Who is your company’s Number One competitor? Actually, it’s not who you think it is. In fact, it’s probably not “who” at all, but rather “what” that is taking away the most sales from your sales team(s).
We recently asked 180 IT salespeople with greater than three years of experience this question: “Thinking about the opportunities you’ve lost in the last 12 months, what is the most common reason for the loss?” They replied that in 43% of losses the reason was “Lost funding or lost to no decision: customer stopped the procurement process.”
Your Real #1 Competitor
Your company’s “competition,” more often than not, is actually buyers deciding not to make a decision at all. You lose to a “no decision.” Your perceived competitors didn’t win either. No transaction happened, no value was created; only cost was incurred by all parties involved. OK, so is this really a "new competitor." No. However, due to changes that I'll discuss below, it is a competitor that has gained far more of a foothold on business that you would like to have. So what happened?
Like many other sales leaders, the sense that tectonic shifts in the dynamics between buyers and salespeople are happening has been palpable to me for a number of years. Researching these changes is why I joined Forrester just weeks before this year’s Forrester Research Sales Enablement Forum. At the Forum, I had a number of surprise learnings or “aha moments” gained from colleagues and members of our Sales Enablement Council who are learning in real time as sales enablement practitioners.
A Cross-Organizational System Issue
The seemingly endless search for the right “solution” to improve sales performance feels like a continuous plodding pilgrimage for many sales leaders. What I learned at the Forrester Sales Enablement Forum, and have experienced with new illumination since, is why the silver bullet solutions (i.e., tools, programs, training, materials, promotions, technology) that leaders in sales, sales operations, HR, and sales training invest in really ever meet our expectations for delivering better overall top-line performance.
There is true chaos that exists in the selling systems of most companies. Various business functions scurry to support the effort of increasing sales. My core learning from the Forum was that we have to ask whether we even have a selling system. My realization in working with clients over the past five months is that most companies “enable” their sales forces through dis-integrated, costly, inefficient, and ineffective multifunction (as opposed to cross-functional) silos of investments that have a poor performance improvement yield.
T-Systems’ Analyst Summit 2011 in Frankfurt was dominated by updates on the progress the company made regarding its restructuring projects. As a result of these efforts, T-Systems has created the basis to become a more efficient and agile ICT services provider going forward. Still, in our view, the period between mid-2010 to mid-2011 was a lost year for T-Systems — despite the obvious progress T-Systems made in addressing its past challenges.
In some respects, T-Systems had become a victim of its own success in 2009 and 2010. T-Systems was clearly overwhelmed by its multibillion deals (with clients including Linde, BP, Shell, E.ON, MAN, Continental, etc). Delivery capacities were stretched to the limit, manifesting in serious transition and transformation challenges. T-Systems was forced to allocate more capacities to big deals, thus depressing margins to just over 2% in Q3 2011 (see chart below). T-Systems still aims to reach the peer-group average EBIT margin.
Source: company reports
About a year ago, T-Systems began to restructure its entire operations in a mammoth project, effectively redrawing the entire organisational structure and reshuffling the top management team, except for the CEO and CFO. The Analyst Summit provided some insights that these efforts are beginning to bear fruit: