Sales and Marketing Performance Blog

B2B Selling: The NCR-MSTR OEM Partnership - Pt 2 Defeat

Posted by Mark Gibson on Tue, Nov 20, 2012

The following is a true story. A few names have been changed to protect the identity of some of the people involved. 

In the first installment of this story,  Scorched Earth, I described the situation leading to my being hired at MicroStrategy into an OEM sales role and the problems in overcoming relationships that had been soured by my predecessor. This episode is about the events leading up to my being given 30 days notice of termination and reflects on the changing role of salespeople in B2B selling.

The Disintermediation of B2B Sales Professionals

Prior to the Internet, B2B salespeople were the conduits of information for customers. They were an essential part of the landscape in selling complex B2B products and services.

Their role however is changing fast, driven by unrelenting productivity improvements and innovation in the way companies buy, market and sell products. I was discussing this point with Adam Zais VP of Business Development at Wistia recently and we agreed that the role of salesperson is morphing into the part-time facilitation of a buying process.

Salespeople are not needed in many cases to sell B2B products. Neil Rackham rightly forecast the end of transactional selling 13 years ago in "Rethinking the Sales Force" and his prescient direction to sales managers to focus their direct sales teams on creating and capturing value for the customer. A preview of The Challenger Sale I believe, echoed in the Value Created and Value Captured Buying behaviors, outlined in the book, Why Killer Products Don't Sell.

Prospects can research potential suppliers, identify products and services, download whitepapers, read case studies and peer reviews, configure and price systems and make a business case without ever speaking to a salesperson. When it does serve buyers to engage salespeople, it is to lower the purchase price. The method is to invite several vendors to a "bake-off" or "beauty contest", where the salesperson's role is to discount the product or service and make other concessions in return for the order. The reverse auction is the ultimate desination for the purchase of commodity products and services and salespeople are not needed for this function.

This may sound slightly cynical, but unhappily it is reality. Having arrived a this conclusion, the discussion with Adam turned to where salespeople are actually needed and where they do contribute to the complex sale and the segments in the industry the top-guns will gravitate toward in the future, - for the big commission checks.

Adam continued, "I believe that I have a more cynical view....I believe that B2B "sales" professionals are "history" as it relates to "contributing to the complex sale" if that sale is thought of as a "deal" instead of a line-of-business or channel or partnership. I also think that the days of "big commission checks" in exchange for what sales people have done traditionally are over. 

Here's an example of what I mean: once-upon-a-time I did two deals with telecom companies for a very complex / very technical piece of software. In reality, the sales were made because of my SE....NOT (as much as I hate to admit it) because of anything I really did. Sure, I did some qualification of the prospects and set up meetings / demos and such. But I didn't really deserve to be paid far more than the SE. He could easily have done everything I did.

In a nutshell, the company could have saved themselves a shed-load of money, gotten much the same results, and properly motivated the correct person. Again, I really think that variable compensation for the function we still refer to as "sales" needs to end. To my mind, this perpetuates behavior that we should not longer wish to have....too much thinking about the individual (the rep) versus the team / company / etc. 

I do think that we want the "top-guns" to be attracted to OEM / Channel / Biz Dev. type roles. The complexity of these roles, which is what I think you mean by "the complex sale", DOES require high-end "sales" skills. I believe these are the only sales roles that are appropriately matched to the type of variable compensation plans that generate "big commission checks." Every other "sales" position should only involve variable compensation if that compensation is essentially the same for any other position in a company if that company decides to have such a compensation plan. Oh, and one more thing, the concept of the "Sales President's Club" needs to be confined to the dust-heap of history ASAP!

I want to be clear, I am not saying that we should give up on B2B. It's more about what the future needs to look like in terms of expectations on the part of sales professionals, how they should be managed and compensated, and most important how they should be trained."

When you are truly ready, the Channel will show up

Until the release of MicroStrategy7, the product was probably the largest Visual Basic executable in the BI industry. From a reseller or OEM's perspective it had very low appeal; no API, no SDK, poor documentation and it broke your software with every new release. I felt sorry for our early partners and they certainly let the executive know they were not happy. Clearly, the MicroStrategy product was not channel-ready prior to release 7 and the channel sales model was push not pull. When you are truly ready, the channel will show up.

That did not stop the channels team at MicroStrategy from selling it however and Scott Hughes hired a strong team of experienced salespeople to sell it....and they did. Like many well meaning channel sales efforts, the software got sold, salespeople got well compensated and the software sat on the shelf and was never implemented.

You are being given 30 days notice to perform - (you're fired)

After 3 years, hundreds of meetings and nothing to show other than a bunch of joint marketing agreements with IBM, Sequent, Tandem and NCR, and a nascent reseller agreement with NCR, frankly I was not surprised that my time was up. My boss Scott Hughes, whom I respected and like, was straight up with me and I recall responding that I understood why and that I would be very adult about it, but I just needed a bit more time as the ship was turning.

The ink was barely dry on the reseller agreement with NCR and I wasn't going to let some Johnny-come-lately walk in and reap the rewards of all of my effort. A couple of months earlier I trained the NCR Teradata retail sales team on how to and where to sell MicroStrategy7 and they were generating a lot of activity and were teeing up a couple of 6 figure MSTR sales with their major retail customers.

I recall walking into VP Sales, Ray Tacoma's office and pleading for another 30 days, as I knew things were about to change. Within 2 weeks of being put on notice, NCR Teradata came in with a big sale and then shortly after that, another one.

Saved by the bell!

Continued....in part 3. Finding a Deal


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Topics: channel sales, B2B selling, sales performance

B2B Selling: The NCR-MSTR OEM Partnership - Pt 1. Scorched Earth

Posted by Mark Gibson on Thu, Nov 15, 2012

The following is a true story. A few names have been changed to protect the identity of some of the people involved.

The Element of Luck in Selling

Luck is an element in every sales person’s career, you may get assigned a territory when a major propsect or customer is in the right moment of a purchasing cycle to need you and your capabilities and you step up and make the sale... the hero of the hour.

Unless you are working in an early stage technology company, you can bet that the territory you have been assigned has had the low hanging fruit plucked by your predecessor, or if it’s a new territory carved off an existing sales person’s territory…. It’s been well worked for opportunity.  

In my sales career, I’ve been lucky several times to land a territory where a good salesperson had been developing opportunity and was promoted out of the role and I stepped in. In these cases success came quickly….but that was not the case on joining MSTR.  

Rule: expect nothing from your new territory, it’s the opportunity that you personally create, that you get to harvest, anything more than that is luck.  
I was hired into MicroStrategy (MSTR) from Informix Software, where I met Sid Bannerjee and members of the MicroStrategy West Coast sales team. I happily introduced them and they were successful selling into some of my retail accounts – we needed applications to run on the Informix data warehouse software.  

Sanju Bansal, COO of MicroStrategy interviewed me and asked me to come on board. He said they needed an experienced salesperson with “some brass” to go after the major relational database companies with the goal of partnering and getting them to resell MicroStrategy software and so began a 6 year stint with MicroStrategy.  

Rules for anyone thinking of going into OEM sales.

Creating OEM partnerships with big fish like MicroSoft, IBM and NCR Teradata can take years, therefore:  
  1. Park your ego at the door; you are an orchestrator and part of a bigger team than in direct sales.
  2. Be prepared for the long haul, it could take hundreds of calls and meetings to get there.
  3. Make sure you have the support of your management and their commitment to back you through a multi-year journey. 
  4. Negotiate a comp plan based on MBO’s, not revenue, or you may starve in the first year or two.

Scorched Earth

Several times during my career I have also had the misfortune of inheriting a territory where my predecessor had actually harmed the relationship and created adversaries in the prospective customer base.  

It happened to me at Sun in the UK at a meeting with top FOREX broker, Tullet  & Tokyo, when Sun workstations were selling by the semi-trailer load for Trading room workstation applications. I well remember pulling the gas relief valve on my chair and sinking slowly under the table for some comic relief, when the IT director told us that he would never buy from Sun, thanks to my predecessor Dan and his mate, an underling at Tullet and Tokyo, who had totally botched an executive level relationship, between the Sun MD, Bill Passmore and their CEO.  

And it happened at MicroStrategy.
My predecessor had developed a strong adversarial relationship with his counterpart at NCR and they had spent a year prior to my arrival, not negotiating a joint marketing agreement. The problem was that he was now my boss and the adversarial relationship continued.  

It became clear to me that I had to outmaneuver my boss and his counterpart before we were going to make progress with NCR and so I wangled a transfer to a new manager, Scott Hughes, who was running the VAR program and things improved rapidly from that point for me. Similarly, NCR appointed a new relationship manager and we eventually signed a joint marketing agreement.  

Building a Relationship, brick by brick

Creating an OEM partnership with the behemoths of the industry is like building a house, brick by brick. Every meeting is another brick in a wall, a step forward hopefully. Sometimes set-backs occur.

I recall a meeting with MSTR CEO Mike Saylor with the NCR technical leadership in San Diego, when they told us that they were developing their own in-house OLAP product, which they were calling Teracube and we left the room with our butts on a plate. I found out why they were building their own product a year later in a revelation that for some reason had not been shared with me.  

Despite the fact that the NCR Teradata team were developing a competing product, the Teradata Retail team was selling big Teradata Data Warehouse systems into major retailers for SKU level analytics and their customers wanted MicroStrategy for the decision support front-end.  

Eventually after more than two years, numerous set-backs and a hundred or more calls and meetings, we inked a Value-added reseller agreement.  
Click here to read Part 2. Defeat

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Topics: channel sales, B2B selling, sales management

Three Tips to Overcome the Channel Sales Enablement Blues

Posted by Mark Gibson on Sun, Oct 23, 2011

Channel Sales Enablement

Channel sales enablement is an ongoing process of messaging, training, marketing, communicating, coaching and leading by example and when implemented correctly helps reseller sales teams to succeed in selling your products and services.

Success starts with a crisp and clear value proposition, essentially a pact between you and the buyer: i. How is it exactly that you create value for your prospective buyers, ii. What can the buyer reasonably expect from using your products or services?

I recall the early days in the channel at MicroStrategy, prior to the release of MicroStrategy7 and our first proper API; when not only our message was vague, but our code-base was vaguer; - a huge Visual Basic executable that was a bear for partners to interface their applications. We had a commissioned sales team pounding the streets signing up anyone who would meet with us and 90% of the partners we signed didn't open the box....sound familiar?

Lots of activity, but no pull through - you may have the channel sales enablement blues.

When You Are Truly Ready, The Channel Will Show Up

In retrospect, I believe the channel will show up when your product is mature enough and your company is ready to support a channel, and here are some key indicators if your company is ready or not:
  • The entire company from the HR Department to the mail room is fully on board with your direct sales approach.
  • Your sales team only has time to handle inbound leads and has no time to think about finding their own outbound leads.
  • You are producing a complete product that your customers love. Essentially, your conception of your value proposition is the same as your consumers, and you are meeting this expectation.
If you are satisfying these criteria, yet continue to struggle with channel revenue growth, then you might find the following case study of one of Avnet's channel enablement initiatives interest.

Avnet Case Study

Avnet created WhiteboardSelling stories for their 3 top selling products (independent of the vendors) and trained 3,000+ partners globally to tell the story.

Avnet implemented WhiteboardSelling, an interactive sales enablement solution that gives salespeople the ability to convey their organization’s message and value proposition visually – on a whiteboard or any other writing surface – in a compelling, confident and consistent fashion.

Avnet worked hand-in-hand with WhiteboardSelling to launch the Pro Series Whiteboard Symposium, a program aimed at offering training and development to VAR partners in 10 countries worldwide.

Avnet and WhiteboardSelling created custom, interactive whiteboards for three Avnet product lines, including NetApp and Oracle, which they used to train sales professionals at their VAR partners. Based on feedback from the participating sales professionals, the whiteboarding sessions helped them to better position and differentiate the products in the market.

The free, half-day training sessions were offered in local languages to sales teams around the world. Read the whole case study

Take-Aways

  1. Triage support for existing partners and define, focus, attract and recruit "Ideal Partners", who may be non-traditional software resellers if they are SaaS sales channels.
  2. Implement an Inbound Marketing system and methodology to increase lead quality and quantity and co-market and share leads with partners,
  3. Create effective messaging and train your partners to use it. I have been selling for nearly 30 years and have seen many sales training and enablement efforts fail to deliver sustainable results. Whiteboard visual storytelling that captures the core value from using the products and engages buyers in dialogue around their issues produces culture change and is highly recommended for channel sales enablement.
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Topics: channel sales, whiteboardselling, enablement, Avnet

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