Do You Have an Integrated Revenue Capture Business Model or Are Just You Just Scaring Prospects Away?
February 2nd, 2010 Posted in NewsletterWelcome to the February 1, 2010 edition of BPI News!
In this issue, we talk about how to create an integrated revenue capture program.
Call me at 617-532-0918 and lets discuss how the BPI Strategy Group can help you accelerate your business growth in 2010.
As always, I look forward to your comments and thoughts.
Walt
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Do You Have an Integrated Revenue Capture Business Model or Are Just You Just Scaring Prospects Away?
by Paul DiModica, CEO - Value Forward Network
* Are your sales costs increasing per sale?
* Does your marketing scare prospects away?
* Do you have products or services that no one is buying?
* Are your revenues down?
If so, then you may have a decentralized revenue capture approach where your strategy, marketing and sales process are not aligned as an integrated revenue capture program.
In my previous life, before starting this company and others, I was VP of Strategy Worldwide for an $800 million public company called Renaissance Worldwide. This was the company that bought Renaissance Solutions, the consulting company owned by David P. Norton, author of The Balanced Scorecard.
As VP of Strategy, I worked for the CEO and the board of directors to evaluate and make appropriate recommendations on the strategy, marketing and sales process of ten (10) operating business units we had. Our operating units included internet start-ups, acquired businesses, and organically grown divisions.
Using the balanced scorecard approach, I identified that many of our business units had a decentralized revenue capture process because their departments were not linked to a common goal or aligned symbiotically to each other. Not that the management teams were consciously trying to build barriers of cooperation between departments, but it occurred due to their individual corporate goals, compensation plans and the team members inability to understand the other department’s functional operational attributes.
This lack of functional operational interdepartmental knowledge and lack of alignment forced departments, even with good intentions, to work as business silos.
Four Truths Many People Ignore
1. Corporate Strategy is based on research of what prospects will buy, not what you want to sell.
Just because you bought a company, created a new offering, or spent $10 million on development to create the greatest widget in the world, it does not mean you have a market for what you sell.
Buyers only care about themselves.
2. The marketing department ’s primary goal is to help generate qualified leads for sales . . . that’s it.
Yes branding, third-party analysis research and beautiful tradeshow booths are important, but they are just tools to ultimately increase revenue.
Marketing must have ROI or it is a wasted investment.
3. The sales department must sell new business.
Yes, selling existing customers is important, but to grow top line revenue where you will not be dependant on your existing customer’s ability to buy . . . you need to hunt for new business as a premeditated approach. By focusing on the lifetime value of deals, you can reduce sales capture costs.
Hunt Now or Be Eaten Later!
4. If your departments are not aligned together by goals, key performance indicators (KPI’s), compensation plans and parallel knowledge of the operational tasks of the other departments, then you have a decentralized revenue capture process.
Revenue capture is a company responsibility . . . not the sales departments.
Take The Revenue Capture Scorecard Alignment Test
Here is a quick assessment of a much larger assessment test we give to help you decide if your team is focused on revenue capture as an integrated group or if are they operating as independent silos.
1. Does your company create (or acquire) new products or services based on market demand?
__Yes __No
2. Does your sales team have separate sales quotas for business from existing customers and business from new prospects?
__Yes __No
3. Is your marketing department paid based on the number and the quality of their leads they generate?
__Yes __No
4. Are your sales quotas or targets calculated based on mathematical demand models?
__Yes __No
5. Do your senior marketing executive and your senior sales executive have a team metric then need to reach together?
__Yes __No
6. Are your marketing managers paid based on corporate department sales increases?
__Yes __No
7. As a business to business company (B2B), does the marketing department report to the VP of Sales?
__Yes __No
8. Do the sales, marketing and strategy departments meet at least four times a year to discuss successes and failures to date and document action steps required by each?
__Yes __No
9. Does your senior management team assign specific measurable metrics to the strategy, sales and the marketing department managers and is their performance discussed at executive meetings?
__Yes __No
10. Are your sales team members evaluated on how quickly they follow-up on sales leads given to them by the marketing department?
__Yes __No
11. Does your marketing department go on sales calls at least twice a year to understand the sales process?
__Yes __No
12. Has your marketing team researched why prospects buy, why they don’t buy, and how your firm creates value?
__Yes __No
13. Do you have a written corporate strategy for all department heads to review as needed as a corporate guideline?
__Yes __No
14. Does the sales team have a written step-by-step sales process to guide the marketing department on what communication deceives they need create for each sales cycle step?
__Yes __No
Scorecard Answers: 1. Yes; 2. Yes; 3. Yes; 4. Yes; 5. Yes; 6. Yes; 7. Yes; 8. Yes; 9. Yes; 10. Yes; 11. Yes; 12. Yes; 13. Yes; 14. Yes
“Remember, revenue capture is not solely the salesperson’s responsibility — it’s the company’s responsibility.” Paul DiModica
Walter Wise
President & CEO
BPI Strategy Group
617-532-0918
TWITTER: BPIStrategy
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