Defining Sales & Marketing Optimization

Posted by Christine on January 31, 2010 under Uncategorized | 4 Comments to Read

The need to do more with less, faster has brought sales and marketing to figure out how to work better together.   There is antidotal evidence that over one-third of all B2B companies starting talking about improving their sales and marketing alignment in the middle of last year.  Most of the talk is around lead management - how to get more leads and sales to follow them up.  And there are the inevitable side conversations about marketing or sales leadership and if it is time for a change. These are all good conversations as it means people are open-minded to change on some level.

Much has been written about the signs of misalignment but little on what sales and marketing alignment really means. We all bandy about the term, sales & marketing alignment, assuming a widely accepted definition exists that all understand and subscribe to.  I haven’t found one, have you?  What I have found is that ‘alignment’ means different things to different people based on their orientation to the problem.  For many sales leaders (not all) and technology solution vendors it means anything from automated lead management, sales force automation to marketing delivering higher quality leads.  Some CEOs think sales & marketing alignment means they’ve stopped bickering, marketing is delivering more leads or that sales is finally following up on the leads that marketing gave them.  Consultants lump into ‘alignment’ anything from developing outbound campaigns, improving product marketing to sales operations and leadership coaching.  And to most marketers, it means whatever it takes to get Sales off their backs and to regain some level of credibility and clout within the organization.     

If we’re going to improve sales & marketing alignment through best practices, we need a comprehensive definition that we all can work with.   I’ve scanned a large number of sales, marketing and leadership books and have yet to find a succint, comprehensive and balanced definition.  Most take the position that misalignment is marketing’s fault. In eMarketing Strategies for the Complex Sale, Ardath says “marketing stands to reap huge benefits….by aligning with sales.” (page 175). Ardath’s book is an excellent for a long list of other reasons.   However, we need a definition that reflects alignment as the mutual responsibility of marketing and sales.  Christopher Ryan gets closer to that in his book How to Create an Unstoppable Marketing & Sales Machine where he defines it as ”synchronizing the marketing and sales functions …with a service level agreement (that) outlines the duties and objectives of each department.”  

 I’ve put a stake in the ground and defined sales & marketing alignment at a higher, more strategic level:

 “Sales and marketing collaboratively working toward the common goal of profitably increasing revenue and customer excellence through shared processes, resources and metrics.”

What does this definition say? Alignment is more than just leads.  At the heart of alignment the two teams are working toward the same goal with a common understanding of resources.  Companies achieve this through a three stage journey that integrates activities, processes and team structures and reinforce alignment with a culture that emphasizes shared accountability and institutionalizes it with common technology platforms.  

What do you think? Do you agree and how would you improve my definition?

Marketing’s Big Disconnect Over Pay

Posted by Christine on January 21, 2010 under Uncategorized | Read the First Comment

Sales people, cynics have said, are coin operated – driven solely by financial incentives.  Marketing people, on the other hand, are generally salaried and have their attention fragmented across a range of different activities including some with only remote ties to revenue generation.  Yet marketing and sales are co-dependent functions and their coordination is critical to any company’s success.  One pragmatic way of bringing the two into line involves rethinking the approach used to compensate Marketing people who, like their counterparts in Sales, also respond to incentives.

A sales force is all about improving a company’s top line performance. Marketing departments also have a hand in improving revenue.  But it’s not their only responsibility.  Their seemingly conflicting charters result in the two functions easily falling out of alignment, ending up with lost leads, resentment, and lack of cooperation. 

As a general rule, people do what they are paid to do, and the pay for Sales personnel clearly reflects that.  Sales compensation plans are geared toward closing orders in the immediate quarter to meet annual revenue and margin goals.  For Marketing, however, the linkage between revenue and compensation is far from clear and it is further muddied by objectives which are on very different time horizons. 

In companies where Sales and Marketing are well-aligned, marketing’s performance bonus includes two elements: a quantified marketing-generated revenue objective and a longer-term qualitative marketing goal.   Marketing staff need to accept the fact that directly producing revenue really is a central part of their job, even it is not their only responsibility.  And where Marketing is tasked with “lead generation” and “deal closing” activities – the two aspects of Marketing most directly involved in producing revenue – their compensation plans need to reflect those responsibilities.

Read the article published in Sandhill on how to redefine Marketing’s compensation at http://www.sandhill.com/opinion/daily_blog.php?id=29&post=    I welcome your comments and feedback on the article.

Musing with Marketo

Posted by Christine on January 14, 2010 under Uncategorized | 3 Comments to Read

Over the past months I’ve gotten to know the folks at Marketo and their concept of revenue cycle optimization.  At a high level, it’s about tightening the processes and feedback loops in attracting, acquiring, collecting and expanding sales opportunities.  Marketo delivers automation technology for the attracting and acquiring part of the process or more commonly known as “the funnel and pipeline”.   Higher quality leads from marketing, and more of them, translates into more sales to ‘ideal’ target customers.  Lead generation and lead management is largely the result of an engine. The more finely-tuned an engine is, and fed with high quality fuel, the better the engine will perform.  

Improving marketing’s lead engine is part technology, people and process.   Start with making sure your processes are optimized. The lead generation processes of most marketing departments are like swiss cheese.  There are typically holes in target databases, gaps in how leads are nurtured, and handed off scored leads to inside sales, business development, or sales.  Leakage is what Laura Ramos of Forrester calls these holes; I call them lost revenue.   Walk a set of actual inquiries through all of the steps to see where the holes, gaps and bubbles are. Then close-up and fine-tune the processes.   Now you’re ready for automation technology.  And don’t forget training, the people part.  You can have the greatest processes and technology but if people don’t incorporate them into their daily jobs or care about the accuracy of data that’s being entered, you’ll have expensive lost revenue.

Getting to know Jon Miller and the Marketo team has invigorating and informative. I’m hooked on Marketo and see it as a key piece of sales and marketing alignment.  Let’s be clear though - automation is not a substitute for going through the alignment process. It is, however, a powerful  enabler.  But I digress… into another article.  One result of getting to know Jon was an invitation to be interviewed for his blog.  What had a great time and I appreciated his thoughtful questions.  Check out the interview at Marketo’s B2B Marketing blog and the other blogs that are taking the conversation further.