Siebel Systems is best known for its commanding share of
the CRM market. Recently, the company
has opened up to showcase how it uses its own marketing software to support
some of the best practices in marketing and demand generation. You need not worry; this is not a Siebel
commercial. As you will quickly
realize, this is mostly about organization, process, and measurement. Here are some of the highlights, based on
Andrew Clarke’s presentation at the Marketing Roundtable and a similar
presentation given at a Siebel
Structure the Organization for Alignment
While not the first to recognize that marketing and sales
are inseparable processes along the demand generation continuum, Siebel has
stepped forward to structure its sales and marketing organizations
The role of sales is to issue proposals, demonstrate
solutions, and close deals. Simple
Marketing has multiple roles, and the organization is
structured accordingly. Corporate
Marketing handles branding, PR, analyst relationships, tradeshows, etc. The Field Marketing organization is
responsible for demand generation. To
ensure that marketing programs deliver responses that fit sales targets, the
people responsible to these programs are placed close to the sales organization
and out in the field. Field Marketing
Managers work with their sales counterparts to design and execute lead generation
programs that are based on sales-driven goals.
In addition, Siebel has a Sales Development organization
designated to serve as the glue between marketing and sales. The role of sales development is to qualify
prospects, gather and validate account and contact information, and create opportunities
for the field sales organization. To do
that, sales development utilizes both inbound responses generated by marketing
campaigns and outbound reach efforts to target accounts.
After a number of experiments with outsourcing, Siebel now
keeps the sales development function in-house.
It is primarily a matter of the quality of the people and the tight
control over the processes they use.
The people Siebel hires for sales development positions are usually
college graduates. They also get extensive
training to ensure they can represent the company adequately and develop an
appropriate level of conversation with the people they call on.
Define a Unified Process
As expected, the unified process starts with a clear
definition of goals. In Siebel’s case,
these goals are:
that sales pipeline is three times the size of sales targets for the next
a third of the sales pipeline through marketing campaigns (the two other
major sources are inbound and outbound sales)
upon goals for cost per opportunity (Siebel is not sharing this number)
twenty new accounts in each region
and maintain 30+ accurate and relevant senior contacts for the top 2000
major accounts worldwide
Do these goals look familiar? The last two on the list point back to our mantra of “Know
”. Most enterprise
software companies target a rather limited universe of prospects, so
identifying them is actually not as hard as it may seem. As nicely put by Andrew at the Roundtable
panel, “there are only 2000 Global2000 companies!”
Now that the goals for demand generation are clearly
defined, next step in the alignment of sales and marketing is to define an
agreed upon handshake process. Unlike
most outsourced telemarketing outfits, Siebel Sales Dev Reps use no guided
scripts. At the same time, they utilize
very clear and well-defined criteria to qualify prospects. This razor-sharp qualification criteria is
one component in a clear and well thought-out handshake process.
A company-wide guideline mandates that any new leads
passed from Sales Dev have to be followed up by sales within ten business
days. At that point, sales can either
accept ownership of the lead or reject it.
Any rejected lead must be accompanied with a standard set of rejection
criteria to help marketing analyze the results of their activities relative to
lead generation goals. This is a tight
closed-loop process that clearly defines ownership and accountability for every
lead and opportunity at every stage of the marketing-to-sales process. In the first year of instituting this
process at Siebel, acceptance and pursuit of new opportunities by the sales
force has increased by 75%. Amazing!
Measure Each Step Along the Way
Andrew presented a dazzling array of dashboards, measuring
pretty much everything that can be measured, in real-time. It’s a wonderful showcase for the Siebel
marketing module, which the company uses internally with great success. Not everybody has such system at their
disposal, and I would guess that even those that do would have to invest
significant time and resources to get to the level of use exhibited by Siebel’s
Generally speaking, the metrics used by Siebel fall into
one of two categories:
Recognize Where You Are on the Technology Adoption Lifecycle
metrics: these are focused primarily on measuring response rates for the
various marketing programs, but also include measurements of internal
performance metrics such as lead follow up time. Within less than nine months, Siebel has seen a phenomenal
increase of 50% in overall response rate!
metrics: these are focused on the cost to generate and move an opportunity
to maturation. Using the practices
described here, Siebel was able to reduce the cost per opportunity by 25%
over a six-month period.
The emphasis on a programmatic approach to demand
generation has not been part of the Siebel way of marketing in the early days. As the enterprise CRM market has been
transitioning from an early adopter market towards the “main street” phase, the
company has shifted its marketing focus from branding and educational
activities to systematic demand generation directed at expanding sales
pipelines and accelerating deal closure.
While Siebel uses clear qualification criteria to drive
ready-to-buy prospects through the sales pipeline, it does not necessarily give
up on companies that “should” be Siebel customers but have not yet defined a
CRM project or budget. However, to
avoid slowing down its mainstream sales efforts, Siebel addresses these late
adopters with special “solution selling teams”. This is a great example of aligning company structure and
processes with its customers (or prospects, in this case)!
Takeaways for the Smaller Software Company
“OK,” you say, “this is all very nice, but we are not
Siebel!” What are the lessons to be
learned for companies that do not have the scale, the resources, and the tools
affordable to Siebel?
smaller companies tend to dismiss structure and processes as a “big
company thing” and believe that team spirit and close quarters will take
care of marketing and sales alignment.
In most cases, they are wrong.
No matter how small the company is, alignment will not happen
without a top-down mandate and supportive organizational structure and
these organizational elements, the most important one in my mind is the
designation of a specific role for transitioning leads from marketing to
sales. These are the equivalents
of Siebel’s Sales Development Representatives in your organization. Without this specific role in place,
neither marketing nor sales have the resources or the incentive to ensure
the transition works.
clear goals and measure diligently against these goals. Do we
need to say more?
in tools that enable clear transfer of ownership of leads from marketing
to sales and provide built-in performance measurements. When you look at the opportunity cost
of not following up on marketing leads or investing in poor performing
marketing tactics, the cost of automation tools becomes an easy
your target market: even a smaller company can build and maintain a
database of its target market contacts.
- Being a leader in a maturing market, Siebel focuses its resources on prospects that are ready to buy. As we’ve written in previous
articles, companies that are new to the market and sell to early adopters have to invest more in solution selling. The important thing is that you understand where your prospects are in the adoption cycle and use a sales process that fits.
I hope this helps.
what you think about Siebel’s marketing and sales alignment and how
it applies to your situation.