An Open Letter to CROs

An Open Letter to CROs from Joe Sexton
  • 25% higher attach rates for early sales conversations 
  • 50-80% higher close rates 
  • Increased average contract value of 25-50% or more
  • Double digit reduction in discounts 
  • 30-50% impact on deal velocity 
  • 50-70% reduction in new hire ramp-up times***

Do the above metrics sound like your current year and latest Quarter results? Or did your last Quarter end with, “We had 15 Qualified deals in the Quarter, we needed 5 to beat not only the Board plan but our internal stretch plan, but we only got 3 of them. While we had a good Quarter, we left business on the field as deals slipped or shrank because (fill in the blank, there are too many reasons to list)?”

Why does that happen time and again and what can be done to course correct so that you crush this Quarter and enter the next Quarter with a running start?

Remember, there are three questions people ask when they buy:

  1. Why Buy Anything? You must get agreement a prospect has a potential problem that your solution can solve, otherwise move on to the next prospect. This should be the easiest answer, qualify in or out a prospect quickly.
  2. Why Buy Your Solution? How do you beat your competitors by establishing your Unique Business Value differentiators and gaining the trust of the prospect that you can actually solve their problem? Again, with most reps, they can be enabled to achieve this. Unfortunately, this is where most reps declare victory, commit deals including the amount, and calculate in their head those beautiful commission checks.
  3. Why Buy Now? This is the most crucial question to answer, yet is the most often overlooked until it’s too late and deals shrink, stall or worse, go away. The reason is that while most reps are very good at selling features and functions, they are terrible at selling the only reason people buy - to solve problems that create clear, business-oriented Value with your solution.

So why does this matter now? I would argue that the last 10 years selling environment has been relatively easy based on a strong worldwide economy, COVID-19 notwithstanding. Real innovation that powered Digital Transformation and the move to the Cloud created massive opportunities that drove new ways to market faster and at less cost. In fact, for a lot of tech companies, COVID-19 was an accelerant for their results. But success can drive complacency.

One of the smartest people today, I believe, is Simon Sinek. He sums 'uncertain times' up perfectly in about 2 minutes. I’m not saying sales have been ‘easy’ the last 10 years, but certainly easy compared to the rough economic times that lie ahead. When people like Simon, who are way smarter than me, speak, I’ve learned from experience its best to listen and learn.

Recently, two of the smartest business people on the planet, but on opposite ends of the business spectrum, said relatively the same thing regarding the upcoming economy. Jamie Dimon, CEO of JPMC and in my opinion one of the best CEOs in recent years, stated regarding the future economy, “You better brace yourself. You know I said there are storm clouds but I’m going to change it. It’s a hurricane. While conditions seem fine at the moment, nobody knows if the hurricane is a minor one or Superstorm Sandy.” And Elon Musk, who I believe is the Thomas Edison of our time, recently said he has a “super bad feeling” about the economy and needs to cut about 10% of jobs at the electric carmaker.

It feels like we’re heading into either 2008’s Great Recession housing crash or the 2000-2002 Dotcom bubble. Either way, as a CRO what can you do about it?

Thinking you can run the same GTM plays you’ve run the last 10 years and get the same results is stinkin’ thinkin’. Jamming more into the top of the funnel with countless pipeline building tools will not fix the issue at the bottom of the funnel where the number of deals getting stuck or shrink will only increase if your reps can’t overcome the ‘Why Buy Now’ challenge.

In 2008 we had one of our best years at McAfee during the Great Recession in the Enterprise Security space. We would surpass Symantec in the Market going from #2 to #1 by selling the same solution as when I arrived in 2007. The difference was, we sold not only the technology, but more importantly, the business Value we drove as the outcome when you used McAfee instead of Symantec. In fact, I felt so strongly about this I made every sales rep put on the front of their business card “Have I proven McAfee’s Value?”

Joe Sexton Business Card-1

When sales reps asked me why it had to be on the front of their cards, my answer was, “because I want you to understand, explain and defend the unique, superior business Value we deliver as a result of using our solution in addition to providing the best security protection. We will only win big if we can do both.”

Forewarned is forearmed. So what can you do to insure you unclog the bottom of your sales funnel transforming your sales reps into Value reps before the impending economic hurricane hits?

I’ve always maintained there are 3 Ps key to massive success:

  • People: Hire the right talent, then retain them by providing world-class sale enablement, the opportunity to massively overachieve their sales targets, inspiration, and a winning culture.

  • Process: Provide a clear, repeatable sales process that enables them to answer the 3 questions “Why” questions mentioned above and inspect what you expect to make sure the reps are “walking the talk”. Whether you use MEDDIC, Command of the Message by Force Management or something else, a process or methodology is only as good as it’s usage.

  • Product: Typically this P stands for your Product. The thinking is to build the best product, make it easy to use and functionally superior in your category then make sure your reps can point out your differentiation to align with their prospect’s needs. But there is an old saying, “The best Product doesn’t always win?” And by win, I mean not only select you against the competition but also cause the prospect to part with their precious budget to enable your reps to close the deal. As I like to say, it’s easy to get people excited, it’s hard to get their money. The analogy for me is it’s like a clogged sink. Dumping more resources and tools to create more into the top of the sales funnel, is like pouring more water into a clogged sink. So how do you unclog the “sales funnel” sink so that deals come flowing out the bottom? There is a solution to the problem but in order to do that let me redefine the P for Product.

    Buy DecisionLink now. Sorry to be blunt, but selling Value is hard even though everyone from the CEO on down thinks their company does it. Very few actually do. The reason is because until DecisionLink, it was hard to make it repeatable for EVERY sales rep, regardless of their skillset or tenure. If you did it at all, it required expensive business value consultants that aren’t scalable or cost effective.

With DecisionLink, a sales rep can:

  1. Create a professional Business Value Hypothesis (BVH) document to use in any initial conversation in 15 minutes with a prospect so that the conversation is “Here’s a problem similar to yours, with a customer of ours that looks a lot like you, that drove these specific business metrics using our solution to solve the problem. Does this sound interesting?” Immediately the sales pursuit begins with a Value conversation instead of features and functions.
  2. A sales rep can create a Business Value Assessment (BVA) document after doing a Proof of Value (POV) that shows the prospect specifically what we were able to prove in a before and after analysis. Most importantly, BVAs highlight quotes from the prospect’s own people captured during the POV so the benefits are theirs, not yours. This transfer of ownership for the benefits your solution will deliver is crucial for credibility so you can answer the ‘Why Buy Now’ question, and more importantly, arm your Champions and Economic Buyers to answer the question when you’re not in the room. An ROI calculator or fancy spreadsheet won’t have the credibility to do this and will be immediately discredited by Executives you won’t meet or purchasing people who only want a price race to the bottom.
  3. Six months to a year after the sale, deliver a professional, automated Business Value Realized (BVR) showing your now-customer the benefits you promised vs. the benefits realized. Then watch your renewals come in on time, your cross sales and upsells dramatically increase and your number of customer references skyrocket.

My last day to day in an operational role was as the President of WW Field Operations at AppDynamics. Our hyper growth results and outcome is legendary. Cisco acquired us for at the time, an all-time multiple paid for a private software company. I was extremely fortunate to have my two key Executives, Dali Rajic, who ran North America and Jeremy Duggan, who ran EMEA, execute brilliantly on Value selling. They didn’t just walk the talk, they ran with it. They inspected what they expected on a weekly basis. They insisted on thorough BVHs and BVRs, then constantly challenged their teams to do them even better. They knew the details of what a great BVH and BVA should be and shared the best practices for each across the world. Our only challenge at that time was there was no automation available for the BVH (we called it a Value Pyramid), BVA, or BVR. We hired expensive but world-class Value Engineers. That model will not scale though for overall cost and productivity.

The key to success for your team and company separating from your competitors and the Market is YOU. As the CRO, your leadership driving the 3 Ps will be the difference between thriving during the coming economic turmoil or succumbing to the havoc it will wreak. In a tough economy, you not only have to beat your direct competitors, but you are also fighting for a tighter and smaller budget that will only go to the best value solutions across the customer’s business. Their internal narrative will be, “I know we want to spend money for 10 projects, but the budget is tight, we can only do 3.”

Difficult times bring out the best in great people and great companies. Think differently, lead your teams to behave differently, and be the change your company, people, and future demand. You can do it, but you must own it on behalf of your company. After all, your success always depends on the overall success of your sales team. Walk the talk. Or even better in the upcoming rocky waters, get to runnin’! Good Luck!

Gone to sell,
Joe


***All actual benefits realized by using DecisionLink’s ValueCloud

BetterCloud – Win rates are 4.9X higher and ACV is 47% greater when a BVA is used in a sales cycle versus deals without them

Verint – Close rates more than doubled, 17% reduction in discounting from leveraging ValueCloud and Value case development time reduced from 8 hours to 45 minutes


Bio

Joe Sexton_sq

Joe Sexton is the former President of Worldwide Field Operations at AppDynamics. Prior to AppDynamics, he spent significant time in senior leadership roles at McAfee, Mercury Interactive, and CA Technologies. At each of those companies, Joe’s distinguished himself with his commitment to Customer Value which was critical to each companies’ success. Widely regarded as one of the ultimate sales leaders in the software industry, Joe’s leadership driving the growth of AppDynamics from a $12M early-stage company to a near $4B exit is a pinnacle achievement in the SaaS industry.

Joe serves on the Board of Directors of CrowdStrike, DecisionLink, Menlo Security, Contrast Security, D2IQ, and BrainBox Intelligent Marketing. He was recently on the Executive Advisory Board of PagerDuty where he helped their sales team while they transitioned from a private company to being listed on the New York Stock Exchange via a successful IPO.

Joe earned his BA in Marketing from the University of Kentucky. He is very passionate about mentorship, helping women succeed in the workplace, and teaching salespeople how to become Value Professionals.