Why Most Sales Enablement Initiatives Fail
The following is the post ‘Why Most Sales Enablement Initiatives Fail’ found at solutionsellingblog.com on September 22, 2009. Please check out the original post to see the comments it got.
“Sales Enablement / Sales Knowledge Management systems sound like a pretty good idea. Who can argue with the objective of “Getting just the right knowledge to just the right sales person at just the right time”?
The truth is that many of the new web content management, collaboration, and search technologies have made this objective more attainable. Unfortunately, most marketing and sales organizations do not agree on what “just the right knowledge actually is”. As a result, the sales enablement movement seems destined to travel down the same path that the CRM industry did in its early years…the technology works fine but few people actually use it.
So, what actually is the right selling knowledge? When you’re selling simple commodity products, customers clearly understand what they want, and value is almost exclusively defined by price. As such, the focus of sales enablement is on helping salespeople communicate features, benefits, and functional competitive advantage. Most marketing organizations do a good job with this because the taxonomy that supports the collection and sharing of product centric knowledge (i.e. the feature lists and competitive matrices) is simple to understand and implement.
However, complex products and services need to be sold in the context of solving specific customer problems, and this adds additional dimensions and complexities to the messaging and sales enablement knowledge model. When you are really serious about supporting a solution centric sales model, the most important sales enablement objective should be to help salespeople clearly and concisely articulate value as well as product differentiation in the context of the customer’s specific problems.
I contend that this is best accomplished by rethinking the underlying taxonomy that you use for sales enablement so that in addition to the product centric knowledge mentioned above it also simplifies the capturing, sharing, and institutionalizing of three kinds of solution centric knowledge:
- Problem Knowledge, which helps Salespeople better understand and talk about the customer’s business problem. This can only be done by documenting the underlying causes as well as the strategic and operational impact of the problems and those causes on the customer’s business.
- Capability & Problem Solving Knowledge, which helps sales people clearly communicate how their solutions actually solve the underlying causes of the customer’s problem, and more importantly, how those capabilities solve this underlying causes better than the competition.
- Value Knowledge, which helps salespeople clearly communicate Generic as well as Differentiated Value (see my blog on solution differentiation).
This solution centric knowledge represents the Value DNA of your organization and your best people intuitively understand and can communicate it. Unfortunately most sales and marketing folks struggle with solution centric communications, and few companies have ever reorganized their product information so that it supports this customer and problem centric perspective.
The challenge therefore is to come up with a taxonomy that simplifies the sharing of this solution centric knowledge in a fashion that everybody in marketing and sales can easily understand.
This is why a formal Problem-Solution Mapping process should be the strategic foundation for any solution centric marketing and sales enablement initiative. An effective P-S Map paints a clear concise picture of the critical customer problems your solutions solve, the key causes of those problems. It also defines which of your capabilities and more importantly your defensible differentiators solve those underlying causes.
And, here’s the clincher. Once marketing validates that P-S Map with sales they will have clearly defined and agreed upon what just the right knowledge is, and they will have permanently eliminated the primary cause of the marketing and sales disconnect. The end result is that an effective P-S Map will become the sanctioned taxonomy for capturing and sharing the three types of knowledge mentioned above so that marketing can finally start to deliver on the ultimate goal of getting just the right knowledge to just the right salesperson, at just the right time.
For more information on Problem-Solution Mapping please visit the Solution Marketing section of our web site http://www.spisales.com/solution-marketing.aspx
There are also two short videos on accelerating the transition from product to solution marketing and sales enablement:
Please check out the original post to leave and read comments.
The cost of running a sales enablement solution: Is there a need for editorial staff to help create and edit content?
In ‘Is Sales Enablement just Lipstick on a Knowledge Management Pig?’ Gerhard Gschwandtner (@gerhard20) asked:
“What’s the real cost of running a Sales Enablement solution? Is there a need for editorial staff to help create and edit content, to set up template standards and apply them?”
The following job posting gives a bit of a hint what kind of tasks around a Sales Enablement Web Portal need to be performed manually:
Job Title: Sales Enablement Intern
Job Date: 2009-09-24Company: Initiate Systems
Job Location(s): Chicago, IL, US
Description:
Sales Enablement: Sales Enablement Web Portal– Maintain the sales portal by:
o Naming, dating, tagging and approving submitted assets on a daily basis
o Building or creating custom pages when needed
o Special projectsSales Enablement: Sales Methodology (RADAR) Opportunity Sessions
o Scheduling monthly RADAR sessions for AEs
o Researching submitted RADAR opportunities to find additional materials
- Hoovers
- Spoke
Sales Enablement: Weekly Reports
o Sales Portal weekly reports
o RADAR monthly reportsAs time permits:
Lead Generation: Lead Processing
o Research incoming leads verify in Salesforce.com and add if necessaryLead Generation: Telesales Tagging
o Add campaigns in Salesforce.com
o Add tasks for AEs in Healthcare and EnterpriseLead Generation: Assist with Tradeshows
o Assemble collateralLead Generation: Mailings
o Tag campaigns
o Mail merge letters
Having been working with the cutting edge Sales Enablement solution BizSphere at a large b2b company since 2007, I can comment on the extend to which the tasks above can be automated:
o The submission process (for assets or pieces of information like contact details) can be shortened.
- Empower both – providers of official content (Product Marketing, MarComm, CI/MI, Training Department, Event Planning Team, etc.) and users who want to contribute (Sales, Customer Service, rest of work force, Channel Partners, etc.) – with an easy way to submit from within the context of the specific combination of geography, product/service/solution and type of information they are looking at. That takes care of the tagging. If they want to tag things further they should be allowed to.
- Implement a Content Governance model that automates notifications regarding content that needs to be approved, that reached the end of its Life Cycle, or that is meant for a limited audience only.
- For most companies cutting down the number of ways to submit content and even unifying the process so that one form allows to upload a single instance (Single Sourcing) and to publish it to multiple locations (facing the public, channel partners or only sales people) would be the wildest dream.
BizSphere goes further than Single Sourcing of assets. It does Single Sourcing for the fragments (nuggets) your assets consist of. When you only have one instance of a photo, a logo, the number of employees you have or lets say a value proposition, then it will be updated in all your assets the moment you update this instance. Your assets are being auto-generated! The moment you click the ‘Generate’ button, hundreds of nuggets come together to form an asset that is customized for the context you chose. You want to pitch an offering to a customer in Spain? Then the auto-generation means that only the customer references from Spain are being pulled and put together in a polished way according to the chosen template. (See Do we really want people who earn $150 an hour creating PowerPoint presentations from scratch? and Do you want your sales people to spend their time customizing slide decks?)
o The task of building pages can be reduced to typing the name of a new offering (product/service/solution) and clicking ‘Publish’.
- When you have established a context, your assets or their nuggets live in, then your sales portal’s pages can be dynamic and just list everything that is applicable for the given combination of geography, offering and type of information. A manually built page would be a silo that would be pretty much outdated the moment the intern from the job posting above has finished it. In BizSphere adding the name of a new offering automatically extends the number of possible combinations of geography, offering and type of information. For each of these combinations BizSphere lists what has a good standing with regards to its life cycle, therefore everything you see is fresh.
o Reports should be in real-time and not weekly.
- Having a dash board overview of both your inventory of assets and their usage lets you track whether a certain region or offering has no assets available or whether they are not being looked at. You will see which type of assets your sales people love (Ratings might not tell you a lot but usage data will). This ability is crucial in becoming better and better in focusing your marketing efforts on what will actually help sales to close deals. “IDC research shows that over 40% of all marketing assets handed over to sales are not in use today.” (IDC’s Best Practices in Sales Enablement – Content and Marketing, July 2009) Why pay someone to create reports every week when you and everybody else, who is interested, could have the kind of dash board BizSphere calls ‘Content Landscape’ as well as even more detailed usage metrics of the Sales Enablement solution; all of it in real-time and sliced and diced as you wish. For presentations to executives just create a deep link to how you sliced and diced the data and they will get to see the current – as opposed to last week’s – data.
BizSphere is the Sales Enablement solution Jeanne Hellman looks at in her case study of “implementing Sales Enablement in a complex, global company”. The link lets you download the full case study for free.
Analysts don’t analyze the economic realities of sales enablement solutions
In ‘Is Sales Enablement just Lipstick on a Knowledge Management Pig?’ Gerhard Gschwandtner (@gerhard20) asked “What Exactly Are Sales Enablement Vendors Selling?”. Please make sure you see all the comments on the original post (from July 29, 2009) as a lot of the parties mentioned in the post responded. To address some of the gaps Gerhard identified in the text quoted below, Jeanne Hellman has written a case study of “implementing Sales Enablement in a complex, global company”. Contact her if you would like to get a copy.
“The noble purpose of Sales Enablement companies is to help sales organizations save time finding relevant information, create and organize sales content and create quick access to all experts across the enterprise.
It makes total sense. Salespeople can win more deals if they are better prepared. To back up this theory, IDC research shows that 33% of unsuccessful deals could have been won if the salesperson had been better informed or acted more client-oriented.
An even more important issue is the growing amount of time that salespeople spend searching for information to answer customer questions. What if a program could give salespeople exactly what they need to know so that they can transform information-chasing time into customer-chasing time? It all makes sense. I can picture the sales-enablement software programmers being obsessed with sales efficiency and sales effectiveness. But let’s take a look how the sales enablement vendors are selling their solution to you, the sales leader.
Vendor Pitches or Marketing Glitches?
Savo promises, “Never sell alone!” Does that hit a hot button for you? I don’t know many lonely salespeople. On another part of the SAVO site I read, “Clone top performers.” Excuse me! Why not promise, “Clone your Swiss bank account”?
Kadient’s Website isn’t shy about pitching the exact same theme on their home page: “What if all of your salespeople could sell like your top performers?” The promise continues, “With Kadient’s on-demand sales enablement application, you arm your sales team with the knowledge, messages and strategies they need to win at every stage of the customer’s buying cycle.” If they found the key to winning at every stage, how come Kadient isn’t a hugely successful company?
iCentera bills itself as a sales enablement company. Their pitch is a model of modesty: “Sales Enablement maximizes your sales organization’s ability to communicate through a central messaging vehicle.” The key benefit: “Close more business through more knowledgeable sales people.”
N-tara.com created a special sales enablement site with this teaser copy: “Ever feel like your salespeople don’t get it?” Here is the pitch: “N-tara’s sales enablement solutions equip your sales force with engaging, customer-ready content that is timely, relevant and in context to your customer’s needs.” The best part of their site is a “Guide to Enlightened Conversations”. It is engaging, interactive and it makes a lot of sense.
SVA BizSphere is a European sales enablement vendor located in Wiesbaden, Germany, with offices in Toronto. The pitch: “Do you want your sellers to minimize preparation time and maximize quality time with your clients?” The key benefits: close more deals, increase average deal size, shorten your sales cycle. It is a clear and concise pitch.
Another vendor in the space is Salesforce.com/content which offers a competing solution to their AppExchange partners Kadient and SAVO.
Other vendors include Avitage.com (marketing automation and sales enablement) Streetsmarts.com (channel sales), Groupswim.com (team collaboration) and Salesforce.com/content.
What Do The Industry Analysts Say About Sales Enablement?
Technology vendors often seek out the help of industry analysts, who lend a helping hand (for a small fee) with objective research that can help sales leaders choose among the competing solutions. When you go to the Websites of sales enablement vendors, you’ll see the same references to IDC and Forrester Research. On November 13th, 2008, Forrester conducted a teleconference entitled, Strategic Sales Enablement. For a $250 fee you could listen to their insights. The analysts defined sales enablement as
“a strategic, ongoing process that equips all client-facing employees with the ability to consistently and systematically have a valuable conversation with the right set of customer stakeholders at each stage of the customer’s problem-solving life cycle.”
If you want to decide for yourself if the paying attendees got their money’s worth, download the ppt at no charge (you need to sign in though).
Not to be outdone, IDC created a very insightful presentation in January of this year. Their definition of sales enablement:
“The delivery of the right information to the right person at the right time and in the right place, to assist moving a specific sales opportunity forward.”
IDC is a bit more generous with their Sales Enablement wisdom. They posted their ppt on Slideshare.com. They scored more than 1,600 views to date.
Gartner defines sales enablement as
“[providing] the sales force with communications programs and tools to drive activity and enhanced productivity.”
On one side we have vendor hype, on the other side we have analyst reasoning. What does this add up to so far? The vendors write the music, the analysts sing the theme song: Here is the category, here are the vendors, here is who is cool, and here is who made it to the magic quadrant.
Here Is What’s Missing:
Analysts don’t tell you that reality is always a step or two ahead of their definitions.
Analysts don’t analyze the economic realities of a sales enablement solution. There are no ROI studies nor objective research that compares the effectiveness of SAVO vs. Kadient vs. iCentera.
Analysts don’t create user studies that tell you more about the information infrastructure, the flaws with the search functions, the project abandon rate by vendor, the average user acceptance, the obsolescence factor of the data, the amount of information that’s missing just because nobody knows where all the useful data is located, the amount of time it takes to train (and retrain) salespeople, or the enduser satisfaction level with the graphical interface (some of the designs are an insult to the eye).
The vendors want you to believe that their sales enablement tools allow you to harness the collective intelligence of your sales organization. It sounds great, but who in the world can define and measure what that means? How do we know what best practices can positively influence sales productivity? Who decides what not to make available (due to security issues)? Most salespeople can’t write coherently, and most of the top salespeople can’t articulate what makes them successful. So how do we really capture sales intelligence?
What’s the real cost of running a sales enablement solution? Is there a need for editorial staff to help create and edit content, to set up template standards and apply them?
How much of a company’s “best practices” and sales intelligence is reusable? If I am a salesrep, getting ready for a presentation to Boeing in Seattle, and I download a presentation that one of my peers created for Airbus, how much data can I reuse, and how much do I have to create from scratch?
Sales enablement companies are NOT too savvy when it comes to social media. Search for Kadient on Twitter – zero results. iCentera has 43 followers, SAVO has 391, BizSphere is the leader with 441 followers. [Post was written on 07/29/2009]
The point is this: Social media tools allow people to connect with lightning speed. If Jill in Jackson wants a ppt presentation on jackhammers, I can tweet and send her a link in seconds.
Here is my biggest concern:
Sales enablement companies seem stuck in the “delay economy,” while Twitter is moving information management into the real-time economy.How Future-Proof Is Sales Enablement?
Go to http://vark.com and test their amazing question tool. I just did and asked, “What sales incentives are best for salespeople age 20-30?” I got the first reply inside of two minutes from someone in England, who said, “Technology, like iPods.” The company will offer a group solution later this fall. [...]
Please read the comments and leave your own comment on the original post.
Is Sales Enablement just Lipstick on a Knowledge Management Pig
In case you have not seen http://sellingpower.typepad.com/gg/2009/07/is-sales-enablement-just-lipstick-on-a-knowledge-management-pig.html It is a must read!
I will try to discuss some of the aspects here on this blog later.
Gerhard Gschwandtner @gerhard20 the author is spot on when he writes:
“[...] Analysts don’t analyze the economic realities of a Sales Enablement solution. There are no ROI studies nor objective research that compares the effectiveness of SAVO vs. Kadient vs. iCentera.
Analysts don’t create user studies that tell you more about the information infrastructure, the flaws with the search functions, the project abandon rate by vendor, the average user acceptance, the obsolescence factor of the data, the amount of information that’s missing just because nobody knows where all the useful data is located, the amount of time it takes to train (and retrain) salespeople, or the end-user satisfaction level with the graphical interface (some of the designs are an insult to the eye).
The vendors want you to believe that their Sales Enablement tools allow you to harness the collective intelligence of your sales organization. It sounds great, but who in the world can define and measure what that means? How do we know what best practices can positively influence sales productivity? Who decides what not to make available (due to security issues)? Most salespeople can’t write coherently, and most of the top salespeople can’t articulate what makes them successful. So how do we really capture sales intelligence?
What’s the real cost of running a Sales Enablement solution? Is there a need for editorial staff to help create and edit content, to set up template standards and apply them?
How much of a company’s “best practices” and sales intelligence is reusable? If I am a salesrep, getting ready for a presentation to Boeing in Seattle, and I download a presentation that one of my peers created for Airbus, how much data can I reuse, and how much do I have to create from scratch?
Sales Enablement companies are NOT too savvy when it comes to social media. Search for Kadient on Twitter – zero results. iCentera has 43 followers, SAVO has 391, @BizSphere is the leader with 441 followers
The point is this: Social media tools allow people to connect with lightning speed. If Jill in Jackson wants a ppt presentation on jackhammers, I can tweet and send her a link in seconds. [...]“
Information Architecture?
In a Sales 2.0 world there is no doubt about the need for Sales Enablement applications to be social / web 2.0.
As indicated in the graphic below, I would hope that even Customer Service taps into and participates in the harnessed collective intelligence of Sales and Marketing by using the Sales Enablement application.
Graphic from Dion Hinchcliffe http://blogs.zdnet.com/Hinchcliffe but altered with regards to ‘Sales Enablement Application’ instead of ‘online community’.
For such a Sales Enablement application to play together with the rest of the intranet / Enterprise 2.0 and the customer facing website, information architectures need to be aligned.
Information architecture?
Information architecture is the organization of sites, the content management system(s), metadata, ontologies, taxonomies, etc … This has actually been the biggest problem for users of intranets as the following data shows (not too fresh anymore but I think it holds true still):
Pain points of Intranets
- 42% Problems with the information architecture
- 38% Search functionality is missing or unsatisfying
- 28% Information is missing or outdated
- 19% Graphical User Interface (GUI) is cluttered/crowded
- 11% Performance problems
- 9% Too little relevance to day-to-day job
Source: Translated from STIMMT Intranet Report 2003 http://topics.stimmt.ch/intranet/
On May 15, 2009, @scottsantucci (Forrester Analyst covering Sales Enablement) noted:
“Had a briefing from @BizSphere. Very interesting thinking, particularly about the need for an information architecture.”
The need for an information architecture that cross-references content based on taxonomies to establish context for sales people becomes clear when looking at old-fashioned sales portals like the ones many businesses expect their sales people to navigate still:
In case you are in Marketing/Sales Enablement at a business that sells to businesses all over the world, would it look anywhere close to the image above when all products and services, that your company needs to enable sales people and channel partners for, were shown in a taxonomy/hierarchy?
Do you have traditional intranet pages for each country or sales region that you have sales people or channel partners in?
If so, then you have thousands of silos to maintain and your users have hundreds of mouse clicks stealing their time! (Also see “Important characteristics of how typical sales reps at large organizations roll”.)
Or with the words of Bruce A. Brien from his blog post ‘Marketing Alignment is critical to Sales Enablement’ from July 16, 2009:
“It is one thing to create a massive library of assets with a navigation structure that only a marketing guru could navigate, it is quite another to enable your sales organization by delivering just the right assets at the right time in the buying process, related to the right industry and business issues being addressed. That’s right, your sales teams will not be able to nor will they want to navigate some intranet or “knowledge garden” as it was called at one company at which I worked. If this is what you have done, your assets will get stale and sales will claim that they can’t find anything they need. Marketing is not supporting them. Don’t waste money creating the asset if you can’t deliver it when and where it is needed.”
Displaying your content and the feedback from your sales people and channel partners in…
- a context (an information architecture)
- in Rich Internet Applications using web 2.0 technologies
… makes the scary amount of traditional intranet pages from the image above a thing of the past. These web 1.0 sales portals have to become tools that help sales people excel at selling. From my point of view they need to offer a highly customized experience for each user based on…
- what we know about their job,
- what we know about their language and location,
- what we know about their last visits to the tool,
- what they want and don’t want to see (they might have taken the time to adjust some settings),
- what marketing or corporate want them to see (news alert/announcement, promotion/campaign, etc…)
- what their peers have rated, tagged, contributed…
- and what they are allowed to see (channel partners aren’t allowed to see everything etc…).
BizSphere Sales Web is one Sales Enablement application that…
- starts with establishing a context as mentioned above
- and then encourages to break up all content into small nuggets,
- which get tagged according to the parts of the context they are applicable to.
- Finally, for sales people this allows to simply auto-generate a polished client-facing presentation or document that includes all the right nuggets (e.g. customer references from the right country and industry vertical etc…).
Check out www.enableyoursales.com/en/solution/documentgeneration/ and request a demo.
how the consumerization of enterprise IT is changing sales and marketing
Zack Urlocker @zurlocker from Sun Microsystems published “Marketing 2.0 hits enterprise IT” on www.infoworld.com, on July 10, 2009:
“Some observations on how the consumerization of enterprise IT is changing sales and marketing
[...] things have changed in the last 10 years. It used to be that marketing was all about the “big bang” launch: rent the billboard, hire a PR firm, call the analysts, buy a Super Bowl ad, ship the product (maybe), hire an enterprise sales team — then wait for the sales to roll in. And in some cases, the model worked pretty well. There were a lot of $1 billion enterprise software companies built on calling on CIOs and closing 1 or 2 million dollar deals per sales rep per year. Of course, those days are long gone. A lot of the traditional IT trade press are no longer in print, analyst firms have consolidated, trade shows have passed by the wayside. I would argue that very few of the old enterprise marketing techniques apply in the 21st century. Why? Because the Internet changed how people search for information. You don’t have to buy expensive analyst reports or go to a trade show. Just look on Google and see what people are saying. Download the software and try it out.
Open source software companies were able to disrupt the market by courting an underserved market and using a radical distribution model. But how well do those same techniques apply in more traditional IT firms? [...] We achieved a 13-fold in run rate improvement in top-of-funnel leads in the first quarter [...]
In the last quarter, we grew to that to more than 1 million raw leads or inquiries — enough to whet any sales VP’s appetite. We also achieved a 25-fold increase in volume of leads further down in the pipeline, what we call “pre-BANT” (Budget, Authority, Need, Timeframe) leads. While not every lead is going to result in a sale, it enables us to understand more about prospects and their interests. In fact, the volume of leads we’re now generating on a weekly basis enable us to develop pretty sophisticated models for predictive analysis and data mining. [...] this becomes a significant asset for cross-sell and up-sell capabilities.
While a lot of these techniques have been pioneered in open source and consumer marketing, we’ve been able to apply to them to traditional IT hardware and software sales with results that are even better than I would have expected. [...] I suspect we can grow another 10 times in both quantity and quality over the next year by refining scoring models, continuous A/B testing, applying new social media marketing techniques, [...]
People in the Lifecycle Marketing team are developing new skills and pioneering best practices in a rapidly emerging field. That gives them capabilities they can continue to apply throughout their careers.”
Read and discuss the full post “Marketing 2.0 hits enterprise IT” on www.infoworld.com.
business case data for sales enablement solutions
This work in progress blog post collects data that Sales Enablement Solutions vendors use to make business cases.
The first one is from Lee Levitt (former Director, Sales Advisory Practice; IDC). He wrote the following comment on July 29, 2009:
“[...] Companies are reporting results with sales enablement. American Express, for instance, indicated that Time-to-Revenue for new reps dropped from months to weeks after they implemented a leading SE environment. They reported this at an IDC Sales and Marketing summit in 2008.
For another large IDC client, we identified a 15% increase in sales productivity after the company implemented some basic sales enablement processes, a small subset of the possibilities in that multibillion dollar organization.
While it’s still early in the sales enablement game, virtually every midsize or larger company today does something in the area of sales enablement, typically based on internal processes and maybe some intranet or SharePoint support.
A very small handful of companies, maybe a thousand in total, have taken a focused approach at moving their sales enablement activities to what IDC refers to as the third generation of sales enablement.
In these early markets, innovators and early adopters don’t care about ROI. That’s for the late majority to worry about. They’re looking for competitive advantage…and they’re finding it. When companies seek to address specific business challenges (new rep support, competitive response, customer intelligence, campaign support, etc), they find substantial improvements in sales productivity and customer satisfaction.
We’ve only scratched the surface with sales enablement. We believe that the potential for sales productivity improvement is on the order of 30-50%, or more, particularly if employed with the other four levers of sales productivity and properly measured.
And the net savings to the organization may be substantial. The typical technology firm spends more $12,000 per rep per year in marketing collateral development, with the vast majority of that expense going to waste. Firms that take an outside-in approach in sales asset development will find this cost dropping by an order of magnitude.
There’s ROI for you – higher sales productivity and lower costs.”
This one is from Bruce A. Brien’s blog post “The core problem with sales enablement”, from July 9, 2009:
“[...] sample company does $10 million in annual revenue with a 40% close ratio and an average deal size of $100k on a 90 day sales cycle.
- That means that the 5 sales reps are each closing 20 deals per year while working 50. They are focused on 12-15 deals at a time.
- If our sales enablement capabilities cause a 3% drop in our overall effectiveness, our sales people will only be working on 48 deals [each] and closing only 18 of them for an average price of just $97k. [18 * $97k * 5 sales people] The result is a revenue picture of $8.7 million or a drop of about 13%.
- Assuming you have fixed costs in the 25% range and an operating profit of 15%, profits would drop by a whopping 47%. The compounding effect can be devastating. A 3% drop in sales effectiveness can easily result in the loss of half of your profits.
- You could re-coup your lost revenues by hiring another sales rep at a cost of $150k and be faced with the same problem next year when your efficiencies drop further or you could address the core of the problem and shore up each part of your sales enablement platform for similar monies while building a solid foundation for future growth.”
Many Sales Enablement and Sales 2.0 start-ups are citing Forrester’s Scott Santucci’s ‘Uncovering The Hidden Costs Of Sales Support’ from April 13, 2009 to make a business case for their services:
“Technology vendors are spending, on average, 19% of their selling, general, and administrative (SG&A) costs or $135,262 per quota-carrying salesperson in support-related activities. Few are aware of this enormous amount because the costs are hidden — tucked away in many different budgets dispersed throughout the organization. Corralling these random acts of sales support presents a golden opportunity. By creating a strategic sales enablement program, marketers can drive significant cost savings in the short term, while improving their companies’ competitiveness to thrive in the new growth cycle.”
On July 7, 2009 Michael Gerard (VP, Research for IDC’s Executive Advisory Group) posted on his blog:
“[...] IDC research shows that over 40% of all marketing assets handed over to sales are not in use today (IDC’s Best Practices in Sales Enablement – Content and Marketing (to be published end of July)). This includes assets that have been developed for sales, channels, prospects and current customers. IDC estimates that at least 30% of companies’ marketing investment, including program and people spend, is dedicated to creating content and marketing assets. Clearly, marketers can leverage cost reduction opportunities if they take the time to improve their content management process and technologies.
- “Our content is all over the place…a more formalized content portal is being created to get our sales team the most relevant materials when they need them.”
- “…marketing is funding an improved marketing asset management system and we are hoping to achieve 3% – 5% reduction/reallocation of spend on annual asset development and improved production efficiencies.” (improvements in production efficiency, reduced program time-to-market, and reduced re-work).In the next several weeks, IDC will be publishing a sales enablement report highlighting best practices in marketing content management from a lifecycle management, technology, and measurement perspective. Detailed company case studies will be also be included. [...]“
In 2004 it was IDC’s ‘The Cost of Information Tasks to the Enterprise’:
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