Growing Revenues in a Tough Economy

Your partner community is your extended salesforce. Why do so many companies treat them as an after thought? Especially in today’s economy?

Now is the time for companies to focus on their channel execution  more than ever! With less direct sales people on staff, and no new hiring on the horizon, targeted recruitement, enablement & go to market planning with your partners will result in expanded revenues in new accounts  & in new markets. And is not attainable by a direct sales model alone.

Companies that rebuild or optimize their partner programs with a focus on mutual accountability & driving joint revenues is the key.   Too often we find that partner programs only amount to listings on corporate websites or as powerpoint fodder.

Ask your VP of Sales how the partner program is doing. Either he will be honest & say it is a waste of time, or he will say it is doing great. If he states the latter, ask him to show you where on his sales forecast the deals that are partner driven or from a partner forecast. Chances are very few.

That is a sad statement given that the partner sales force of  System Integrators, ISV’s and OEMs far outnumber his own sales force. It should be that partner sales forecasts make up a far greater percentage of a company forecast.  In today’s economy, that could make the difference between survival or closing the doors.

The order taking days are over folks. Time for a wake up call in how we all sell & your partner community is just sitting there waiting for you to execute a fresh new sales approach with them.

A partner program that delivers is about focusing on what leads to breakout performance for you in the channel & in the markets you sell into. It’s all about selling smart utilizing all sales channels. It’s all about generating revenues!

Sales Management Style – What Works Best?

In the classic movie Glengarry Glen Ross, Alec Baldwin plays the role of a tough sales manager from “Downtown” who is sent out by corporate to a local sales office to motivate a sales team falling behind quota.  He hurls insults & vulgarities at the sales team, and challenges them to close business or they will be fired permanently. The question is: Does this style of management really work, or is a more collaborative approach better served?

We tested both approaches with sales reps at several clients & found that early on, the intimidation factor actually did increase “paper activity” in the forecasts. However at the end of six months, over half the team treated with  the tough approach had left the companies with no additional revenue contribution.

On the other hand, the sales teams that we worked with in a more collaborative approach, using the techniques from our game planning service, rebuilt their pipelines & eventually started closing significantly more business.

The lesson is, by being collaborative with the sales team & mutually uncovering reasons why deals are not closing, you can increase team productivity &  save in the huge costs of having to recruit & retrain new sales reps.

This latter approach may not work in every situation, but is worth trying if members of the sales team have had a history of success with prior companies. Make them allies instead of enemies. Save your tough approach & “walk in the woods” approach for individual one on one meetings with reps, thus avoiding costly mass defections.

Palladin Consulting can help. Contact us to find out how.

http://www.palladinenterprises.com/Sales_Marketing_Channels.html to see the Glengarry Glen Ross Video.

Outbound PR

Outbound PR is a companies chance to get out their messages in their way.  Perception is reality.  If you don’t believe this, look at the ongoing presidential elections and look at what we are barraged with, think about how it changes as candidates drop out and the competition changes.  This should also be true as a business changes.  When you first start out you want to be the next “hot” company.  As you grow and get established you want to be viewed thought leader and when you are established you want to claim market leadership.  Outbound PR however is more than messaging and spin.  You want your programs to have a purpose.  Outbound PR is not just getting your messages to the press, but to all of your stake holders.  Outbound PR is about getting your messages to your customers, prospects, analysts, partner, investors as well as the press.

Programs work best when you have a target.  Create these programs around events, a product launch, announcement of funding, a major industry event or a market changing event.  These will grab their attention and associate your message with the event.  

My opinion is that outbound PR should closely align with your go to market model.  Outbound PR programs are very effective at launching partner programs.  PR that positions your product a part of a bigger solution and mentions potential partners by name will help you get noticed and highlight the scalability of your product.  At the same time you can introduce your partnering ideas to industry analysts to get introductions to the appropriate people at your target partner companies. 

Outbound PR is a big part of how you approach the markets you serve.  Getting your messages to the right people will not only make it easier to sell, but also project you as an authority in your space.  Measure these programs on improvement in serving your market not on mentions and placements.  Outbound PR is just a tool to drive opportunity, make sure it has purpose.

Competition: Friend or Foe

If you don’t have competition, you don’t have a market.   Often we run into entrepreneurs who tell us they have no competition.  Comments like “we do it so different than others that we don’t consider them competition.”  This may be possible, you are the only company that does it this way or your product is the first to market with something.  Without competition, you have no one to compare your offerings to. 

Know your competition as well as you know yourself.  Get to know their personality.  How do they sell?  Are they reactive?  Are they the market leader?  Do they consider you a competitor?  Who else is a competitor?  When you can answer these questions then you will be prepared to compete.

Look for uniqueness and how that translates to value.  Make this so important that customers would not consider buying something else.  Your product will always have its USP’s, sometimes these fit into a particular market sector.  Use these when choosing a market and make them a “have to have” for your prospect. 

It sounds simple, but a sales strategy should be geared to win all of the time on your chosen market, most of the time in a second market and some of the time in a third market can be very effective.  If your competition comes after you in your primary market, they will expend resources going after deals with low probability of winning.  At times like these you can learn a tremendous amount about your competition because they are working extra hard to try and get this business.

Your competition will also be important in determining the value of your company.  Value is based on performance and market size.  Multiple competitors in a growing market create growth and excitement.  When one exits it starts to establish value. 

Treat your competition with respect; they help you build your market.  If they market well, you will get in more deals, learn when you can win and you will grow.  Your competition will help you determine what markets you will serve.  Know them well, learn to compete but remember they are essential to success.  

Growing Your Business

You are building a company, things are going well, and you need continued growth, continued excitement in your market and prove your contemporary business model. Your biggest worry is how to scale your operation. Direct sales are risky and expensive, geographic expansion requires localization and product investment and partnerships take time to nurture and pay off.

With all of these challenges how do we build an effective sales operation to take us to the next level? This is not an uncommon problem. All technology companies face it some point during their evolution. Whether it is picking the right sales reps, serving the right markets, or selecting the right partners, you need to stay focused on your core competence and plan your opportunities.  Stay away from the common pitfalls and get help from people who have successfully done it before.

The first question to ask your team; is our offering scalable? Most companies think of stability in terms of product performance and quality, though important for growth this is assumed. Your offering is scalable when messages are simple and your value proposition is easily understood. Your offering should have a straight forward implementation and should quickly integrate with larger solutions. When you have achieved this, then your offering is repeatable. When repeatable it becomes easy to train new reps, expand to new geographies and partner with companies that will integrate your product into their solutions.

It starts with messaging. Are your messages simple? Can you articulate your value proposition in a minute? Is it repeatable in targeted vertical markets? Do you have proof statements to back up your claims? It is very important to get his messaging crisp. When you go to market with a direct sales model, your good sales reps can overcome messaging problems at the point of sale, but these models don’t scale. Remember that direct sales reps sell your product many times, the customer buys only once.

If you have a configurable product that suits many purposes for many people, you will need to package and price solutions to show tangible benefits to end users. Once installed, expansion opportunities will emerge through good account management. Good messaging is the foundation of effective outbound PR. Outbound PR will gain influencer mindshare, company and product awareness and most importantly attract new selling partners. Good crisp messaging makes your offering scalable shortening direct sales cycles and jump starting the partnering process.

The scaling of your operation requires collaboration with the whole operations team. It involves listening to what is happening in sales situations, tracking your competition then projecting your core competence. This will help you choose your vertical markets, drive product development and align with solution partners. This sounds straight forward, but there is many pitfalls along the way. Staying focused requires a plan that can be executed by the entire operations team. The best operations are plan driven and process managed, allowing you to constantly measure and manage progress, make adjustments and learn from your actions.

Sales and Channels Execution

Direct Sales: Hiring direct sales can be risky. It takes time to train and build a book of business. It is important to develop a sales rep profile. The profile is important, moving too far away from it will produce poor results. An empty apartment is better than a bad tenant.

When hiring executive sales management, be sure you understand how they fit into your expected profile & company culture, because more than likely,  they will bring in their own team of sales people who behave similarly.  By nature, sales people tend to yell the loudest. Are they Theory X take no prisoners type guys, or do they have a more collaborative style. An interview does not always show these traits & is important to understand what you are in for before you bring in a new sales team. If not, your entire organization may suffer.

Other than references, one simple way to find out more about an important hire is to bring them out for a round of golf. You would be surprised what you can learn about someone’s style in a 6 hour pressure packed round of golf!

Make sure that the sales compensation plans are aligned with company business plans. Make sure that territories are clearly defined to avoid channel conflict with other reps and selling partners. Define the sales process and assign resources based on process steps. This will encourage information sharing and opportunity qualification. All this information should be contained in a collaborative sales tracking & forecasting system that all company stake holders have access to.

Geographical Expansion: Europeans like to buy from Europeans. A successful sales group in the US may not succeed in Europe.  Look for talent that has been successful selling similar products in the foreign territory.  It is important that they have contacts and the ability to bring in good people. Look for expansion through American multi-national companies to get local references.

 Partnering: Choosing partners can be very difficult. Analysts can be very effective at suggesting potential partners and making introductions.  Ask your customers what service providers they use. Look at your competitions, who do they partner with? Partnership include, selling partners that sell with you, OEM partners who embed your solution in their offerings and technology partners which extend your solution. To gain revenue through partners you must understand how they sell and get paid. Are they vertically aligned and is your vertical alignment similar. Are you speaking with the right people, you can spend a lot of cycles chasing a marketing relationship. Follow the money, sell with your partner. Check your contacts with analysts or other influencers to see if you are speaking with the right people.

Be sure the compensation plans for your direct sales teams are in line with your channel objectives. Compensation drives behavior. Do not create compensation plans that are destructive to your channel objectives. Find a compelling reason to partner. Make sure that your joint value helps them win deals. Make sure they understand how the partnership makes them more competitive.  Never get stuck in a program.

There is a lot to do, and if you can do it quickly you will beat your competition. Who is your coach? Palladin can help. Our partners have lived this problem at many companies in different roles. We can help you through the process rolling up our sleeves, working with you, sharing contacts and giving you the benefits of our experience. Why can we help, because that what we do? Go to our Website, then please give us a call.

Plan for a 60 minute game !

The Patriots are 18-0, why?  Because they play every game the entire 60 minutes.  The teams that have been close and took them into the 4th quarter, lost because they couldn’t stay focused for the entire game.  Why do the Patriots play 60 minutes? Experience.  They have a game plan and they run to it, making minor adjustments as they see what their competitors throw at them. Business is the same, management teams have to play 60 minutes and it all starts with a good game plan.  How many times do businesses panic and lose focus, away from their plan and travel down wrong paths.  Your number one competitor gets bought by a gorilla, how do you react, how do you leverage it to move your message forward.  Who can you get to help you get out this message and how does this affect your plan. You launch a new partnership, how will your competitors react?  How will your sales force leverage the partnership and how will the market react?

All of these events are predictable and should be part of a plan, as they happen, they should be considered market validation.  It is all part of the planning process. How a team reacts to these events will determine whether they will play 60 minutes or lose focus in the 4th quarter.

Trouble in Paradise

As consultants, we work with a variety of companies ranging from start ups, to the very large, in growth & in troubled conditions. One common thread we often see in both environments is a lack of  coordination between the strategic business plan & the companies operational, organizational & individual plans. Or worse yet, there are no plans at all, just really bright founders, sales teams with polished resumes & a potentially hot product.

This lack of coordinated planning can really sink a company. They have truly left port without a compass. Only a stroke of luck will get them to their desired destination.

It is easier to get this point across to executives at troubled companies. Getting it across to executives & investors at emerging growth & fast growing companies is another matter.  Why? In the latter, early on sales are brisk with their products & services flying out the door. Everything appears hunky dory. It’s a cash bonanza for everyone!

However, most likely, competition will eventually creep in, market conditions will change, & growth will slow. Without factoring these variables into your companies overall plans, it may be hard to recover.  Is it a product problem? A marketing problem? A sales problem? It will be tough to know since there is no orchestrated plan.

As a result, like in troubled environments, even these companies will begin to stagnate.  The deer in the headlights gaze will start to appear at company meetings as customers, executives, sales reps & investors begin to abandon ship for the life boats. Death is in the air. The industry is littered with great ideas gone by the wayside or sold off at bargain basement prices.

Only companies who are dedicated to coordinating their plans between all four phases: strategy, operations, organizationally & individually –  will be in a position to make seamless mid course corrections. Your customers, partners, employees & potential acquisition candidates will understand your mission. You will be rewarded in the marketplace by your consistency.

This does not mean companies should remain inflexible to their plans to take advantage of opportunistic events.  However an ongoing selling, marketing & operational du jour process is a recipe for disaster in the long term.

Branding

1. Brand your product or brand your company.
2. Don’t mix company messages with product messages.
3. Your company is about it’s people & what you offer.
4. Your product is about what you deliver for money & how it helps your customer.

Outbound PR – “key event management”

1. Your number one competitor gets bought by a gorilla,  when a gorilla enters,there is no oxygen left in the room.
2. Leverage the event to get your messages across
3. Leverage it to move the ball on partnerships.
4. Leverage it to gaun more attention.
5. Leverage it to validate your market.