In the pages that follow, we'll show you -- through the eyes of small-business owners and managers -- what you need to know about those and other technologies, all of which can change the way you sell.
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Knowledge Is Power
If you have intimate knowledge of how your salespeople sell, and of how and why your customers buy, you already hold the keys to using technology effectively. Sam Poole knew he had that knowledge, and he knew he had to figure out how to use it. When he joined Maxis as vice-president of sales, in August 1992, the software publisher was undergoing a major transition in the way it sold its computer simulation games. The plan, which Poole carried to completion the following year, was to break away from Broderbund, the huge software maker that had been responsible for the retail sales and distribution of Maxis's products, including SimCity, since Maxis's inception, in 1987.
From there Poole was starting from scratch. So he began by asking some basic questions. "Every company has to figure out, 'How much will I sell? What kind of information do I need to create forecasts? How can I get data on competitors' sales?" says Poole, who is now CEO of the $23.5-million Orinda, Calif., company.
Asking those questions enabled Poole to create a spreadsheet template in Microsoft Excel. In it he entered sales by customer, by month, and by SKU (stock-keeping unit). Maxis had always had some of that data, in the form of monthly computer printouts supplied by Broderbund. But those printouts were not, on their own, very useful. Poole's regional sales managers could use the Excel reports to understand exactly where a product was in its life cycle; which computer platforms were key to which Maxis products; and which sales channels were key to Maxis's success. "By proving how well our products are selling and by demonstrating how fast the market is growing, we can persuade distributors to buy our products," says Poole. The new system has made a phenomenal difference: the old reports counted sales; the new ones help generate them.
Today Poole's salespeople, newly immersed in the information-technology mind-set, create their own reports in Excel. The reports are based on data gathered from a wide array of sources, such as the Software Publishers Association (SPA), which for $300, the price of an annual membership, provides general information on the types of software categories and platforms sold at certain retail chains. The distributors on whom Maxis calls often have the printed SPA information sitting on their desks, says Poole. "But they wait for our analysis on what those numbers mean. It makes us the expert on the marketplace."
How Do You Sell?
Asking the right questions is where good sales-force automation begins. The first step is hunkering down with the top players from your company for a from-the-ground-up rethinking of how you sell. Why go to all that trouble? Because, says Barton Goldenberg, a consultant in sales and marketing automation based in Washington, D.C., virtually every part of a company affects every other part. (See "Ten Steps Toward Successful Sales Automation," page 5.)
Take Goldenberg's description of a failed automation effort at one computer-leasing company. Instead of taking a holistic look at its organization, the company built applications function by function -- one for sales, one for customer service, and so on. "They forgot that when salespeople go out to take an order, and it's thrown back at them when the delivery is late, customer service gets involved," Goldenberg says. The result: time wasted and customer goodwill lost. Plus, the company had wasted more than $100,000 on the new applications -- which it eventually scrapped.
Examining how you do what you do is the most critical step you will take in overhauling your sales effort. You can, of course, call in a hotshot consultant to do it all for you, but that will cost you a lot of money. Instead, we recommend that you assemble your own team made up of top players. Start by asking your team some straightforward questions about your company's sales process. Whose desk does the order sit on? Does that person take important action on the order or just rubber-stamp it? Do salespeople have to play phone tag to confirm prices or inventory? Do they waste time hunting for follow-up mailings or thank-you notes? That information gathering can be done using a questionnaire, or by following an order through the processing cycle, or by watching how a salesperson does his or her job.
It will make your sales staff consider the big picture, says Sateesh Lele, senior vice-president at Telogy Inc., which manufactures, distributes, and leases electronic test and measurement equipment that's used by telecommunications and computer companies. Lele and his team -- comprising representatives from sales and marketing; operations; customer service; research and development; and manufacturing -- followed the rethinking process with good results. One big win: they streamlined the order-fulfillment process and made on-time delivery a priority. That meant creating, for the first time, a daily report to track what had shipped the night before, and what had shipped late and how late it had been shipped.
Lele's sales-tracking system can not only slice and dice sales by customer, region, product line, distribution channel, or any other criteria under the sun; it also tells him about the customers that got away. "If a customer calls up and says, 'Got a widget?' and I say, 'No,' I've just lost a sale," says Lele. If the company never thought to track how often customers ask for widgets, it would never know there was an unmet demand. So Lele and his team created additional sales categories and added functions to track potential customers with its new client-server software. Among other things, Telogy found it hadn't been stocking enough of the 200 top items that generate the most revenue. As a result of its software improvements, the company has boosted sales by 15% while cutting inventory levels by 10%.
