Any sufficiently advanced technology is indistinguishable from magic.

—Arthur C. Clarke

When companies get technology right, the sales results can be impressive. Supermarket chain Tesco runs a loyalty program that generates a tremendous amount of customer data, which the company mines to inform promotions and strategic segmentation of customers. US insurer Progressive is known for conducting experiments to segment its customers systematically and effectively and to tailor product offers accordingly. Bank of America’s rewards program analyzes customers’ previous credit- and debit-card purchase histories to generate reward offers, and it claims to have helped customers save more than $20 million since it began the program in 2012. The offers are popular: Bank of America has retained 30 million online banking customers since January 2012, and the number of mobile bank users increased by 4 million in the two years beginning in May 2012.¹

Using data to pinpoint targets is only a small part of what IT—when properly designed and implemented—can do to improve sales productivity. Indeed, if we look back at the range of best practices we described in the previous chapters, we see that sales organizations need strong IT support for all of them—from identifying growth ahead of the competition to mastering multiple routes to market, to managing sales operations. As the search for growth becomes more challenging, and as channels—especially digital ones—become more complex, mastering IT will become ever more central to outselling the competition.

Unfortunately, the history of IT in sales is a tale of mixed success. Even among the companies we interviewed for this book, only about two-thirds report real frontline improvements from IT investments. The other third say they spend a lot but gain little other than frustration. Our survey of more than a thousand sales and marketing executives reinforced the extent of the problem. Less than 40 percent believed they were even moderately effective at using digital tools and capabilities. Some specific tools fare even worse. CRM tools seem to be best understood, yet only 16 percent of executives felt their use of them was outstanding. This fell to just 11 percent for renewals and aftersales support tools (Figure 12.1). The reality is that too often, instead of raising productivity, ambitious sales-management systems have had the opposite effect: reps become bogged down in data or can’t get the right data.

That has to change. Companies can no longer afford to make wasteful investments. They need to get good at using technology to compete and to drive growth.

What are companies that maximize returns on IT investments doing right? Based on our interviews, we found that they use technology to succeed on three fronts:

1. Arm sales teams with insights. Giving reps on the ground and in the office the tools to make them more productive and effective is vital in maximizing sales potential.
2. Enable channel partners. To treat partners as an extension of the sales force, they invest in collaboration tools to improve the flow of data between organizations.
3. Gear up for analytics. Leading sales organizations recognize the potential for big data applications, micro-market or macro-trend analyses to enable new ways of selling. As the technology emerges, they are making targeted investments in tools, technologies, and talent to make the most of these opportunities.

Arm Sales Teams with Insights

The difference between success and frustration with IT often depends on how easily the company can turn technological advances into insights that sales teams can use in competition. The insights can come from new software applications, through detailed customer analytics, or by sifting through the chatter on social media. What matters is less where the insights are from than how the organization harnesses them.

Here’s a simple example of how getting some very basic data in the right hands at the right moment can be of enormous value. A global consumer- goods player had a scattered sales force that spent its time on the road visiting small independent retailers. To improve rep productivity, the company created daily route maps compiled from data on store opening hours and a simple analysis of the best order in which to schedule stops, based on location and traffic conditions. No longer did reps have to waste time figuring out their own routes—they just picked up the maps and started selling.

When the reps got to the stores, a second bit of technology helped them quickly and accurately monitor how their products were displayed. Reps were asked to take pictures of the displays with digital cameras and then upload them to a central system, which used a leading-edge photo-recognition software program to identify the goods’ labels automatically. The system then told the rep whether the shop owner had stocked the display cases correctly—and whether competitor products had been placed in the branded display units in violation of their agreements. The system made the cumbersome but crucial task of monitoring displays very simple for the sales reps and made it easy for them to explain to store owners how the correct display boosted sales and profitability. It also allowed for new, more effective sales rep performance indicators. Rather than evaluating reps solely on volume, sales managers now had tools to measure how well reps were helping store owners maximize sales. After the system was introduced, sales from these smaller retailers rose 10 percent, partly due to this program, and the average revenue per account increased, too.

The company used technology to help salespeople get the most from their time on the road, but cutting-edge tools can make travel redundant in the first place. The sales model at one high-tech enterprise relied on extensive travel, resulting in high costs, burned-out employees, and problems scaling operations. The sales leaders decided to use collaboration tools, including videoconferencing and shared electronic workspaces, to allow people in different locations to work with the same document simultaneously. A sharp reduction in travel budgets ensured that people really changed their habits. The tools paid for themselves: the savings on travel were four times the company’s technology investment. Even better, customer contacts per salesperson rose by 45 percent, while 80 percent of the sales staff reported higher productivity and a better lifestyle.²

For a North American building-materials supplier, a technology overhaul helped revive the art of selling. When the recession hit and construction came to a near-standstill, the company took stock and decided to rethink its sales strategy. Sales leaders felt that the company had lost its selling skills during the boom, when orders simply flowed in. Now, during the bust, when every sale was contested, its investments in web-based sales support and CRM tools were not delivering results.

The head of sales set two goals for the new IT system: first, to allocate sales capacity to the best opportunities and, second, to generate closing pitches for the sales team, generating the right value proposition for each type of customer, including retention offers for customers at risk.

In retrospect, the company says that the most important step in its success was starting with clearly articulated requirements and then making clear to the IT specialists exactly what the company expected the system to do. Then it collaborated with the IT vendors to create the right systems to support these activities.

The first step in implementation was to create a list of best prospects based on an “ideal customer” profile, which was derived from the order histories of customers with whom the company had near 100 percent penetration. The profile included factors such as size and industry sector. It then refined the list by using a churn predictor based on order patterns of customers just before they stopped being customers. The profiles helped identify where the company could increase its share, head off a defection, or admit defeat and allocate resources more productively.

Using a sales force automation tool, the company translated the customer- profiling data into actionable sales plans. Sales leaders segmented customers into four groups based on their degree of fit with the ideal template. Each segment was assigned a different call-frequency rate, with the best prospects getting the most attention and the loosest fits receiving the least. The system also told reps which products to offer, based on sales histories that included the relative penetration of different categories and products. The reports also suggested best pitches tied to the next-products-to-sell list for each customer. Finally, the system flagged at-risk accounts and told reps to arrange immediate face-to-face visits, equipping them with targeted value propositions to try to avoid losing the customer.

The IT system greatly improved the sales teams’ pitches because it selected the right value proposition based on real insights gained from sales people who had actually participated in sales calls at similar customers. This was a huge improvement over pitches developed purely by marketing or product specialists. Average annual earnings grew by 3 to 5 percent as a result of this program.

Enable Channel Partners

Chapter 7 demonstrates the benefits of treating channel partners as an extension of the company’s sales force. In this spirit, the best sales organizations have extended their own IT systems to partners. Among other services, they provide partners with finely tuned prospecting lists and support for managing sales-rep performance.

High-tech company Cisco became a leader in sharing tools with partners after it got its own sales house in order (see sidebar). Before launching this new approach, it faced the same complaints that many companies hear from resellers: the deal-registration process was a headache, deal reviews and approvals were slow, and channel partners would argue they were losing deals as a result.

So Cisco opened its suite of communications tools to channel partners. Now, when a partner’s rep registers a deal on Cisco’s portal, she can see immediately if her contact person is available to approve the deal on the spot. If the account manager is on the road, the rep can leave a voicemail with all the details. This is then converted to text, which makes it simpler for the manager to accept, decline, or transmit to the next approver. The approver can even add a voicemail to inform the rep of the decision. All this can be done from the rep’s mobile phone.³

Another global high-tech company, SAP, has also innovated the approach to partner interactions. In 2011, the software supplier launched a collaborative tool that makes it easy to create customer/partner communities online. On the SAP website, a customer can search the full range of SAP solutions and see which channel partners to contact for different solutions. The website also hosts chat areas for partners in which it encourages them to get to know each other better and develop alliances to go after new opportunities—extending the capabilities and performance potential of both parties.

An office-products company we spoke to combined point-of-sale data from its retail partners with syndicated market data and then used its analytics capabilities to better understand consumer buying behavior in specific markets. This helped it coach partners on more effective ways to capitalize on promotion, price, product, and placement, but also enabled collaboration in supply-chain management and logistics. Both the company and its retailers achieved double-digit profit growth in the targeted categories in effectively flat markets. In addition, the company received various Vendor of the Year awards.

To help partners improve sales forecasting and performance management, sales executives at an industrial-products manufacturer decided to co-fund CRM tools for each distributor. To be eligible for commissions, the distributor had to input its sales pipelines into the system. But the inputs were kept simple, and there was just one access point per distributor. “This created the initial benefit of giving us visibility into the sales pipeline. However, the bigger benefit is that distributors became much more disciplined about boosting their own sales pipelines,” said the head of sales.

Gear Up for Analytics

In Chapters 1 to 3, we wrote about the growth opportunities offered by macro-trend analysis, micro-market sales strategies, and big data. However, much of the data and the analytical capabilities needed to drive sales growth does not always exist within the sales organization. The strategy department often conducts trend analyses; micro-market insights may sit in marketing; and much of the data in big data sits outside the company altogether.

The leading sales executives we interviewed have pried open these departmental information storehouses and encouraged collaboration between formerly sealed-off functional units, combining internal, customer, and external data to find growth. They have built up analytical capabilities, sometimes within their own sales teams, to hunt for insights that could reveal pockets of growth. They have also tried to make this all very easy for their sales teams, hiding the scientific-grade statistics and algorithms, and instead putting forward simple sales strategies that give their sales teams more qualified opportunities. None of that can happen without new tools, technologies, and talent able to manage them.

Data analysis can be applied in many ways across the sales organization. One Fortune 500 market leader in business outsourcing, for example, realized that its customers were becoming much better informed about their purchasing options thanks to the proliferation of online content, including chatter on social media. Management took this to mean that customers expected sales reps to add more value and to be well prepared for the initial meeting. Sales reps had to devote more time to researching accounts and less time to selling.

The solution began with a diagnosis of the company’s sales and marketing data, processes, and systems. The project revealed that the company was sitting on a gold mine of internal and external data about its customers and prospects, but this information was not reaching the sales force in any useful way. The data could be used to spot behavioral and purchase patterns and make predictive recommendations for how to engage with each account. It could tell, for example, that customers who had bought one particular product but also had a growth rate above a certain threshold and had expanded internationally in the past 12 months were disproportionately likely to buy another particular product. Incredibly useful information, but the challenge facing the head of sales was how to transform reams of raw data into simple account-level recommendations for the front line.

The head of sales committed to harnessing data and analytics to provide the knowledge that reps needed and to point them in the most productive directions. The company chose a sales intelligence software solution from Lattice Engines, a B2B big-data specialist. This solution helped it combine its rich internal data sets of purchase histories, product use, and customer-service records with external data on target accounts and decision makers from news reports, company websites, social media, and other sources. The software was deployed to more than 2,000 field and telesales reps, and it enabled them to optimize their selling time. The program produced reports that told reps which accounts to call, when to call, how to gain access to decision makers, and which pitch to use. This led to a 10 percent increase in sales productivity within the first year.

New tools are only part of the solution. Too often, new technologies fail through a lack of sufficient groundwork to prepare the organization for the change or through not having the right people in place to lead the effort. To use analytics on a large scale and apply the insights to make better, more informed decisions, sales organizations need to convince the sales force of the benefits of this type of data-driven decision making and to train them to make the most of it. Some companies that we interviewed have built a core group of deep analytical talent within sales, which serves as a resource for the rest of the organization.

One such organization is the chemicals supplier we described in Chapter 2 that used sophisticated micro-market analytics to increase new account growth by 15 to 25 percent in just one year. It created a team within sales operations to act as the central nervous system for micro-markets. This team collected information and insights from various sources and translated them into simple tactics that the front line could use. To be effective, the team needed both serious analytic capabilities and a real understanding of what worked for the front line. Therefore, the company recruited specialists from internal and external marketing analytics teams and respected high-performing sales managers with frontline experience.

Given the scarcity of highly qualified talent to manage big data and sophisticated analytics, sales organizations are competing for the best candidates and will have to recruit aggressively. This effort could include sourcing talent from specialized academic institutions. One financial-services company that is well known for its use of data and experimentation with new technology has identified a network of institutions in its region that train analytical talent. It has developed a close relationship with these institutions, using them both for recruiting and employee training. When a sales organization can’t land the right talent, it can hire external partners—an increasingly popular option for insurers and healthcare payors.

Even if a company’s analytical talent does not reside within sales, the sales organization must be able to use the corporate capability effectively. The implication is that sales organizations will have to recruit talent that knows enough to get the trend analyses, micro-market strategies, and big data insights the unit needs. So when recruiting for their sales operations group, companies should look beyond traditional skills and put a premium on candidates with analytical problem-solving and strategic selling skills, and a proven ability to collaborate across corporate functions.

■ ■ ■

Top sales organizations use technology to improve their own operations. Improvement can be something simple, like giving reps tablet computers to boost their productivity, or more complex, such as using sophisticated IT tools to give phone reps the right pitches and offers for each lead they call. In the case of Grainger, it helps show their customers where they can save money, as Deborah Oler explains in the interview that follows. Frank van Veenendaal tells us how Salesforce’s own sales force uses chatter tools to help give reps a full picture of customers. Channel partners also benefit from technology, as we saw with Cisco partners who can immediately see whether their Cisco contact person is available to approve the deal. All this technology, and the growing need for exceptionally high-grade analytics, is driving sales leaders to make targeted investments (with clear ROI) into both tools and talent, perhaps following the financial-services company mentioned above and building relationships with training institutions.

Tools and technology won’t be enough without a star team. Talent is at the heart of the fourth winning strategy of the world’s best sales leaders. Companies that focus on their people are far more likely to deliver sustained sales growth, as we shall see.