Ever wish you could get a look inside a customer's head? Would you really make changes that the customer wants? This final installment discusses the rise of the enterprise sales force and the organization changes needed to allow it to flourish.

Part 5 of 5

The enterprise salesperson is aptly named because the sales effort involves selling the firm in its entirety.

Sometimes salespeople wish they could get a look inside their customers' heads to learn what services are really wanted and needed. But, would salespeople really make changes in their sales approach? This series has sought to get readers thinking about your company's method of sales. Some approaches are dated and need making over. In this final installment, we'll look at the enterprise salesforce and the organization changes needed for it to flourish.

Many distributors confuse enterprise selling with relationship selling. There are similarities between the disciplines; however, the role of the enterprise salesperson is far less of an ambassador than relationship sales.

In relationship selling, the primary role of the salesperson is to maintain the current sales stream. In essence, the relationship salesperson keeps the status quo running at a smooth level through multiple sales contacts, high-level communications and high-level tactical decision-making. Relationship salespeople are often conduits for service snafus as well as tactical moves to enhance the relationship. Relationship salespeople are common in distribution and have titles that include key account salesperson, large account salesperson and sales manager of key accounts.

Enterprise selling, as opposed to relationship selling, involves substantial changes in the firm's relationships. Enterprise salespeople exist to perpetuate current revenues and offer avenues to significantly enhance the long-term destinies of both companies. Enterprise selling begins at the top of respective organizations. The goals of enterprise salespeople are to align supplier and customer strategies, streamline the current interactive processes and enhance the profit future of both companies.

Enterprise salespeople are often involved in supply-chain-reduction processes, customer front door growth planning and matching the functional needs of supplier and customer. The enterprise salesperson needs to have an advanced understanding of business processes and the interrelation of the processes as they impact the customer's customer. A complete channel perspective is important to the enterprise salesperson.

Too often, distributors confuse relationship selling with enterprise selling. It is not uncommon to find relationship salespeople in enterprise roles with the output being poor design and performance of interdependent processes. To clarify the skill sets and projects of relationship and enterprise salespeople, review Figure 1.

The boundaries that exist between supplier and customer are the domain of the enterprise salesperson. Lessening these boundaries with technology, reorganization of the supply chain, and shared information are common areas of work.

And, don't forget the use of the enterprise salesperson in customer reversal roles. Customer reversal is where the enterprise salesperson of the supplier out-sources a process done by the supplier that is more easily performed by the customer. An example is where a distributor used a contractor's fabrication facilities for assembly of system components into kits. The enterprise salesperson recognized the customer's need for the products and their difficulty in assembling them. He examined the customer's cost to complete these assemblies and ability to sell this service at a competitive price. He then convinced his employer to give his company a chance to do this assembly. After a successful trial, he showed the customer documented cost savings.

Foremost in developing a successful enterprise sales effort is selecting the right person for the job. The previous list of skills and projects should help determine the potential of the salesperson for the role. The next challenge is to make the necessary organizational changes to let the enterprise position work its magic.

The enterprise salesperson is aptly named because the sales effort involves selling the firm in its entirety. The strategic objective is to reduce costs through streamlining and to develop joint plans for mutual gain. Because firms can differ greatly in their strategies, philosophies and cultures, however, the enterprise salesperson must have backing from the top of both supplier and customer firms. It is estimated that up to 70 percent of strategic alliances fail or denigrate into a “first price” mentality with the main reason being failure of top executives to adequately plan and ratify joint projects.

Before projects are ratified, a careful audit should take place. Questions involving the financial payoffs for both parties, capabilities of each party, scope of the project and what is expected of each player are crucial. Often the enterprise salesperson has to be an ombudsman who performs critical capabilities analyses or directs intra-functional planning. The following is a list of things to know for enterprise projects that should be answered before collaboration:

• What is the expected financial return in increased revenues or cost reduction of both parties?

• What are the expenses for both parties and their relationship to incremental project cash flows.

• Does the project meet cost of capital requirements for both parties?

• Are there significant investments for the project? Who will bear the expense?

• Are there lease, rent and/or buy-back arrangements?

• Is there use of third-party service providers? How do we evaluate their fees in a make-or-buy situation?

• Is there sufficient understanding of how operations jointly affect the customer's customer?

• Is the information sharing sufficient to allow operations streamlining?

• Does software need to be created or purchased to augment operative enhancement?

• What costs can be reduced in the channel? Whom will they benefit?

• What are the other functions affected by the operations decision and do we understand the overall effect on service satisfaction?

• Do we understand the customer's segments?

• Is there sufficient power in the project to capture share from our competition and the customer's competition?

• What are the pricing implications for the joint program? Does pricing meet legal pricing differentiations?

• Will the program build long-term loyalty or merely create a supplier of choice rise in short-term sales?

• Can we jointly market services instead of products?

• Are both partners technologically compatible? If not, is the low-tech partner willing to invest or outsource needed expertise?

• What types of information exchange are critical and have the best potential of lowering supply chain costs?

• Can information be downloaded from one system to the next or does there need to be outside manipulation and a reduction of integrity of information?

• Is there outside software that will aid in the transfer of information?

• Can the customer's customer benefit from a joint technology project? Can the benefits be translated into increased revenues?

These are but a few of the common questions by functional area that arise in enterprise sales situations. The enterprise sale is a decidedly long sales cycle. Projects can often run a year or more before contributing to their costs. Continuity in personnel also contributes to successful enterprise projects. Too much turnover or changing of personnel only serves to delay the implementation. It is wise to choose committee participants who will be with the project in the long term and who have a lengthy tenure with their organizations in several functional areas. The more participants understand the unwritten rules of their organizations, the less they will be stymied by cultural nuances.

It should go without saying, but there must be a strong element of trust for enterprise organizations. Companies share sensitive data, and it is imperative that both parties agree on complete confidentiality in enterprise projects. Although written contracts can be used to insure confidentiality, they also put trust at arm's length. Trying to legislate trust too often benefits the lawyers and not the participating parties.

Because of the complexity of the projects, many enterprise salespeople would be well served to carefully choose their partner firms. A good understanding of the cultures of supplier and paying customer is instrumental in progressing the collaboration. In Figure 2, the “y” axis is labeled quality and the “x” axis labeled cost. To use the quadrants, think of the industry-specific quality and cost structure of the prospective enterprise customer. Generally speaking, quality perceptions of a firm's products or services are reasonably easy to ascertain. For purpose of analysis, think of a low quality, average quality and high quality relative to competitors in their industry. Cost can be pinpointed more precisely by comparing the firm's operating expenses versus the competition. As in quality perceptions, think of low, medium and high costs of operations. Operating costs and relative quality measures don't always reflect where the firm is in its development, so the following analyses are generally right but have to be kept in context of the supplier's and customer's long-term strategies.

For example, suppose you had a supplier and a manufacturing customer with high costs of operations and high perceived quality. Looking at Figure 2, the upper-right quadrant gives a general direction of enterprise projects focused around reducing supply chain interactions and channel streamlining. The quadrant can be used when both supplier and customer cultures are roughly the same. In other words, both supplier and customer should be able to fit in one of the basic quadrants. This may seem limiting for distributors who want to engage in enterprise projects, but it actually is liberating because it matches the general culture of the distributor with that of the enterprise prospect.

In our experience, enterprise projects have a much better chance of success when the relative quality to cost of operations match between distributor and customer. Both firms are starting from a common culture dynamic; the synergies allow for easier planning and implementation of enterprise projects. Plot your firm on the quadrant versus those key customers with whom you have enterprise projects. Are the cost-to-quality cultures in agreement or are they far apart? Which projects seem to work better, cultures that match or those that are in differing quadrants?

Careful selection of enterprise partners around cost and quality dynamics makes good sense. Training your enterprise salespeople to recognize good cultural fits with prospective partners pays off with better relationships and less costly failures from mismatched cultures.

In this series, we have looked at five basic designs of the sales force including: geographic, functional, transactional, consultative and enterprise. Geographic and functional salespeople are common in distribution and recognize the need for efficiency or matching the salesperson to a type of product/service sell.

Functional sales designs (missionary, trade, technical) are often driven by products while geographic sales designations are driven by time constraints. Both geographic and functional sales designs are yesterday's fare. They don't recognize the needs of customers and put geography or product needs before market-based customer definitions.

Transactive, consultative and enterprise sales designations are based on how the customer wants to buy or on selling consultative service. These new areas of sales will require that the strategic directions of their firms support their efforts. To be a good transactive salesperson, you must have the backing of low-cost/good-quality operations. To be a consultative salesperson, you must have professional marketing to help discover, brand, price and advertise new fee-based services. Distribution markets and consequently distributors are realizing that incrementalizing a 100-year-old model of business with geographic salespeople won't work. Sales forces of the future will be congruent with the basic strategy of the firm, and salespeople will be the interface of that strategy with the customer.

Scott Benfield is a consultant for industrial manufacturers and their distributors. He has authored three books and can be reached at (630) 428-9311 or Bnfldgp@aol.com.

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© 2007 Penton Media, Inc.