In this podcast episode, hear from Mike Burnett and Dave Eddleman, principals at the Alexander Group, on our business services practice, including segments served, key client engagements and an introduction to the top five mandates impacting service organizations.
[00:00:10] Welcome and thanks for joining us. This is Mike Burnett with the Alexander Group. Today, I’m joined by my colleague Dave Eddleman. Dave and I are both principals and co-leaders of our business services practice here at the Alexander Group. This is the first in a series of videos exploring prevalent go-to-market trends we’re seeing in the business services space. We’ll talk about key challenges, as well as several go-to-market mandates that we’ve encountered through our research and work with clients.
[00:00:36] For those of you not familiar with the Alexander Group, we’re a management consulting firm that focuses exclusively on revenue growth. Since 1985, we’ve worked with sales, marketing and service leaders to assess, build or optimize go-to-market models, as well as the commercial and enablement programs required to make them run smoothly. All of our work is supported by industry research as well as insights from our community of revenue leaders. You’ll find that business services is just one of the many industries that we focus on as a firm.
[00:01:06] Our business services practice covers a broad spectrum of sub-groupings within the industry. We’ll cover and work with organizations from the banking and financial services sector, professional services, industrial services, as well as a heavy portion of organizations that fall into the I.T. or tech-enabled services arena. Many of our clients actually have a combination of these services they’re providing, either in the format of a subscription, one-time or time materials and set up or revenue model.
[00:01:35] Across business services, we’re seeing that organizations are facing persistent pressure to continue to evolve as relatively simple business models have become increasingly complex. With new digital delivery platforms, there’s now been a fundamental shift in terms of customer expectations regarding both the speed and delivery mechanism of services. Technologies also lower barriers to entry for many new, smaller competitors that have been able to quickly scale and target niche corners of the market. And lastly, the constant development of new offerings, acquisitions and the mix of one-time versus subscription revenue models has led many business service providers to encounter an identity crisis. Are we a provider of content and insights? Do we provide services only? What’s the right portion of our business that should be tied to software? What’s the optimal combination or balance? All of these have led to organizations being forced to reckon or decide what the optimal mix of their revenue model should be moving forward.
[00:02:36] Everyone, Dave Eddleman here. As we think about and react to some of the trends that Mike talked about, we wanted to present you with some prevalent go-to-market mandates – initiatives that revenue leaders are engaged in and also sort of presents the bulk of project work that we do with the Alexander Group in business services.
[00:02:55] Number one is update customer segmentation. You’d be surprised how many great companies are out there. Still don’t have their full segmentation program complete. They’re pretty good at defining the breakpoints between down segment and up segment and the revenue breakpoints or vertical breakpoints, whatever there are. But in terms of assigning particular targets to incumbents, for example, if I’m a hunter, farmer or hybrid type of seller, do I have the 39 targets and do I have sort of the top quartile of targets? And do I understand why they’re attractive? So arming sales reps or field reps with this sort of navigation and understanding where the best prospects are is super important.
[00:03:37] Number two is really prioritizing revenue models, and this recurring revenue model is going through a lot of our business services clients. It’s evolving and what this really means is it mandates a post selling type of motion, whether that’s a customer success manager or some other kind of customer satisfaction role. Upselling, cross-selling and renewing this is a different coverage model, and it’s not always so easy to transition to, as well as transitioning from the field sellers into or passing off to the post selling organization.
[00:04:13] Number three is basically the job roles and the overall coverage model across the board, defining roles and responsibilities for all sellers. This really helps a lot in coaching and mentoring from the first-line sales manager and also sort of gets go-to-market teams straight on what their assignments are and what their roles and responsibilities are.
[00:04:34] Fourth is the digital strategy. So what we’re doing is we’re working with clients to make sure that they’re putting a stake in the ground with their digital strategy, how they interact with their customers in a different way. What are they demanding in terms of digital interaction and what are they trying to push that is the clients trying to push to their customers in terms of digital interaction. So having a great strategy that has some practical sort of implementation plans is really important.
[00:05:03] Last but not least, is sales compensation. The Alexander Group’s had a long history and sales comp. We always try to do this at the end of getting sort of all the issues one through four straight, and that usually entails looking at different sales compensation plan designs, different measures, different weightings, as well as trying to understand how we set goals and allocate quota to incumbents with these different measures and different sales comp plans. So again, if we look at most of the work that we do, it probably encompasses some of these go-to-market mandates and these are sort of prevalent trends in terms of projects and initiatives that we’re seeing.
[00:05:42] So moving forward, we’re going to have a three-part video series and what we’re going to do is double click down into some of those initiatives and starting off with total addressable market. We’re going to be looking at some of those issues around segmentation and assigning accounts to incumbents. We’re going to be talking about sales coverage in the second video. Last but not least, we’ll be having a third video on sales comp trends in business services, so we hope you can listen to those videos as well. Thank you for listening today.