely increasing sales contacts. That's why companies flirt with disaster if they merely attempt to bolt onto their existing sales organizations the latest and hottest SFA tool. Rather, they must begin by asking themselves the most basic question of all: What does it mean to be a salesperson? Those that do so honestly will find that they quickly come to place far less significance on automating the sales process and far more on informing the sales representative. In particular, these companies find that to keep their sales force fully informed, they must: * Equip salespeople with all of their leads, prospects, and contacts; All of these actions share a common trait: they place effectiveness above efficiency. By using technology to serve the salesperson, organizations can dramatically increase the acceptance of technology by salespeople. Using technology to assist sales representatives in real selling -- versus merely recording data -- will dramatically affect their success and ultimately increase revenues, and that means larger commissions and a better career path within the organization. Early adopters of this technology who become informed sales representatives will soar ahead of their unautomated peers, enjoying more satisfied customers and consistently becoming top revenue producers. By comparison, sales representatives who do not attain expertise in using sophisticated technology in the selling process will become increasingly less and less marketable, and ultimately unemployable. Call this new vision Virtual Selling to distinguish its flexible, sales process-oriented philosophy from the limited scope of today's administrative automation systems. Virtual Selling is the result of the application of the state of the art in management principles, information technology, and communications technology to the selling process. In the past three decades we have seen dramatic changes in management philosophies. The advances in the practical application of computer and communication technologies over this same period are simply mind-boggling. We offer you the road map for applying these advances to the sales process. Applying Virtual Selling to the sales process we can achieve exceptionally high levels of sales effectiveness-because we now have exceptionally well-informed sales personnel. Informed salespeople can now fully appreciate their customers' needs. They can enjoy complete and accurate knowledge about their company's products and services -- as well as those of their competitors. Now they can configure properly priced, yet highly customized, solutions to meet their customers' needs. They can become a sales force that learns, gaining an ever-richer understanding of its customers over time -- thus providing constantly improving service and cementing ever-greater customer loyalty. We call this revolutionary body of sales personnel an Informed Sales Force. What will a typical Informed Sales Force look like? For now, begin with a definition: The implications of an Informed Sales Force are enormous, a revolution of the profession that will take decades to complete. But what is obvious right now is that the daily life of the salesperson of the future, the "informed" salesperson, will look very little like that life today. Some have suggested that these informed salespeople will more closely resemble modern product managers. But that is too timid. More accurately, they will resemble independent entrepreneurs directing their own businesses -- developing longterm customer relationships, generating proposals, managing the configuration and creation of products and providing customer service and support...all the while linked by an electronic umbilical that is continuously sending massive quantities of information to and from a distant corporate headquarters. But as powerful as an Informed Sales Force using Virtual Selling techniques would be, it is still incomplete without the combination of an operating philosophy and an empirical, measurable goal. This is the crucial step, because establishing such a goal acts as a regulator on innovation, assuring that as the Virtual Selling program grows and evolves it also stays on track, and that the Informed Sales Force doesn't exist only for its own sake, but for the ongoing success of the company. This philosophy, derived from what has been learned over the last decade in manufacturing, is called Total Sales Quality™. It means precisely what it says: perfection in sales. Great leads, great pitches, irresistible closes and inevitable sales. An Informed Sales Force using Virtual Selling to reach Total Sales Quality. It is an exhilarating vision. And it is possible. The time to start is now. This book was written to explain that vision and how we get there. It is written not only for corporate management, but also for the millions of sales professionals -- because, after all, if this vision is at all accurate they too will be chief executives of their own sales enterprises. From this day on, every salesperson should be the founder of his or her own sales start-up. Total Sales Quality, like most revolutions, will begin from the bottom. The best way to understand the Total Sales Quality/ Informed Sales Force model is to see it in action. Not every company has swallowed the lure offered by SFA. Some have taken a different path. Though none have yet created a fully Informed Sales Force, some of the world's best companies are on their way. One of these is Hewlett-Packard Co. of Palo Alto, California, one of the nation's oldest and most respected high technology firms. The company's story offers a vision of what can be accomplished through an intelligent, not knee-jerk, application of technology to sales. Hewlett-Packard, founded in 1939 in a now-legendary garage, is a worldwide electronics giant, with annual sales of $20 billion and 80,000 employees in 110 countries. At the heart of HP's success is a much-imitated business philosophy it calls "The HP Way," built upon the twin foundations of technical excellence and superior customer support. Nowhere has this been more effectively done than in field sales. HP salespeople were expected to be as technically knowledgeable as electronics engineers (which many of them were), but also sufficiently empathetic and responsive to customers' needs to keep them loyal for generations. As numerous surveys over the years proved, HP's sales force did just that. But by the late 1980s and the company's fiftieth anniversary, cracks were beginning to show in the HP Way. The company had grown so large, with so many employees scattered around the world, that some questioned if Hewlett-Packard could still be a "family." Field salespeople found themselves dealing with an increasingly monolithic home office that every year seemed less responsive. The company found itself for the first time losing sales in key businesses -- computers, test and measurement instruments, and medical devices -- to smaller and faster-moving competitors. Said Dick Love, vice president of manufacturing for HP's Computer Systems organization, "The pace of change is so rapid that the ability to change has now become a competitive advantage." A restructuring of the entire corporation was in order. Fortunately HE unlike many other large U.S. technology firms, identified the need for change early. Even the founders, William Hewlett and David Packard, returned to the daily operation of the company to assist with the reorganization. Company operating divisions were restructured, new customer service systems were put into place, supplier lists were pruned and the relationships redefined for greater efficiency. As Forbes magazine would later write, HP "did what had to be done." One of the biggest targets for re-engineering was sales. Not only had the historically warm relations between field sales and the home office become increasingly strained, but the salespeople were finding themselves increasingly buried under mountains of unmanageable information. Like many high-technology companies, HP had raced to bring more and more new products to market, until by the mid-1980s the rate of new product introductions approached one per work day. With dozens of possible permutations for each model, Hewlett-Packard salespeople found themselves representing a catalog with 6,000 different products. Not surprisingly, product managers were complaining that their specific lines weren't getting enough attention from the field, while salespeople struggled to pick potential best-sellers out of the overall noise. Something clearly had to be done if sales performance was going to keep up with the changes going on in the rest of HP. Being a company that sold others on the power of computers and communications gave Hewlett-Packard a head start. And, according to Dick Knudtsen, sales force productivity manager for the company's U.S. field operations, "We knew that our window of opportunity was narrowing." Accordingly, HP set out to rethink the entire sales operation of the company, searching for ways to use technology to improve performance. The first area identified, in 1988, was speeding up the qualification of leads. HP instituted its Qualified Lead Tracking System (QUILTS). As Moriarty and Swartz describe it: That was just the start. As a leader in client/server computer networks, Hewlett-Packard set about putting such networks to work inside the company. Where before, HP's customer response program had typically been handled by systems engineers on a rotating basis -- resulting in varied-quality support -- the company now set up a sophisticated computer-based Response Center with a permanent staff armed with database tools for tracking products and orders, searching for the solutions to common problems based upon keywords, sending software modifications to customers, and submitting modification requests to various engineering divisions. This not only enhanced the sales force's image with its customers, but removed from it what had been an added burden of acting as the customer's advocate to the company. More remarkable, HP also set out to use technology to help the salesperson before the sale. It organized a Professional Services Organization to provide potential customers with technical consulting, project management, training, and product transition planning. By 1993, HP had also created Electronic Centers of Expertise, regional demonstration centers which prospective customers could tour and where they could see simulated corporate environments with HP-based solutions at work. The biggest challenge of all was that of keeping the sales force informed of what the company was doing. The first step was to abandon fifty years of geographic deployment and reorganize the force by industry focus. Recalls Wim Roelandts, senior vice president and general manager of HP's Computer Systems Organization: Sales training itself was revised to take advantage of technology. Before, HP had conducted nearly all of its new product training by bringing the entire 1,000-person sales force to a handful of classrooms -- a process that consumed an average of three work weeks per salesperson per year, and cost $5 million for each two-day seminar. Now HP turned instead to video instruction and conferencing. Using the Hewlett-Packard Interactive Network (HPIN) developed by Tom Wilkins, the company's media technologies manager, salespeople could stay in the field and work while they learned. Yet instruction was not compromised because the salespeople could interact in real time with the instructors by voice transmissions or their networked HP 100 LX pocket computers. With HPIN, Hewlett-Packard salespeople can now be brought up to date on the latest products without leaving the sales office and with minimal reduction of the time they can spend selling -- and at $80,000 per seminar with HPIN, Hewlett-Packard has seen a 98 percent reduction in training costs. Wilkins is now looking at ways to make the learning process even more flexible for the individual salesperson. "The network will move more toward an on-demand, just-in-time system as we add video servers so that programs can be stored and retrieved at each user's convenience," he says. The emphasis has now shifted to the individual salesperson. From the beginning of HP's restructuring of sales, the goal had always been to free the salesperson to sell. According to Jim Kucharczyk, HP's national manager of sales programs for computer products, the company's efforts quickly focused upon where company salespeople were wasting productive selling time. It turned out to be the sales office itself. "When we looked at why they went to the office," he told Performance magazine, "we were surprised to learn that the biggest reason was to process the volumes of paper we were providing to equip them to sell the products. When our monthly newsletter hit eight-anda-half pounds, we realized we had created the world's most highly paid filing clerks. By 1992, Knudtsen, Kucharczyk and others were leading the drive to keep the salesperson out in the field: the "virtual sales office," as it was called, supported by laptop computers, fax-modems, and pagers. Salespeople were now offered the choice of an office at home, an HP office without administrative support, or a rented efficiency office. But that mobilization of the sales force presented a host of new challenges, most notably in terms of motivation and the maintenance of team spirit. To that end, Knudtsen implemented programs to regularly and automatically share company news and information with all of the sales force. More importantly, he set about redefining the role of sales management to include maintaining morale and employee cohesiveness through regular communications and gatherings. Says Knudtsen, "We don't want salespeople spending time in the office, but they get a lot from sharing ideas with other sales reps in social situations. So we ask the managers to make these opportunities available." Thanks to all of these changes at HP the very role of sales had begun to change. By the end of 1993, Roelandts would describe the company's sales force not as a revenuegenerating operation, but as "a consultative partner." Something profound had happened. Now representatives from the sales force were being invited to contribute to product development and were asked to provide input to company direct marketing programs. Telephone salespeople now found themselves not only preceded by direct mail campaigns, but briefed by a massive database on each customer's purchasing history even before they made the call. The leads that resulted were now classified by the customer's likelihood of upgrading and instantly sent to the proper salesperson. As Hewlett-Packard approached its sixtieth anniversary, it had found new life. By rethinking its organization, and in particular, by applying technology to its sales operation, Hewlett-Packard had not only regained control over impending information overload, but increased its revenues and profits, and reduced its operating costs. While the other giants of the U.S. electronics industry found themselves in desperate straits by the early 1990s, HP restored itself to leadership. From the trajectory of companies like HP we can trace forward to see a model for sales far different from anything proposed by Sales Force Automation -- a model that is much more adaptive, organic, and most of all, not in command but commanded by the very human process of human beings selling to other human beings. What these companies are creating is an Informed Sales Force, and whether they have elaborated it or not, their goal is Total Sales Quality. The rest of this book will be devoted to elaborating upon that model, showing why the Informed Sales Force is inevitable, how it works, and the best ways to evolve toward this model. Chapter 2 presents a vision of Total Sales Quality, and shows its antecedents in total quality programs in other parts of the corporation. Chapter 3 sets the stage by looking at how sales are currently made, how those models and techniques date back a century or more, and why they are unlikely to survive. Chapter 4 explains how the dynamo of technological innovation is forcing change; in particular, how developments in multimedia, telecommunications and the mobile office are forcing radical changes in both sales and marketing. Chapter 5 shows how these old models are fading in the face of an explosion of hardware and software tools uniquely suited to sales. Chapter 6 looks at how technology also will transform marketing, forcing the use of new tools, revamping the professions of marketing communications and, most importantly, reversing the old hierarchy of marketing "over" sales. Chapters 7 and 9 then take an in-depth look at each of the areas where technology is having its most profound effect upon sales, including accessing information, reaching the customer, making the pitch, and configuring the right product. Chapter 8 shows the Virtual Selling model at work, in clear contrast to traditional selling. Chapter 10 presents a vision of life in an Informed Sales Force and suggests realistic, practical pathways for companies, large and small, to get there. Total Sales Quality is the future of sales. Its intrinsic advantages make it inevitable. The real question is: which companies will recognize that fact and get there first? Which sales forces will see the need and force their companies to share their new philosophy? And which corporations will fail -- through ignorance, inertia, or arrogance-to recognize the revolution erupting around them...and suddenly find themselves on the brink of extinction? Copyright © 1996 by Thomas M. Siebel
In slower times, achieving results was simpler. For leading organizations, outperforming competitors demanded little more than business as usual. Not so any more because intense competition is rendering historic success formulas obsolete. To continue achieving results in the future, organizations will need to compete in new ways, with new skills to satisfy ever-changing customer demands.
Andersen Consulting
Outlook 1994The salesperson is increasingly the "point person" who presents to the customer the combined efforts of separate company function: product development and design; advertising, merchandising and promotion; R&D and manufacturing, etc. In some instances, this is done by building customer relationships, acting as a consultant, and even co-producing the product with the customer...Contact is continuous, not only at the time of the sale, but before that, in design assistance and cooperation, and later, through service and follow-through.
In cases we have reviewed, sales increases arising from advanced marketing and sales information technology have ranged from 10 percent to more than 30 percent, and investment returns have often exceeded 100 percent. These returns may sound like the proverbial free lunch, but they are real.
The electronics concern installed a sales support system for more than 500 salespeople. Sales rose 33 percent, sales force productivity rose 31 percent and sales force attrition dropped 40 percent. The reduced attrition alone produced savings in recruiting and training costs that paid for the company's $2.5 million investment in less than 12 months. At the custom printer, an $80,000 investment in a minicomputer and tele-marketing software returned a 25 percent increase in sales and attained payback in less than 6 months.
* Provide the facility to track, record, and communicate all of the history of an opportunity or an account;
* Support team selling and workgroup collaboration;
* Facilitate work flow and routing for approvals;
* Provide access to all relevant information on products, prices, competitors, and decision issues;
* Incorporate support for unique selling methodologies and processes that support sales cycle tracking and analysis;
* Provide salespeople with the ability to create custom presentations and on-demand, customized sales literature;
* Enable the salesperson to find the best combination of products and services based on a customer's unique profile;
* Empower that salesperson to make his or her own decisions, develop custom contracts and proposals and, acting as the customer's advocate, organize ad hoc interdepartmental company teams to serve as Virtual Selling™ organizations;
* Offer on-line sales training on sales process and new products and services;
* Automate the administrative tasks of recording, tracking, and reporting salespeople's appointments, activities, correspondence, literature fulfillment, expenses, and forecasts;
* Create closed-loop marketing and sales systems that assure complete traceability from marketing spending on lead generation through sales closure, product shipment, and customer support. An Informed Sales Force uses technology to maximize the individual salesperson's selling time, provide complete access to all relevant corporate and market information to make the sale, and position that salesperson to independently make critical decisions that best serve both the immediate and long-term needs of the customer.
[QUILTS] electronically transmits inquiries to a telemarketing center, which qualifies and ranks them and electronically returns them to HP headquarters. The company has trimmed the turnaround time for leads from as much as 14 weeks to as little as 48 hours. Hot leads are handled even faster; they are telephoned to the field sales force from the telemarketing center.
The tendency was to focus on a particular functional area which crossed industries, as an example R&D, or to develop an industry focus based on interest or opportunity. With the change to an industry alignment, we've minimized geographic obstacles by creating a sales business unit which focuses on customers in the electronics industry. This has enabled our salespeople to become far more knowledgeable with regard to the business issues electronics companies are facing and the application of information technology across the entire enterprise. Of course, we've taken advantage of our own experience as an electronics manufacturer in providing the sales force with the training and business insights required to add value to the customer.
Overview