Monday, July 13, 2009

can you outsource Sales?

The below article from the Mass Hightech Times informs us that smaller technology companies are considering a near 100% virtual model, including the outsourcing of Sales. Their example is a hardware company with a seemingly low price point.

It is Xtra Effort's opinion that outsourcing of Sales is only viable if the product's price point is relatively low, the category mature, and the installation/integration simple. Otherwise it won't work.

Sellers need to have extensive knowledge of their customers, markets, and pain points to be effective in making a corporation feel comfortable to make a capital expenditure with a newer technology that requires a change in enterprise behavior (to adopt among users). Customer intimacy is also required to help the enterprise buyer mitigate political and financial risk.

Only Sales people who are 100% committed to an employer can develop this required mix of knowledge and relationships for an enterprise to embrace change that is externally initiated by a start-up.

Outsourced demand generation is the exception. Appointment setting and market intelligence gathering can be effectively performed by a third party.

Technology start-ups should only outsource their entire Sales cycles if their price point is relatively low, their solutions represent little risk to enterprise decision makers, their product category is mature, and solutions easy to integrate and adopt.

Can you imagine a CIO (or more likely, her subordinate's subordinate) adopting new wireless headsets or a blog widget from a third party Sales agent? Yes, probably.

However, can you imagine a sales agent from a third party being successful in convincing a CIO to embrace a $500k annual commitment to a new order entry system based on Cloud Computing? Probably not.


The Mass High Tech Times article:
http://www.masshightech.com/stories/2009/06/15/weekly7-Limited-funds-drive-startups-to-contract-hiring-.html

Tuesday, July 7, 2009

you win some, you lose some

In the past month, Xtra Effort has helped three clients hire very accomplished sales people within clients' respective niches, i.e., "find me the purple squirrel".

Clients continue to insist on both functional skills and industry knowledge/experience. These hires represented long evaluation processes. The interview process is longer because both candidates and clients are cautious in today's market. Clients can't afford a bad hire because of the impact on cost, time loss, and customer perceptions. Candidates don't want to jump from one risky company to another because of lack of due diligence, and end up with too many job changes on their resume and have ineffective territory and customer momentum/traction or no substantial enhancement in acquired industry/technology knowledge.

In addition to the successful hires, we have had a couple of 4+- month evaluation cycles result with qualified candidates receiving a job offer but ultimately either staying with their current employer or accepting an alternative offer. Our candidates would have likely accepted our clients' offers had they been delivered less than six weeks from their initial meeting, but the lengthy client evaluation processes afforded the candidates the time to discover alternative choices.

Xtra Effort intends to be timely and professionally assertive with clients in communicating an old Western gun fighting adage "there is the Quick, and there is the Dead". 'A' player candidates still demand competitive wages and have lots of choice.

Overall, it is Good News!! We are seeing more clients hiring and more job offers being produced.

We commend the clients who are hiring because they believe in their company and its products they are selling solutions with a definable ROI and have an optimistic view of the future. However, we also have empathy for the clients who are taking a wait and see approach.

In the mean time, all of us: recruiters, clients, partners, and candidates, need to continue to flip as many stones as possible to find the right match, while also developing meaningful relationships for the long term - nobody said it would easy. But then again, an endeavor is only truly fulfilling if it contains challenges.

We are cautiously optimistic.