How to Achieve Higher Revenues: Align Sales with Services
Alignment between sales and delivery services increases the value you provide for your customer. Best-in-class companies develop processes that grow revenue by improving the linkage of these two departments. Today’s blog post provides a high-tech services perspective from Bob Armour with serVelocity, a management consulting and solutions implementation firm that is focused on helping high-tech services organizations define their services vision, grow revenues and improve bottom-line performance.
Sellers -- We know the reality. The services department is often an afterthought when it comes to traditional product-selling companies. Even in more service-centric organizations, the gap between sales and delivery can be quite large, and frankly, crippling.
Without bringing these organizations into alignment, companies typically experience challenges that at best strain internal relationships and at worst become all too evident to customers:
- Sales can’t get the information or commitments from services required to close a deal
- Sales creates expectations that services can’t deliver on causing cost overruns / free work
- Follow-on sales and customer testimonials are lost
Organizational alignment across product, sales and services is vital to reversing these barriers and creating sustained revenue. With customer expectations increasing and their success more important than ever to sustained revenue growth, best-in-class companies recognize the importance of building the bridges necessary to deliver solutions and drive results.
The serVelocity team has worked with service organizations for decades. Take it from our perspective. You will gain higher sales by elevating, aligning and selling services from the beginning – we call it Services Forward. Here are the four action-items that matter most when developing a stronger link between sales and services.
1. Agree on Offerings
Agree on a limited number of well-defined service offerings that combine product and services value. These offerings should make clear the business benefits, deliverables, major activities, timeline and pricing. They should also provide the necessary sales support materials to position and sell effectively.
Bottom line: This agreement better anchors customer expectations and ensures reliable, repeatable delivery.
2. Define the Opportunity Engagement Model
Establish an engagement model that makes it easier to tap into a services professional (those actually accountable for delivery, not proxies!) when opportunities are qualified. Be committed to involving services before commitments are made to the customer.
Operational flexibility is the key to managing demand and supply in services, since people don't inventory very well! Properly engaged well-managed services operations give clear answers to questions about availability and have enough flexibility to help win strategic deals.
Bottom line: Responsiveness to customers and engagement of services closes deals faster and ensures a smooth hand-off for successful delivery.
3. Set the Expectations
Delivery excellence comes from services following through and meeting or exceeding expectations. A customer messaging platform that can guide both sales, and service customer conversations will help drive consistency in expectations start to finish. Better internal alignment is an important by-product of this clarity. So, if sales does its part, there should be no excuses from services.
Bottom line: When sales and services are speaking the same value message, expectations are clearly communicated and the value promised is fully realized by the customer.
4. Aligned Compensation Model
Sales commitment to services not only relies on appreciating the value and making it easier to engage, but requires follow-through in the form of a compensation model that reinforces the value of selling services.
Bottom line: The customer may not value services enough, if sales does not value services enough.
Creating Visible Impact
When you have alignment between sales and services, you find shared success because margins improve. Therefore, capitalizing on these four action areas with services drives a virtuous cycle:
- Higher services margins allow sales to offer more services to their customers without diluting company profitability.
- Services delivering on what’s promised in the sales cycle means greater customer success.
- More success drives renewal, follow-on and testimonials that power sales with still higher margins.
The best services people like to solve problems and make a visible impact. They thrive on it! When they feel they're providing value, they’re more likely to stay and your organization is more likely to retain these top performers. Thishelps your sales team as the best services people create far greater business value for the solutions you’re selling to the customer.
While greater alignment is not always easy to achieve, even small changes can lead to better results.
What’s holding you back?
Meet your services peer; discuss openly how the sales process may improve, and pick just one of four action areas described to get started on together.
What are your best practices for creating this alignment? How much is it worth when you get it right? What has worked for you when making the first move? Comment and let us know your thoughts.
Bob Armour is a founding partner with serVelocity. Armour has sold and delivered services to some of the most demanding customers in the US and Europe. In addition, he’s built organizations and transformed others into high performers by consistently applying the principles and actions described above.