Sales & Marketing

Sales and Marketing (S&M) is probably the most important part of demand creation and revenue generation.

According to Ajay Shah of Shah Capital, it is really important to be first-to-market, which not only means you get the first revenue, but also means you establish yourself as an innovator and the trend-setter. “90% of all marketing programs are based on communicating the essence of the better product or service. Unless you are already the leader, these programs are bound to fail because the prospect assumes that the leader must have the better product."

Once lead customers accept the product, sales and marketing is required to create momentum and expand the customer base. To identify a customer base and give the sales force a target audience, it is necessary to identify the Target Market Segment, i.e. who is the audience/customer, which requires identifying customer's likes/dislikes, technical requirements, and price targets. It aids in developing the product so that it is a right fit for the customers.

Since there are always competitors or comparable products in the market, a well-defined value proposition and differentiation is a must.

• What value does this product add for the customers?
• How will it help them?
• Why should customers choose our product over others?
  

Being first-to-market, targeting a market segment, and having a strong value proposition are critical factors in getting customers and generating revenue.

The sales and marketing strategy should also define how to maintain and grow revenue. A disciplined sales methodology is required to sustain and grow revenue and drive products to the market. At any stage of sales and marketing, a closed loop feedback system is required to continuously fix and improve the overall process. Measurable goals and targets should be defined well in advance and a feedback loop on driving these metrics should be standardized.

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[1] Marketing: The Importance of Being First by Al Ries and Laura Ries

Take risks and don't be afraid of failures

This one is probably one of the most important lessons that I got out of my MBA, i.e. not to be afraid of risks and failures.

In one seminar, Mr. Greg McNulty, CEO of Cranite Systems, shared his success stories and talked about how he has always followed his gut in selecting his next venture. He mentioned, “When in doubt go with your gut”.

Mr. Dennis Barsema of Benchmark Capital also talked about his weakness and fear of reading scripted presentations. He followed his wife’s advice, “the worst that can happen is failure, but you will never repent that you did not go through the door of opportunity”. Mr. Dennis also mentioned that success stems through the roots of failure and the most important thing that defines success is how you actually rise from the fall.

I took this lesson very personally. It gave me the courage to leave my 10 years of engineering experience behind and jump into sales!

Being an entrepreneur is not easy, as Joanna Rees from VSP Capital also mentioned. It needs energy, tenacity, resilience, reason, knowledge, expertise, and courage to take risk!!

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Relationships and Networking

Relationships and networking with the right people is crucial to be successful. Jim Collins in his article “View Point” talks about the need for managers to hire the right people. “Too many companies spend too much time trying to motivate the right behaviors in the wrong people, rather than getting the right people in first place.”[1]

It is even more critical to know the right people when pulling together a startup, as Mr. Greg McNulty (CEO, Cranite Systems) mentioned. Mr. McNulty has been able to leverage his strong relationship network and have been very successful in creating several companies from scratch. He stressed on the point of having domain experts and choosing the right people for the right job.

Good to Great talks about the fact that almost any company can become great. “The greatness is not conferred, nor does it come by luck or through inheritance. Greatness comes when leaders commit themselves and all who work with them to becoming the very best at what they collectively do. Deep, personal commitment precedes greatness.”[2]

Mr. Richard Rapoza (VP R&D, Abbott Vascular Solutions) also shared his thoughts around building close relationships with customers. He discussed “golf-marketing” and how sales people develop close relationships with customers to be successful.

I have always believed in relationship building, but never took it so seriously until I met these these people and heard some of their success stories.

We all should work actively towards building and growing our network. Following is the small checklist that can help your networking initiative:

• Build network across organizational boundaries. Keep up the old friends when jobs change, and be curious about others work; interest is a key currency[3]
• Always gauge requests for help so the answer you get is yes. Ask for advice before asking for resources and build collaborative relationships gradually
• Attend networking events
• Plan to meet one new person every week

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[1] View Point by Jim Collins

[2] Good to Great by Jim Collins

[3] Intrapreneurial Warriors versus Traditional Managers by Gifford Pinchot

Moral Compass!

Last quarter, I met Robert Finocchio, former CEO of Informix, and Dennis Barsema from Benchmark Capital. I was very much intrigued by Robert's story of Informix and how he weeded out the deep-rooted ethical problems by sticking to his moral character. Not only Robert, but also Dennis stressed on the importance of having a strong moral compass in life and in business.

Sue Newell in her article on “Business Ethics” talks about how unethical behaviors result from complex interactions between individuals, groups, and organizations[1]. It is the same reason why Robert stressed so much on the “Sin of a week character”.

In business, we interact with different people and processes all the time. It is relatively easy to point out a person doing something ethically wrong, but the problem intensifies and becomes complex, when a process (established over time) is responsible for unethical actions. Many times, these processes may not even involve monetary transactions, but still are morally and ethically wrong as they eat up on other two parameters, i.e. time and quality. It really requires a strong character to challenge these processes and stand up against them when everyone else in the company blindly follows them.

I firmly believe in what Bob mentioned that if a person looses his moral compass, he is a dead man. A strong set of moral principles is required when interacting with suppliers, customers, and partners. Globalization is making it even more crucial for companies to have organization-wide ethical standards as different cultures have different values and interpretations.

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[1] Business Ethics by Sue Newell

Level 5 Leadership!

Leadership is a process by which a person influences others to accomplish an objective and directs the organization in a way that makes it more cohesive and coherent. Leaders carry out this process by applying their leadership attributes, such as beliefs, values, ethics, character, knowledge, and skills. Good to Great talks about Level 5 Leadership characteristics: Humility & Will, Ambition, Compelling Modesty, Unwavering Resolve, etc.

Level 5 leaders channel their ego needs away from themselves and into the larger goal of building a great company…they are incredibly ambitious-but their ambition is first and foremost for the institution, not themselves.[1]

This is the most important lesson that most people don't get – i.e. the ability to separate emotion and sell the idea by aligning it with the corporate vision and overall strategy.

A true leader is someone who is all about his followers; a person who is honest, supportive, who can provide vision and focus, and who motivates its followers by listening to them and providing regular constructive feedback. In presence of true leadership, companies can make transition from shinning to shining and from Good to Great.

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[1] Good to Great by Jim Collins

Creating value through people

One point that most of the companies overlook these days is the importance of its people. “Management through spreadsheet” is becoming more common these days. Costs are being managed quarterly in a rush to satisfy wall-street expectations and lay-offs have become a norm! This narrow focus on quarterly performance has put companies on a downward spiral.

The financial performance of a business is not something you can or should directly control. It is achieved by providing superior value to the marketplace. Marketplace value is a consequence of energizing and focusing employees to create and deliver value. To make money, managers should not spend their time managing money, but should instead devote their efforts to the things that produce the money: the enthusiasm, commitment, and drive of the labor force.[1]

More and more executives these days are focused on trying to make money, and mostly disregard the motivation and feelings of the people who are the real engine of the company.

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[1] Creating Value Through People by David Maister