As M&A Volume Surges, More B2B Customers At Risk


2015 is shaping up to be one of the busiest ever for M&A activities, highlighted by 45 $10 billion+ deals announced in just the first nine months of the year, according to Dealogic. And that was before Dell’s announcement about acquiring EMC.

Mergers and acquisitions are often prescribed when organic growth is slowing, there’s a clear strategic add, when it makes sense to consolidate market share and perhaps, when your balance sheet is awash in cash.

Yet as is so well documented, they often fail to deliver on the promise. There are a lot of reasons for the failure of a merger or acquisition, but one of the most common problems in B2B events – customer turnover – can be mitigated. So with the large volume of M&A events this year, it’s fair to ask how many B2B customers will be lost in the wash.

Valuable institutional knowledge of complex customer relationships is often lost when sales teams are consolidated. But even when there is continuity, do sales professionals know what the customer has purchased from both the acquired and acquiring companies, across geographies and business units?

Are sales reps able to engage with customers knowing renewal dates and triggers? Do they know the commitments and whether those commitments have been met? Or the pricing and discounts in effect?

Can sales reps put their hands on the entire corpus of documents that define the customer relationship, including contract masters, associated documents and statements of work? Do they know the risks attached to this customer or whether they are in compliance with the acquiring company’s policies?

Armed with critical information to retain a customer, sales reps may be able to cross or up-sell them on an expanded product line, greater geographic reach or other benefits from the combination of formerly separate companies. And a customer at risk may end up being a customer primed for growth.

CRM of the Future is Intelligent

Praful_SaklaniWe cheered the acquisition of RelateIQ by Salesforce last July, both because it was a step toward introducing more intelligence into CRM and because it would shine a bright light on the benefits of doing so. We’ve seen time and again that Salesforce can shed a lot of light.

At this past week’s Dreamforce conference we got to see the first fruit of their collaboration – tight integration of customer information from email, calendar and social streams into SFDC. And we heard Salesforce co-founder, Parker Harris, talk about a future where CRM is infused with more and better customer intelligence.

This is a vision we share and have been talking about for the past 18 months. The intelligence gap in CRM is felt every day by sales and sales operations professionals, the people on the frontlines that need to know more about their customers in order to serve them better, more proactively and strategically.

Getting a reminder from your CRM solution that a prospect didn’t return your email or you forgot to follow up is helpful. While we thank Salesforce for adding energy to the term customer relationship intelligence (we expect our search volume to increase), email, calendar and social stream data just scratches the surface.

Deep insight, and actionable customer intelligence, come from tapping into contracts and billing data, because these are the sources that define customer relationships. And the most valuable intelligence, an understanding of the true nature of your customer relationship, can only result from what these data sources uniquely reveal: details about pricing, key dates and triggers, T’s & C’s and the gap between commitments and actuals.

Knowledge is a journey. It’s true in the broad sense and it’s true when it comes to knowing your customers. We welcome Salesforce to the journey and the era of Customer Relationship Intelligence.

Adding Customer Relationship Intelligence to CRM

Integrating contract, billing and other data to get a single view of the customer. Featuring CenturyLink’s John Serdinsky from Pramata Corporation on Vimeo.

100,000+ people are descending on the Bay Area this week for Dreamforce 15, this year’s celebration of all things We’ll be there too.

One of the themes common to Dreamforce is how to do more with, and get more value and impact from your CRM solution. Regular readers of this blog know we believe there’s tremendous benefit that comes from adding more intelligence about customer relationships into CRM — the essential information about what customers have agreed to buy and actually purchased, key dates and triggers, T’s C’s and the other things that make up and define complex customer relationships.

It’s not enough to provide sales teams with this intelligence. It’s got to be in the same CRM dashboard they’re in each day to manage their pipeline and opportunities, which is why Pramata makes Customer Relationship Intelligence available within and other CRM solutions.  

Check out this short video from sales enablement expert, CenturyLink’s John Serdinsky, on integrating customer relationship data.  The impact is magnified when it’s all available in just one place.

Focus on Current Customers to Increase Profitability


Stock market watchers and analysts are wearing out the roller coaster analogy in trying to describe the market over the past week. The implications for the technology sector are especially interesting:

  • In the New York Times, Farhad Manjoo ponders whether start up founders accustomed to boom times “…will be up for managing in a more stressful, frugal environment.”
  • In the San Francisco Chronicle, Thomas Lee (paid) reports that tech start ups that waited too long to go public may have missed their window of opportunity.
  • Writing in re/code, Carmel DeAmicis reports on how a market basket of start up companies plan to weather the (potential) storm by running their businesses conservatively and not run out of cash.
  • And last week, Benchmark’s @bgurley suggested we may be at an inflection point, where profitability becomes a higher priority than growth.

Markets go up and they go down. But some businesses prosper regardless of what’s happening in the public markets or perhaps in spite of them. And this gets to one of the most interesting things about the call for a return to fundamentals and especially about companies’ strategies for riding out the storm. The re/code story describes cash conservation, expense control and putting money away for a rainy day. Those are all excellent approaches and necessary. However the re/code story is also notable for what was not mentioned: doubling down on current customers in order to retain and grow them.

This is a proven approach to profitability and the data is conclusive:

  • Gartner Group statistics show that 80 percent of a company’s future revenues are likely to come from 20 percent of its current customers.
  • A Bain & Company study shows a five percent gain in retention can increase a customer’s profitability between 25 and 95 percent.
  • And according to one study, 70 percent of companies believe it’s cheaper to retain a customer than acquire a new one.

It’s just short of de rigueur for companies in Silicon Valley today to pursue growth at any cost. Valuations and investment are based on high velocity customer acquisition, and you know, that typically costs a lot of money. As a result, it’s not unusual for companies to spend 110 or 120 percent of annual revenues on customer acquisition. That becomes very difficult to sustain when access to funding slows or the economy contracts.

I’ll leave it to others to debate the merits of the tortoise and the hare in emerging technology markets, but there is no doubt that the companies that focus on delivering maximum value to – and extracting maximum value from – current customers, are better able to withstand storm clouds.

So you have to ask yourself, are you optimizing pricing and volume commitments? Do you know the profitability of each customer and are you taking steps to maximize it?

Or for that matter, are customer retention and customer growth a part of your back to fundamentals strategy? Do you know enough about your customers to keep them? To up and cross-sell them?

Relationships Matter


Relationships make life richer and better. They’re also the foundation of good business, because we all prefer to work with people we know, believe in, and trust.

This doesn’t seem like an especially radical notion until you stop and think about all the barriers that hamstring a company’s ability to engage with customers with whom they already have a relationship. This is not by design, of course, but it’s true nonetheless.

I talk with prospective customers who struggle to answer basic questions about their current customer relationships. They can’t say with a lot of confidence:

● what they’ve sold a big customer,

● what the customer agreed to buy, or

● what the customer paid for.

They often don’t know key dates and triggers, such as for auto renew, or even if they want to renew on the same terms. And this is just a sample from a long list of need-to-know but hard-to-get answers.

Mind you, these are often big, sophisticated companies, with advanced technology infrastructures and forward-thinking management. But this stuff is hard if you have to do it manually.

We recently collaborated with Selling Power to publish an infographic about some of the common barriers to sales productivity. It’s a quick and informative read that describes issues I hear about every day. Many of these barriers are rooted in the lack of complete and up-to-date knowledge about the customer relationship.

The implications are sobering. Salespeople are often ill-equipped to engage with customers because they don’t know the details of the current relationship. This is true when the customer relationship is multi-dimensional and highly negotiated, spanning tens or even hundreds of products and supporting contracts, SLAs, SOWs, amendments, and the like. And it’s especially true when the company has grown through acquisition, and institutional knowledge about acquired customers is lost in the wash.

Sales team productivity is compromised because they spend too much time chasing customer information at the expense of active selling time. Hobbling and slowing the sales team is frustrating – and costly – enough. The downstream implications are lousy, too, including the impact on customer retention and growth within current accounts.

Everyone knows the argument – it’s less costly to keep new customers than acquire new ones. The lower cost per sale associated with current customers drives higher margins, which, in turn, fuel additional investment in the product enhancements and extensions that lead to customer satisfaction, loyalty… and customer retention. It’s a virtuous cycle that managers aim for but often miss.

One of our key customers boosted their retention numbers over 4 percent by arming their enterprise sales teams with better and more accurate information about the customer relationship. Their sales reps can easily see which of their accounts have expiring contracts, and focus first on those accounts. They are able to identify expiring products, pricing, usage, and payment details in seconds, and have the information they need to engage with and keep that customer.

The benefit of arming sales teams with the info they need to better manage the customer relationship ripples throughout the company. Supporting teams in sales ops, finance, compliance, and legal departments are freed from routine requests for help and, instead, are able to focus on more strategic and valuable work.

Accurate and up-to-date knowledge of your customer also fuels expansion within that relationship, because a sales professional is better able to spot cross-sell and up-sell opportunities.

Companies are better able to boost customer retention and grow their most valuable customer relationships when they arm sales professionals with complete and up-to-date intelligence about those customers. It’s worth it.

Reduce complexity to drive sales productivity

Contracts define complex customer relationships.  Understanding the relationship between contracts and related documents is critical too:  what’s the most recent?  Which is the master?  What is the relationship between various SOWs and contracts?

Clarifying the relationship between documents and reducing the complexity attached to them is one of the ways CenturyLink is helping its sales reps be more productive and effective.

Spend a minute and 21 seconds of your day to check out what John Serdinsky, CenturyLink’s director of sales effectiveness, has to say about it.  

Pramata and Gartner’s Hype Cycle for CRM Sales



Gartner just published their Hype Cycle for CRM Sales and we’re happy to share the news that Pramata is listed among the sample vendors. According to the good folks at Gartner, the Hype Cycle is intended to help buyers assess the relative maturity and impact of various technologies.

Pramata is listed under a new division within CRM Sales called Recurring Revenue Management, which was given a high benefit rating and a prediction of widespread adoption over the next 5-10 years. The author, Tad Travis, said “recurring revenue technologies have a high benefit rating because they provide strong opportunities for revenue growth at decreasing operational costs.”

The companies we talk with understand this at a DNA level. They know that a significant portion — in some cases the majority — of their future revenues will come from current customers. They’re focusing on delivering greater value to these customers, cultivating satisfaction and loyalty along the way. Doing so requires a deep and up-to-date understanding of the entire customer relationship, and processes and solutions to ensure every person is seeing the same information at the same time.

It’s interesting that this is the first year recurring revenue management is included in the CRM Hype Cycle. We’re delighted to be included in it, and especially pleased the conversation about doing more to help B2B companies keep and grow their current customers is attracting the attention it deserves.

See the press release here.

Three steps for fast time-to-value

CenturyLink re-engineered it’s sales effectiveness program, boosting enterprise customer retention by 4.5 percent and increasing active selling time for sales reps by 15%.  A few weeks ago, CenturyLink’s John Serdinsky, director of sales effectiveness, shared some of the key learnings from their experience in a webcast.

Here’s three minutes of goodness from the webinar, focusing on the three-step approach that generated results and exceptionally fast time-to-value.  



Timing is Everything: The Next Step in Raising Your Customer Relationship IQ


As we continue through the series on how to more intelligently engage with your customer, we have covered vital areas you must address including making sure data is accessible, correct and consistent, and giving it context and meaning for the sales reps who need it.

The good news is, pretty much every company we have worked with has solved those essential elements for at least a portion of their relationships. Once. At one point.

Because customer relationships are not static, most companies have event based customer relationship intelligence. A sales team may do a detailed analysis of a single customer relationship before an upsell or the sales ops team may comb through contracts looking for a certain license structure or key upcoming dates.

But as soon as the project is over, things change. You sign a new deal or start amending old ones and all of that hard work instantly becomes stale. Soon, another project rolls around and you have to start from scratch.

This constant evolution makes it difficult for even the most sophisticated CRM or sales tool to offer intelligent insight into the current state of the customer relationship. Each time a sales rep interacts with a customer, it is possible and even probable that the parameters of the relationship have shifted. In fact, you want them to change!

The key question related to timing is, how long does it take you to understand your customer relationships as they stand today? If you have to wait too long, you will miss out on important opportunities to engage and grow your customers.

To solve this, a lot of companies look to 1) standardize the customer relationships, or 2) collect most of the key information during the contract drafting and negotiation.

Option #1 is a typically the right solution for very high volume, very low complexity deals. Think: “I’m calling AT&T and changing my cell phone plan.” Where it breaks down is in more complex B2B negotiations. IBM is not accepting your ‘standard terms’ no matter how many times you say please.

Option #2 sounds good, but in our experience it really breaks down once customer negotiations get serious. At some point, the deal team needs to negotiate on the fly with the customer and those changes don’t make it back into the data workflow. That creates gaps in the data. Closing those gaps would require controls that unnecessarily create friction in the deal process and potentially insert risk.

The ideal solution comes quickly after a deal is signed. By inserting a final check into the deal process post-signing, you can build and maintain an essential database of critical customer information. The investment in this capability will create a very significant return by enabling groups across the organization to proactively engage the customer and execute campaigns, rather than waiting for the next “event.”

Best in class companies don’t require their sales teams to wait for valuable data that has a direct impact on customer engagement. You shouldn’t either. Delays in collecting relevant customer details can delay upsell cycles and kill promising sales campaigns before they start. Because timing is everything.

This post is part of an ongoing series examining the Five Keys to Making Your Sales Team Customer Relationship Intelligent. Stay tuned for our final post of this series where we’ll cover the last step in making your customer relationship intelligent: how to ensure the customer relationship trumps all.

Making your data mean something – part 4 of Raising Your Customer Relationship IQ


In our previous posts in this series, we explored the importance of having data accessible to sales reps in CRM, and ensuring that data is accurate and consistent. Yet no matter how accessible and accurate your data, if it doesn’t make sense to the sales reps that need it and if it doesn’t provide contextual understanding, it’s virtually useless.

The often-cited goal is to turn data into information, and information into insight.

Creating insightful information is no small task.  For example, sales contracts yield invaluable information that speaks to the what, when, where, why and how of the customer relationship. Those same contracts are often sprawling, complicated and hard to decipher.

This situation leads to a pretty common scenario in sales operations.  With the right tools and understanding, data from contracts can provide invaluable context.  At the same time, a blunt force approach can and will overwhelm sales teams with yet another field (or 50) in their CRM.  It just becomes more useless noise.

The key to surfacing insight from the noise is to engage the sales teams to deeply understand how and in what situations the data will be used.

I’ll give you a pretty common scenario that we see:  a sales person is doing a new deal with an existing customer and they ‘need the contract.’  Now, one approach could be to create a contract object, plop in a PDF, and enter a couple of pieces of metadata.  Voila!  They ‘have the contract.’  Next problem.

But that gives the sales person no context.  Instead, if you double-click with a sales person, you’ll see that there are at least two distinct use cases with key related questions that involve the contract in this scenario:

Account Research & Opportunity ID (pre-proposal)
What have we sold this customer and what is the current pricing?  What are they using/buying?  Where are the ‘gotcha’ commitments I need to know about?

Engaging the deal desk/deal process (post-proposal)
Is there a ‘clean master’ I can use to close this new purchase and bypass the whole deal process? What about pre-approved discounts? Are there any non-standard contract terms that require additional approval? Who do I need to get involved?

By going to this level of detail, you may notice that each of these use cases requires a slightly different approach.

In the first use case, an account rep would most likely be doing account research in their CRM. You’ll probably need to give a fairly high level, but impactful summary of products and pricing. The second use case is all about working with an in-flight opportunity. In that scenario, the best solution may be to pull through old contract terms/pricing into the opportunity and accelerate the process.

In neither case would a rep need to read through the contract or interpret the underlying legal text

Whether you’re working with contract data or another data source, the important thing is that you engage your reps and understand what they actually want to do and how things actually get done.

This will help you offer up solutions that put the information they need in context and display it in a way that enables action.

This is the fourth post in series examining the Five Keys to Making Your Sales Team Customer Relationship Intelligent. Stay tuned for our next post of this series where we’ll cover the fourth step in making your customer relationship intelligent: timing is everything.