25
Jul

Glue Products Have An Advantage When Customers Determine Value for a Solution

“Glue products” connect sections of software solutions for customers. At the application layer examples include Tibco, IBM’s MQ Series and more. At the functional level, examples include software systems for training, networking, data collection, and many more. This post will discuss functional glue products.

A brief word on how these products tie together sections of functional solutions may be helpful:
I have current experience working with Microsoft’s SharePoint server product and related training solutions. So I will present what follows specifically on training as a glue product and how I think sales teams should address value with their customers.

SharePoint customers, on-premises, have objectives like “collaboration”, “compliance reporting”, internal communications (intranet), communications with partners (extranet), etc. Without training, personnel may not be able to successfully deliver on any of these objectives. So does the value proposition for the training component depend simply on the training itself, or should the calculation of value be based on how the system chosen for the training requirement optimizes the overall value of the SharePoint solution? Sales teams should help customers understand the most accurate value calculation will be based on the value of the overall SharePoint solution with the training component included as the optimum choice for the job. This tactic enables a favorable pricing discussion for the training component for the sales team while, at the same time, promising the best chance the customer will have to extract the highest possible value from investment in the overall solution.

If sales teams don’t do the work (in other words come up with a description of the solution the customer expects to build with SharePoint, and the expected role for training or one of the other glue solutions I mention above), then the value proposition will likely come down to an “apple vs orange” comparison where one training option is compared to another without any attention to the overall solution. The sales team will likely find itself haggling over price, while the customer struggles to get to the highest possible return on investment in the overall system.

Convincing customers to participate in a value calculation as I have just described depends on trust. So sales teams should also implement supporting tactics capable of elevating the relationship with the customer.

I am often surprised to see how few early stage ISVs marketing functional glue products demonstrate understanding of these tactics. Successful efforts to sell to enterprise software customers almost always include this type of value discussion, calculation and proposition.

29
Sep

Putting Larry Ellison’s New Role at Oracle in Perspective

Larry Ellison announced his decision, on September 18, 2014, to step down from the position of CEO Oracle. A lot has been written about the significance of this announcement. But content volume doesn’t mean much when compared to relevance, not to mention accuracy.

The general consensus is Ellison’s change in roles marks the end of an era. Ellison is the last of a list of “first generation” entrepreneurs (including Bill Gates, and Steve Jobs). Regardless of the enormous success all three of these individuals achieved, both Ellison and Gates have been included in what the overall market considers a group of once successful, but, in 2014, out-of-touch business builders. The argument goes like this: Ellison and Gates were great in their time, but times have changed and, now, the massive organizations they built, Oracle and Microsoft, are losing enormous ground to much younger competitors, (Amazon, Facebook, Salesforce.com). This latter group includes Apple, which, despite being a business with the same longevity of serving consumer markets for technology as both Oracle and Microsoft, nevertheless, speaks a different tongue, learned from its radical founder, Steve Jobs.

This argument looks good on paper, but in reality is way off the market. Leaving aside the question of whether or not Microsoft has been eclipsed by Google, Salesforce, Amazon, and even Apple, Oracle does not fit the frame.

As this writer wrote earlier to this blog on a couple of occasions, a lot of the sales effort for Salesforce.com, Microsoft, and Google is now in the management hands of 3 former Oracle sales executives: Keith Block is now the President of Salesforce.com; Judson Althoff is now Corporate Vice President and President of Microsoft, NA; finally, Amit Singh is now the President of Google At Work.

All 3 of these executives held very high level positions at Oracle: when Block left Oracle he held the position of Executive Vice President, North America. Singh appears to have reported into Block as Vice President, North America. Althoff held the position of Vice President, head of channel sales for Oracle.

The importance of this point is to illustrate the actual enormous impact Ellison and Oracle have had on the whole software market for enterprise business customers. Oracle set the bar at a very high level. Their sales team, perhaps better than any other, understood how to implement a complex sales strategy, and had a better history of converting sales efforts into successful deals than any other.

The fact Block is now President of Salesforce.com should act as a reminder on the limitations of “hands-off” selling of cloud subscriptions, and the need for direct engagement (collaboration is a better word) with customers if further sales are to be made.

Ellison had an enormous impact on his peers. It is important to note his new role at Oracle: CTO and head of product marketing. As we have written all along in this blog, product marketing is truly the neighborhood where the real tech winners show their stuff. Perhaps Ellison has something further to show us all. We’ll see as Oracle moves forward.

Ira Michael Blonder

© IMB Enterprises, Inc. & Ira Michael Blonder, 2014 All Rights Reserved

4
Jun

Succeeding at Enterprise Software Sales Still Requires Sales People Who Can Do Something More than Just Present Products

During the 2014 Technology, Media and Telecom Conference, hosted by JP Morgan, Judson Althoff, President of Microsoft, North America made clear the importance of “consultative” skills, rather than product presentation, to the success of sales of Microsoft software to enterprise business.

The North America software business, for Microsoft, per Mr. Althoff’s remarks, produces approximately “$25 billion across 8,000 folks” (quoted from a transcript of Sterling Auty’s interview with Mr. Althoff, which took place during the 2014 JP Morgan Technology, Media and Telecom Conference).

Like any other component of Microsoft, the North America business has been in transition. Presently the sales team works with a set of products “down to three or four Microsofts instead of 22 Microsofts when [Mr. Althoff] started from a product standpoint”. (ibid). Mr. Althoff characterized the world of the “22 Microsofts” as a terrain filled with silos, which often worked at cross purposes. The “One Microsoft” reorganization, in his opinion, which Steve Ballmer articulated over a year ago, is still ongoing and promises to alleviate a lot of the drag which beset the company under the “tyranny” of these product silos.

The sales process, as well, has changed. Mr. Althoff’s remarks described the old selling process, where Microsoft sales personnel would “try to dream up a big data project together [with customers]”. The driver behind this type of effort clearly was what I have referred to in this blog as “solution without a problem” syndrome.

According to Mr. Althoff, this approach has been changed. Now “we try to coach our sales force not to have a singular starting point, and show up with a canned pitch, but rather be much more consultative in our approach to understanding” (ibid) the challenges prospects and customers are facing.

He then went on to emphasize the importance of industry understanding to a successful software sales process: “[i]t varies quite a bit by industry, financial services, healthcare, and manufacturing.” (ibid). This response is entirely inline with comments made by Keith Block during yet another technology day sponsored by an investment bank — this time Piper Jaffray’s Media and Telecommunications Conference, March, 2014. Mr. Block emphasized the almost critical importance of sales personnel maintaining an accurate understanding of the software requirements for specific industries, if they are to succeed.

Bottom line: despite the apparent simplicity of a new set of consumerized IT software products, usually served from the cloud, the enterprise software selling environment is still highly complex. For both Microsoft, Salesforce.com, and, I would argue, Oracle (the past employer of Mr. Block and Mr. Althoff), sales personnel with demonstrated success selling complex products are still the most likely to succeed.

Ira Michael Blonder

© IMB Enterprises, Inc. & Ira Michael Blonder, 2014 All Rights Reserved

30
May

Has Salesforce Completed Its Transformation Into an Enterprise Sales Organization?

On May 20, 2014, Salesforce.com reported its results for Q1 2015. The speakers included Marc Benioff, CEO, Keith Block, President and Vice Chairman, and Grant Smith, Chief Financial Officer. It should be noted Mr. Block will complete his first year at Salesforce.com in June, 2014. He came to the company from Oracle® Corporation, where he spent 26 years, from 1988 to June, 2013, in a series of sales management roles, which culminated in a tenure of nearly 10 years as EVP North America where he had responsibility over a multi-billion dollar revenue generating effort.

As I wrote earlier in this blog, on April 2, 2014, in a post to this blog titled
Cloud SaaS ISVs Develop Sales Strategies for Enterprise Prospects, Mr Block is, perhaps, one of the strongest examples of a master of the Complex Sale, which is a sales concept championed by Jeff Thull. After all, Mark Murphy, a software analyst for Piper Jaffrey referred to Mr. Block’s tenure as EVP, North America for Oracle as an opportunity “to run, arguably, the largest and most profitable enterprise software business in the world.”

So, given this backdrop, the analyst questions Mr. Block fielded about just how long it will take before the sales teams at Salesforce.com produce a “9 figure deal” make a lot of sense, especially when one considers the ratio between Salesforce’s present market cap of $30.62B and a staggering forward price to earnings ratio, for its CRM public stock, of 149.25 to 1. Mr. Benioff’s reflections on the level of success the business has achieved are certainly admirable. The company sounds like a terrific place to work and a great contributor to its social surroundings. But the forward price to earnings ratio requires a sense of urgency, on the part of management, which was somehow lacking, in my opinion, in Mr. Benioff’s opening remarks.

Mr. Block cited a win at Manulife, an expanded relationship, where they leveraged “[Salesforce] Service Cloud to develop a customer engagement platform, with very personalized service across their life insurance, wealth management and investment products” (transcribed from remarks made by Mr. Block recorded on the audio webcast).

He went on to refer to several other enterprise-wide wins at other larger organizations, across several industries. But Rick Sherlund asked a very big question: “I think we’re all waiting for 9 figure deals. Is that realistic? Are there deals of that magnitude in the pipeline that we can look forward to over the balance of this year?” (transcribed from a recording of Mr. Sherlund’s question, which is included in the quarter’s webcast).

In my opinion, Mr. Block’s reply to the question signaled a much slower pace of change than, perhaps, the analysts in attendance would have wanted to hear. On the notion of whether there are any “9 figure deals” in the works, he merely referred to a “natural evolution” of relationships with important partners, which, over time, he argued, exhibit the potential required to support sales of this magnitude at some future date.

Disclaimer: I have no position in Salesforce.com whatsoever

Ira Michael Blonder

© IMB Enterprises, Inc. & Ira Michael Blonder, 2014 All Rights Reserved

17
Jul

It Pays to Know Who Is on Your Website When Managing Large Sales

Sales with a substantial impact on business revenue usually transpire over a comparatively longer sales cycle than the typical sale. These sales also have a complex architecture, including a set of stakeholders who contribute to a purchase decision. Any changes, over time, in the performance of a prospect’s business can impact on the direction of a sales campaign. Therefore, managing these sales to a successful outcome should be a top priority for early stage technology businesses with the right products for these markets.

Much of the marketing communications burden, in 2013, for most early stage technology businesses is handled by website editorial content. Stakeholders in complex sales opportunities will want to review marketing communications materials, press releases, customer success stories and whitepapers. So they will come to your website, over time, to search for this information. If your sales teams can monitor website visits, then they may be able to use the information they capture to better position products and push sales forward.

As we have written earlier in this blog, we are very familiar with a couple of solutions for collecting this information:

Either of these tools can be used to collect information about visitors to your website, who would otherwise be anonymous.

Here’s an example of how this information can be of substantial value to your sales teams. We have been managing a sales opportunity for one of our clients. This opportunity is reaching a decision point. Our client is using the VisualVisitor solution. We noted a recent visit by our prospect to our client’s website where the landing page presented a different product than the one our prospect had expressed interest in earlier in the process.

At the same time, our prospect let us know of some substantial internal purchasing resistance on the original product. So with the information we collected from VisualVisitor we gained an advance view of where our prospect would likely take our discussion, going forward. Providing sales teams with advance warning of coming changes in purchasing discussions can help them salvage a sale where otherwise a buyer might pass. In our case we are using the information to help our prospect migrate the purchase discussion over to a product more appropriate for their changing needs.

Ira Michael Blonder

© IMB Enterprises, Inc. & Ira Michael Blonder, 2013 All Rights Reserved

28
Jun

Small Businesses Benefit by Carefully Managing Brand Marketing and Selling Efforts

On June 17, 2013, the New York Times “You’re the Boss” blog published the first of a series of articles, authored by Paul Downs, on why a small business may want to think about hiring a sales consultant: Why We Hired a Sales Consultant. We offer consulting services, so we thought we’d read the series carefully and provide our thoughts on it.

The basic problem Mr. Downs’ business faced, as we see it, was not really related to sales, but more in the area of product brand management. Mr. Downs’ business, in our opinion, was not able to successfully manage the change in market perception of his conference tables. His products had gone from magnetizing very high levels of market interest (which truly required no more than a click ad campaign and an order form to close lucrative sales orders), to products customers “needed to think about” in order to buy. From the post series, it is pretty clear this change in market perception “just happened” and was not anticipated by the product marketing effort at the business.

We’re not trying to diminish the importance of complex sales skills to Mr. Downs’ ultimately successful effort to turn the business around. But we do need to point out the need for small businesses to understand the curious relationship between successful brand management and sales vulnerabilities. Brand management should always be judged against its ability to produce some level of substantial market interest in a product. The easier the selling process gets, the more vulnerable the business becomes to a possibility of poor sales results in a more difficult business environment.

We would have recommended a closer look at the product message and the lead generation venue. In Mr. Downs’ case the primary drive for sales leads was Google Adwords. We think a different driver, transporting a new brand message for the product would have produced even better results for his business.

Ira Michael Blonder

© IMB Enterprises, Inc. & Ira Michael Blonder, 2013 All Rights Reserved

18
Dec

Any Opportunity to Include Decision-Makers in a Sales Plan for Enterprise Software should be Acted Upon

Sales teams representing enterprise IT ISVs need to act on any opportunity to include decision-makers in their sales plan. It is is easy to be lulled into skipping this critically important step. Here’s an example: sales receives an incoming inquiry from a user at an enterprise organization. This user, as it turns out, is looking to implement a specific solution like our ISV’s product. The user has gone through a preliminary step of gaining management approval to purchase some solution to meet his/her requirement. Therefore, from this user’s perspective, the next step is simply to gather all of the information required to make an informed decision as to which product will best meet the objectives of the requirement.

In 2012, the user depicted in our example usually doesn’t even need to reach out to sales at any point prior to placing an order. In fact, our ISV, like all of its competitors, has exposed lots and lots of informative content about its products, clients, testimonials, etc on its web site. Even more, pricing information is included in this material. The result is that our user knows just about everything, without any required contact with sales.

Once the inquiry finally comes in, the purpose is generally to shop the product, or, often, to place an order. Our sales team may try to slow down the process, in order to collect a lot of information about the user, his/her application, why the purchase was likely approved, etc., but our user may have very little tolerance for the efforts of the sales team to slow things down. After all, our user already has all the answers to the qualification questions he/she required to determine the set of products that would likely meet the requirement, which, in turn, needed further review. Our sales team will likely back off of its requests and assume the role of order taker.

If our ISVs product is a cloud offering with an annual subscription, it may be literally “up for grabs” as to whether or not our user will renew the enterprise subscription in year two, or not. When our sales team makes the attempt to secure an approval to send an invoice for the renewal charge, the response may be something like “I love your content, but I’ve moved onto another set of tasks and management has turned down a request to renew even though the team that took over for me would certainly benefit from a renewal”.

In fact, our sales team laid the groundwork for this problem way back when our user placed the order. It would have been much more fortuitous to push our user prior to accepting the original order. In the next post to this blog we will present some of the technique that we exercise to get the actual decision-maker included in the discussion.

© IMB Enterprises, Inc. & Ira Michael Blonder, 2012 All Rights Reserved

23
Aug

In Late Summer, 2012, Dell and Hewlett Packard are on the Trail of Highly Capable Enterprise Sales Personnel

Dell reported their second quarter earnings for their 2013 fiscal year on August 22nd 2012. Hewlett Packard followed right behind on August 23rd, 2012 with their Q3 results. We found lots of consistency between the two reports:

  1. A common theme — 2012 presents a challenging “macro” environment where personal computers sales have declined steeply, year over year for both companies
  2. A second common theme — enterprise deals are moving at a substantially slower pace than was the case in the past
  3. A shared objective — improve the performance of enterprise IT sales teams

In the next post to this blog we will express some of our opinion on pt 1, above. For the remainder of this post we will focus on pt 3 and, to an extent, pt 2. As we have consistently voiced in this blog, since its inception in early 2011, the characteristics of effective, valuable sales personnel charged with selling products into enterprise-class (meaning very large) businesses, and comparable sized organizations in the public and not for profit sectors, have changed, radically, since the early days of the personal computer (late 1970s, early 1980s).

Back then, the winning mindset for top sales performers was much the clarion call of the wild hordes. The art of selling was as easy as “taking candy from a baby.” Finally, the optimum mindset that sales personnel needed to cultivate in order to “hit their numbers” was to think like a rabid dog driven to “go for the jugular” of the prospect. The environmental habitat that underpinned this selling environment was exclusivity — sales personnel who consistently exceeded quota mastered the technique of convincing prospects that they truly had something to offer that no one else could deliver.

Those days are gone in 2012, where entire categories of products overlap, groups of prospects must arrive at a consensus in order to purchase products/services/integrated solutions, etc and, of most importance, budgets are almost no where to be found when needs are at hand. Today’s most successful enterprise IT sales personnel must be masters of all of the steps required in a complicated process that can take, literally, several years to develop. Much of that work, as we have written about in this blog, is actually a matter of facilitating the natural evolution of the prospects purchase process, by no means does it have much to do, at all, with pointing their boat and forcing them to drive in your direction.

We were gratified to see that these two public businesses acknowledged, in their quarterly reports, the imperative they share to build more effective sales organizations. We are absolutely convinced they are after precisely the type of skills that we have delineated in this blog.

If you head up an early state enterprise IT ISV and need to staff up with sales personnel who can work, successfully with prospects in our 2012 enterprise business climate, please contact IMB Enterprises, Inc. We have a methodology that we can teach you to implement that will certainly shorten the time it takes to develop the sales team that you require. Please call Ira Michael Blonder at +1 631-673-2929 to further a discussion about our services. You may also email Ira at imblonder@imbenterprises.com.

© IMB Enterprises, Inc. & Ira Michael Blonder, 2012 All Rights Reserved

27
Jul

Buyer Skepticism must be an Underlying Assumption for Enterprise IT Sales in 2012

We read recently of a well publicized failure for a large scale ERP project for a publicly traded business that markets products to the United States Department of Defense. In fact, this failure was significant enough to negatively impact on the quarterly return, meaning profitability, for this business. As we read further about this misfortune, we noted the names of other publicly traded businesses that had sponsored similar failed projects.

We think this type of experience is quite common in the enterprise IT software market. Therefore, we advise that it is entirely mandatory that sales and marketing teams for innovative tech businesses looking to enter these markets assume that buyers will express, at some point during the sales cycle, a skepticism about products and related projects. Further, these same sales and marketing teams need to set reasonable expectations of product and project results. In 2012 we think it is much better to make a mistake by under estimating the final benefit to a customer than to over estimate in any way the end result of a purchase. Finally, any quantified ROI estimates need to be rigorously tested to ensure accuracy.

Maintaining a sales plan that assumes skepticism and related “environmental characteristics” ought to lead sales and marketing to look for opportunities to not only include purchase proponents, but likely opponents, as well, in a sales plan. It is far better to obtain advance notice of pending criticism than to be surprised after the fact. Of course, the question then becomes how to collect contrarian views on a purchase within a plan? We think it makes sense to either convince buyers of the necessity of gaining a preview of any objections (along with an identification of the source) or to work with contacts at competitors who may be privy to this information. The end result should be a much stronger sales plan, one that can withstand internal objections and scrutiny.

We hope that it is apparent that highly experienced sales and marketing staff need to be on hand to deliver a positive result for the type of sales activity that we have just sketched. Skeptical enterprise buyers who have experienced failed projects will be loathe to trust “just any” sales personnel. Rather, familiar personalities (potentially ex employees) will need to be included in the sales effort to provide a rationale for enterprise buyers to trust tech innovators enough to collaborate on designing a sales plan.

If your business can use the type of expertise required to put together a successful sales campaign for enterprise IT buyers, we would like to hear from you. Please telephone Ira Michael “Mike” Blonder at +1 631-673-2929 to further a discussion. You may also email Mike at imblonder@imbenterprises.com.

© IMB Enterprises, Inc. & Ira Michael Blonder, 2012 All Rights Reserved

11
Jun

Applying Complex Selling Techniques to IT Commodity Products

The same principles of complex sales can be applied to selling technology commodities like PCs, servers, printers, routers, etc. to enterprise customers with high value results. When prospects are permitted an opportunity from an initial conversation (and thereafter) to endorse a notion that value can be derived from the implementation of products, services or an integrated solution, they take a position in the outcome that is lacking in a typical sales dialogue where a sales person jumps into presenting a product with an objective to simply “get to yes.” The inquiry may not produce a sale, but for the duration of the dialogue a customer will be much more engaged, not to mention forthcoming than would be the case with a less open exchange of information. Therefore, it makes complete sense for teams selling IT commodities to adopt the same approach, wherever possible.

Learning about why customers are looking to buy commodities like desktop computers can produce very useful information. For example, perhaps a customer is in the market for desktop computers not simply as an upgrade to existing equipment. Rather, a plan is in place to automate a cumbersome manual procedure. The computers are required to support data processing for the procedure. Therefore, in the context of collecting this information from the customer, a sales person (by virtue of having strictly adopting the stance of a listener/facilitator in any/all early stage discussions with the customer) has opened an opportunity to, perhaps, contribute unique value to the customer’s effort that would not have otherwise been the case through a typical commodity discussion about price and availability.

We think it always makes sense to attempt to engage with customers with open questions (who/what/where/why/how). In fact, we advocate passing on, right away, should customers be unwilling to discuss requirements in this manner. Why waste time with customers who are simply shopping a solution? The results of early stage discussions conducted in a controlled manner to gain as much information about the customer’s unique situation will be quite useful to determine whether or not it makes sense to devote substantial effort to a specific opportunity. There is absolutely no reason that we are aware of that would preclude sales personnel from proceeding along the same information gathering effort for commodity sales. If you subscribe to our thinking and need your sales teams better equipped to collect the information required to make for promising sales, please contact us.

You may telephone Ira Michael “Mike” Blonder at +1 631-673-2929 to further a discussion. You may also email Mike at imblonder@imbenterprises.com.

© IMB Enterprises, Inc. & Ira Michael Blonder, 2012 All Rights Reserved