Why is it that sales models are perhaps the most under examined area when it comes to preparing for the future? Why is it that the CEO does not demand the same level of planning rigor in the sales organization as they do in the rest of the company? Is it that sales can be measured on the simple – did you hit your numbers or not – measurement stick? Any sales leader who uses their ‘gut’ as their strategic compass should quickly realize – what got you here is not going to get you there with the same level of success it has in the past. There are too many market forces (such as mobile, social, cloud and information) at play which take many existing sales models and turn them upside down. During our special report research on the Future of IT Sales, one thing which stood out to me was not many (read very few) technology sales leaders embark on any level of scenario planning when they are looking to improve sales performance. They tend to fall back on old habits such as spending more marketing dollars, deploying more sales resources, copying what their competition is doing and finally adjusting compensation all in an attempt to improve performance. However, that mentality must change; otherwise future growth becomes more at risk with each passing quarter. Scenario-based planning can provide you company the ability to reduce the reaction times to unexpected changes, improve resilience and increase competitive advantage.
Everyone should agree that an effective sales model remains essential to every successful organization, whether it is a new venture or an established player. What you sell, how you sell and to whom you sell are changing at an unprecedented pace, especially in the IT segment. Everyone knows that. However, what is not known is the precise details and timing of what will be effective in any given market, segment, region, vertical and technology sector, going forward. This is where scenario based planning comes into play. It can help uncover hidden assumptions and mental models, and stimulate new thinking. Much of the value resides in collective learning, the joint understanding of available options to a given direction, and the discussion and evaluation of appropriate reactions to different circumstances that may occur.
Let’s put this concept to the test. If you are a sales leader for a technology company for example– as yourself, how quickly could you respond if the following manifested themselves this quarter and then do you have the means to quickly make up sales shortfalls within the same quarter or year? What if:
- The adoption of cloud accelerated at a faster pace than we (and others) have predicted, and enterprises were no longer investing in their own data centers and on-premise applications – what would you have to do to keep delivering revenue?
- You sold PCs – and desktop virtualization was now the standard deployment model for enterprises, and desktop refreshes pushed out to 7-10 years or longer?
- You sold on premise software – and your category was now littered with SaaS providers who were able to deliver ‘good enough’ solutions at a reasonable price, and customers were now interested in giving them a try?
- Your largest partner was purchased by your fiercest competitor?
- IT no longer controls the majority of the IT budget – now it is in the hands of the BU – and you historically have only sold to IT?
Keep in mind, if you had been watching for the signs that these things were beginning to happen (even if they never fully materialize)- you would find yourself in a very different situation than if you ignored them all together. Attempting to play catch up after the fact is exactly where your competition wants you to be. Using scenario-based planning provides C-level executives and sales leaders with a proven methodology to test various assumptions and build future models to prepare to compete. Scenario-based planning can help illuminate where there are hidden and under-leveraged assets to further exploit, where productivity or profitability is not meeting overall corporate expectations and should lead to de-investment, and where to build future capabilities and innovate with new models. Too many companies today are too focused on executing today’s sales model, and forget that sales model innovation can create measurable differentiation in the market when given the same level of planning as the rest of the organization which has been built to compete.
For a successful sales leader to deliver their best value to the business they must test various assumptions and have a clear plan of attack when a particular scenario shows itself as promising. Sales leaders often (falsely) believe that once a sales strategy is set, it will dominate in perpetuity with no need for (drastic) change. But that belief has lead technology sales leaders to what we are calling the ‘sellers dilemma’ - an organization which has held onto its sales models and go to market segmentation for far too long while the market and the customer has shifted significantly, and are now faced with extremely hard decisions which many are ill prepared to make. Sales leaders should acknowledge that they need to develop a way of sensing (not predicting) shifts in the market early so that they are not caught off guard by the next disruptive force – which in case you didn’t know is just around the corner. Always keep this thought front and center - Success today does not guarantee success tomorrow – get scenario planning on your high priority to-do list today!1 Comment »