B2B Sales: Has SFA Really Reached a Tipping Point?

Malcolm Gladwell, in his book of the same name, pointed out the power of “The Tipping Point”, and sought to demonstrate with a series of examples how little things can make a big difference. Now Lauren Carlson of Software Advice has picked up on the theme in a recent blog, in which she asks whether SFA (and its more widely targeted superset CRM) has passed a tipping point?

Lauren makes some familiar points about the poor reputation associated with early SFA projects - all too often they took too long, cost too much, failed to deliver the hoped-for benefits, and were regarded with intense suspicion by the sales people they were (in theory at least) intended to help. As a result, after a burst of initial over-hyped enthusiasm the early SFA market shot past what Gartner memorably characterises as the “Peak of Inflated Expectations” and into the “Trough of Disillusionment”.

Since then, thank goodness, the market has clawed its way back up the Slope of Enlightenment and may even - in the eyes of some enthusiastic observers - be approaching the Plateau of Productivity. Not all software markets have succeeded in mastering this transition through Gartner's Hype Cycle - in fact many remain obstinately stuck in the trough. So what has happened to SFA/CRM to enable it to recover from some of the early disappointments?

4 Tipping Points?

Lauren suggests that there have been 4 Tipping Points that have affected the road to recovery:

• SaaS made implementation cheaper and faster
• The Cloud made SFA more acceptable
• Analytics and marketing automation turned SFA data into gold
• Process improvement compressed sales cycles

I believe these are important factors in the recovery, but that they don’t tell the whole story, and that it is premature to declare victory just yet. There’s no doubt that Cloud-based SaaS solutions have dramatically simplified getting a workable system up and running in the first place - and removed the temptation to build a heavily customised solution that is then an expensive and painful nightmare to upgrade (a common outcome in pre-Cloud days). There’s no doubt that Cloud-based solutions have made it easier for sales organisations to keep up with the latest best practices.

I’m less convinced about whether analytics and marketing automation have come anywhere close to achieving their potential to turn data into gold - and in fact these markets may not yet have fallen from the peak of inflated expectations into the trough. Progress is being made, but there’s still a great deal of work to do to get high quality data into the system and to get timely, relevant insights out. This is one reason why products like Cloud9 Analytics are doing so well - they make it easier for sales leaders to get timely insights from their data.

Marketing automation is an interesting market. We’ve seen leading players like Eloqua and Marketo highlighting the benefits of Revenue Performance Management - and of taking a fully integrated approach to managing the end-to-end marketing and sales processes. I think that there’s a lot of work still to be done before most organisations are realising the full potential of these capabilities. Technology by itself won’t solve this - organisations are going to have to step back and re-design their marketing and sales processes to take full advantage, as I am pleased to say a growing number of the top-performing organisations in a variety of markets are starting to do.

Finally, Lauren refers to process improvement compressing sales cycles. But many sales organisations still don’t pay enough attention to tracking sales velocity across every stage in the sales and marketing process, or the factors that affect it. As Donal Daly of Dealmaker 365 points out, shortening sales cycles is the most effective way of accelerating revenue growth. There’s still plenty of scope for improvement in this area, and it would be my number one recommended focus area for any organisation wanting to improve sales performance. There’s still a lot of untapped potential for organisations to learn from the winning behaviours of their top sales performers and to use these insights - embedded in their CRM system - to raise average sales performance.

Passing The WIIFM Test

Last, and by no means least, I think we’ve still got a way to go to answer the “what’s in it for me?” question that’s still on the lips of many sales users. Applications like salesforce.com’s Chatter can help, as can Dealmaker's approach to online coaching, and the growing number of applications that integrate market intelligence from sources like LinkedIn to the sales person’s working environment.

So - has SFA truly passed the tipping point? I think there’s still significant room for improvement - but we at least (and at last!) seem to be headed in the right direction. What do you think? And how could we get there faster?