If I had a dime for every time I’ve been told by an MSP, “I tried hiring a sales person, he/she lasted 6 months, it didn’t work” or “We’re at 10 people and $Xm in revenue, as the CEO I’ve done all the selling, now what do I do to scale my sales?”
Well, after having grown many tech businesses from $0-Xm, and in some cases over $100m, by recruiting and growing 100’s of MSPs around the world, I’m telling you scaling your MSP sales can happen. And it can happen cost-effectively. It’s not simple or easy or even for the faint of heart but here are 5 elements that can help you get there.
1. You must have a tip of the arrow value prop. There is absolutely, positively a 100% correlation between the strength of your value prop and your EOS (Effectiveness of Sales) and COS (Cost of Sales). A me-too, sell anything to anybody value prop will get you a ridiculously high EOS and COS that you will never get out from under. Conversely a very well thought-out, timely, well articulated and documented, razor sharp, priced for value, focused on specific markets value prop is infinitely more manageable and scalable.
2. You must have a lead gen machine. Anyone can generate quality leads once in a while and poor leads all the time. The key is a machine where you will consistently generate leads and a simple closed-loop management system that will help you quickly qualify quality leads and tell you where and how to get more quality and less poor leads. And guess what, it’s not as simple as blogging, SMM or SEO, it’s these and some of the good old fashioned ways like webinars, lunch n’ learns, good old cold calls etc. The key is a mix of these and “managing their effectiveness” throughout the sales process. We just closed a deal, great! The very first thing I always say is “Where did we get that lead?” Let’s do more of that lead gen. What about all those leads that never matured. How did we get those? Can we modify that campaign and get better results or just nix that campaign? ROI, ROI, ROI……
3. You must have a sales success model. I hired the sales rep and he/she just didn’t cut it. Well, was that person destined for failure or was he/she a bad hire? Many more times than not I see sales reps put into no-win situations where there is no tip of the arrow value prop, no leads being generated (believe me I believe the sales rep must generate 50% of their leads on their own), no quality sales tools in place, no form of training what so ever, no 90-day ramp plan etc. The hiring company (MSP etc) is equally as responsible for the success of the sales rep as is the sales rep.
4. You must have a productivity/scalability model. Making one sales rep successful is easy. Making a sales function successful is all together another animal. So you made one sales rep successful. What did it take to do that? How long did it take? What was the $ revenue ramp productivity per month? What was the ASP (Average Selling Price) per deal? How many deals does it take to make $ revenue targets? When did he/she achieve full productivity? What $ revenue is full productivity? What was the COS to make that rep successful? You must know the answers to these questions, and many more before you can say you have a sales productivity/scalability model.
5. You must have RTM (Reports-that-Matter) in your back pocket. My favorite. I always have the following (at least) weekly RTM in my back pocket.
a. Activity report – quantity and quality of leads generated and appts attended
b. Pipeline report – quantity, quality and change in the 90 day sales opportunity pipeline
c. Bookings/forecast/commits – bookings vs. forecast and commit numbers per sales rep
d. Win/loss – deals won/lost per sales rep and why
So there, it’s not as easy as I just wrote. I could easily type away and give 50 more elements, this is just a taste. Yes you can scale you MSP sales cost-effectively.
Todd Hussey, Partner and Co-Founder, MSPexcellence