Books I Recommend

Many companies have asked me, “How can we get from a lower quadrant into the “winner’s” quadrant?” For those of you unfamiliar with the “Quadrant,” it is essentially an interpretive visual representation of how a research analyst believes vendors are competitively positioned. Ordinarily, the highest possible level of X and Y attributes are used to visualize an entire competitive segment of a market. While with Meta Group in the nineties, I was asked to show the healthcare-based Interface Engine market on one slide, so used Vision and Execution as the X & Y axis designations to ambiguously position all competitive vendors in that segment. The lower-left quadrant represents vendors with neither a vision nor execution to warrant hope. The upper-left and the lower-right quadrants designate the hopeful vendors with only improved vision or execution (in the analyst’s perception) to eventually be in the upper-right, or “winner’s,” quadrant.  As much as this representation proved successful, the “quadrant” has been highly subjective and historically created by junior analysts unqualified with the contextual understanding to make such designations. Gartner has gone as far as to trademark their interpretations as the “Magic Quadrant.”  

I believe that any company should invest into buyer alignment disciplines (e.g., win/loss analysis, client satisfaction, prospect perception) in order to “prove” they are a market-driven company. Furthermore, the proof should not be subjective. Therefore, positioning a company by its unique and validated attributes (company and product) will enable a company to run a race that only it can win. Alternatively, a company can continue to position itself comparing its effectiveness of every day operational activities (e.g., support, product, quality, commitment), which, will ultimately lead to price as its undesired differentiation attribute.

An aligned vendor is able to change the criteria being used to affix the attributes within the quadrant positions. As a result, positioning validated product differentiation ranked against your company’s unique attributes will position you to run a race that only you can win. As long as a buyer alignment discipline can be credited for the selected attributes to be assigned the quadrant, a company is market driven. Furthermore, a company can uniquely position itself with its prospects and against its competitors.

To align a company, recent evaluators must score you and your competitor attributes before being in production (live) with the acquired solution or product. This is a critical step missing in many win/loss analysis initiatives. When completed correctly, comparing aggregate scores will reflect buyer perception of each company activities (e.g., demo, RFP, reference call) and attributes (e.g., innovation, flexibility, viability).  Claiming the most appropriate of the top 2-3 ratings in this comparison will give you your X axis attribute. Product alignment requires the compilation of a function commonality comparison. This comparison scores functionality expected by a prospect when acquiring your solution.  Score your functionality against that of your top 3-5 competitors using a scale of 0-1 with the following designations: 0-Function unavailable; .2-Function can be customized; .4-Function is available from a 3^rd party; .6-Partial functionality is planned or available via work-arounds; .8-Function is in Beta and GA within 3 months; 1-Available and part of standard deliverable. Aggregate the scores of each function against the total responses. If you score above 85% of expected functionality and competitors do not, this is validated functional differentiation. If competitors score high and you do not, this function needs to be addressed by product development. Select differentiated functionality that best validates your company and positions you with your prospects as your Y axis designation on the 4-square quadrant.

When completed, map your validated company attribute on the X axis of the 4-square quadrant against the differentiated product functionality on the Y-axis. It is critical to ensure that all cross-organizational departments (e.g., sales, marketing communication, customer service, product management) use these attributes to position your company and products.  Of course, this is an abbreviated and simplistic description of a more complex discipline. However, if followed, it will enable you to prove that you are a market-driven company and to reap the rewards of buyer alignment.

Welcome to 2011. Is this the year that you will finally create a process to extract meaningful strategic actions from your time-consuming tactical activities? Why not start with Win/Loss Analysis? Win/Loss Analysis, or post-decision interviews, historically have been one-time events conducted by sales personnel after a vendor has finished second in the final decision process and the singular-focused objective is to discover any last minute opportunity or opening to still secure the business. This is wrong in every way, but, most importantly, there is a missed opportunity to align with your buyer. Therefore, it is imperative that companies continually monitor client perception and sales performance after every opportunity, regardless of a win or a loss, to glean “actionable” knowledge. The interview that rates, weights and ranks the sales cycle process is also the same vehicle that discovers buyer processes, buyer decision criteria, as well as company and competitor attributes (core competencies).

Excellent insight can be gained from post-decision interviews to validate your company core competencies, sales positioning, buyer priorities and perceptions. As a New Year’s gift, I would like to share some of my favorite lessons learned extracted from hundreds of post-decision interviews. Would any of the following help you better understand your buyer?

• Trust and honesty are big factors in winning complex sales cycle decisions and disparaging remarks about the competition undermines those virtues;
• The sales representative is the only means of a prospect estimating the potential customer service quality, so sales reps must provide quick, anecdotal and accurate responses;

• Complex sales processes are circumvented when the prospect’s needs (product differentiation) or expectations (demonstration) are not established prior to the validation stage (site visit);
• The vendor vision is the “beast that aligns partners,” so fine-tune your vision presentation;
• Never miss an opportunity to show off headquarters personnel behind your solution – It may be a differentiator;
• Most prospects would rather buy an older product than a “shiny” unfinished one;
• Everyone is rated #1 by someone. It is easier to apologize for too much attention when positioning a #1 company than it is to have a prospect perceive itself as just another number. Therefore, large companies should transform “biggest” or “largest” nomenclature into “overwhelming attention”;
• Integrity is positioned by the sales person’s truthfulness and is positively influenced by quick responses, especially by executives, to prospect inquiries during the sales cycle. Furthermore, don’t hesitate to respond with, “I don’t know,” when answers are not known;
• Preface all provided client reference contacts to be expecting a call from your prospect. Align similar culture and functions for the prospect/client correspondence because prospects don’t have the time or vision to see beyond current state;
• Any corporate news making national headlines during the sales cycle should be communicated to the prospects first because competitors will certainly remind them;
• Pre-qualify the prospect’s past vendor experiences as well as future needs because “comfort/familiarity” trumps “best product” much of the time!

I hope that you read some lessons that you can apply within your organization. Make a resolution today to stop wasting valuable time on efforts that don’t:

• Align you with your buyer;
• Produce “actionable” data;
• Enable a better understanding of your core competencies (key attributes);
• Produce better sales results and products;
• Improve your brand!

All too often marketing management looks to client satisfaction ratings whenever sales performance declines. Unfortunately, customer satisfaction conveniently points a finger at company products or services to help deflect marketing or sales organization blame.

Customers are reliable internal sources of knowledge, but should be secondary to information obtained from prospects when validating market positioning.

On the other hand, if used effectively, customer satisfaction results can quantify beliefs to validate or change an organization’s culture and product positioning. To be successful, marketing departments must understand a few basic tenets:

• Satisfaction ratings are not always validation that organizations provide excellent customer support. The greatest promise offered by these findings is the foundation for organizational (e.g., product positioning, company focus) change, which rarely goes fulfilled;
• Customer perception gathered from satisfaction ratings (attributes in this case) must realistically match the existing company culture (e.g., brand) before embarking upon a replacement, sunset or an upgrade product strategy because a mismatched product delivery and company brand (e.g., best in class, market leader) leads to prospect apathy or loyalty loss.

Of course, some organizations internally conduct satisfaction surveys while many turn to third-party industry resources to monitor client satisfaction.

As I have written in the past, internal efforts return biased findings. Yet, an inevitable problem occurs when outsourcing the data to third parties: Integrity of findings.

There are several factors that impact why it is hard to anticipate unbiased data from outsourced client satisfaction surveys:

1. Data Availability
   The complexity of collecting client data from the vendors to conduct these satisfaction surveys is the first factor. Survey firms require a minimum of 25-30 clients per quarter to ensure an accurate statistical probability and the list of clients must come from the firm outsourcing (and paying for) the surveys. If a vendor does not have a sales process/forecasting or Customer Relationship Management (CRM) system in place there is a high probability that the client information function is weak as well. Considering that less than 60% of WW organizations have these systems in place, the expectation of providing a single accurate report containing all client information is ill-fated.
2. Response Incentives
   If sales forecast and CRM automation is in place, common practice is to have the firm outsourcing (and paying for) the surveys to preface the customers slated for satisfaction interviews. Far too commonly, many vendors add incentives (e.g., free monthly support, fix an immediate issue, free pass to user group meetings) to secure superior ratings. Once these falsified ratings are posted for one quarter, competitors feel compelled to reciprocate with similar incentive-based activities to level the playing field. This unnatural competition for the highest ratings precipitates inaccurate findings and a vicious cycle of lofty and misrepresented client satisfaction ratings is perpetuated. The truth is that vendors spend more resources measuring client satisfaction or improving client ratings than they do on simply satisfying their clients.
3. Invalid Statistical Probabilities
   The final factor is that mathematical probability prevents movement within short time periods favoring small firms. Competitive rating winners are sometimes crowned when they only have a 1/10 of a percentage point better rating than the next closest competitor, so organizations with smaller sample bases (clients) have a better chance of scoring higher than large organizations with larger sample bases (clients). For example, two companies have the same 8.5 rating on a scale of 1-10 in a single quarter. One is a small organization with only 30 clients while the other is a larger organization with 100 clients. If the smaller organization gains two new clients in the next quarter and both clients post a 10 satisfaction rating, the result will be a new satisfaction rating of 8.6. If the larger organization adds 2 new clients in the next quarter who also post 10 ratings, the new quarterly satisfaction result is a lesser 8.53 rating. The larger organization would require three new clients rating a ten (33% more clients) to gain the equivalent spike in ratings. This is why new competitors to any field usually enter the satisfaction ratings higher than larger and heritage organizations. Furthermore, organizations with fewer clients maintain lofty ratings for at least 4-6 quarters before the field stabilizes.

In summary, I believe that organizations should just overwhelm clients with quality support because satisfied clients are essential in any successful business. However, competitive rating environments incite many vendors to coach, coerce or entice select clients to respond with high ratings. These actions create unhealthy and unrealistic metrics setting up false industry expectations of which no real change occurs. In addition, the basic principle of mathematical probabilities provides a statistical edge to new-comers to the market because higher ratings can be achieved with lesser clients responding to satisfaction surveys. As such, customer satisfaction rating integrity should be monitored to prevent falsified responses. Moreover, you should not lose the fact that as important as a satisfied client base is to add-on future business and positive referrals, nothing improves new business greater than understanding pre-client (prospect) perception!

The Problem: Sales Organizations have forgotten how to articulate their corporate and product differentiation!

Henry Kissinger once said, “The real distinction is between those who adapt their purposes to reality and those who seek to mold reality in the light of their purposes.”  In sales and marketing, no one would dispute that perception is reality. If interpreting Mr. Kissinger’s quote into a sales and marketing context, I would restate that “understanding prospect perception, whether reality or not, can be used to create differentiation to fulfill corporate sales and marketing goals.” WorldNet defines differentiate as “to be a distinctive feature, attribute, or trait.” Therefore, creating a prospect’s perceived differentiation would simply mean to understand your prospect’s perceived reality of their needs and to fulfill those needs with a unique attribute or feature of your company or product.

Solution-centric sales training and principles teach “Probing” or “Discovery” stages, but do not account for market perception or provide the differentiation of your products. Furthermore, when previously successful sales performance falters, the differentiation articulation has sprung a leak. The only way to discover differentiation messaging is to understand prospective buyer perception and to align the findings with real attributes of your company and products.  As such, there are two types of differentiation: Product and Company.

Remember that to differentiate is to have a distinctive attribute. Likewise, ownership of an attribute is validated by prospect perception. Therefore, verifying an organization’s attributes requires a simple validation process ensuring that attribute ownership realistically matches the organizational culture. Company differentiation is validated using the discipline of post-decision interviews after sales cycle opportunity wins and losses with its goal of aligning the marketing and sales messaging. Any subsequent efforts after the original internal process is completed should have the goal of mapping external (e.g., prospect, competition, market) findings and trends to ensure continuity and accuracy of your attribute and organizational message. Without this message validation, marketing agencies and departments give up perspicuous aspirations of a systemic, singular approach in lieu of the path of least resistance – catchy marketing slogans and phrases - the dysfunctional cycle continues.

Product differentiation must first be discovered by comparing real product functionality to real competitive functionality. I am not suggesting a competitive side-by-side detailed feature-to-feature comparison because that is both impractical and unnecessary. Instead, I compare functionality because functionality is a summary of many features. For example, invoice matching is an accounts payable function, but how the function performs is the result of many features. I recommend comparing no more than 150 functions of 2-4 competitive products to thoroughly understand the strengths and weaknesses of competitors as well as the functional expectations of the market. Note, it may be easier to distinguish between reality and perception with prospects than with internal company product development teams because most company branding and positioning activities are inconsistent with what sales and sales support people are telling prospects and customers. Therefore, is it a surprise that most product development teams design products based upon the loudest screaming client and not the principles of prospect-driven product differentiation?

In summary, prospect perception offers a world of understanding to discover your corporate attributes and the validated attributes owned by your company is your differentiation. Affixing your unique company attributes to unique competitive product differentiation creates the highest articulation of your common sales cycle “story” ,of which, should be incorporated into all prospect, client, and shareholder communications (e.g., prospect demonstrations, presentations, messaging, web site, shareholder annual reports, customer service, trade show booths, brochures, installation manuals). Understanding prospect perception is the most important discipline required if your company is serious about buyer alignment or being a market-driven company.

The Problem: Sales Organizations have forgotten how to articulate their corporate and product differentiation!

Henry Kissinger once said, “The real distinction is between those who adapt their purposes to reality and those who seek to mold reality in the light of their purposes.”  In sales and marketing, no one would dispute that perception is reality. If interpreting Mr. Kissinger’s quote into a sales and marketing context, I would restate that “understanding prospect perception, whether reality or not, can be used to create differentiation to fulfill corporate sales and marketing goals.” WorldNet defines differentiate as “to be a distinctive feature, attribute, or trait.” Therefore, creating a prospect’s perceived differentiation would simply mean to understand your prospect’s perceived reality of their needs and to fulfill those needs with a unique attribute or feature of your company or product.

Solution-centric sales training and principles teach “Probing” or “Discovery” stages, but do not account for market perception or provide the differentiation of your products. Furthermore, when previously successful sales performance falters, the differentiation articulation has sprung a leak. The only way to discover differentiation messaging is to understand prospective buyer perception and to align the findings with real attributes of your company and products.  As such, there are two types of differentiation: Product and Company.

Remember that to differentiate is to have a distinctive attribute. Likewise, ownership of an attribute is validated by prospect perception. Therefore, verifying an organization’s attributes requires a simple validation process ensuring that attribute ownership realistically matches the organizational culture. Company differentiation is validated using the discipline of post-decision interviews after sales cycle opportunity wins and losses with its goal of aligning the marketing and sales messaging. Any subsequent efforts after the original internal process is completed should have the goal of mapping external (e.g., prospect, competition, market) findings and trends to ensure continuity and accuracy of your attribute and organizational message. Without this message validation, marketing agencies and departments give up perspicuous aspirations of a systemic, singular approach in lieu of the path of least resistance – catchy marketing slogans and phrases - the dysfunctional cycle continues.

Product differentiation must first be discovered by comparing real product functionality to real competitive functionality. I am not suggesting a competitive side-by-side detailed feature-to-feature comparison because that is both impractical and unnecessary. Instead, I compare functionality because functionality is a summary of many features. For example, invoice matching is an accounts payable function, but how the function performs is the result of many features. I recommend comparing no more than 150 functions of 2-4 competitive products to thoroughly understand the strengths and weaknesses of competitors as well as the functional expectations of the market. Note, it may be easier to distinguish between reality and perception with prospects than with internal company product development teams because most company branding and positioning activities are inconsistent with what sales and sales support people are telling prospects and customers. Therefore, is it a surprise that most product development teams design products based upon the loudest screaming client and not the principles of prospect-driven product differentiation?

In summary, prospect perception offers a world of understanding to discover your corporate attributes and the validated attributes owned by your company is your differentiation. Affixing your unique company attributes to unique competitive product differentiation creates the highest articulation of your common sales cycle “story” ,of which, should be incorporated into all prospect, client, and shareholder communications (e.g., prospect demonstrations, presentations, messaging, web site, shareholder annual reports, customer service, trade show booths, brochures, installation manuals). Understanding prospect perception is the most important discipline required if your company is serious about buyer alignment or being a market-driven company.

The Problem: Your sales process is misaligned with your buyers!

Fewer than 10% of polled organizations claim to have initiatives targeted to align selling and buying processes. I am sure that, if probed, the positive responses would change their responses when adding “…with discipline and regularity.” This statistic is not so much a condemnation of an organizations dysfunction, but an alarming missed opportunity to stay in alignment with its buyers.

Sales organizations don’t knowingly want to miss prospect opportunities, but this glaring oversight costs organizations millions in lost potential business. Sales organizations spend millions of dollars on sales process training. Yet, 3 out of 4 sales training initiatives fail to return its investment. Sales training focuses on the process used to qualify prospects when selling a vendor’s products and services. Not a single dime is allocated to understanding the buyer’s evaluation process. Therefore, when training is complete, most sales processes are out of alignment with their buyer after the first sales cycle. This resource risk (people and money) could be avoided by simply adding a buyer-based diagnostic back-end step after every sales cycle is concluded. That diagnostic “insurance policy” step is a win/loss analysis or post-decision interview (PDI) conducted with prospects who have evaluated your products and services.

Other than mitigating investment risk, the greatest benefit of embedding an iterative PDI process into daily operations is the assured organizational alignment with your buyer. There are three types of buyer alignment: Process (Sales, Evaluation); Differentiation (Solution, Company); Messaging (internal,external). All three types are embedded into the buyer evaluation process and can be quantified using a PDI process. Four priorities that buyers continually strive to align during their evaluation processes are the: buyer needs; vendor solution; solution cost; aversion to risk. Furthermore, the primary keys to aligning these buyer evaluation priorities to a vendor’s selling process are the articulation of the vendor’s differentiation and the validation of that differentiation. Therefore, the PDI process can diagnose the sales cycle to quantify a vendor’s competitive differentiation and the articulation performance of the “differentiation story.” What’s more, the PDI verifies the prospect’s perception of the sales cycle processes (e.g., site visit, references, demonstrations) taken to “prove” the differentiation claims of the vendor. Considering that they are responsible for the sales cycle, should the sales organization be responsible for the PDI process?

The Problem: Executives fail to prioritize or fund market-based validation to adapt sales processes with market changes!

Fewer than 1 out of 4 organizations conduct win/loss analysis with any discipline or regularity. However, organizations need empirical evidence of their sales performance and product positioning. Unfortunately, management seems to affix a low probability to the what, how and when of win/loss analysis. The reason for de-emphasizing win/loss analysis is usually that executives don’t understand the alignment between buyer perception and the quantitative benefits to their organization. This misunderstanding is confusing when you consider that the only way to understand buyer habits is to talk to them. Furthermore, win/loss analysis is not discretionary because validated buyer alignment is required in every decision made by marketing, product and sales management.

If a company has committed to a discipline of mapping their products and services to uniquely fulfill their focused buyer problems and needs, they are selling solutions. Furthermore, win/loss analysis is the foundation required to understand their buyer problems and needs. There are unique qualitative and quantitative benefits associated with selling solutions rather than just products or services. According to Keith Eades, founder of Sales Performance Inc. and author of Solution Selling, the benefits associated with selling solutions are that sales teams:

• Have a 20% higher win rate;
• Outdistance competition quota attainment by 25%;
• Avoid excessive discounting by a factor of 5;
• Have a 30-50% better sales forecasting accuracy.

Sales management is responsible for the sales cycle, so has the greatest opportunity for quantitative benefits from an organization’s investment into win/loss analysis. Oddly, fewer than 20% of organizations have a process to maintain sales processes with buyer evaluation processes. A common mistake is that win/loss analysis is conducted by the sales organization, not product management, with the goal of extracting the single reason why an opportunity was won or lost from a win/loss interview. The result is a one-word entry inserted into its CRM or SFM tool. The irony is that a sales person conducts the client interview using open-ended questions without a template. This causes defensive and cryptic responses with little validity or a means to measure results. In addition, the results are filtered by salespeople to preserve the reality of the sales cycle from management. In a sales performance study conducted by CSO Insights, 50 percent of sales executives wanted to improve their ability to adapt their sales process to marketplace changes. That said, a discipline that extracts performance data is needed to enable sales management to identify sales representatives requiring coaching and sales cycles requiring process improvement or refinement in order to improve quota attainment.

What is a sales organization’s ROI when adopting a win/loss analysis process with discipline and regularity? Validation from CSO Insights claims that the number of sales within 1-3 months will increase by 15% and turnover will improve by 9% when sales management reviews wins and losses with sales representatives. What the research does not present is how to continually collect validated sales performance knowledge used by the sales managers during the win/loss review. This diagnosis is the most critical data to the sales organization and it can only be collected via win/loss analysis. Therefore, if an iterative win/loss analysis process (e.g., training or outsourcing) could feed the sales management system with constant validated sales performance data, CSO Insights claims that 40% more organizations could identify salespeople who need coaching, quota attainment would improve by 12%, and 60% (my research discovered 80%) of organizations would obtain the discipline of win/loss analysis. Finally, win/loss analysis is not discretionary because it is the umbilical chord to buyer behavior. By instilling a disciplined diagnostic process at the end of each sales cycle, organizations can expect multiple qualitative benefits, such as:

• Identify salespeople requiring coaching;
• Product management will develop products meeting buyer expectations;
• Product management will train sales to articulate unique value and differentiation;
• Marketing management will articulate messages that uniquely fulfills buyer needs;
• Marketing management will harvest better leads for sales;
• Sales organizations will recite common value and differentiation messages to the market.

Most organizations would be happy with the above benefits. However, for executives requiring a quantitative return on any win/loss analysis investments, the following benefits are a direct result of deploying win/loss analysis processes:

• A 9% improvement in salesforce turnover;
• A 15% increase of sales within 1-3 months;
• A 12% improvement in quota attainment.

In summary, win/loss analysis is non-discretionary if an organization wants to be market-based or has the discipline to sell solutions. Still, qualitative and quantitative benefits exist to ensure that management raises the priority to fulfill the promise of win/loss analysis initiatives. With a minimal investment to instill a diagnostic interview process on the back-end of every sales cycle, company’s adopting the principles of win/loss analysis will outdistance their competitor’s sales quota, turnover, and closure rates. Most importantly, win/loss analysis ensures that your products, services or solutions are aligned with market expectations and that your messaging is articulated in a beneficial manner.

What is the difference between “win-loss analysis” and post-decision interviews?

Good question. Win-Loss Analysis is conducted by fewer than 1 out of 5 organizations and is usually discretionary, open-ended, does not use a template to gather findings and is conducted by the sales organization. Post-decision interviews (PDI) are not discretionary and have been woven into the sales organization fabric to continually diagnose sales performance, verify competitive differentiation and to align messaging with buyer bahavior. A PDI qauntifies prospect perception, not client satisfaction, and reached beyond sales performance to verify brand recognition, company attributes, market messaging success and more. To maintain credibility and ensure accuracy, post-decision interviews:

1. Can not be sales focused or conducted by the sales organization, but should be outsourced or conducted by an autonomous sales enablement department;

2. Should be non-discretionary and an iterative process marking the end of a sales cycle;

3. Must be templated by using measurable (ranked, prioritized, and rated) attribute metrics as well as collecting substantiated remarks;

4. Will drive actionable goals for the outcomes in order to change/continue buyer process alignment!

For more detail, download a free report titled “8 Rules of Successful Post-Decision Interviews” at
http://www.salescycleanalytics.com/signup-report.php.

Excellent question. Solution-centric sales process training focuses more on single opportunity qualification from the seller’s viewpoint than it does on the buyer’s process. What’s missing are the “proof” and “validation stages” that are so critical in setting the differentiation hook in the sales process. I constantly wonder why being able to successfully position (align) differentiated solutions isn’t the primary focus of the seller process rather than leaving it up to generic messaging tools and templates? When I refer to buyer alignment, I am referring to the alignment of buyer and seller processes from the continued demonstration and positioning perspective to guarantee that the prospect needs match (align) to the seller’s differentiated solutions. This is accomplished by instilling a discipline of continued evaluator post-decision interviews (win/loss analysis) that extracts “actionable” results. The benefits of continued win/loss analysis are alignment of processes (sales, buyer evaluation), differentiation (company, solutions) and messaging (internal, market).

A vendor must continually understand how a prospect perceives it’s messaging, functional differentiation and corporate attributes so it must align that perception to the buyer’s evaluation process. Therefore, in order to align with a buyer, a seller must align with the buyer evaluation process. Buyer priorities change throughout a sales cycle, so a vendor needs to understand its perception in advance of the selling process and align its positioning to the priority affixed to the buyer’s risk, cost, needs and solution. Post-decision Interviews (win/loss analysis) gather attribute ratings that are aligned with each of these four buyer priorities. Moreover, attribute ratings provide performance measurement to inform the sales organization what decision criteria is most critical to its prospects during the sales cycle and how the vendor meausures against that criteria. Armed with this knowledge, the sales, marketing and product management teams can continually align with the changing buyer needs (solutions), priorities (process) and perception (messaging) during the sales cycle.

Problem: Baseless claims of being a market-driven company are substantiated by the lack of existing buyer alignment disciplines

In a recent State of Market-Driven Adoption Executive Poll conducted by SCAI, 83% of respondents claimed to be a “Market-Driven” company. However, many responses highlight inconsistencies in their claims:

• When asked to substantiate what “market-driven” means to them, most executives responded by citing activities with their “customers,” not prospects or evaluators;
• 57% have invested into sales process training, yet half believe that its only benefit was to provide a process for the salesforce;
• 83% have not invested into product management framework training necessary to include buyer validation (e.g., personas, demand, perception, needs, problems) into product development;
• 57% irregularly conduct win/loss analysis and 28% don’t conduct it at all;
• 43% are just beginning the process.

These results maintain that one of two possibilities exist: 1.) Companies have fallen prey to unsubstantiated “me to” claims in order to be perceived as equal to their competitors who are performing market-based research; 2.) Executives are confused about how to create a cross-organizational market-driven culture.  The answer is that both are true. Dwindled budgets have forced organizations to take shortcuts and it is easier to claim something than it is to prove it. The problem is that products, services and solutions will not keep up with market demand if diagnosis of sales positioning, perception of company / solution differentiation, and reality of the vendor’s “buyer need/vendor solution” equation is not monitored, measured and improved. Moreover, ignoring market-based perception and measurement disciplines will only invalidate any claim to “market-driven” to potential buyers and will be used by competitors as an edge or advantage.

Who is in Charge?

The top two responses by market-driven companies were split between the CEO and CMO (28% each) as to who was in charge of cross-organizational market-driven initiatives. 14% say the President is in charge and another 14% claim that no one is in charge of market-driven initiatives. When asked who is in charge of sales, marketing and product management, 57% said the CEO and 29% say the President, while 14% claim the COO. In order to be successful, the reality is that market-driven responsibilities must be shared and job-based performance must be paid upon its successful execution. Furthermore, market-driven processes should be driven by the CMO and monitored (and funded) by the CEO.

“Voice” of the Buyer

43% of executive respondents claim that the sales organization is currently the “voice” of the buyer, but 29% believe that they should be. More commonly, 43% say that product marketing is the “voice” of the buyer and 43% believe that they should be. Finally, 14% say that marketing communications is the “voice” of the buyer, but that executives should be. Historically, sales organizations have held the distinction of being the “voice” of the buyer. However, “market-driven” companies will relinquish this distinction to product marketing for cross-organizational initiatives to maintain buyer alignment. In the absence of product marketing personnel, product management should be the “voice” of the buyer.  Some larger organizations have enabled the Business Development function with understanding the buyer, yet the most new-age companies have created a liaison individual, called the Sales Enablement Officer, to ensure that buyer alignment is achieved and maintained.

Fox in the Hen House

71% of responding executives claim that their only sales performance diagnosis is represented by a CRM housing sales-facing data. Yet, the only diagnosis that is updated into these systems is the one-word reason that an opportunity was won or lost - no “actionable” data on buyer behavior. Usually, the responsibility is that of the sales representative and the reason given is price, product or lateness to the opportunity. This is not valuable or unbiased data. As Einstein said, “The significant problems we have can not be resolved by the same level of thinking with which created it.”

Also, a CRM is a cross-organizational means of maintaining data on a customer, but is not effective with sales-facing prospect knowledge or as a diagnostic tool.  Likewise, a sales forecasting management (SFM) tool functions only as a sales process monitor and a closure projection tool. Finally, to be a “market-drive” company a post-decision interview (win/loss analysis) process is necessary to gather evaluator-based knowledge. As such, this content requires the use of a non-CRM, non-SFM, easy application exchange in order to input, maintain, retrieve and evaluate sales cycle performance, competitive positioning and other sales-facing content.

Cross-Organizational Adoption

71% of executives claim that their cross-organizational efforts to understand their buyer “needs work” and another 14% are “somewhat satisfied.” This trend simply points to the nascent or fledgling efforts underway in most organizations to understand their buyer. Furthermore, there is an industry void of cross-organizational models that instills an iterative process that continually validates, monitors and quantifies the buyer’s perception, needs, problems and processes.

A “market-driven” company is a company that measures and continually aligns its evaluator, customer and prospect needs, problems, processes and perception with its own development, positioning, sales processes and solutions. The buyer-based disciplines must include an iterative process to quantitatively measure improvement in all four areas. As such, a company can not be a “market-driven” company unless it maps buyer knowledge extraction initiatives to development, positioning (competitive and messaging), processes (sales cycle) and solutions (products and services).