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Winning the Sales Hunger Games


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Tweaking technology sales teams to exploit the increasing speed of information sharing

Tweaking technology sales teams to exploit the increasing speed of information sharing

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  • 1. Winning the Sales Hunger Games Tweaking technology sales teams to exploit the increasing speed of information sharing Sandeep Kaujalgi, Founder and CEO of Collabor Inc ! For long, within the technology industry, conventional sales models have been triumphant. While there exist many variants of these models honed by sales executives to suit their specific teams and management styles, they all take off or have evolved from three basic models. ! Firstly, the “Order Taker”, wherein the sales team is blessed with a portfolio of products and services that have significant market demand and in essence sell themselves - in effect turning the salesperson into an order taker. Imagine the role of sales in an Apple Store where people line up for days waiting for the latest iProduct. Another example would be a services sales person during Y2K. There have also been attempt to artificially create this demand by introducing exclusive access or limited availability and they seldom succeed, without an intrinsic market pull. ! Second, the “Consultative Sales” model, in which the sales person is encouraged to become a “trusted advisor” to their customer. This is supposed to create a bond between the customer and company and creates a barrier to entry for competition. And there are enough stories about deals made over a round of golf or even a client being a godparent to a salesperson’s child. ! Finally, we have the “Hunter-Farmer” model, in which a sales person sells and then hands over the customer to the account management team, while they move onto their next hunting grounds. If your sales team is not Order Takers or Consultative Selling, then most likely they are a variant of the Hunter-Farmer. ! !1TWEAKING THE TECH SALES MODEL
  • 2. All of the above models come with pros and cons (like, well almost everything in life). The Order Taker model, lulls the sales team into complacency and they are always surprised and clueless when a new competitor emerges. e.g: disrupting the CRM industry. I like to think of the Consultative Sales model “Relationship Hypnosis”. And like hypnosis, it does not work on everyone. And you can play only so many rounds of golf or have only so many children to godparent. In addition any high-touch, time invested model inherently has problems of scalability. ! That brings us to the Hunter-Farmer model, which many successful software and services companies employ. The one major drawback of this is that the products and/or services tend to become commoditized. The argument goes thusly, since Hunters are not interested in necessarily understanding the nitty gritty of what they are selling, but are incentized to make numbers, they are hence most comfortable with data sheets, price lists and discounting as their primary tools. And we all know that this technique leads to commoditization and its natural consequence - price wars - many of us have either been, met or heard of - that ERP sales guy offering at 80% discount at the end of a quarter. It still, however, remains the most effective of all the three models - because it achieves one fundamental purpose. It moves numbers. ! Let’s juxtapose this with the changing world, the chaos of our times - social media, big data, cloud, facebook, twitter, dropbox, ….….. the net result being that technology has been completely disambiguated as a function of time, cost, availability, access and utility. A) Information is freely available and shareable through social media - reducing or eliminating information arbitrage. That means a company’s successes and failures are just a google search away, contracts and pricing information are increasingly public and your thought leadership is not necessarily unique or exclusive and is subject to criticism; B) Customers are getting younger - a younger workforce who have grown up in the connected world are getting to be in places of influence, persuasion and decision making. This impacts the systems and devices of creation, consumption and engagement; C) Loss of Permanence - Success is not as sustainable as before and sales and customer management have to work harder. In many ways, the speed on the treadmill has been cranked up and we need to run harder to stay in the same place; and finally !2TWEAKING THE TECH SALES MODEL
  • 3. D) Surprise Competitors - New competitors are emerging that even the most verdant marketers and strategists cannot vision. Amazon’s entry into the Cloud with Amazon Web Services culminated a few months ago when they won a $600 million order, beating IBM, from the Central Intelligence Agency. Or that every social tool that starts off being frivolous, free and of the people, will soon have a business side - as envisaged by Dropbox or Facebook or Twitter or Evernote ! To tackle this increased sales complexity, I propose a rethinking/retooling of the technology sales team. If we use the Hunter-Farmer as a foundation, how do we make it better ? To, lets say, enhance the pros and minimize the cons. ! Let’s illustrate this new model using the time-tested oh-so-important matrix. Let’s map the two axes to indicate short-term needs or Revenue Impact and long-term benefits or Strategic Impact. And now let’s see what these Hunters, Farmers, Whale Watchers and Fishers are supposed to do to feed our hungry organization. ! ! !3TWEAKING THE TECH SALES MODEL
  • 4. Marketing becomes more important Hunters are used to being lone rangers working off prospect and price lists to achieve quotas. In this age of information, when prospects have access to data about the company, Hunters need to make sure they proactively arm themselves with data on their prospects. They can and should work closely with marketing, to use technology to their advantage. ! Inbound tools help understand what prospects are looking for. Social Media and Collaboration portals help companies get close to their customers. Customer usage and purchase data and Net Promoter Scores give hints on why existing customers bought from the company, and Network Effects help build overall brand equity. All these tools help Hunters increase their win %. I have always believed that Sales is 50% art and 50% science. Well, that science just showed up, big time - use it. ! Protect existing customers Once upon a time, you signed a customer and they were with you for life. Ya right! A Department of Labor statistic says that companies lose 50% of their customers every 5 years. Many industries like SaaS, see their customers hang on for months at best and companies may never recoup their marketing dollars. To add, a Harvard Business Review article said that it is 6 times more expensive to sign a new customer as it is to retain an existing one. ! Companies have to refocus their farmers on retaining and growing existing customers. Let’s provide incentives for growth and penalties for churn. Good Farmers know how to build and grow relationships and in my time farming that I always found this account mapping tool very handy. ! Once a relationship is established, I encourage farmers to draw a 3x3 matrix around them. Now let’s identify the contact’s Boss (B) and the Boss’ two peers (BP1 and BP2). Identify the contact’s own two peers (P1 and P2) and then a subordinate (S) and their two peers (SP1 and SP2). One starting relationship allows the Farmer to reach an additional 8 people. ! !4TWEAKING THE TECH SALES MODEL
  • 5. For every new relationship forged, draw a 3x3 matrix around them and repeat the process. Very quickly, as shown in the images below, we see a progression of relationships built in a focused, disciplined manner that map the account and create additional business while building entry barriers against competition. ! “C” Suite needs to Sell Revenue belongs to the whole company and while the sales team has primary responsibility to accrue it, they can always do with some help. And while this is logical, it is not always common sense. I propose that the “C” Suite is actively tasked to sell. And I don’t mean just the occasional passing to sales of new contacts or deal gossip - which should be still done. ! The “C” Suite meet and interact with people at their peer level. They should have active talking points from Marketing and be coached to identify and flush out potential large deals. Deals that will fundamentally change the company’s direction and future. Deals that sales people will never get to with cold calling. Deals that will never be won by RFP responses. These deals are the equivalent of winning the Lottery Jackpot. While these cannot be forecasted, if the “C” Suite does not look for them they are not going to happen. If the President of the United States has to sell The Affordable Care Act, can the CEO of a company not have the same responsibility. The “C” Suite are Whale Watchers ! ! !5TWEAKING THE TECH SALES MODEL
  • 6. Order Taking is dead And finally Fishers are the proving ground in the sales organization and tend to work RFPs and small deals. This could also be a training ground for new hires or a place to rehabilitate poor performers who need to be given a second chance. ! So welcome to a refined, tweaked and updated sales model ready for an information age that makes unreasonable demands on reasonable people. Happy Selling ! !6TWEAKING THE TECH SALES MODEL Sandeep Kaujalgi is the Founder and CEO of Collabor Inc., an enterprise SaaS software company based in Greater Boston.