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Sometimes
sibling rivalry is a good thing. It can actually push kids to carve
out their identities more distinctly and to perform better. The
same is true in the business world. CEOs often encourage some healthy
tension to push the organization to higher levels of performance.
Between Sales and Marketing, for instance, you want Sales to push
Marketing to define winning products while Marketing should be pushing
Sales to keep prices up despite pleas for deep discounts. The same
tension exists between Engineering and Support. Support would love
more design for supportability built in, and Engineering would love
not to worry about documentation and supportability needs.
But sometimes sibling rivalry goes too far. Often I hear CEOs of
technology companies talk about the virtual fist fights between
Sales and Marketing when it comes to handoffs. Having one VP of
Sales & Marketing, unfortunately, does not always remedy the
issue. In fact, some of the conflicts between the silos directly
lead to longer cycle times between first customer contact and final
contract. This clearly hurts revenue growth. So the problem statement
then is: how do I ensure the best, fastest handoffs between Sales
and Marketing? What's the right goal congruence between the two
functions?
I recommend three areas in particular of goal congruence to drive
the right sense of urgency and mutual accountability in the context
of overall revenue growth.
Agree on the definition of a "lead"
One of Marketing's most important contributions to Sales is, of
course, generating leads. The source of the conflict is that there
is poor or no definition of a "lead" for proper handoff.
It's too common to hear Sales complain that "the leads from
Marketing are just junk." Or from Marketing you often hear
"why doesn't Sales just follow up on the damn leads we give
them?" Both are valid criticism. The answer lies in having
an explicit agreement on the handoff. If you use sales force automation
tools like Salesforce.com or Siebel CRM on Demand, you can even
hard code these definitions into the tool. I recommend agreeing
on explicit criteria by which leads are judged. The table gives
you a template for your teams to develop their own criteria for
lead quality.
| Criteria |
Example |
High Quality Lead |
Minimum Acceptable |
| Desired industry |
Financial services |
Yes |
No |
| Industry leading company |
Citibank |
Yes |
No |
| Company Size |
>10,000 employees or >$250M in revenue |
Yes |
No |
| Intent to purchase |
Plans to buy in <3 months |
Yes |
Yes |
| Desired audience |
Director of IT Operations |
Yes |
Yes |
| Contact information |
Name, title, company, phone, email, address |
Yes |
Yes |
The point here is to sit down and have two representatives from
both organizations come up with the success criteria and build this
into the Inside Sales efforts or other processes used to handoff
leads to Sales. You'll find that this will not eliminate the healthy
tension between the two teams but it does get them focused on what
really matters-qualified leads for sales action.
Define "success" as a booked appointment with the prospect
Another great opportunity to drive the right teamwork is to demand
that leads are evaluated on the number and quality of actual appointments
with the customer prospect. Too often I see Marketing just focus
on cost per lead as the figure of merit in ROI calculations. This
approach puts neither weight on higher quality leads nor emphasis
on conversions to actual appointments both of which are far more
important to driving sales. The other advantage of this is that
it puts pressure on Sales (or Inside Sales) to convert "inquiries"
which are just unqualified leads into booked meetings for sales
action. Again, both Marketing and Sales are held accountable to
maximizing the number of appointments meeting the criteria above.
Use the $100 test to prioritize product pricing/feature set requests
Pricing is another classic source of conflict between sales and
marketing. Sales tends to blame pricing as a sales inhibitor especially
in highly competitive deal situations. Marketing tends to discount
the issue as a sign of poor salesmanship. The problem is that no
one is stepping back and looking holistically and prioritizing what
matters most to customer acquisition which is always a combination
of pricing and product feature set or value proposition. I recommend
getting reps from both organizations together in a room and giving
everyone an opportunity to allocate $100 across a number of perceived
inhibitors to winning profitable business. The operative words to
focus the team are "winning" and "profitable"
business. Have them write down their spending mix on a piece of
paper to avoid group think. If people are forced to distribute $100
across, say, the top ten topics including pricing and some feature
gaps, you'll find that pricing may not the #1 sales inhibitor or
competitive issue.
I encourage you to apply all three practices here over the next
quarter and see what impact it has on closing business. I promise
you that it won't stop the bickering, name calling, or even occasional
fist fights. But it will force some goal congruence between two
key functions that absolutely must align to support your business
objectives.
Sridhar Ramanathan (Pacifica
Group) is a management consultant specializing in revenue growth
strategies for enterprise technology companies. He can be reached
at (650) 355-9700 or sridhar@pacifica-group.com.
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