Pre-Sales Performance ExcellenceSM
This blog is the first ever dedicated to the pre-sales community. Bond with your fellow SEs, and share your passion as an SE. Enjoy the blog, and Good SElling!
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Manufacturing operations have it right. If you don’t build quality into a product, people won’t buy it. Toward this end, manufacturing divisions boast of compliance with ISO 900x quality standards and six-sigma quality initiatives. The improvements in operational quality have direct and measured impact on the bottom line.
So why don’t sales operations have the same mindset? Just as improving the quality of calorie burning activities will lose weight, just as improving the quality of manufacturing operations drives product excellence and revenue, improving the quality of sales operations will have direct and measured revenue impact.
Very few organizations annually budget for quality initiatives specific to their sales operations, many are the same folks who implement ISO 900x and six-sigma in their manufacturing operation. You have to wonder why not. Pehaps because the sales trade has been a black art for so long, few executives believe that structured quality initiatives could possibly apply.
But oh they do. A handful of companies are experimenting with implementing lean six sigma type initiatives into their sales operations with dramatic results. Simple changes in simple sales activities, activities that have long been neglected for quality improvement, go a long way. Simple regular measurement of the quality of key sales activities goes a long way. Payback of 50-300x on the dollar are common.
It may take a long time to change the C-level mindset with regard to regularly budgeting for sales operations quality. But in the meantime, please help us beat the drum.
Hello blog. Yes, it’s been awhile. Activity has been picking up lately. Among lots of other things, I presented at the MIT Sloan Sales Conference — How to Leverage SEs to Drive Business.
It strikes me as I talk to people at the conference and to our clients, that smart companies are investing now in their people and processes because they know he who invests in their people and processes will come out far ahead on the other side of this mess. Companies who crawled under a rock, and there are lots of those, will pay an even worse price when they crawl back out. Sadly, the smart people who realize this and are under a rock are forced to keep quiet, otherwise they’ll be the first to join the unemployment lines.
Here are a few musings to ponder.
How much money do SEs leave on the table in revenue? What is the SEs’ cost of sales? Why did a $multi-billion company say to us, “We’re spending a half billion dollars on our SEs every year, and we don’t know what we’re getting in return”? Why don’t companies know the impact of their SE operations?
If SEs have a highly technical job role, why do companies “flea dip” SEs through traditional business oriented sales training? Can we blame SEs for resenting this type of force-fed training?
Why does every traditional sales methodology treat Solution Closure like a fait accompli? Oh, by the way, Solution Closure just happens. Why do they think the months of effort SEs put into getting Solution Closure is just a footnote?
E-learning does a great job of teaching new technology and hard skills, so why is e-learning ineffective making soft sales skills stick in the field for the long-term?
Why do so many companies think that the CRM du jour will fix flawed sales processes?
If case studies have documented that SEs can generate 50x-300x in new revenue from every dollar spent on their process improvement, why then are SEs the first to be laid off?
If sales process quality investments have a payback of $450,000-$700,000 per person per year at a cost of about $2,100 per person (which can be amortized over 24-48 months), why then are companies choosing not to invest in sales process quality because of a few thousand dollars in one-time travel expenses? If the business case is such a no-brainer, what’s really going on?
When we try to lose weight, we don’t do so by standing on the scale every day. We lose weight by performing quality calorie burning activities which then take the weight off. Why do so many companies measure only revenue every day? Why don’t companies measure sales activity quality which will then drive revenue?
Why do so few hi-tech companies annually budget for sales process quality improvement? Why is sales process quality culture so lacking in so many hi-tech companies? Why don’t more companies run their sales operation like an ISO 900x or lean 6-sigma manufacturing operation?
Any other musings out there?
We’ve been hearing a lot lately about problems with hand-offs between pre-sales SEs and post-sales pro-services consultants. The issue deserves so much attention that we recently released a full 2 day course to address the topic called SEforPS. I’ll first discuss why there is often a disconnect, and then offer some thoughts on what to do about it.
You would think that it would be easy for pre-sales to hand-off what they know about a closed deal to pro-services, and likewise, for consultants to hand-off what they know about a potential opportunity to pre-sales. Far from it. Part of the issue is related to the way pre-sales and post-sales “gets excited”.
If you think about it, sales works hard to sell products, while services should be intimately involved in the sales cycle, but often is not. Then a sale is made. At that moment, product revenue is recognized — Tadah! Lots of excitment for sales, little for services. Services is just getting started. Services now works hard developing and deploying. Revenue is recognized along the way. Lots of excitment for services, meanwhile sales has less interest.
The point is that the motivations for each team differ in time. If motivations are not aligned, how can one expect hand-offs to be aligned?
From a workflow perspective, there are clear inputs and outputs that pre-sales and pro-services need from each other. A key for successful handoffs is for each party to educate the other with regard to what each needs to do their job effectively. Document templates which are mutually agreed upon. Assign small teams to keep these templates current and pertinent. Keep communication open between sales and pro-services. Proper education and expectations will promote successful and painless hand-offs.
Just how bad can the Sales Engineer’s condition get? We ran into a company whose SEs have no incentive plan. “They’re getting paid to support sales, so why should I bonus them?” Sigh.
This is in stark contrast to those rare companies that empower SEs to take their own initiative to drive revenue, reduce cost of sales, and cleanse funnels. We’ve seen ratios of SEs to sales reps of 2:1 and even 3:1 because these companies have learned that SEs can drive more revenue than sales reps. And to be sure, those SEs are making tons of money. “Our sales reps are getting paid to take orders, so why…”
On a personal note, that US Airways pilot and crew who crash landed in the Hudson River and saved 150 lives are true heroes in our midst. God bless them.
Happy New Year and all the best for 2009.
I’ve been getting lots of email from SEs getting laid off. One SE lamented about their sales VP who keeps unproductive reps while SEs are let go — the same SEs who maintain customer loyalty and find new business even during down times. All I can say is that I feel your pain. Sometimes the attitude toward SEs is hard to change.
Fortunately, there are lots of sales executives out there who “get it”. Even though today sales reps are stuck in the economic muck, they leverage SEs to continue to drive technical decision cycles. During these tough times, here are 10 action items for you as an SE to improve your value to your organization…
10) Grow deal sizes — You are in a perfect position to dig for pain and new business problems that are always lurking under the surface. More business problems = more solutions = more revenue.
9) Improve the quality of deals — How often do you lose to “do nothing”? Is this deal worth your time? If not, what do you need to know to improve the quality of the deal you are working on? If the customer does not know things like the timeframe for a technical decision or the quantified business impact of the solution, help them figure it out. Do not be afraid to walk away from deals that are a waste of time.
8) Improve the technical win rate — Improving the quality of deals will improve the technical win rate. Identify each stakeholder’s technical decision criteria. Prioritize the stakeholders. Resolve their criteria step-by-step in priority order. Ensuring key technical decision criteria are being resolved will win allies, and improve the likelihood of a favorable outcome.
7) Get technical decisions faster — How can you win faster? You do not have to let the customer dictate the time to a technical decision — this is independent of the business/money decision. Get there as fast as possible, and then help them defend the decision for the long haul. Is that trial really necessary when a controlled proof-of-concept will do? Is that POC really necessary when a custom demo will do?
6) Prioritize your time — For any activity, ask yourself, “Is this a good use of my time?”. Do not agree to blind on-site calls. Do not agree to blind demos. Don’t do it! Just say “No”. Ensure yourself you are using your time wisely — Your time is too valuable to be abused.
5) Check in with existing customers — Existing customers, for the most part, are successful with your solutions. Do a “start of year checkup”. Dig for new pain and opportunities for more solutions and services. Existing customers are the best and fastest opportunities for new business.
4) Check in with partners — The more you can clone yourself, the better. Imagine if you could clone yourself 5, 10, even 50 times over into your partner SE organizations. Not only will you save significant time, but your partners will be better enabled to generate revenue without your involvement.
3) Check in with product marketing, engineering, tech support — As an SE, you are an invaluable resource to these teams. You are on the front line gathering customer and competitive intelligence. You will do your company a great service sharing this information with other organizations, and you will improve your perceived value to these groups as well.
2) Check in with your manager — Don’t strictly rely on the obligatory yearly review — Are you clear on your goals and objectives for the coming year? What obstacles can your manager work to clear for you? How does your manager want you to prove your value? Now’s a good time to take stock and regroup if necessary.
1) Get SALES training – Balance product training with sales training. Down times are great times to sharpen the saw. Even the most senior SE can improve their technical sales skills — just ask our customers. Typically ’tis the season when SEs are forced to drink product training from a fire hose. Review the training plans coming from training and product marketing. If they are flooding you with product training, vehemently object. How are SEs supposed to effectively technically sell new products if they don’t get proper sales, positioning, competitive, or value proposition training designed and targetted specifically for the SE team? Raise an alarm, and contact us.
Recently, an SE sent me the email below. I had many mixed emotions — I was appalled, saddened, and heartened, but not at all surprised.
For Sales Managers and VPs reading this –
This SE lives in a dark cultural chasm that, based on a decade of experience, exists in various forms and degrees in many, many sales organizations.
I urge you not to dismiss this SE’s posting as a rant. We have seen literally hundreds of sales organizations that exhibit some of the characteristics that this SE describes. I assure you, the SE speaks for tens of thousands of SE professionals. Do you see shades of your organization in the below? If you’re not sure, our on-line assessment can help you find out.
Every now and then, we visit a sales organization that, in every sense, values the SE role. There, the SE is a vital resource that drives enormous incremental revenue in alignment with sales reps well beyond the sales rep’s capability.
In these sales organizations Management enables, empowers, and rewards SEs to do so. And do they ever reap reward! In one case, an SE team grew incremental revenue 425% in 6 months. (Our recent newsletters discuss how our program can be implemented in a financially responsible manner).
‘nuf said. Enjoy the email…
“I just stumbled upon your webpage and read the entire BLOG. OUTSTANDING. How can we get this word out to every SE Hiring company out there? I’ve been in [my industry] for 20 years. Finally, your webpage is THE VOICE for SEs ! Thank God ! Outstanding, [my industry] is the worst for not appreciating SEs.
“I listen to VPs of Sales refer to SEs as “sales bitches” or “sales whores”. So many companies don’t realize our value. I can’t tell you how many meetings I’ve been in where my voice was suppressed to let the sales guy run the meeting and not get HALF of the information out that the customer wanted to, choking the customer with their power point, or looking so desperate for the sale that the customer lost interest. My vision for the customer is HUGE, many of the sales people I’ve worked with fail to have discipline, self control, or empathy. I’m sick of it.
”I said to myself, I wonder if maybe finally there is a “voice” for us out there. Once I started reading [your website] I was like, YES, [THESE PEOPLE] GET IT. FINALLY I HAVE FOUND HUMANS THAT ACTUALLY UNDERSTAND AND Give a ____ about SEs ! ” Awesome….just awesome !
”One day, I dream of a company with massive SE resources. Where a brand new SE comes into the company, and is taught REAL TRAINING THAT IS MECHANICALLY USEFUL to their ACTUAL JOB ROLE and they are trained in a Military style - WHEN You are DONE with all the training, YOU ARE QUALIFIED and FULLY Capable TO TEACH IT to any stranger from the foundation on up, or you STAY in the Training until you can! One day, my company will be like that. One day I will have the SE Role for my SEs who will be highly esteemed, respectful, knowledgeable, caring, great coaches, sharing their knowledge, teaching AND doing, building their teams with good hard, honest work and no snooty attitudes from sales reps who only care about the dollar and not the customer and my SEs will be paid VERY WELL for work ethic and integrity and unselfish sharing of knowledge within their teams/groups.”
Yes, SEs can play an important role in the sales cycle in a down economy.
How? Note that in a complex sales cycle there are actually two decision cycles at work in parallel — The business decision and the technical decision. These decision cycles are independent of each other except that the technical decision needs to happen well before the business decision.
So, just because the business decision is stalled because money is not flowing, does not prevent the technical decision from moving forward as usual. The SE can work the technical decision right up to actually acquiring the decision. The SE can then maintain watch over those technical closures until the economy starts moving again, and it will. At that time, there will be a queue of technically closed deals awaiting business closure.
Sales VPs, I wouldn’t be so quick to lay off SEs during a down time. There’s plenty for them to do.
Brace yourself.
Prospects are going to cut way back on spending money, but they won’t stop entirely — they never do. Traditional sales approaches as we know them will falter. Making a sale will be as difficult as it has ever been in the past 30 years.
In the stiff competition for funding, what can you do as a sales organization to persuade the customer to give top priority for the expenditure for your solution?
Leverage your SEs.
Use your SEs to work with the customer’s technical constituents to dig deep for business pain. Find lots of pain. The more pain the better. As an SE, when the customer explains their business problem to you, don’t take their word on face value. Dig for more pain. Good questions are, “What is the impact of this problem on the business / your group / your job?”, “Who else is affected?”, “To what extent?”, “How much?”, “Why is that?”, “What would be the quantified impact if this problem could be resolved?”
Get numbers from them. Numbers help the customer visualize the problem and solution. Numbers help you, as the SE, establish compelling value, which helps you hold price. The vendor who helps their customer visualize problems and solutions better, will get precedence over those who don’t. Those vendors who help technical decision makers build a clear quantified business case for funding will more likely get priority for that funding.
Sales and SE Executives: In this time of stress, rather that trying to squeeze more out of sales reps, consider leveraging the SE’s technical credibility to grow deals, shrink sales cycles, and cleanse funnels. Leverage their technical credibility to help the customer give top priority to the expenditure for your solution.
Don’t think SEs can impact revenue? Consider this: A $2.5 billion dollar hi-tech company has a 2:1 ratio between SEs and sales reps. That’s right. Two to one SEs to sales reps. Years ago the VP told us that they discovered that SEs could generate substantially more revenue than sales reps, so they switched the traditional ratio, and the strategy paid off handsomely.
A Fortune 500 company has a large pre-sales force. Their normal sales cycle uses SE to drive the entire deal to the extent that sales reps only process orders. Why? Because customers prefer working with the “Technical Side of the Sale”.
Leverage your SEs, and brace yourSElf.
The number one request we get for improving the pre-sales role is helping SEs manage their time better. We hear inumerable complaints involving the constant chaos and time crunch SEs find themselves in.
It’s no wonder. For many professional fields, you go to school for formal training. Not so for a Sales Engineer. SEs figure out how to be an SE through on the job trial and error. We then become Senior SEs who are creatures of bad habits without realizing it. With lack of formal training, the SE role is fraught with inefficiency and ineffectiveness.* And so, time becomes our #1 enemy.
Here are some helpful hints for SEs to better manage time:
Control what you can control.
Get SE specific training through a program like salesengineering.com’s.
This will go a long way toward reducing the continual chaos and lack of time.
* We are aware of two relatively new college programs in the U.S. that now have a Sales Engineering minor — the University of Florida, and the University of Iowa.
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