The Phoenix effect
Review of the recent economic crisis may shed light on our possibilities in the current economic crisis. When the dot com bubble burst a few years ago, the two companies resulting economic storm far better than could be expected.
Cisco Systems has been at the heart of the Internet. As a leading supplier of network equipment to not only put her in the heart of the growth cycle of the Internet;And even if it was at the upper end of the spectrum of risk when performed in the cycle. After the dust settled, however, Cisco has had only a 15% drop in revenues from 2001 to 2002 better than most of the market for Internet-based. This feat of leadership could easily ignored until it was sold to the competition: 3Com and Nortel revenue suffered two drops of 40% over the same period.
In a parallel story, Dell Computer has also led in the growth cycle of the Internetimpressive results. However, if the rug was pulled out, they also noted a slowdown in demand for their flagship products, PC. But the growth of their return and subsequent profile appears more favorable. Dell's sales were down 2% year on year during the break, it recovered over 13% in 2003. In contrast, Compaq has fallen 21%.
So the question is what Cisco and Dell, to avoid suffering serious disasters, other companies?
ToTo answer this question, let me start with what we see not.
vulnerability to short-selling
If the economy is healthy, and demand for new business solutions, a variety of marketing techniques, in general, suffer from neglect. This is not a criticism of a particular organization, it's just a matter of commitment that brings the highest return. In the case of Cisco, while the increase in view of the Internet market demand was so strong for their products, their sales teamrarely engaged stakeholder customer outside of the customer IT organization. In this context, it is rarely taken the time to gain an understanding of business challenges of the client or help the customer justify the purchase of contact with the Return on Investment discussion. spend most of your time to educate their customers about the latest drilling, negotiate contractual obligations and management of the closure at the end of the quarter to higher levels.
Dell is no exception toThe lack of discipline of sale by the bank during the race to the Internet. The model "1-800" business, a multi-billion dollar companies are created force developed in advertising marketing, distribution of the catalog, product configuration and customer-specific implementation. The population of the sales force was largely recent graduates who have a culture dominated by a clock, all visible entry in the call center, shows the time a customer has been suspended pending orders. concerns about patient wasmore precious.
As a first example, skills, access to key stakeholders, the development of financial reasons, or need to create free products were not highly valued skills in Dell in advance. Nor were they necessarily need.
Leadership
If the market pulled back, recognized that both organizations passively ride the storm was not an option. Without delay, Cisco implemented a leadership role in campaignadapt their behavior in the face of slowing sales market conditions. If you have used my services, they were well versed in their strengths and weaknesses.
They knew they needed to break the unity of IT and access to sponsors 'business customers' real overcome their addiction to freeze overall spending, the large number of their best customers, requiring a. They also cited the lack of skill on sales of other products and services outside the main switch and routerProduct lines. In other words, they believed that they left money on the table by selling other products that are for the customer's situation.
But now they had the motivation to act on the situation.
With the help of many leaders in business, we have jointly developed an initiative to create Internet business solutions directly to the management of their business unit goals of customer relationships. The reasoning was that even during the spending freeze, a companystill spend money. He was a diligent work of priorities where they spend their money. Cisco 's easy task to create solutions to their needs for solutions with the decision to drive business network managers, were in the best position to give priority to a purchase.
The initiative has been very successful. The first victories, including a 300% increase in the pipeline to post-merger. They cited many examples of great opportunities that came out of the ashes of expenditurelockdowns.
By Dell, have been sent, as well as describing the skills that were not in good times estimated. They realized that their culture is a very interesting organization has been lax capacity building needs created. Previous attempts to introduce other products have been described as weak, at best.
I was asked to help lead a campaign that takes Dell to integrate a wide range of new products related to their sales opportunities. One of the main resultsThe campaign has been a dramatic increase in the "Attach a metric, a measure can be used to track sales of servers, storage and services. Currently, these products now account for more than 14 billion dollars of additional revenue and accounts for over 23% of the total 61 billion U.S. dollars in 2008. Not bad for a payoff an initiative born from the crisis.
The devil is in the details
Summaries of Cisco's leadership and success in its effort to reboundthe Internet bubble popping may seem like it was easy, but both cases require a significant amount of leadership for a return on their efforts to produce.
Here is a list of the types of high-level management measures are in place to produce a significant change in the behavior of Use:
O Development of Vision
fire initiative or
or train troops
o Define and communicate the success of early wins
O Re-align the Environment
o Remove barriers
o Upgradethe team
For the rest of this article, will expand on each item, however, the initiatives of this complexity, the paper much more to the plan, the use of this short article, if you decide to print the consumer. For this reason I will note this section with the confirmation that I will probably be used in any subject, because the length and scope of this article is not intended to convey information succinctly. Please note our other White Paper on the conversionTransformations for further information.
Developing the vision: Though it seems a simple task to diagnose the situation as a solution and to communicate, there are several possibilities for the process on the wrong foot. The most important is to ensure that enough of the management with the initiative is purchased to support the transition. According to Sellers, one of the main reasons for resisting a change in behavior, if their superiors do not recognizewalk the talk.
Effective visioning process should be a group effort with the entire senior leadership of sales, to define the problems of objectives and strategy solution. It is very common for an initiative to purchase the missing the same leader, responsible for overseeing the implementation of this initiative would have died.
Another critical aspect of the visioning phase, the vision of society in terms of representation and communicationas people who will be called, make changes in their daily behavior. If the seller on the street does not understand why it should change, you will find a way, the passive or active resistance to the campaign.
Finally, it is too easy to communicate with a management initiative. estimated in his seminal book "Leading Change, John Kotter, who informed the initiatives that led to a factor of 10, 100 or 1000 A memo is not sufficient to supportcommunication needs of an initiative to change behavior.
Brand initiative: There is significant value in the branding initiative with a catchy phrase, symbol or identification of options, such as a simple acronym to remember easily. If the branding is effective, will convene the entire model used each time so that participants regularly the target of the solution of the problem and remember, without repeating theDetails.
Train the Troops: behavior change starts with awareness, but the recipe calls for a component of skills development. Where possible, use this type of training provides not only the concept, but allows participants to new skills with appropriate exercises to develop. With the use of external resources, it is important to adjust its capacity to identify skills development exercises, your products, customers and your sales skills situationsChallenges.
wins in advance and communicate the success, if the goal of the initiative is something that will take some time to realize, it is crucial to the success define some initial victories that specify your team is on the road. For example, if your goal is to increase sales by 15%, the results may not show for a quarter or more. Select a number of wins in advance that you enter on the road to success, perhaps to increase the pipeline of new orders or forecastsProduct, for example. Choose something that can be achieved sooner than the overall objective, but it is really a milestone on the road to success. Then you take the time to recognize, communicate and celebrate success.
Set the environment: when a society matures over the years, systems, processes and cultural norms, behaviors are the support provided. If new practices have been identified as key to the environment should be investigated for realignmentOpportunities. Examples could forecast terminology, or stages, marketing messaging problems, communication formats, agendas, previously accepted cultural norms, and more.
Removing barriers: Even if the subject is above a form of identification and removal of barriers, obstacles in this section, I refer people. Any major change in behavior has its share of critics, people who do not want change, and it is passive oractive against the amendment. In some cases, oppose, form coalitions, groups of people to change and work together to undermine the initiative. The key action for the leader of this initiative is to identify the enemy, try to neutralize their attitude, they win, or remove them. The vendors are very adept at "waiting for" leadership initiatives. Nothing less than a direct focus on this issue provides no relief.
Update the team: There are twoFacets of this approach. The first one is obliged to provide its expectations for skill levels, offering the possibility of measuring the development and provide feedback. In other words, improving the capabilities of the team. The second aspect concerns the process of replacing members who can not or will not improve, their skills.
Skills and leadership
In both situations, Cisco and Dell, skills, economic growth has not been evaluated in the course of one, but it wasParticularly critical to the lifting of economic activities:
Create or need other products.
access or influential interest groups outside the Infrastructure group.
Or help to discover the effects of the customer to justify and prioritize the purchase in economic terms. Sometimes referred to as ROI sales skills.
or elaboration of the proposals that speak for themselves. A price range would be sufficient in a growing economy, but a convincing business proposal is required before the surveygreed authorities to cancel the registration.
But the development of skills alone are not sufficient to change behavior. Consider all the forces against the person, work needs to change:
clients or push the seller of product attributes, access to decision makers is available, and can not understand the impact enough to create their justification.
o Many companies have product training which simply means that training on product attributes, not for use by the customerSituations that the seller need to create, build and would benefit justification for establishing the credibility of management.
or sellers of their comfort zone is an obstacle to change, especially if they have worked for him or enough to make their ODA targets in the past.
If you or your website and marketing materials are key capabilities of the advertised product, but you want to call your sales team to managers, there is an opposition force in the game.
The list is actually longer, but theThe point is that leadership is an essential part in determining the behavior change turnover. More specifically, the leadership of the application to be the team to overcome obstacles in the way of behavioral change. Create and communicate the vision, role modeling of expected behaviors, the definition of early victories, the removal of obstacles, navigation, resistance and reconstruction of the team are all qualities of leadership. I often training programs that allow you to get less than 10% of the exposure to changes in behavior.If necessary with the management and others to promote a change in contrast, is the current training event of a small piece of cake.
So, if the team was able to increase their selling prices in this market difficult to profit in this article is to encourage you, Handbook of design and execution should be, they benefit from the change in question. Most of the failed attempts of processing sales can be attributed to an underestimation ofLevel of fee is required. Remember that to change the behavior of 90% lead!
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