Foreword: Michael Jones joined us this month to head sales at ElasticBox. He brings over 20 years of seasoned sales leadership. Most recently at Crittercism he was responsible for building their global direct and channel sales. Prior to that, he held senior sales leadership positions at Intersoly, Keynote Systems, Splunk, and AppDynamics. Welcome, Mike! Here’s his introductory blog on a topic close to his heart, sales.
Let’s start with full disclosure. I’ve been in enterprise software sales for three decades. Most of my career, I’ve sold tools and services that make developers more productive. I still remember my first sales job to sell PVCS, a version control tool for developers. Developers have the most powerful role in evaluating and purchasing software–the power of VETO. So, as a salesperson, I need to make sure you either love the software at best or at worst, don’t issue the dreaded VETO!
The most misunderstood role in most companies is that of the developer. Developers hold the keys to the kingdom. For when developers face roadblocks, companies slow down their rate of innovation. And when developers work better, smarter and faster, companies accelerate innovation, making their offerings that much more competitive.
So there’s no question that developers greatly influence the purchase of development tools, databases and systems (remember their VETO power?). With a little knowledge of the IT buying process, they too drive purchase decisions for systems and tools that directly affect their lives and productivity. The key is to understand and leverage the way businesses buy technology. In most cases, that translates into finding the right executive in senior IT operations or development to fund a purchase need.
Buying is a three-phase process. It starts by clearly defining a business problem. Defining a problem is pretty simple as these examples show:
“It takes 30 seconds for a credit card transaction because our systems are too slow internally, and we see 50% of the buyers drop off after 20 seconds.”
We often hear our prospects at ElasticBox say, “After I commit code, it can take up to eight weeks for my code to go into a test cloud so I can begin testing. We need to decrease the entire process–from change request to production–to two days.”
A well-understood business problem has three parts: the current issue or complaint, the impact on the company, and the expected results. If all you have is a complaint, “it takes too long,” you can’t solve the problem. Once you identify the problem, impact and desired state, you enter into a three phase decision or buying process.
In addition, you need to determine the ROI to finance potential solutions. Suppose you see buyers abandoning 50% of the shopping cart on average. The ROI math is pretty easy. If you’re losing $100,000 in abandoned shopping carts daily by an 8% margin, you’re losing $8,000 per day in profit and losing $3.1 million in monthly revenue. So, if the particular transaction processing tool you need costs $200,000, it pays for itself in just 25 days.
Consider another ROI example. If you can increase developer productivity by 30%, you can reduce development schedules by 30% and accelerate your company’s innovation by 30% or do 30% more projects with the same team.
Once you identify a business issue, the impact and desired state, you move to the three primary buying phases. Keep in mind though that as an innovative developer, you may very well skip this process and evangelize bottom-up for a clearly differentiated offering.
Phase 1: Setting criteria
- Define a list of specific capabilities
- Create a list of very detailed technical capabilities
- Select a list of vendors who potentially meet these capabilities
- Set up a vendor selection criteria, companies on the left, capabilities across the top
- Interview all of the prospective vendors and fill in the columns to the right of their names
- Select the top three vendors to enter into proofs of concept
Phase 2: Testing against criteria
- Create a test plan and test all three vendors identically
- Work closely with the three vendors to make sure they respond to your needs and questions
- Zero in on the cost to train in those capabilities and the cost to integrate the solution into your environment
Phase 3: Selecting solution
- Stack rank the potential vendors in order of preference by how they performed in the test
- Get your best and final price from each
- Introduce your selected vendor to your procurement and legal teams
- Submit your final ROI calculations to your sponsor to get your project funded
If you do this right, you’ll save your company money and accelerate your business capabilities. If your testing phase is solid, you have all the capabilities you need to roll out your selected solution. So who said developers can’t buy products? Go beyond the role of an influencer. Use these simple techniques to drive purchase decisions for technology that affect your work. Good luck, and enjoy your new-found capabilities and freedom to innovate.