Top 4 Sales Challenges in Mid Size Technology Firms

Reading time 4 mins. If you are a CEO or entrepreneur of a mid-sized technology firm, this article is for you.

Well, here are some interesting facts from the field.

I met a tech entrepreneur with USD 20 million in revenue loose USD 4 million in a bad channel selection decision! This mistake hit him deep and will take a long time before it leaves his psyche!!

Met another CEO of a mid-sized cloud technology firm not have any faith in his sales team. Sales team comprised of freshers and seniors who were demonstrating deep insecurities on one side and lack of capability on the other.

So how do we define sales challenges of a mid-sized technology company?

Should we categorize it as people, competency and process issue? Or as something else?

To begin with, Mid-sized technology firms come in many shapes and sizes. Some are old players (survived for 10+ years), some are family businesses, and some are relatively new entrants in their field (eg: born in the cloud service providers).

Based on what I have observed in the field let me classify the challenges into 5 types:

 

1. People Challenges

In most of the small to mid-sized tech firms, business is usually driven by one of two lone wolf superstars.

Sometimes, it’s the owner himself or herself drives sales. He or she generates business through sheer determination and drive. He is the key account manager, mainly aware of all major deals. This star is not just great at selling he is great at ensuring customer orders are serviced and is also probably the best in sales operations. The sales success of the business is synonymous with the great sales person the sales superstar is.

In other cases, the entrepreneur is the domain expert and relies on lone wolves to run sales. This is far more dangerous as the entrepreneur has less control over customers and will have to be always on his toes to watch what is happening in the field.

Mid-sized tech businesses usually have a problem in retaining great sales talent. Due to lack of a clear plan to attract and build great sales people, they are mostly training ground for many salespeople before they move to greener pastures.

Over time, the company becomes gets into a vicious cycle of hiring and losing salespeople.

Both these situations are not scalable and unfortunately any small to mid-sized business has to go through this phase. Well, here are a few ways in which this situation can be de-risked and managed.

  1. Find a way to systematize sales process. Without a process that can be monitored and managed, it is difficult to have a handle on the sales cycle.
  2. The entrepreneur should definitely understand selling and should be comfortable about selling cycles though he or she may not be responsible for sales function. It is highly recommended that the leader sit in key sales meetings and understand to interpret sales KPIs such as leading and lagging indicators.
  3. The leader should plan to put together a people plan where there is enough control in on-boarding new sellers and get them to be productive as soon as possible. This is so important as in selling time to revenue is the key.
  4. If there are still struggles, hire a company like Agility Nexus that specializes in installing a sales system in your company. Paying for this services so worth it.

 

2. Go to Market Issues

Selling a $20/user/month SaaS product is lot different from selling a $50,000 Salesforce Automation services.

It’s foolish to travel across the country for an in-person demonstration to sell a $20/user SaaS product! Likewise, it’s foolish to expect an Enterprise client to commit to a $50,000 platform by simply visiting your website and entering their credit card details.

Clearly, each of these has a different Go To Market approach for which for which the ‘Customer Acquisition Cost‘ (CAC) has to fall in line with the revenue it generates.

Depending on CAC, sales models can range from freemium, web sales, online sales, inbound selling, channel selling, outbound centric selling to direct field sales force sales.

Getting this mix is so important to reach the market. If the leader makes a mistake in GTM then the business burns cash and is set back by few quarters.

Let’s see how this can be mitigated?

  1. Come out with a well defined GTM strategy for your product and market.
  2. Structure your selling team in line with your GTM strategy.
  3. Structure your selling approach and selling cost in line with your revenue strategy.
  4. Structure sales compensation in line with your GTM strategy.
  5. Choose and apply the right prospecting process that is line with your GTM approach.
  6. Tweak your product prices in line with your GTM approach.
  7. If you need help in any of these areas, do seek help from a company, say Agility Nexus, that is focussed on helping you accelerate sales and shorten time to revenue.

3. Sales Process Challenges

I asked on of the mid-sized tech CEOs as to if he has a sales methodology or process to guide a sale?

Pat came the answer. “We have installed Salesforce CRM”.

Many mid-sized companies have implemented a CRM system like Microsoft Dynamics, Salesforce or Hubspot and think that they have a sales process! This is absolutely a wrong assumption.

Even in mature mid-sized firms, there is a lack of awareness as to how their ideal customers buy stuff! A lot is left to chance. While a good 40% are focussed the rest of them still follow ‘spray and pray’ approach when it comes to a selling process.

Any selling process should begin with an understanding of how your customers buy. You have to know what’s most important to them, how they evaluate new products and services, how and when they allocate budget, who needs to be involved, how decision are made, how terms and deals are negotiated, etc.

Knowing how the customer buys gives you the ability to map your sales process with the buying process of the prospects.

Let’s see how your sales process can be aligned to speed up ‘time to revenue’?

  1. Understand who your ideal customer and buyer persona is?
  2. Understand how they buy? What steps do they take before they are willing to spend money?
  3. This includes how they evaluate new products and services, how and when they allocate budget, who needs to be involved, how decision are made, how terms and deals are negotiated, etc.
  4. Now design a sales process in any CRM system in line with your customer buying process with right gates to check deal progress.
  5. If you have doubts about establishing this, do give us a call. We might be able to help you.

 

4. Sales Competency Challenges

Finally, mid-sized technology companies should realize that the way customers want to be engaged by sellers (or selling cycle) has changed a lot in 2018.

With customers having more control over the sales process than ever before, salespeople must be able to engage them at every point in the buying cycle.

This reality is reflected in survey responses that identified several stages where first interactions with customers can take place: the prospecting stage, when identifying customer needs, when forming product or service solutions, when delivering the pitch, when closing the sale, and even during the follow-up stage.

The results suggest that salespeople must be skilled at both identifying a customer’s stage in the sales cycle and effectively engaging customers at every stage. They need to possess the sales competencies to establish rapport, initiate a dialogue, understand customer needs, position the solution, negotiate and close, and maintain the relationship.

Only by leveraging these competencies can salespeople move the customer from one stage to the next.

This is where training and coaching your salespeople to be precise and productive becomes very important.

If you don’t train, you don’t gain.

 

Let’s see how you can make your sales team effective and get results:

  1. Tailor the right training program for them to lift their game. It should be a targetted intervention led by a trainer from the industry who understands the skills needed to get the job done. Generic training won’t cut the bill.
  2. Further sellers should be coached over a period of time, say a quarter, to correct their mistakes and sharpen their skills to engage clients and win deals.
  3. If you don’t have the in-house capability and need someone from the technology industry with experience in training hundreds of technology sellers, click on the banner below.

Meanwhile, if you have any questions in each of these topics, do give us a shout. We are a full cycle sales company that helps mid-sized technology companies simplify selling and win more deals.

Happy selling.

 

Is Your Sales Team Bridging The Value Gap?

If you are a sales leader, I am sure you are hearing a lot of these from your sellers right now.

“Clients are indecisive. They can’t make up their mind. They are not ready for cloud”.

“I have qualified the deal but client stakeholders are not moving the opportunity. Analytics is not top priority”.

“I thought they wanted sales force automation. Got the right signals. But now it’s dragging beyond reasons I can’t fathom”.

I often hear salespeople and sales leaders express their frustration with not getting deals closed or their inability to get prospects to move through the sales cycle.

Deals get stuck for lots of reasons, one of the big ones is because no one is finding the value gap or measuring the gap. If clients are not able to experience the ‘value gap‘ between the place they currently are and the place they want to go, there is no incentive for a change.

It does not matter if you are selling Analytics, a new transaction platform, digital stack, a version of cloud technology or state of the art Cognitive AI.

If you miss the value gap, technology is just a moot point.

The value gap influences everything. The bigger the gap the greater the return. Big gaps can also mean greater complexity, more change, and more money. The smaller the gap, the smaller the return.

Whether customers or prospects are aware or not, the gap plays a heavy role in their decision to buy or not, as well as how they buy. Do they move quickly or slowly? Do they get a lot of people involved or no one involved? The value gap can’t be ignored.

 

To identify the value gap requires a solid understanding of where the customer is today,

  • What is their current state?
  • What are the current frustrations?
  • What are they doing now?
  • Why they do them that way?
  • What the current outcomes are
  • What is the impact to the organization?
  • Who is affected

The next part is to understand where they want to go tomorrow,

  • Where do they want to go/be?
  • How should their tomorrow be?
  • What should they be doing tomorrow?
  • Why do they want to do them that way?
  • What are the new expected outcomes?
  • Whats the new impact to the organization?
  • Who benefits?

In fact, the value gap should be addressed as part of your go-to-market strategy where you clearly identify the value perception of your customer segment and incorporate in your product roadmap and marketing messages as well.

When you’re selling, your team should focus on the value gap and target the impact. The value gap is what influences how people buy. The value gap creates the baseline or the comparison from what we have to today to what we’ll have tomorrow.

Is your sales team trained to dig deep and discover value gaps? Do you zone in on value gaps in your cadence meetings? Are you finding ways to bring the value gaps and make it part of your win plans?

If not, do it right away. Else your deals will stall in the pipe and might not even move forward an inch.

Why Segment Accounts to Accelerate Sales?

Recently, I met up with 10 technology P&L leaders and asked them what ‘Sales Enablement’ meant to them?

Over half of them responded that sales enablement consists of developing sales productivity materials.

Well, that’s only part of it and there are many tools you can use to increase sales productivity. Account segmentation is one of the most important areas they had completely missed. It’s difficult to grow revenue faster than your industry’s growth rate and faster than your competitors.

Your sales team must be having a bunch of these questions for which they don’t have any definite answer:

  • What accounts do I call?
  • Where are the best opportunities?
  • What accounts should I contact first?
  • How can I improve my results?

Do your Sales Operations or Enablement teams have good answers?

Well, here is a point of view.

 

What is Account Segmentation?

Why is this important? Not all accounts are created equal. Some of your accounts will spend a little, and others will spend a lot. Some will spend this year, and others will spend next year. Some will respond well to your value proposition and others will respond well to your competitor’s value proposition. If you cannot rank accounts best to worst on revenue potential and propensity to buy, you will miss the number.

So segmenting accounts helps a lot in deploying your sales resources to the right accounts.

 

But then why Segment Markets?

Customers are different. Some are small, while others are large. Some are driven by price, while others want the best service. Some want breadth of services, while others want a targeted offering. Some are early adopters, while others prefer battle-tested solutions. In the end, segmentation helps salespeople meet the needs of a diverse customer base.

Segmentation also helps create Ideal Customer Profiles or ICPs. These are target accounts with the greatest spend potential at the lowest acquisition cost. Accounts are scored and prioritized using a flexible formula. The formula applies to current customers, opportunities, and prospects. Sales Reps are then better able to prioritize up-sell, cross-sell, and new acquisition activities.

 

How can you Segment Markets?

The best segmentation plans use three categories: profile, behavior, and needs. They are often blended together to effectively target customers and prospects. Understanding who they are, what they do, and their needs are important. This helps salespeople satisfy a diverse customer base. Ultimately this approach translates into:

  • Larger deals
  • Faster sales
  • Better win rates

 

What should an account segment process result in?

An effective Account Segmentation process delivers:

  • A prioritized list of current customers and prospects
  • Potential spend figures for all customer types
  • An Ideal Customer Profile
  • A completely analyzed customer master database

This allows you to help sales with bigger deals and improved win rates.

If you are not using account segments to rationalize and deploy your sales resources, you are simply not being efficient in your selling strategy. This one exercise can save you a lot of sales bandwidth and yield 10X results.

 

Why the link between marketing and sales teams break?

Smarketing, where marketing and sales work as one dream team, sounds so simple yet it ain’t!

Your revenue engine works best when Sales and Marketing are working in lockstep, yet for many organizations, this is just a dream. Their tools, tactics, metrics, and mindsets get in the way of making this fantasy a reality.

This dysfunction exists in both large and small companies.

And a lot of times when you have a sales team and a marketing team, each of those team’s goal is a little bit different, or maybe individual members within those teams have a different goal that is their top goal.

And, this happens, a lot of times, because of the ways that we incentivize teams.

Salespeople are incentivized to makes sales, that’s how they make money, you promote them when they make a lot of sales. In some companies, there are team incentives where if you all hit quota, then everyone gets some sort of incentive as well.

The way the marketing team is incented can be a lot different. They may not have solid targets like sellers and it’s never a make or break situation every quarter.

This typically results in two breeds of people in any company. The marketers and the salespeople. Different thinking, different behaviors and different motions. The little things we do from the incentives to just the way we talk about our teams lead us to have these factions.

Another thing that happens, an easy way to get a little bit more of a team thing going on, is we actually physically sit the salespeople and the marketing people away from each other. I think it’s actually really important to mix people.

We are energy being first and we would love to be part of a team that is excited and energetic. When you actually have people mix, or even better, switch seats, people start to empathize with each other more.

I would strongly recommend that for great teamwork to unfold, everyone needs to feel like they are part of one team.

 

If we can have one leader drive lead to deal, like a Chief Revenue Officer, who is able to plan KPIs, incentives to build one team that works towards ONE GOAL – you can definitely move towards a Smarketing DNA.

Will you?

 

 

Why Poor Enablement Leads To Sales People Failing?

There has been much written and discussed on how sales people fail themselves. Totally agree. But then there is another side to the story.

Poor sales enablement by the company!

Yes! Sales people fail because their company fails them. It happens all the time. The only difference between when sales people fail themselves vs when sales people fail because of their company — the company rarely gets blamed.

Often times there is no revenue strategy that drives go to market plans, product, marketing and sales function.

I have seen these situations a lot around me. When it happens and it’s a crying shame.

Sales people are only part of a two part system to drive sales. Sales people are the tip of the spear, they are the executors and if they aren’t doing the right things, nothing is getting done. With that said, the company has a job too, and if they aren’t doing their job, it doesn’t matter how good sales is, ain’t nothing gonna happen.

Sales people fail because they company fails them and when the company fails them the isn’t doing some or all of these things;

  1. There is no solid revenue strategy and a ‘Go to Market’ plan
  2. The business model no longer fits the market
  3. Poor territory development
  4. Poor sales process and review mechanisms
  5. They don’t provide a good competitive product. In 2018, it’s all about providing business outcomes.
  6. They aren’t providing solid sales support (enablement)
  7. They don’t have a solid on boarding process
  8. They have unrealistic quotas
  9. They don’t provide adequate training
  10. The have horrible hiring practices
  11. They don’t have a sales culture through out the entire company
  12. They lack sales leadership
  13. They don’t listen to the sales people
  14. No lead development
  15. Weak sales messaging
  16. Lack of market understanding
  17. Slow product upgrades, improvements
  18. High prices
  19. Weak marketing department
  20. They micro manage
  21. No room for failure
  22. Too much room for failure (never make quota, and still have a job)
  23. Bad talent management
  24. No coaching
  25. Poor communication
  26. It’s political and bureaucratic
  27. Over zealous legal
  28. Unrealistic expectations
  29. Can’t deliver product, they can’t implement
  30. Crappy customer service
  31. Poor customer retention
  32. Not enough tools (salesforce automation, CRM’s, etc.)
  33. Don’t embrace social media
  34. Don’t recognize it’s 2018 NOT 2002!

This is one long list of ways sales people fail, because of their company.

It’s too easy to blame the sales person or the sales team for falling revenue, for poor sales results, but before we do, we need to take a good long look at the company. Is it providing the sales team with what it needs to crush it? Often times, the answer is no.

It’s time companies become accountable for sales success and failure as much as the sales individuals.

How does your company stack up?

If you want a top-notch sales organization, hire top-notch sales people AND then give them everything they need to be successful, which starts with avoiding EVERYTHING on this list.

Yes, companies CAN be the reason sales people fail.

Build Your Own Sales Process and Trust It!

If you want to sell better, start creating your own, repeatable processes that will get you to your goal.

Just like losing weight, each one of us have to figure a way that works for us. Getting lost in umpteen weight loss plans, apps, gadgets, and recommendation is often the case with many of us. Picking one plan, one process and staying disciplined to set of activities will definitely get you off to a good start and deliver results.

Improving from that place of progress is much easier than frequently flipping over to multiple approaches, processes and activities.

Too many salespeople (including organizations) just get lost in a bunch of activities without a plan. They make calls. The write emails. They read books. They follow up on tasks, etc. But what is missing with most sales people is consistent, reliable, processes that increase the probability of making their numbers.

If you want to sell better, step back and analyze how you do what you do. Start learning to ask WHY?

  • Why do you call when you call?
  • Are they the right times?
  • Why do you write the emails you write?
  • Are they the correct emails?
  • When do you prospect vs. follow up on existing pipeline opportunities?
  • How do you manage open tasks?
  • What tools have you/do you incorporate into your daily routine.
  • Why do you use the tools you use today?
  • Why are you using the current cadence that you use?
  • What are the outcomes you expect from each process?
  • What happens if it’s not delivering?
  • How are you identifying new companies to call, or connect with?
  • How do you know when to change things up, etc.?

The best sales people build repeatable sales processes that increase their probability of being successful.

Take inventory of your day and evaluate how you execute. Where is there room for improvement? How can you maximize your chance of success? What things can you do, repeatedly, that will get you more opportunities, accelerate the sales cycle, increase the average deal size and more.

The times I’m most successful is when I put a solid process in place. It’s when I become an expert in “how” something can be done.  When we become experts in how to do something we increase the probability of getting it done and done well.

Start analyzing your work flows, your work processes and how you execute. Look to build effective, repeatable methods to do your job and then trust the process. Too often we underestimate the power of execution. It’s not enough to just do. We have to do it well also.

In our case, we have used a consistent prospecting process, set of KPIs and a solid CRM (Hubspot) to drive our sales pipeline.

 

We know how we will qualify and move our Subscribers to become leads and further to become sales qualified leads. We have honed our process over a period of 5 months and now we know how to go after our Ideal Customers and Prospects.

This has resulted in a consistent increase in our pipeline and movement towards our sales goal.

If you want to get better at selling, build your own processes and trust them.