the sales effectiveness effect

© CSO Insights 2004

The Sales Effectiveness Effect

2004 State of the Marketplace Review

Jim Dickie Barry Trailer


Sales Excellence Reviews 4,000 small, medium, large firms Initial project goals Evaluation methods Justification approaches Implementation plans Hands-on experiences


Selling In Turbulent Times

2004 sales excellence challenge

• Surveyed over 1,337 companies worldwide

• Interviewed 200+ CEOs, CSOs, CMOs,

• Results:

Understanding of the challenges

Defining of the causes

Surfacing best practices


Sales Rep Performance vs. Quota

Under Quota50.8%

Meet or

Exceed Quota49.1%

The Report Card is NOT Good


0.0% 10.0% 20.0% 30.0% 40.0% 50.0% 60.0% 70.0%

Other

Reduce sales admin burden

Support team selling

Decrease sales costs

Improve communications

Increase channel effectiveness

Reduce sell cycle

Increase margins

Increase customer loyalty

Increase market share

Increase sales effectiveness

Increase revenues

Top Three Business Objectives For Sales


Sales Effectiveness Issues

Generating leads

New rep ramp-up

Up-sell/cross-sell

Avoiding discounting

Optimizing channels

Communications:

sales teams/

enterprise

No decisions rates

Forecast accuracy

New product rollouts

Sharing best practices

Building customer

loyalty

Sales rep retention


At Your Company, is the Sales Effectiveness Challenge:

A) Increasing

B) Holding steady

C) Decreasing


1 2 3 4 5

Complexity of order entry process

Amount of sales rep turnover

Difficulty accessing information

Admin burden placed on sales force

Rate of new product introductions

Complexity of product offerings

Breadth of product offerings

Competitive activity in the marketplace

Rate of Change in the Marketplace –Challenges


Sales Effectiveness Hall of Fame StorageTek• 300% increase in revenues/rep over 4 years

McKesson • 200%+ increase in new product selling effectiveness

Global eXchange Services• 350% increase in lead generation effectiveness

Pitney Bowes • Order error rate reduction from 23% to 1%

Xerox• Doubled services conversion rate of warranty

customers


What impact is CRM having for you?

A) Significant improvements in sales

effectiveness

B) Minor improvements

C) No measurable improvement

D) Do not know


Sales Effectiveness - The Dark Side

Success is not a given

• Significant improvements – 25.7%

• Minor improvements – 44.9%

• No measurable results – 17.8%

• Don’t know – 11.6%


Impacting the Customer Life Cycle

CLOSERETAIN

EXTEND

ATTRACT

SELECT

Reduce the

number of “no”

decisions

General more/ better leads

Generate greater

incremental business

Avoid customer

losses, maximize renewals

Shorten sell cycle and

increase win rates


Sales Effectiveness in Action

Case Study – Global eXchange Services

E-commerce vendor; 100,000 trading partners

and 1 billion transactions annually in 58

countries

Very complex sale, hard to attract right leads

Before project started:

• Revenue potential leads generated per 100 Web visitors =

<1, per call center rep = 1.5/day


Global eXchange System Walkthrough


Increased call center leads from 1.5/day to 7+

New leads close 30% faster than traditionally

gathered leads

Up-sell/cross-sell ratio improved by 25%

48% of conversations advanced to the phone

Reach a higher-level decision maker

Global eXchange Success Statistics


Sales Effectiveness in Action General medical, $2B+ division of McKesson.

Represent 300 manufacturers, 30,000 products.

Project challenge: Represent every product as

well as the product manager!

Technical requirements: Link field sales,

marketing, distribution, finance, suppliers

seamlessly into sales process.


General Medical System Walkthrough


General Medical Results

30% increase in revenues per rep

400% increase in new product hit rates

1.4% improvements in margin

Higher rep retention rates


Sales Effectiveness Levers

Process

People

Technology


What is the biggest single challenge negatively impacting CRM success?

A) People

B) Process

C) Technology

D) None of the Above


Sales Effectiveness Levers

Process

People

Technology

Knowledge


0% 10% 20% 30% 40% 50%

Getting Adequate Funding

Getting Executive Support

Supporting Remote Users

Getting Users Productive

Effectively Rolling Out System

Identifying Process Problems

Customizing CRM Tools

Matching Technology to Process Problems

Measuring Project ROI

Gaining User Acceptance

Populating/Maintaining Data

Toughest Challenges Encountered During CRM Initiative


AMM Customer Message Management (CMM) Initiative

More effectively aligning sales & marketing

Focus on the how of sales versus the what

Creation, delivery and management of

marketing messaging

Optimizing performance throughout the

entire sales process


CMM Case Studies

Cisco

American Express

EDS

FedEx

IBM Canada


0.0%

5.0%

10.0%

15.0%

20.0%

25.0%

30.0%

35.0%

40.0%

<10% 10 - 25% 26 - 50% >50%

Percentage of Presentations Resulting in a Sale


0.0%

5.0%

10.0%

15.0%

20.0%

25.0%

30.0%

35.0%

40.0%

<10% 10 - 25% 26 - 50% >50%

Percentage of Presentations Resulting in a Sale

All Responses

World-class CMM


Common CMM CRM Components

Static & dynamic content support

Prospect specific focus

In-context sales process

Effectiveness analysis support

Link in with existing CRM applications

www.CMMForum.org


P x C x V x F > RP x C x V x F > R

Formula for Successful Change

Four factors must be present for change to occur:

• P -

• C -

• V -

• F -

The product of which must be greater than R - Resistance to change


Questions & Answers

White Papers at www.csoinsights.com

• Sales Effectiveness Insights 2004 Top Ten

Trends

• Optimizing Sales Performance with CMM

• Sales Knowledge Management Study Results

(July)

the sales effectiveness effect

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