Enterprise B2B Sales Systems Built for Scale
Challenges of the Start-Up and Growth Phase
Much has been written about the different phases of a company’s growth and the challenges it must overcome at various stages of its lifecycle. During the exciting start-up phase of a business, a founder spends most of his/her time launching and validating a business concept and gaining market acceptance for the company’s products and services.
With a proven product, the company moves to the growth phase typically with the founder or his/her designate acting as Chief Sales Officer. It’s at this stage that focus shifts from products to sales as it must identify, sell, and retain a few large customers to maintain positive cash flow. In the words of Ichak Adizes and his analysis of the corporate lifecycle, this is akin to his “Go-Go” phase of the lifecycle. According to Adizes, this phase is characterized by, among others:
Everything being a priority
Confusion in roles and responsibilities
Unclear communications
Insufficient cost controls
Sales prioritized over profits
These can be challenging times in the business, but they are typically accompanied by rapidly growing sales, raving fan customers, investor excitement and an entrepreneurial culture rooted by the vision and passion of its founder. While employees may be frustrated with the workload and lack of clarity, it is largely accepted as the norm in any fast-growing company looking to establish and grow its brand. However, companies in growth can rarely enjoy the stay for long – the cash burn requirements to fuel further growth and the competitive pressure from more nimble competitors force them to wrestle with the challenge of scaling their operations.
The Defining Moment
It’s at this time that a company comes to terms with its most challenging transition in its lifecycle – achieving scale. For the first time, the bedrock of the company’s culture and values are threatened as it shifts from entrepreneurial to professional management. As the company begins to find its identity beyond its founder, new leaders are brought onboard with a focus on developing systems and capabilities to scale operations. Conflicts between the old and new guard emerge as new systems and process become a threat to the family-oriented culture and values which had thus far defined the company. Referring back to Ichak Adizes’ analysis of the corporate lifecycle, this is akin to his “Adolescence” phase of the lifecycle. According to Adizes, this phase is the most difficult in the company’s lifecycle and is characterized by, among others:
Transition from entrepreneurship to professional management
Conflict between newcomers and old timers
Volatility in sales, production, and morale
Difficulty changing leadership style
Infrastructure under upgrade and reconstruction
The constraints of the growth phase are particularly pronounced in B2B organizations selling complex products and services to the enterprise market. The impact becomes evident after losing a long, expensive sales pursuit to a competitor or seeing deep subject matter expertise leave the company to seek another opportunity.
From Heroic Sale to Enterprise Scale - The 4Ps of Revenue Operations
It’s precisely at this time when the best customer-facing leaders recognize the strategies which helped them grow are not the same ones needed to achieve profitable, scalable growth. The emergence and rise of the revenue operations function has served to bring equal attention to the science, as much as the art of the sale. For it’s in the scaling phase of the business, the focus shifts from the heroic sale to enterprise scale and the mantra shifts from “working harder” to “working smarter.”
At this stage, sales leaders rely less on sales heroism and look more to the overarching sales system itself. They look to create a sales system much like the coach of a professional sports team seeks system players to win at the highest level. On the team, the coach is not looking to optimize at each position, but rather focuses on the value of each player within the context of the overall system.
The same is true when it comes to developing an effective revenue operations system. To operate at scale, the components of the system must be both optimized and aligned to consistently achieve four objectives including:
Prioritize Targets: Align customer-facing investments proportionately against the addressable market
Position Value: Align value messaging to buyer personas at each stage of the buyer journey
Drive the Process: Align and enable activity against the buyer journey to drive pipeline progression
Pace Performance: Align the right behaviors and outcomes to execute at the speed of scale
Enabling the Change Process
As is the case with any enterprise business system, it’s not just a matter of hitting the on/off switch. As we all have learned from the evolution of the CRM space, gaining outsized returns is as much about changing behaviors as it is about instituting great tools and processes. Nowhere is this truer than in the sales organization where processes are as dynamic as the personalities themselves.
Particularly at the transition from growth to scale, driving change in the sales function requires an emphasis on speed, adoption, and impact. We all see this when we’re trying to keep our New Year’s resolutions. We have a limited amount of time to sow the seeds of change, embrace new behaviors and start seeing the results before we revert to our old ways.
Facilitating this type of change from the inside-out is often difficult at this period in the business given the rapid pace of the business and the challenges highlighted earlier related to the evolving leadership, culture, and priorities of the business. Bringing in a 3rd-party expert with a proven set of “accelerators” including tools, processes and frameworks is often a better alternative. Rather than engage in debates about the business itself, they can focus on aligning the business around key decisions related to the four components of the B2B revenue operations system. This gives key stakeholders in the business the opportunity to own the change process and create an environment where routines and habits can take root.
For today’s enterprise businesses built before the new economy, forging the great divide between growth and scale is no longer a choice. In the speed of today’s modern economy, growth alone is not good enough. Capitalizing on a flood of new technology, capital and access to the world’s collective knowledge, companies have made innovative products and services more accessible and at lower cost. New, built to scale business models are emerging and setting new standards for speed and agility across nearly every sector of our economy. Passing efficiencies on in the form of lower prices, they are challenging incumbent providers and stealing market share. For aspiring small and mid-sized businesses, seeking growth at any cost is no longer a sustainable approach.