State of the Art

Sales-force automation gives you the power to do everything from closing deals on-site to configuring marketing campaigns. But making it succeed is a risky business

Michael Hays, a regional sales manager for Gulf Industries, a sign-making company based in Torrance, Calif., remembers the old days of selling signs. He'd spend nearly an hour with a potential customer, trying to come up with a design the customer couldn't resist. After cutting and pasting various pictures and shapes from color printouts and having the customer imagine a range of typefaces and logos, he'd sometimes get an enthusiastic response. But it wouldn't last long. As soon as Hays said he'd have to run the artwork by Gulf's designers and engineers to make sure it was executable, he could feel the room go cold.

But recently, when Hays visited a car dealership, he sailed through the entire call. After about 10 minutes of asking the owner questions about his business--How many customers were from out of town? How busy was the location?--Hays whipped out his laptop. To the owner's amazement, in less than 15 minutes Hays had designed the perfect sign, down to the squiggly border and the red Mustang the owner had said was his favorite car. After scanning in the dealership's logo, Hays quoted the owner a price of $5,000--the computer did all the calculations--and set a contract down in front of him. Because Gulf's designers and engineers had already OK'd the design combinations stored in the laptop, Hays knew there would be no problem transforming the digital sign into a real one. The delighted dealer couldn't sign fast enough.

Tired of losing business because of disorganized sales calls and untrackable market information, more and more small companies are turning to sales-force automation (SFA)--the 400-plus computer programs on the market aimed at helping sales representatives do their jobs more efficiently. One category of SFA gives reps tools for designing products and closing deals on-site. Others provide the technology to develop multimedia presentations, to configure and carry out marketing campaigns, or to tap into a company's intranets from the road. And that's just for starters.

With so many options, though, comes a big risk. According to a recent study by the Gartner Group, more than 60% of all SFA projects are not successful. "I've found more tombstones in the backyards of companies in honor of sales-force automation than I have in honor of total-quality-management programs," says Jim Cecil, founder of the James P. Cecil Co., a sales-and-marketing consulting company in Bellevue, Wash. Whether the reason is rebellious salespeople, automation of the wrong processes, or failure to involve key managers in the upgrade, taking on SFA is a gamble.

But before you go crawling back to your safe contact-management program and your easy-to-use automated expense reports, consider this: when used correctly, SFA can boost your sales anywhere from 15% to 35%, according to the Pentech Corp., an SFA consulting group in Atlanta. Indeed, if you follow a few simple rules--like analyzing your sales strategy before you automate and choosing your tools based not on their popularity but on your company's specific needs--you could end up among the 33% of companies that achieve an impressive return on their SFA investment.


Consider Evan Segal. President of Dormont Manufacturing Co., a $30-million manufacturer of gas-appliance connectors in a small town outside Pittsburgh, Segal needed a way to broaden customers' perceptions of what his company could do for them--and his own perception of what the company should be doing with its energy and resources.

Segal puzzled over the first problem for a good six months. He knew that if he could just get people to come inside his factory, they'd stop thinking of it as a place where underpaid workers pieced together dirty bits of rubber tubing and realize it was a clean, spacious plant staffed by dedicated technicians assembling everything from faucets to newfangled coupling devices. But how to get customers over the threshold?

The answer came to Segal when he saw a virtual-reality (VR) tour of Carnegie -Mellon University, his alma mater. If he couldn't bring customers to the factory, he realized, he could bring the factory to them: he'd simply develop a VR tour and load it onto each of his six managers' Gateway Solo laptops. But when he discovered that the VR project would cost him at least $200,000, he quickly changed his direction. Today all his sales managers carry a 10-minute multimedia tour of Dormont, complete with animation, still photos, and video.

To design the tour, Segal hired Tom Dixon, an independent programmer based in Pittsburgh. But Segal did a lot of the legwork himself to save money. He spent a day walking around his company, acting like a guide and scribbling down everything he'd normally explain to a live audience. Then he wrote up a script and turned it over to Dixon, who designed the tour using a program called Director Multimedia Studio, from Macromedia ($999; 800-526-0498; Next, Dixon and Segal hired a freelance artist to design five animated characters--including Monty, a friendly gas-hose connector--and an actor to do their voices. He pinched pennies in less obvious ways, too: moving his characters' bodies was much more expensive than moving just their mouths, so he had them talk more and travel less. The entire project ended up costing only $25,000.

To be sure, Segal's tour may seem a bit crazy at first glance. Segal, an animated character himself, may have pushed the envelope when he decided to feature Monty, the gas hose, singing "Let's Get Flexible." But the tour produced results. Take the case of Barbara Bloecher, purchasing manager for FoodService Purchasing Cooperative, in Louisville, and a longtime gas-hose customer. A couple of months ago, a Dormont sales manager came to her office and took her on the multimedia tour. During the presentation Bloecher noticed the factory workers assembling faucets, a product she'd never realized Dormont carried. She also discovered that the company had introduced a new kind of coupling device--a piece that connects two hoses. The sales meeting lasted a bit longer than usual--about 45 minutes--but she didn't mind. "I felt in control of the meeting," says Bloecher, who could choose which 30-second segments of the 16-part presentation she wanted to see. The outcome? In addition to her usual gas-hose order, Bloecher spent a couple hundred dollars on faucets for one of her clients, a restaurant chain. "The chain will be opening many restaurants in the next few years and will order new faucets continually," she says.

Though Monty may not yet rival Mickey Mouse in the corporate-identity game, Segal is pleased with his--and his cartoon colleagues'--performance. "Most people compare themselves to competitors, but I benchmark against MTV and CNN," he jokes. He's in the process of putting the tour on CD-ROM so that his 300 manufacturer's representatives can use it with customers, too.

Getting customers inside the company, however, was only the beginning of Segal's foray into SFA. Now he needed to figure out how the technology could help him pinpoint the most lucrative places he should go outside it.

His partner and best friend, Stacy Brovitz, had learned from the software company that developed Dormont's central database that opportunity-management systems (OMSs) were designed for that very purpose. Heeding the software company's advice, Segal and Brovitz purchased a 10-user license for PowerPlay, an OMS from Cognos (800-426-4667;, for about $10,000. "If the system helps your salespeople make good business decisions, as it did ours," says Segal, "you can recoup the cost, literally, in a week."

OMSs are highly evolved descendants of contact managers. Like their predecessors, they track company names, phone numbers, and meeting notes. But they go several steps further, helping salespeople identify untapped wells of revenues hidden in their existing accounts and then setting specific objectives for each customer. The systems do this by tracking everything from sales information on a macro level (say, by country) to specific product information by industry and even by customer. So, for example, if a sales manager notices that gas-hose connectors make up 70% of sales to large fast-food chains as a whole, he or she can drill down to the regional level and determine which regions aren't selling as many connectors as their counterparts.

Though he installed his OMS only about a year ago, Segal has already seen its benefits. Just five months ago, he noticed that a few large customers in certain territories around the country were spending considerably less than their same-industry counterparts in other regions. So he ran a report that itemized the products sold to each customer in the low-buying group, and in a matter of hours he spotted the weakness: while most of Dormont's large customers had been purchasing the company's newest product--a safety valve--in record numbers (nearly a million dollars' worth), the problem customers hadn't bought a single one. When Segal asked the reps for those customers the reason for the poor showing, he learned that he himself was the source of the problem: he'd been so caught up in pushing the newly patented product that he'd overlooked seemingly mundane details--like making sure all his reps had adequate samples to give to potential customers. He subsequently put together sample kits for each of the low-selling reps and also wrote up individual sales goals for them.

The insight went a long way: Segal's projections show that he'll sell 50% more safety valves this year than last. And overall, he says, he expects Dormont's revenues to shoot up by 25%--thanks to the implementation of the SFA system.


Kozell Boren, who is president and chairman of Gulf Industries, had no problem figuring out whom to sell to. The challenge for him was keeping customers interested once his salespeople had made a pitch.

For years Boren, the son of a Texas blacksmith, had thrown all his energy into manufacturing his signs and spent little time figuring out the best way to sell them. By 1992 Gulf Industries had become one of a handful of sign companies to perfect the use of Lexan (a material hard enough to withstand gunfire) in its sign making, but its salespeople were still using colored pencils and glue sticks. It wasn't until a year later that Boren discovered--almost accidentally--that technology would revolutionize how Gulf sold signs, just as Lexan had revolutionized how it made them.

Boren purchased his first laptop--an NEC 386 notebook computer costing $7,500--and the software package Corel Draw as a test: he wanted to see how computers could facilitate the design process. With the help of employees in the company's design center, he loaded Corel's off-the-shelf design program ($489; 800-772-6735; and added a few of Gulf's basic sign configurations and fonts. A few months later, Boren handed the notebook to salesman Perry Powell and told him to use it when he called on customers. The length of Powell's sales calls quickly shrank from three hours to an hour, and within a few months he became the company's number one salesperson.

Boren would have loved all 200 of his salespeople to follow Powell's lead, but he couldn't afford to buy each one a laptop. And because they operate as independent contractors, he couldn't force them to lay out the money themselves. So he began waging a major high-tech campaign, and little by little he converted half the reps. The hundred who held out, he says, said they didn't need laptops. "But what they really meant," he adds, "was that they were afraid of them."

Those who use the laptops are selling in a completely new way. Each week Boren gathers fresh graphics from some of the top design firms in the country and sends them to his sales force on disk or by E-mail to use in creating signs. At any one time, the salespeople have no fewer than 400 pieces of artwork on file. Many salespeople have added portable scanners and digital cameras to their arsenal as well. Boren urges his salespeople to invest in high-resolution screens, even though they add about $1,000 to the cost of the laptop. "People are always hovered around a laptop during a sales call," he says, "so the picture should look good from every angle."

Three years after Gulf launched the laptop program, its sales had increased by 29%--after five years of revenue stagnation. And the salespeople who'd invested in the technology reported an average increase of 25% in sales. In fact, 45 of the 50 reps rewarded recently with a trip to Hawaii for hitting or exceeding their 1996 monthly quotas had laptop computers. That statistic did it for Boren. After returning from Hawaii, he embarked on a two-week tour of 14 states to visit his reps and announce a contest. If the reps reached a certain sales goal within one month, he said, they'd win a free Pentium notebook computer. The results were startling: one rep reached the goal in three days. Boren plans on giving out some 50 laptops and has budgeted $2,300 for each.

It makes you wonder: Maybe his reps weren't afraid after all; maybe they were just short on cash.


While most small companies implement SFA one step at a time, the way Gulf Industries and Dormont did, a few find that automating sales sends a technological ripple through the entire organization. Multicom Communications, a $5-million sound, data, and communications contractor in St. Louis, is one such company.

Multicom is responsible for all the stuff you don't think about when you enter a building--like lighting, sound systems, computer networks, and surveillance. With a fleet of four salespeople and an overwhelming number of details to keep track of, founder and CEO Michael Koenig realized seven years ago that he needed a better way than tickler files to organize historical sales information and sales-meeting notes, and a more reliable system than sticky notes to help salespeople remember to follow up on leads. After researching his options, he decided to purchase Market Master, a marketing-and-sales software package from Breakthrough Productions ($395 to $1,995, depending on the number of users; 916-477-8685; Market Master). And though the program did what he wanted--and even increased sales five times over--it had an unexpected side effect: it highlighted the poor communication among departments once jobs were in the bag. "As sales were going up and up," says Koenig, "I could see the downside clearly: the rest of the company was much too low-tech."

Market Master, a Macintosh program, asks users to set up several general time frames for sales campaigns--including one for very hot leads, one for hot leads, one for cold leads, and one for very cold leads--and then applies those schedules automatically to clients, according to the salesperson's directions. For instance, a salesperson might specify that very hot leads get a follow-up phone call two days after the initial sales call and marketing literature one week later. He or she then designates which clients fall into which category. The software does the rest--collating, scheduling, guiding. When the salesperson next calls up a client's file on-screen, he or she will find a schedule detailing when to do each task. The software also automatically generates follow-up letters.

The prodding capabilities of Market Master appealed to Koenig, but what particularly impressed him was the program's ability to tailor marketing campaigns to different kinds of clients. That could mean anything from choosing what type of information will be sent to the customer to compressing a previously drafted six-month campaign down to three weeks--all at the click of a button.

The latter is what he needed to do to draw riverboat casinos into Multicom's fold. In the late 1980s and early 1990s riverboat casinos were built at a dizzying rate--Koenig saw more than 100 potential clients looming on the horizon. But he had to act fast and get on board before the boats got their casino licenses. Rather than taking time to draft an entirely new campaign, he simply applied Market Master's compression feature to the six-month campaign he'd already outlined for land-based casinos; within minutes the campaign was shortened to 30 days. He then set his salespeople loose with the program to swamp the riverboat-casino owners with carefully timed phone calls and automatically generated letters--all the while tracking every move in the Market Master database.

But with new jobs flowing in like water, Koenig quickly became aware of how creaky the company's other systems were. Multicom's handling of a large customer-- Delta Queen Steamboat--perfectly illustrated the problem. Each year, the historic Delta Queen had a "layup" period, during which the boat would dock and undergo any necessary repairs. Multicom was responsible for fixing the cabin's music system, theatrical sound system, and the like. Every department in the company got involved. Say the engineers on the boat had to fix faulty wiring. They'd have to first get approval from accounting; accounting, in turn, would have to get approval from production; and finally, production would have to go to fabrication, which would see that the proper parts were ordered and that the job got done. Every time information passed from one department to another, facts would get jumbled and deliveries would be delayed. The procedure resembled a long game of telephone.

The result was that for two years in a row, Multicom's workers remained on the Delta Queen long after it had shoved off for a new season. "Our workers had to sleep in the same cabins the Delta Queen had been hoping to sell to customers," says Koenig.

The situation had always been disturbing, but now that he'd seen how efficiently technology could make things run, Koenig found it unacceptable. His solution was a company intranet, linking every department. Multicom's chief engineer wrote the code for the intranet using an operating system called Linux, which he then ran off two of the company's four servers, along with the company's databases. To make the system companywide, Koenig also had the engineer reconfigure several of Market Master's fields--for example, the one that reminds salespeople to follow up leads and the one that automatically draws up a contract once a sale is complete--for the company databases so that salespeople could tap into the program through the intranet while they were on the road. (The complete Market Master program still sits on a single computer.)

Now every department works off one electronic document per job, which the salesperson begins at the start of a new client relationship. Each week, 5 to 150 leads from the Dodge Report, a commercial lead service, are downloaded directly into the company databases through a program written by the chief engineer. Koenig accesses the leads, assigns each one a rating of one through four (from very cold to very hot), and divvies them up among his four salespeople by downloading the contact information into each person's password-protected area on the intranet. The salespeople take a laptop with a modem along with them on their calls. When a prospect becomes a client, they fill out an electronic "job start form" on the intranet, providing information such as the project end date and any special terms the client requests. Once all the information is filled in, the salesperson hits a button, and an E-mail message is automatically sent to the accounting department. Accounting OK's the project, then zaps the form over to production for scheduling. Last, production shoots the form over to the fabrication department.

The payoff of the system shows up in all phases of a project. Consider the work recently done for a riverboat called Showboat. The job involved four subcontractors, three project managers, and 10 engineers--spread out over three locations (the boat itself, the boat's land-based operation, and Multicom's fabrication shop). Partway into the job, the boat-based rewiring crew realized it needed a thicker cable. Before Multicom's plunge into automation, the project would have come to a halt for several weeks while the accounting department awaited approval from the customer (the thicker cable costs a few thousand dollars more), production waited for the go-ahead from accounting, the fabrication shop waited for production's orders, and the crew waited for the new cable. But this time around, the crew communicated its change of plans instantly to every department. The new cable was delivered within days.

Of course, for every successful automation attempt, there's at least one regret. For Koenig and his employees, the trade-off was obvious. "Now that we're always on time with projects," says Koenig, "we never get to ride on the Delta Queen."

Are you properly automated?

Are you automating your sales force at an appropriate pace? Use the chart below to see where your company falls on the SFA curve.

One Word processing, spreadsheets, E-mail Now
Two Contact managers, electronic expense reports Now
Three Account-territory managers, order-management systems, call-reporting systems, sales-analysis systems, mobile client-server systems Now
Four Sales-configuration systems, opportunity-management systems, marketing encyclopedia systems, telesales, system-administration systems, interactive selling systems 1998
Five Enterprisewide opportunity-management systems, intraenterprise team-selling tools 2000
Six Interenterprise opportunity-management systems, virtual sales organizations 2002
Seven Tools that allow unassisted selling 2004

Source: The Gartner Group.



  • "The State of Sales Technology," SMT, December 1996. SMT is the quarterly technology supplement to Sales & Marketing Management (212-592-6412; The article includes a comprehensive list of sales-automation software.
  • Sales Process Engineering & Automation Review (SPEAR), a quarterly newsletter put out by the Sales Automation Association (312-245-1094;

Web Sites:

  • , developed by Richard Bohn, president of the Denali Group, an SFA consulting firm. The site includes an SFA needs-analysis questionnaire.
  • , a site featuring an SFA return-on-investment work sheet developed by the Pentech Corp., an SFA consulting group in Atlanta.

Sarah Schafer ( is a staff writer at Inc. Technology.