Are You Ready to Scale?

The Importance of Timing

Are you ready to scale? It’s a simple question, yet it requires thoughtful deliberation. It’s not a question of “if” - scale is a must for any company looking to survive amidst a flurry of new market entrants and innovative business models. It’s more a question of “when” because the consequences of poor timing can be significant. Scale too early, and you may be ill-prepared to deliver upon your brand promise. Scale too late, and you may have missed the window for establishing an early lead in the market. No doubt, the margin for error is thin - so when is the right time?

The McDonalds Story

In 2016, Michael Keaton starred as Ray Kroc in “The Founder,” which documented the rapid expansion of the McDonalds fast food chain. While a traveling salesman selling Prince Castle brand milkshakes, Ray meets Mac and Dick McDonald in San Bernardino, CA who were revolutionizing the restaurant industry by delivering a hamburger from grill to counter in thirty seconds. During a scene in the movie, Mac and Dick bring their whole staff to a tennis court where they use chalk to meticulously draw out every workstation in the kitchen such as the griddle, the garnish, the fryer and the soft drinks.  As the staff mimicked the operation and bumped into each other, Dick looked from his perch atop a ladder and made a series of operational adjustments. After six hours of trial and error, Dick had settled on a kitchen design he would describe as a “symphony of efficiency.”  Ray would ultimately convince the McDonalds brothers to franchise the brand, and today there are over 38,000 locations in more than 120 countries. Editor’s note: Not a spoiler - there is plenty more drama to unfold in the movie for those who have not seen it. 

While Ray didn’t have to lay out the menu for the next 30 years before franchising, he knew that any new product had to be delivered at the “speed of McDonalds.” It was not the product (i.e. the hamburger) itself which had to scale, it was the experience of getting one’s food within 30 seconds. With this context, it’s inconceivable to think McDonalds will be introducing slow-roasted chicken to the menu anytime soon – the scope of the operational changes across thousands of stores would be cost prohibitive.

The Customer Experience across the B2B Customer Lifecycle

Fast forward to today – the US is now the world’s largest service economy and the customer experience is the currency of competitive advantage.  As goods and services become commoditized, customers increasingly choose winners and losers based on the quality of the brand experience.  In this environment, the costs of retooling the customer experience go beyond operational investment and are borne out through highly public criticism of the brand and customer attrition.

This is particularly challenging for B2B companies with longer, complex sales cycles. The customer experience is not just in the delivery of the product or service, but it includes every touchpoint from the first outreach to discovery, solution design, contracting, delivery, service, growth and retention.  Across the customer’s lifecycle, there are a dizzying array of online and offline communications and interactions with executives, front-line leaders, sales reps, sales support, technical support, customer support et al. Retooling the kitchen to accommodate a new milkshake flavor is one thing – it’s considerably more complicated when the inputs of the experience are not predictable machines, but rather unpredictable people.  Now, more than ever, it’s important to be fanatical about what is and how to deliver a superior customer experience before scaling your business. 

If the start-up phase is about validating the viability of your product or service, the growth phase must be more than establishing a few foundational customers.  It must also be the time to define and align on the customer experience you aim to deliver to each client who interacts with your brand.  Like the McDonalds example, this doesn’t mean you have to lock in on your product roadmap for years to come, but it does mean that you have to define the attributes of the experience you need to deliver across the customer lifecycle. 

Preparing for Take-Off

With a market-tested value proposition, an established and loyal set of customers and clear vision for the customer experience, a company aiming to scale can now exert all its time, energy and resources to “lock-in” on a revenue model which delivers predictable results. As it approaches the scaling phase, it must not just address, but it must also operationalize answers to three critical questions:

1.     Who is our ideal customer?

2.     How do they buy our products and services?

3.     Why do they buy our products and services?

When you ask many sales leaders about their definition of an ideal customer, they will likely provide a reasonable answer.  However, when you follow-up with “how does your definition of an ideal customer determine where and how the sales team spends its time in the field,” you’ll likely get blank stares.  This is the key difference between “knowing” the answer and “acting” on the answer also known as the knowledge-execution gap.  Believed by many to be the single biggest determinant between those that succeed and those that fail, this chasm has become the bane of today’s B2B sales organization. 

Operationalizing the answers to these questions requires institutionalizing them in the core operating system of the customer-facing organization – the CRM.  First and foremost, this requires aligning the sales and marketing organization on how the investment across markets and accounts differs based on the definition of an ideal customer.  Equally important, it requires this alignment to be documented in the CRM so it informs sales coverage and marketing investment at each touchpoint of the customer experience. 

This same knowledge-execution gap exists when it comes to how and why our customers buy our products and services.  We may understand our customer’s buying journey, but we still call the wrong sales play.  We may be sharing an ROI analysis tailored for a CFO when we should be sharing a case study of employee retention with the CHRO.  Of course, relying on the CRM as the only means to address the knowledge-execution gap is insufficient – strong leadership has a significant role to play.

When leadership shares a common sense of purpose and shared responsibility, accountability can have a dramatic impact on sales performance.  The most productive sales performers are not motivated by fear and creating a culture of negativity stifles trust, teamwork and creativity.  Establishing a sales rhythm and cadence is critical to operationalizing the right play with the right buyer in the right account at the speed of scale. 

In the B2B space, there are significant costs borne by scaling prematurely; the negative impact on speed to market, the damage to the brand, the cost of rework and poor employee morale are but a few.  These costs can be avoided by defining the customer experience during the growth phase of the business.  With that defined, the company can focus on building a repeatable B2B sales system which creates real impact across key metrics such as cost of sales, sales cycle, forecast accuracy, pipeline growth, win rate, deal size, quota attainment and client retention.   

For more information on tailoring a B2B enterprise sales system for your organization: https://www.growthsigma.com/