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The Next Generation Sales Operations Team

  1. The Next-Generation Sales Operations Team – Companion Presentation [The Next-Generation Sales Operations Team (IDC#224122, July 2010)] Michael Gerard Program VP IDC Sales Advisory Service v2 For Internal Use Only. Not for Copyright 2010 IDC. Reproduction is forbidden unless authorized. All rights reserved. Distribution without IDC Permission.
  2. Sales Operations as a Driving Force of Change Customers Technology Vendors “The pace of “My technology vendors change is speeding do not understand my up” [Sales Exec.] business” [CIO] “Our customers are more knowledgeable before our first “I am unable to leverage meetings than ever what my organization before.” [Sales Ops] has to offer me” [Sales Rep] Sales Operations needs to be the driving force for productivity improvements across sales, setting its vision for the future and maintaining the path towards this vision. For Internal Use Only. Not for © 2010 IDC 2 Distribution without IDC Permission.
  3. Mapping the Transition to the Next Generation Sales Operations Team Current Sales Operations The Next Generation Sales Function Operations Team • Tactically focused • Strategic driver for sales‟ • High decentralized, with poor executives alignment within sales and • Center of Excellence structure with other areas • Process engineering and change • Limited involvement across management expertise, leveraging IDC‟s Sales Productivity industry best practices Levers • Managing or governing • Mired in traditional CRM improvement across IDC‟s Sales technology and redundant Productivity Levers systems • Fluent in the use and leverage of • Unable to directly or indirectly next generation sales automation measure performance • An expert in sales performance measurement For Internal Use Only. Not for © 2010 IDC 3 Distribution without IDC Permission.
  4. Sales Operations Organizational Strategies - Agenda  Clarifying Terminology  Study Objectives and Methodology  Current State Analysis, Challenges  Best Practices  IDC Essential Guidance For Internal Use Only. Not for © 2010 IDC 4 Distribution without IDC Permission.
  5. Clarifying Terminology: Sales Operations Global and local sales staff responsible for developing and orchestrating the processes and systems required to enable an efficient and effective sales organization: strategic planning, financial management, sales performance measurement, sales infrastructure, marketing and sales alignment, and overall sales excellence. Sales Strategy & Sales Compensation Planning Sales Forecasting Sales Enablement Quote to Order Sales Analytics Sales Operations Sales Automation Infrastructure For Internal Use Only. Not for © 2010 IDC 5 Distribution without IDC Permission.
  6. Sales Operations Study: Research Objectives and Methodology  Methodology  Conduct executive interviews with sale operations professionals at leading firms  Leverage data from other IDC Sales Advisory Service research  Participant Demographics*  Company interviews(partial list): Amdocs, CSC, Fujitsu, HP, Intel, Juniper, Kronos, Microsoft, MTE, Oracle, Siemens, Sungard ($1B+ companies with complex sales processes for large customers)  Representative titles: VP, Global Sales Strategy & Performance; Dir. Strategy and Planning, WW Enterprise Business Operations; Dir. of Sales Model Design *This study also includes insight from attendees at IDC’s May 2010 Sales Leadership Board meeting where initial results of this research were first presented. For Internal Use Only. Not for © 2010 IDC 6 Distribution without IDC Permission.
  7. What‟s the Mission of your Sales Operations Team? Optimize the sales organization‟s productivity “Allow sales management to focus solely on revenue-generating activities” Drive process improvement Own the quote to order process For Internal Use Only. Not for © 2010 IDC 7 Distribution without IDC Permission.
  8. Sales Operations Challenges  Identifying the roles and responsibilities of sales operations: strategic and tactical  Too many sales operations folks in the regions are doing too many tactical activities  Collaboration with other teams (e.g., marketing, finance)  “Do we have the right skill-sets across sales operations to be more strategic?”  Managing Change  Reorganization of the sales force  Gaining credibility and buy-in from sales management  Identifying the greatest opportunities for improvement (“low hanging fruit”)  Lack of Focus  Poor process (and technology) adoption  Optimizing Sales reps time  Performance measurement of sales operations  “Budget money keeps coming in without any formal assessments.”  “How has sales operations impacted our business?” For Internal Use Only. Not for © 2010 IDC 8 Distribution without IDC Permission.
  9. Sales Operations Best Practices  Global Sales Operations Functions as a Center of Excellence (COE)  A global sales operations team is responsible for establishing and governing best practice processes and infrastructure (top down support)  Regions are empowered to execute locally - they have a sales operations function for localized activities  Strong Alignment Between Global and Local SO Teams  Common reporting hierarchy: “We all report to the same boss.”  Common functional structure: “Each functional group has steering committees.”  Clearly established communication and interaction points  Sales Operations Sets Priority Objectives, Initiatives: evaluate current state vs. best-in-class, identify key gaps in sales‟ productivity, develop and prioritize initiatives  “We have a „war room‟ run by SO to track key issues across the world. . key sales execs are on a weekly call to highlight and discuss these issues and reps can create a „case‟ in our SFA.”  “I run weekly staff calls for the sales executive team.”  “Sales operations provides channels for sales reps to escalate key productivity- related problems.” For Internal Use Only. Not for © 2010 IDC 9 Distribution without IDC Permission.
  10. IDC Sales Operations Maturity Matrix Operational Excellence • Lack of global alignment • Good executive support • Inability to execute • High level of productivity • Agile sales organization Role of Sales process improvements Operations • Market forces will drive change • Struggling to build credibility • Good executive support • High level of redundancy • Improvement needed across • Inability to focus on longer- SO staff and structure term initiatives • Need better SO processes Tactically Focused Decentralized Global Sales Operations Global Sales Operations Forming, SO in Regions, as a Center of BUs Operate in Silos Excellence Level of Centralization For Internal Use Only. Not for © 2010 IDC 10 Distribution without IDC Permission.
  11. Sales Operations Best Practices • Directly impact sales reps to improve productivity and increase SO visibility • “We are working with sales management including FLSMs to develop a gap/skills assessment process for reps improve their training and overall productivity.” • “We‟ve established a shared services model for some of our sales operations processes – e.g., order management and pricing.” • Preparing for customer interactions • Sales Enablement as a High Priority • “We have a dedicated team focused on sales enablement within sales operations.” • “Sales playbooks have made our selling efforts more prescriptive . . . . Reps spend more time asking the right questions of prospects.” • Customer Intelligence as a High Priority • “We‟ve significantly increased productivity with our new CI solution: what used to take five days, speaking to 3 different people now takes under five minutes.” • “All information can now be accessed through one system – our SFA.” • “Our reps can now spend time on deals and in front of customers, and less time constructing a transaction.” • Collaboration with Marketing  Clear identification of points of process overlap (e.g., lead management, sales enablement)  Inclusion of marketing in more tactical sales operations activities: “Our sales operations team meets with the CMO and marketing operations teams at least weekly.” • Integration with Marketing Automation – e.g., marketing and sales‟ pipelines For Internal Use Only. Not for © 2010 IDC 11 Distribution without IDC Permission.
  12. Sales Operations Organizational Structures: Center of Excellence Model Global Head of Sales Regional VP Sales VP Global Sales Regional Sales Operations Operations Teams Strategy & Planning Analytics Forecasting Local Sales Execution of Finance, Compensation Global HR Practices Sales Marketing Enablement RFPs, Pricing & Order Mgmt. Sales Automation Mission: Process & Mission: Local Execution and Technology Infrastructure Collaboration with Global Ops For Internal Use Only. Not for © 2010 IDC 12 Distribution without IDC Permission.
  13. Sales Operations Performance Measurement  “Our performance is based upon how much we improve the „productivity‟ of the sales force.”  Quantitative Metrics  Financial metrics (revenue (quota attainment, cross-sell/up-sell), profitability, cost of sales)  Pipeline metrics (% aging)  Order Management: quality holds (e.g., reduce the number of delayed orders – revenue recognition, human error, configuration error)  Forecast accuracy  Other: Return of time to sales: “Our goal is to give the reps back 4 to 5 hours per week.”; % up-time for sales applications as well as other SLA-related metrics • Qualitative Feedback  “Productivity has increased with deployment of CI tools – allowing sales reps to easily find data they need, and freeing up the fields ops support people who were gathering the data for them.”  “Productivity in the sales area is measured on fulfillment of roles and responsibilities to allow other team members to function efficiently in their assigned areas.” For Internal Use Only. Not for © 2010 IDC 13 Distribution without IDC Permission.
  14. Sales Operations Experience  Varied backgrounds: sales, sales operations, marketing, finance  Cross-functional experience: “Allows managers to understand the different challenges that can arise and have a large pool of experience to draw on to resolve challenges.”  Sales Automation: “Sales technology and training skills have increased in importance.”  Communication: “Being able to train and communicate clearly on applications, processes, and the strategic vision is key.”  Diplomacy in working with sales folks: “We need to work with people who think they're a gift to the organization and in some cases a gift to the world“.  Consulting skill-sets: “Experience with business process management and project management is mandatory to elevate the role and impact of sales operations.”  Global experience: Experienced with different types of selling models and cultures across the world as well as. “Improved ability to empathize with the regions.” For Internal Use Only. Not for © 2010 IDC 14 Distribution without IDC Permission.
  15. IDC Guidance for the Sales Operations Function  Sales operations must provide greater strategic insight and impact  SO initiatives must have greater impact in a shorter amount of time (i.e., short-term achievements in parallel with long-term initiatives)  Process consistency and technology adoption: More consistent adoption and leverage of processes and sales automation, allowing for regional nuances  Improved ability to foresee future challenges and improve organizational agility (e.g., acquisitions, shifting coverage models, greater reliance on the channel)  Greater rigor in sales performance measurement will help SO and the sales organization as a whole (e.g., drive dashboard development) Sales Operations needs to be the driving force for productivity improvements across sales, setting its vision for the future and maintaining the path towards this vision. For Internal Use Only. Not for © 2010 IDC 15 Distribution without IDC Permission.
  16. Contact Information Michael Gerard Program VP Sales Advisory Practice Phone: 508-988-6758 Irina Zvagelsky Research Analyst Sales Advisory Practice Phone: 508-988-6916 For Internal Use Only. Not for © 2010 IDC 16 Distribution without IDC Permission.