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Your company has developed a new technology product, and your early customers are up and running. You look at your recent two quarters and the sales department has missed both of its committed forecasts. Your board is beginning to ask “do we have a product problem or a sales leadership problem?” If this sounds like your company, then read on.
Today, IT product selection it totally changed from the 1990’s. Back in those halcyon days, as companies and IT organizations bought and adopted PCs, servers, LANS, switches, routers, the Internet, dealt with Y2K, OLTP, OLAP, the Web, eCommerce, ERP, CRM, SCM, while spending up to forty percent of businesses invested capital, the selling of IT products and services roared along at a fever pitch.
Selling in the “new economy” was easy, at least compared to today. Sales people pitched features, gave a demo, proposed, negotiated and closed the deal – followed by installation and customer training. This sequence was repeated over and over, with each new IT “must have” initiative.
When the “bubble” burst, Innovative IT product sales came to a screeching halt! IT organizations couldn’t buy anything, and tech company sales departments shrunk to survival strength.
Now, in 2004, the IT industry has shed its weak players, and the survivors – early stage, growth and mature companies - are again on the move, with new offerings in security, wireless, Web services, and business analytics.
Well, what’s different about today’s information technology market, compared to that of a decade ago, and are there implications for IT product sales departments?
First, mid-level IT managers no longer drive product evaluation and adoption cycles. They are busy serving their business “clients”, and have little time to evaluate technology innovations, especially from early stage or growth tech vendors.
Second, IT governance is rapidly becoming a key initiative in most companies, demanding that IT organizations operate in alignment with their company’s business managers and their goals. And, discretionary IT spending is a small piece of the overall IT budget.
Third, when it comes to evaluating new hardware and software product offerings, companies are demanding that solutions deliver real business value, with payback measured in months, not years.
And fourth, business executives are increasingly involved in IT purchase decisions, to insure that new IT initiatives are geared toward their business goals, objectives and needs.
So, what do these evaluation and procurement changes mean to technology vendor sales and marketing organizations? Do they need to alter their selling strategies and tactics - or risk being out of alignment with their prospects and customers buying behaviors?
Could it be that the tech sector growth lag (vs the overall economy) is due to a misalignment between tech company sellers and the new key influencers on the buying side of the table?
We think that there is some truth in this assertion. It’s our experience that many sales people, and sales managers, are stuck in a 1990s time warp. They are still pitching products to the IT department, hoping that IT will secure funds to purchase their offerings. Their sales pipelines are stuffed with deals that end in “no decision”, and their forecast accuracy is well below fifty percent.
What are successful technology vendors doing, enabling them to leapfrog their competitors? They are adapting to the changes in the way that companies are evaluating, installing and using new technology solutions – by launching and sticking with the following five essential sales and marketing initiatives:
So, what about the value of these new sales process, training and coaching initiatives? Adopting tech companies are achieving shorter sales cycles, larger revenue per sales person, faster new hire ramp-up, better use of technical resources, high accuracy forecasts, and most important, accelerated revenue growth.
Now, isn’t it time for you to take stock of your sales force’s productivity and performance, and to convert from product selling to customer- focused selling?
Bob Washburn helps high tech sales executives accelerate sales revenue by improving sales team performance. WashburnGroup is an affiliate of CustomerCentric Selling® (www.customercentricsystems.com).
Contact Bob at firstname.lastname@example.org or 508-366-0994.
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