Marketing Book of the Year is an organisation of M&SB and selects the best global Marketing Book of The Year 2014 from the world wide offer in the last year.
Any strategy lives or dies on the basis of its customer value proposition. There are many typologies relevant to crafting a value proposition, because there are many ways to win customers. But the key issue is always: what is the center-of-gravity in our approach? Do we ultimately compete on the basis of our cost structure (e.g., Ryanair and Wal-Mart) or another basis that increases our target customer’s willingness-to-pay (e.g., Singapore Airlines and Nordstrom)? In other words, will we sell it for more ormake it for less — and allocate sales resources accordingly?
Nearly all competitive markets confront firms with this choice. In retailing, there is Wal-Mart, Dollar General, and category killers. But there is also Nordstrom, Louis Vuitton, and many high-end boutiques. In pharmaceuticals, there are blockbuster drugs targeted at mass-markets segments. But there is also Soliris, a drug sold by Alexion to treat certain blood and kidney diseases that afflict relatively few people. Soliris costs $400,000 per patient annually. But insurers pay this price because Soliris is the only safe and effective treatment for these diseases and that price is less than the total cost of alternative treatments. Alexion has grown from $25 million in sales in 2007 to $1.5 billion in 2014.
There’s no question that the corporate marketing function is evolving rapidly to become one of the most strategic functions in the enterprise. And that means the makeup of the marketing teams that leading CMOs must assemble is also undergoing a rapid transformation.
“Marketing is changing quickly, and it’s incumbent on CMOs to adapt to those changes in the teams they build,” said Todd Merry, CMO of global hospitality and food service company Delaware North, in an interview with CMO.com. “We need skill sets previously not required in the marketing suite.”
Marketing is in a state of evolution, explained Caren Fleit, senior client partner with Korn Ferry and head of its global marketing center of expertise, in an interview with CMO.com. And the skills required of the marketing organization are changing rapidly as well—from deep technology knowledge to customer experience expertise to sales enablement.
Companies typically spend more hiring their sales forces than any other function in an organization, yet sales managers often aren’t adept at assessing the right skills to make good hires. It’s time to turn that around in order to drive better bottom-line results.
If you want people in the field to understand your strategic initiatives and demonstrate behaviors that will drive profitable growth, then there must be a clear roadmap to drive that alignment, says Frank Cespedes, author of “Aligning Strategy and Sales: The Choices, Systems, and Behaviors That Drive Effective Selling.” He discusses the issue with Anita Bruzzese in the second part of this interview that looks at hiring and how sales will be affected by an improving economy.
In the preface to Aligning Strategy and Sales, Frank Cespedes writes; “Selling is, by far, the most expensive part of implementation for most firms… The amount invested in sales forces (including salaries, benefits, and other components of SG&A — selling, general and administrative expenses) is about $900 billion annually. This is more than five times the $170 billion spent on all media advertising in 2012 and more than twenty times the $40 billion spent on all online advertising and marketing in 2013.”
According to Cespedes, that gap between your company’s sales efforts and strategy? It’s real-and a huge vulnerability. Addressing that gap, actionably and with attention to relevant research, is the focus of Aligning Strategy and Sales, published by Harvard Business Review Press.
Welcome to a Leadership Channel podcast on TotalPicture Radio, with Peter Clayton. Joining Peter for our interview with Harvard Business School professor and author Frank Cespedes is David Dalka, Business Transformation Consultant, Facilitator, and Keynote Speaker.
It’s that time of year again: the dreaded performance review. While this practice is key to getting teams to set priorities and clarify actions, managers (and employees) often treat it as a make-work task instead of a productive conversation. Perhaps it’s no wonder then that companies worldwide deliver just 50 to 60 percent of the financial performance their strategies promise due to a noticeable gap between their goals and employee behaviors. To mend this gap and create real impact for 2015, it’s time for both parties to make this process an actionable dialogue. And they can start by avoiding these seven mistakes…
Frank sat down with Linda Richardson of Top Sales Magazine to discuss “Translating Strategy into Sales Behaviors That Win.”
It’s tough for people to implement what they don’t understand. Communicating priorities to the front line, especially salespeople, is highly correlated with business performance. Conversely, this “middle ground” is where strategy execution often breaks down. Yet, many executives resist making strategy explicit. The most common reason is fear that this information will get to competitors. As a consequence, the organization tends to become a “global mediocrity”: good at many things, but not very good at any particular things. And the essence of strategy is being excellent at things your customers value and competitors find hard to imitate.
First, let’s address the issue of competitors “stealing” your strategy. The strategies of successful firms are usually well publicized. How many books, blogs, and case studies get written about Apple, IKEA, Nike, Southwest Airlines, and others? For decades, Toyota has allowed outsiders to study its factories on-site. This may increase knowledge of operations (which is not the same thing as strategy). More often, as a 4-year study of Toyota’s production system concluded, “observers confuse the tools and practices they see on their plant visits with the system itself.” In a world with a global infrastructure of consulting firms and others paid to disseminate information, confidentiality as a reason not to articulate and communicate strategy is both myopic (the information is just not that hard to acquire) and often beside the point (you have bigger things to worry about than competitors reading your strategy documents if your people don’t know your strategy and therefore can’t execute it well).
Business strategy is about the choices a company makes in its attempts to compete in a market. Some choices are explicit. They’re put in a plan or discussed at meetings. But many are implicit in the decisions made, often without thinking of them as strategic, in the flow of running the business or on a project-by-project basis. This includes the hurdle rates used to evaluate capital requests and the questions you’re expected to ask and answer when you propose an R&D, marketing, operations, or sales initiative.
The gap between your company’s sales efforts and strategy can be a huge vulnerability, says a new book. But there are ways to link your go-to-market initiatives with strategic goals.
If you want people in the field to understand your strategic initiatives and demonstrate behaviors that will drive profitable growth, then there must be a clear roadmap to drive that alignment, says Frank Cespedes, author of “Aligning Strategy and Sales: The Choices, Systems, and Behaviors That Drive Effective Selling.” He discusses the issue with Anita Bruzzese in this two-part interview.
Excited to announce “Aligning Strategy & Sales” is in the running for the Top Sales & Marketing Book of 2014. To cast your vote, please take a minute to click on the link below. Appreciate your support in advance!