Why F12 brought in Ballistix founder and author of The Machine’s Justin Roff-Marsh to revamp their sales strategy and processes—and how it could work for your business, too.
Many companies face the same sales strategy problem: their salespeople are so busy handling customer fulfilment that they have limited time to sell to new customers. Sound familiar? At F12, we were encountering similar challenges with our sales strategy. So when a few members of F12’s senior management team read The Machine by Justin Roff-Marsh, we knew we needed to meet with the author’s consulting firm, Ballistix. The point? To discuss how to improve our sales strategy and processes. In a recent webcast, Marsh shared his radical growth insights with F12 CMO Devon Gillard, and why business owners should reconsider their own sales functions.
First, what is Ballistix, and what do they do?
Ballistix is a sales management and marketing consultancy that rebuilds an organization’s entire front of house to improve the sales strategy. The big idea is that salespeople should be focused on one activity to the exclusion of all else: selling conversations. Selling conversations means pursuing new business only, not maintaining existing business. So in the Ballistix world, salespeople do not own accounts. The one thing they should be focused on is pursuing new business. To make this happen, a business will need to transfer most of its salespeople’s practical responsibilities elsewhere in the organization. This means:
- No more account ownership
- No more customer service tasks
- No more prospecting for new business
Ballistix takes away everything other than selling conversations and transfers them elsewhere. And that requires a complete rebuild of an organization’s front of house customer service design, engineering, marketing and sales.
At most small businesses, founders sell. In order to grow, they replicate that same model, opening more branches across the region, province or country. But that’s the wrong strategy.
That strategy works on a very small scale. Not only does it work, but it’s probably the most efficient way of growing a business. If a founder starts a very small business and goes out and wins new accounts, he or she is probably maximizing their chances of succeeding. The problem is that as organizations scale, this method ceases to be the most efficient way to run sales. And many organizations intuitively recognize that, so they end up subdividing the organization. So now you end up with lots of offices all over the place, run by general managers. And each general manager is meant to be a facsimile of the founder—i.e., “rainmaker”.
The problem with this system is that you end up delegating the founder/rainmaker responsibility to a whole bunch of characters who don’t have the same set of rare personal attributes that the actual founders did. That’s why it’s not a scalable model, and eventually the organization will hit diminishing returns on it. To be truly scalable, you need to centralize. Case in point: The Tesla model is infinitely more efficient than the traditional automotive model because it’s so centralized.
Salespeople shouldn’t be prospecting. The marketing department should be prospecting.
Selling is trying to convince prospective customers to become customers, or existing customers to buy some new service or product. It can be tempting to package prospecting in with selling, but if you think about what prospecting is, it is materially different from selling. The most obvious difference is that selling is one to one. Prospecting is one to many; it’s identifying prospects among targets and qualifying them. It’s buying lists of organizations and packaging up those lists of carefully identified prospects with a compelling proposition. The marketing department is better equipped to perform those activities than the sales department. They should be identifying opportunities and then passing them to the salespeople to chase.
Why should salespeople only sell?
There are two big problems with a sales strategy that sees salespeople doing anything more than selling:
- If salespeople are responsible for managing accounts, then once they have a book of accounts to manage, they end up spending most of their time managing accounts and not selling. Instead, account managers should be managing current client accounts.
- If salespeople are responsible for originating their own sales opportunities, they end up taking an account-centric approach, which means they look at a list of companies and ask themselves what they could sell this organization. As a result, you end up with very limited resources applied to the design of propositions, because these propositions are designed on the fly by salespeople who do not have the resources or the degrees of freedom to come up with truly compelling propositions. Instead, the marketing department, in conjunction with the executive team, should adopt a campaign-centric approach. First, identify the market segment they want to go after, then come up with a truly compelling proposition for that market segment—one that a salesperson wouldn’t normally have been able to come up with themselves.
So what is a campaign-centric approach to sales?
By adopting a campaign-centric approach to sales, it is the responsibility of the executive team to come up with propositions. It’s the responsibility of the sales team to pitch those propositions to the list of candidates fed to them. The results from that effort are then presented back to the executive team, illustrating how that compelling proposition the execs came up with fared in the marketplace. Now the executive team is being held responsible for how compelling their propositions are. That sounds radical, but that was happening automatically on day one back when it was a small business.
How can a company afford to divide roles?
It’s true that if you mapped out the perfect model based upon the idea of a very strict division of labour, you would probably end up with a model that required a large number of roles, and therefore it would look like it was more costly. But ultimately what’s important is cost per unit of growth. Your current model might look efficient in terms of cost. But the question is, how much are you spending per unit of growth with your current model? If you’re not growing at all, then the fact that you’re not spending much per unit of growth should also be keeping you awake at night.
The benefit of division of labour is that you get extraordinary increases in efficiency as a consequence of specialization. So what tends to happen is as you start to create division of labour and put those additional people in place, you get very fast and very significant increases in efficiency. And those increases in efficiency mean that not only does the organization do a better job of delivery, but also that more selling conversations start to occur. It ends up being a self-liquidating exercise. If you navigate this journey correctly, you will end up with a bigger team, but you will also end up with significantly greater revenues and happier customers.
How did this new sales strategy plan work out for F12?
When F12 started this journey with Ballistix, our sales strategy meant we had between 16 and 20 people in account management/sales fulfilment. And when they were really busy with sales activities, they were probably underserving their existing customers. And vice versa: their attention was often going to current customers rather than creating selling conversations with new prospects.
Since implementing a campaign-centric approach to sales, F12 now has a small team that solely focuses on customer fulfilment. Yes, we have more titles and more labour, but our funnel is 63% higher based upon those activities. More importantly, one year year into running this model, our outbound sales team has brought in contract revenues valued at more than 10 times their cost—this fiscal year. And we’ve still got a lot of room to grow.
It was a leap of faith, a year ago, that this rebuilding strategy would pay for itself, but it did—and then some. It’s been fascinating to see that as individuals specialize in their particular function (sales conversations or prospecting), they get better; they get efficient and more effective, because they’re doing it more often, rather than just being one of the 40 other responsibilities they have.
So how do you scale your business?
Scaling a business is the hardest part. An organization probably does 80 percent of its work on what we call the “operation” side, rather than the “sell” side. So on the sell side, put marketing and sales. The operation side should include customer service, customer success, sales, engineering and onboarding. But don’t forget to always re-engineer the operations departments to get them to the point where they can do exceptional work but also scale rapidly to keep up with the volume of new business. This is almost always more difficult than the work that needs to be done in sales.
If you want to scale an organization aggressively, you need to have “protective capacity”. That means that from time to time, staff will be sitting around twiddling their thumbs. You can’t scale a complex system if you attempt to activate all of its components simultaneously. And that’s one of the big challenges Ballistix faces when it goes into an organization: if you want to scale your organization quickly, you need protective capacity all over the place.
If you want to learn more about Justin and his team at Ballistix, and how they can help your company reengineer its sales process, check them out or buy a copy of Justin’s bestseller (and F12’s gamechanger), The Machine.
For all of your IT needs, or just to learn more about how we redesigned our sales function, contact F12 today. We love talking tech and business.