Product vs. Process: Why big industry sales teams lose to tech sales machines

How do startups dominate spaces quickly? It’s not a big secret. Big industry can’t adapt fast enough and many times they continue to sell what people wanted vs what people want today or tomorrow. It’s not that big companies don’t want to change and SVPs aren’t eager to try new things, it’s that failure is amplified at a billion dollars in revenue! The odds are against radical change, and executives spend equal time in CYA mode as they do getting dirty in their process. It has to change though, or you will start to see startups accomplish in 5-10 years what it took these giants to accomplish in 50. We’re already seeing this to some degree. But is there hope? Of course.

Let’s explore the top four reasons why big companies struggle to sell like small companies, and what they can do to start the journey:

1. SDR teams

Older companies often don’t have SDR teams, and when they do have them they are separated from marketing. The tech sales org is a beautiful (or at least functional) marriage at the top of the funnel. Whether it’s Yesware or other growing companies where the CRO and Head of Marketing work as one team, or teams like Zenefits where all 70+ SDRs report to marketing, the trend is apparent. You need people to specialize in lead generation, and marketing needs to be involved.

2. Tenure

When you’ve been in the same sales role for 5-10 years, atrophy sets in. The same people doing the same job makes it tough for new people to come in and disrupt the process. The tech sales environment encourages a “move up, or move out” attitude even past the “startup” stage. Salesforce’s career progression is simple and known to all new hires based on the role in which they entered the company – check out LinkedIn and you won’t find very many sales professionals who have been in the same role for more than three years.

3. Investments

Investments intended to update the process are often reallocated towards training employees who are currently failing to adapt, rather than spending those dollars on overhauling the entire process. You can’t turn a relationship person into a challenger after they cross a certain amount of experience, and you can’t change the culture and process if your CRM and monitoring tools are the same. To shift your organization to adopt a value/solution-based, consultative, challenger sales process, the system and leadership must be the catalysts.

4. Relationships vs. ROI in the sales process

Many established sales teams fail because of the belief that relationships rather than ROI are the most important part of the sales process. Don’t get me wrong, making people like you is a good thing, and in the days of Mad Men it was probably just as important as the results in the initial sale. While we still need to be likeable today, that only gets you so far. Even in big enterprise deals, the relationship to get in the door is less important than ever. Last month at Skaled we set over 165 appointments for our clients with C and VP level decision makers at companies like Walmart, Disney, Prudential, Best Buy and about 15 other Fortune 500 companies through COLD outreach! I’m not saying warm intros aren’t great, but I am saying that they aren’t as needed if you understand how to add value. We need to understand what it takes to build the case vs build a friend.

Big company sales teams are in trouble. Last year there was $321 billion dollars spent in enterprise tech with the biggest chuck of that in software, and guess what, this year will be bigger. These sales machines are building replicable copies of themselves as leaders spread and infect the next big disruptive company with the same virus that stole market share the same big company last year.

How can big companies compete?

1. Get nimble

Hire startup leaders in senior roles or at least bring in advisors that have been there and built the machine. Trainers on a process aren’t the answer, you need practitioners who understand real world execution and not just content.

2. Create career growth opportunities

Don’t look for people who want to just sell, look for people who want to excel. Create new roles and responsibilities and look for the type of people that want those opportunities.

3. Cut out the bad pieces

You know the people in the org who are getting by and teach the new people all the tricks? They need to go. Change can’t take hold without a group of people all willing to change.

It’s not too late for the big industries to adapt, but the old way of setting up a sales team won’t foster processes that enable growth. Developing new products or bringing in trainers from the outside is not going to transform these outdated organizations. Change comes from within, with a little help from experts along the way.