Sales may dismiss marketing initiatives since they do not recognize their marketing colleagues as credible allies. In the end, it is apparent from the results that an aligned sales and marketing interface will have positive consequences on the performance variables that firms need to satisfy customers on and to prosper in business.
Arguably, there are no functional areas in the organization more responsible for creating revenue than sales and marketing. Thus, management at all levels (and especially the highest)needs to support each and every effort aimed toward having the sales and marketing functions work seamlessly together since they have a common goal, but separate responsibilities.
The results issue a needed “wakeup call” for top management to address issues related to fostering alignment between the sales and marketing functions. Additionally, it provides powerful ammunition to managers at firms of all sizes, industry, and nationality seeking to have sales and marketing work together to cultivate better performance. Toward this end, fostering open and useful communication between sales and marketing offers a foundation for greater transparency between the two functions and increase interaction. However, increased interaction (involving meetings, emails, and perhaps training), in and of itself, is only a preliminary step toward alignment. The objective is to increase collaboration, which entails information sharing, mutual understanding, and common vision.
The sales and marketing functions working in tandem are a much more meaningful contributor to value creation than when either is working on its own. Toward this end, management must avoid creating separate mandates for sales and marketing which will tug at their time, resources, and affect priorities. For example, left to their own devices,the sales function will always be pulled by quota requirements and tend to work on making sales happen, irrespective of the product marketing strategy. Thus, in order to engender cooperation, a shared destiny needs to be instilled.
Aligning sales’ and marketing’s goals and compensation tends to be a powerful tool. A common fate for the two functions, in cases of both success and failure, could be contrived. Under this scenario, for example, bonuses could be earned only by truly acting like partners instead of merely coexisting, or being adversaries. In short, this could be a positive prisoner’s dilemma situation for all players involved. The bottom line: salespeople want to make quota, solve customer problems, and generally will work with anyone to accomplish these goals if they perceive the other party brings value. Alternatively, marketers want to build long-term customer relationships leading to organizational profitability and will gladly unite with people who will make success happen. As such, sustainable efforts to move key players toward desired actions are needed.
Likelihood of Improved Results Among Aligned Organizations
All six findings below are statistically significant, meaning the high-aligned firms did better than the low-aligned firms on these six performance metrics. Further explanation of the probability of these findings can be seen below.
1. Qualified Leads: Organizations high on alignment are 12 percent more likely to show a growth in qualified leads of 5 percent or more than organizations low on alignment. More leads equals more revenue, it’s always been a numbers game.
2. Conversion: Organizations high on alignment are 8 percent more likely to have conversion rates of 40 percent or more vs. organizations low on alignment. What would that mean for the average sales volume for a company if they are likely to close more business than their competitiors? What would that mean for salesperson bonuses, sales managers?
3. Acquisitions: Organizations high on alignment are 19 percent more likely to see a growth rate of 5 percent or more on acquisitions than organizations low on alignment during this time economic upheaval.
4. Retention: Organization high on alignment are 11 percent more likely to see a growth rate of 5 percent or more on their retention of existing customers than organizations low on alignment. Do the math, what if you had a significant chance to improve your retention rate versus your competition? Further, how much does it cost to gain new customers vs. retain current ones in your industry?
5. Average Billing Per Customer: In a difficult year of global economic downturn organizations high on alignment are 8 percent more likely to increase their billing by 5 percent or more than organizations low on alignment.
6. Revenue: While the global economic downturn has hit nearly everyone, organizations high on alignment are more likely to grow their revenue vs. organizations low on alignment. In numbers terms, high aligned firm are 4 percent more likely to grow their revenue by 5 percent or more than organizations low on alignment.
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