Lessons from the CEO of one of the best sales organizations

Bill McDermott, CEO of SAP Americas faced a problem in 2002. He was the newly appointed CEO, having been preceded by 5 CEO’s in only 6 years. The stock price was in the single digits and employees were resigning in droves (turnover of 40%). Four years later, the stock price was over $50 a share, turnover was down to single digits and market share was way up. How did he do it? It is a great story and one I recommend you invest an hour into to watch from beginning to end. But let me summarize here.

First and foremost, rethink what your company does — but from the customer’s point of view. In SAP’s case, they decided that CEO’s have a vision for growth, but the CIO has “his feet in quicksand.” He is strapped with custom code, unsupported packages and all types of problems. What does SAP do? “We close that execution gap between the CEO and the CIO.”

Secondly, SAP evolved from a Product-oriented company to a “Value Creation Engine for the Customer.” He got rid of all product centric salespeople and managers. He then urged everyone to think “What is it that the customer wants to get done?” He urges that software CEO’s start with the customer and reverse engineer their offering.

He also shared where he believes the focus should lie for sales people and sales managers:

  1. People — the quality of the team. You are in a race with no finish line, so you must constantly hire, train and retain your staff. How do you measure new salespeople? Great ones are productive six months after starting. Weaker ones take nine months. If 12 months pass — make a change.
  2. Customers — sales and sales managers must know them cold. Look back at your company from the lens of the customer. Also, don’t expect your salespeople to be expert in everything. They should manage the process. (He used the “quarterback” analogy for salesperson — which I have used many times.)
  3. Manage your business — rather than asking “Are you going to make the quarter?” everyone should look on his territory as a business and manage a rolling four quarter year. Conversations should be about how that four quarter pipeline is being managed. This eliminates the constant up and down of most software firms.

He also stress that pipeline is what companies should really manage. It is where Marketing and Sales meet. Both are responsible for building a robust pipeline.

Finally, while his competitor was creating a call center, SAP was out hiring the thought leaders from Boston Consulting Group, Booz Allen and like companies. How can you be respected in retail unless you can be a thought leader in retail and know where the industry is headed?

Again, I invite you to watch the whole interview. It truly is terrific.

Jeff Ogden, the Fearless Competitor, is President of Fun and Find New CustomersLead Generation Made Simple” Check out the online show every Friday at 11am ET, “Laugh and Learn with the Fearless Competitor.”

Find New Customers helps businesses (with 50 to 5,000 employees and complex products) develop and implement marketing lead generationprograms to improve the way they find and acquire high quality sales leadsusing best practices in business to business lead generation. In fact, a recent study found that sales teams with fewer, high quality sales leads closed more than sales teams with more leads of dubious quality.


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