Setting Sales Transformation Priorities: Finding a Problem Worth Solving
Mar 02 2017
Each January, like clockwork, I get calls from research clients. In addition to wanting to review how the past year ended up, they want to discuss one thing: how do they hit their new revenue target for the coming year? The fact that they need to make fundamental changes to how they sell is clear to all the sales executives I talk to, but how to do that is not. With so many aspects of selling they could look to improve, how do they determine the ones they should focus on? My answer has been the same for the last decade: “go find a problem that is really worth solving!”
What do I mean by that? Michael Hammer, the business innovation guru, noted that, “Reengineering is not about doing everything a little better, but rather doing a couple things an order of magnitude better.” That same premise holds true for sales transformation. If we focus in on how sales organizations are selling, we can easily find processes that are screaming for optimization.
A case in point surfaced during CSO Insights 2016 Quote-to-Close survey. In this study – download it here – we surveyed 250 sales executives to assess how sales teams were handling all the steps at the end of the sales process to get a signed deal completed. In looking at the data, what struck me was how many companies are relying on antiquated processes to handle the key sales task of Configure, Price, and Quote (CPQ). In the study, we found the most common methods for supporting salespeople doing the CPQ task were providing them with spreadsheets or rudimentary online templates, putting a heavy burden on sales teams to create the right/best solution for a client.
Here is why that is, and will continue to be a problem. As part of CSO Insights 2016 Sales Enablement Optimization Study, we asked sales executives to assess the rate of various types of change impacting their sales teams. The chart below summaries their responses as related to a company’s product line.
Here we see that change is a standard way of life for most sales organizations. As we keep releasing more enhancements to existing products, increase the complexity of what we sell, and rollout a stream of new offerings, the CPQ task becomes increasingly complicated. If we leave it to salespeople to manage this task on their own, we set the stage for two ways for sales teams to underperform. The first is they misconfigure a solution which incurs costs to remedy problems after the customer has received their products, as well as negatively impact customer satisfaction. The second is salespeople may miss out on opportunities to optimize the deal size via effective cross-selling ad up-selling.
Our study data found that only 25.8% of sales organizations reported leveraging CRM 2.0 solutions to guide the salespeople through the CPQ task. This means that for nearly three-quarters of sales organizations, the CPQ task is clearly a problem worth solving, and is ripe for transformation. Leveraging CPQ technology, salespeople are guided through the process to create solution sets that fully align to the customer’s needs. This is an area where Salesforce is doing a lot of work, and you can learn more about that here.
As CPQ systems have access to most current product and pricing information, as well as rules-based insights into all the co-requisites and pre-requisites involved in the configuration process, the output they generate all but eliminates the chance of errors. CSO Insights Report: CPQ Solutions Will Solve Your Sales Woes also found that 73.5% of the sales executives surveyed reported that CPQ solutions noticeably reduced the closing cycle, with 55.6% of those study participants reporting a reduction time of >20%. So optimizing the quote-to-close process is a problem not only worth solving, but one that can be effectively solved.
Questions for you:
- How do you enable your salespeople across the buying phase, regarding skills, knowledge, strategies, and fluency?
- Which content types and enablement tools do you provide for salespeople to prepare themselves and to share with prospects?
- How do you address the “stalled opportunity” challenge?
Related blog posts:
- Navigating the Dynamics of the Customer’s Journey
- How to Use Different Content Types Along The Customer’s Journey
- Enablement builds it, but do salespeople use it?
- Dynamic Value Messaging: Part 1, Defining Messaging Criteria
- Dynamic Value Messaging: Part 2, Different Buying Scenarios Matter
- Dynamic Value Messaging: Part 3, Value Messaging Types Along the Customer’s Journey