Sales Automation

Sales automation amounts to much more than improving sales productivity and efficiency. This article shows how contact management programs and enterprise-wide systems can play an integral role in your company's sales and marketing strategy.

DEFINITION AND OVERVIEW

Sales automation is technology that enables salespeople to increase their productivity by helping them better manage critical account information. The Customer Relationship Management Association (CRMA) surveyed its user members for the report, "Analysis of Sales Automation Trends and Uses: 1995-96." Most of the 140 respondents said that their sales automation systems were either "valuable" or "very valuable." Although many said that using the system wasn't easy at first, more than half said they wouldn't give up their system now. Sales automation is revolutionizing the sales process by using technology to serve customers better and increase sales productivity. For example, today's systems make it possible to:

• Automate an entire sales process, from generating a lead to closing the sale;
• Manage customer relationships more effectively by providing easy access to customer and contact information;
• Improve customer communications by automating letter-writing, faxing, e-mailing, and even dialing the telephone in telemarketing operations;
• Rapidly generate many reports, including lead sources, close ratios, geographic trends, and industry sales trends;
• Easily plan sales trips geographically;
• Make it easy for salespeople to share information and ideas among team members or with other departments on a real-time basis;
• Mail or fax customized personal letters in bulk to specific customer groups;
• Improve close ratios by focusing sales efforts on the people most likely to buy, thus shortening the selling cycle;
• Keep track of customer needs and buying schedules;
• Serve customers better by giving them easy access to the information they need from your company to make quicker, more informed decisions.

Although sales and marketing executives do not need to have extensive technical knowledge to select the right software application, they do need to have a thorough understanding of their sales process so they can select the appropriate approach to automation.

SOFTWARE AND HARDWARE

Of the hundreds of sales automation software packages available today, most fall into two main groups: contact management and enterprise-wide solutions. Sales automation systems vary in complexity, so it's important to know your objectives from the start. Companies buying their first sales automation system typically begin with contact management software, which is inexpensive and easy to learn. Later, they may move on to enterprise-wide solutions, which link the sales force with other areas of the company, such as customer service, accounting, and marketing, by giving each department access to the same customer information.

Contact management software allows salespeople to keep and use information about their customers and prospects. With it, salespeople can store basic information about a customer (company name, address, phone number) plus additional facts, such as hobbies or a spouse's name. Salespeople can also print letters instantly and track each time they meet or speak with a client.

With "contact managers," as this type of software is often called, customer information is not only at the user's fingertips, but it can be manipulated in many useful ways. For example, the software could search for all clients in Dallas or sort contacts based on company size. In addition, the system can prevent important prospects from falling through the cracks by reminding salespeople of the next step to be taken with each account and indicating when they need to provide more information or follow up with a phone call, letter, or fax.

Contact management software is essential for individual salespeople, and it may be all that's required for small sales forces or for organizations that just want to get their feet wet before embarking on an enterprise-wide sales automation effort.

An enterprise-wide sales automation system, while more complex and costly than a contact manager, can be the answer to a company's prayers. Companies without enterprise-wide systems often have a different database for each department. Departments such as sales, marketing, and accounting use the same customer information in different ways but can't share the information efficiently. For example, if accounting makes an update to an account, the only way to share the new information with sales and marketing is through paperwork, which is time-consuming and often unreliable.

With an enterprise-wide system, all departments work from one centralized database. Thus, when a salesperson changes a contact's information, not only will everyone in sales have access to the new information, but so will everyone in marketing, accounting, and any other department using the system.

Also, an enterprise-wide system allows salespeople to use graphics from the latest marketing brochure to add punch to a proposal. They can track the customer service department's contacts with a dissatisfied customer. Each department using the system benefits from it in different ways. A successful enterprise-wide solution can make the company more efficient with its time and resources, more professional in its dealings with customers, and more effective and competitive in the marketplace.

Today's laptop computers are revolutionizing sales by giving salespeople access to customer information no matter where they are: at home, in the office, on a plane, or with a customer. Modems allow salespeople to send and receive e-mail and to visit the Internet. They also enable salespeople to connect to their network at the office so they can send or receive the latest information about an account. Laptops range in price from $1,000 to $5,000, modem included.

SELECTING CONTACT MANAGEMENT SOFTWARE

Here are the steps involved in choosing contact management software:

1. Determine specific objectives for the system. How can the system facilitate sales efforts? To what kinds of information do you need instant access?
   
   
2. Examine your manual processes already in place. Are they effective? How can they be improved before they're automated? Can your sales process be clearly defined?
   
   
3. Try out several packages. Ask yourself such questions as:

   Is the system easy to learn?

   Is it easy to navigate through the screens?

   Can fields be customized?

   Can the system generate useful reports?

   Does it have e-mail or Internet capability?

   Does it have a networked version? How robust are its data synchronization capabilities?

   Most important, will it help develop stronger relationships with your customers and prospects?
   
   

4. Find out what type of training and support are available. If the vendor does not offer training in a classroom setting, resellers often will. Also, find out if the product comes with online tutorials, videos, and other training materials.
   
   Support generally includes online help, complete and accurate documentation, a technical help line, or some combination of the three. The more comprehensive the support, the higher the maintenance fee. However, applications that are intuitive and easy to use will require little support from the vendor. This is an important consideration, since the more time salespeople take to get help, the less they have to spend with customers.
   
   Make sure the help line is available 24 hours a day, seven days a week, and check on how quickly calls are answered. Support might also include a bulletin board system and a Web site.
   
   
5. Investigate the vendor's background, technical expertise, and financial stability. How old is the company? How highly is the product rated? How responsive is the vendor to calls for help? Will the vendor still be around in six months to answer support calls?
   
   
6. Determine your hardware needs for the system and buy the appropriate technology.
   
   
7. Commit to using the contact management program every day. Your salespeople are more likely to give you the results you want if the system becomes an integral part of the way they do their job.
   
   
8. Once the system is implemented, measure the results against your objectives. What improvements can be made?

CHOOSING THE RIGHT ENTERPRISE-WIDE SYSTEM

Here are the steps involved in choosing enterprise-wide systems:

1. Before you begin to think about a system, look at your sales process. What are all the steps involved? Is the sales process as effective as it could be? Does it need to be refined? Can you eliminate some steps? If your sales process is a mess, you could wind up automating a mess. Take the time in the beginning to understand your manual processes thoroughly and clean them up. By doing that, you'll increase your chances for a successful sales automation effort.
   
   
2. Assemble a project team with representatives from each of the departments involved. This could include sales, marketing, accounting, and management information systems (MIS). Assign a project manager to head up the team and to take ownership of choosing and implementing the system. Once the system is implemented, the project manager will be responsible for making sure that the system does what it's supposed to do.
   
   
3. Get the sales force's buy-in. If salespeople don't feel they have a stake in the system, they won't use it. If they view the system as just another way for management to tighten the reins, they'll ignore it, or they'll use it just enough to get by. Either way, of course, your implementation will fail. It's best to start by showing the salespeople how a sales automation system will help them sell better. Ask for their input. After all, they're the ones who "know the territory." Also, it often helps to "sell" salespeople on the system the same way you'd present them with a new product to sell. For example, start a newsletter that describes the system and its progress. Get people excited about the new system, and the chances are they'll view it positively and enthusiastically (see Step 11).
   
   
4. Determine your objectives for the system. What will make your salespeople more effective? E-mail? An electronic catalog? The ability to produce contracts on site? A word of caution here: Don't try to automate everything that can possibly be automated. Trying to do too much can be a costly mistake. Prioritize your objectives, and choose four or five functions to automate. You can always add other features after the system is up and running successfully.
   
   
5. Calculate the return on investment (ROI). What is the ROI for your proposed sales automation system? Consider not only hard costs, such as hardware and software, but soft costs as well, such as training, support, communications expenses and time, and downtime caused by installation and enhancements. And remember: Be conservative in your estimates!
   
   As you begin your analysis, think about measurable sales functions where the system can quickly bring you the greatest ROI with the least effort. Some of these might be average training time per sales rep, close rate, forecast accuracy, percentage of time salespeople actually spend selling, and percentage of time spent on administrative tasks.
   
   Tip: Knowing the ROI will help you justify the sales automation system to top management.
   
   
6. Keep top management committed and informed throughout the process. In order to support your sales automation efforts, executives need to be convinced that your sales automation system will fit into the company's current business strategy. They also need to know measurable benefits, including a decrease in costs, so they can be assured that the system will pay for itself over time.
   
   
7. Determine which of the following would be the best option for your company: build a system internally, buy an off-the-shelf system and customize it, or buy a custom-designed system. This decision has far-reaching implications. For some companies, an off-the-shelf system, once it has been tailored to fit a particular business, will do the job and usually will be cost-effective.
   
   But this approach may not be as simple as it sounds. The cost of rebuilding an off-the-shelf system can far exceed the cost of building a system from scratch. Also, there's evidence that a custom-designed system may simply be a better investment. A 1994 report by International Data Corp. suggests that use of customized applications is the common ingredient among businesses reporting substantial ROIs from sales automation groupware deployment. 1
   
   Some companies opt to have their own information systems (IS) department design and develop their sales automation systems, perhaps in conjunction with outside developers. A word of caution here: Unless you know exactly what you're doing, this can be an extremely expensive and time-consuming procedure. If the objectives for the system are not clearly understood, developers may be trying to aim at a moving target. Often, documentation is incomplete or poorly done, and regular maintenance and upgrades are nonexistent. Sometimes company politics and conflicting priorities can delay the process.
   
   
8. Evaluate specific software packages. By now, you have a good idea of what you need in a sales automation system, and you're ready to look at software packages. You might consider hiring a consultant at this stage to help narrow down the choices and to make suggestions about factors you may have overlooked in the initial planning stages. You can find a listing of sales automation consultants in the CRMA's "1997-1998 Sales Automation Suppliers and Consultants Directory" (see Finding Suppliers).
   
   Tip: Choose a consultant who has a broad knowledge of the systems available, rather than one who works exclusively with one or two packages.
   
   As you look at each sales automation package, consider the following factors, which are listed in the Guide to Implementing Sales Automation (see Books):

   Value vs. cost. Initial cost should not be an important factor in choosing your sales automation system. More important is the potential long-term return of a system. If a system is cheap but difficult to use, the salespeople probably won't use it. Better to pay more and get the right system.

   Adaptability. As your needs change, you will probably want to enhance the software. How adaptable is it?
   

   Ease of use. Your salespeople need to be able to learn a system quickly so they can begin to incorporate it into their day-to-day selling. Is the system intuitive, i.e. does it guide the user without the user having to know a bunch of arbitrary commands and codes? Is it easy to use? Does it have menus? Does it look consistent? Does it have useful help screens? Sometimes, to get the functionality they need, companies choose systems that are a little more difficult to learn and use than others. Determine whether ease of use or full functionality is more important to you, keeping in mind that, if a system is too difficult to use, you're probably wasting your money.
   

   Availability of training and support. Training and support are critical to a successful sales automation effort. Does the vendor provide them? If not, how will you obtain them?
   

   Frequency and cost of upgrades. Find out the cost of software upgrades or updates and determine how often they will be released.
   

   Software vendor. Choosing a product from a reputable vendor is an important consideration. You're buying your sales automation system for the long haul, so you want to be sure your vendor will be around to go the distance with you. Is the vendor financially stable? How large is the company? How successful is its product? Can you get references from clients who have used the system a while, not just from those who have recently bought it?
   

   Laptop compatibility. If you're planning on providing your salespeople with laptops to run the sales automation system (which is very likely), make sure the software works on laptops. Can you see the system's screens on the laptop's screen? Does the system require an inordinate amount of disk space and memory?
   

   Hardware requirements and cost. Determine what kind of hardware the software requires, and buy the appropriate technology.

   
   
   One final note about evaluating software: Make sure that the system does what the vendor says it will do. Don't rely on demos, either. Too often, demos of sales automation software work fine, but when the system is implemented, certain features don't work, or worse, the software crashes. When you get references from your vendor, talk to them about problems they've encountered or features that didn't work as promised.
   
   
9. Submit requests for a proposal to selected vendors. After you and your consultant have narrowed down your choices, send each vendor a list of your requirements. Request a proposal that will outline the costs of the vendor's sales automation software based on your requirements. In your request, list such information as the number of salespeople and sales managers, any hardware you already own that will be used for the new system, and the schedule for implementation.
   
   
10. After you select your system, negotiate a contract with the vendor. Much of the information you included in your request for a proposal will also be used in your contract. Make certain that you specify everything down to the last detail. To ensure that the vendor moves along at a reasonable pace, set dates for the completion of certain phases of the system. Have your attorney look at the contract, and remember that age-old advice: Get everything in writing.
    
    
11. Plan your implementation for success. It's important to sell your salespeople on the system beforehand. Do some internal marketing and create excitement among the salespeople and other users before they begin using the system.

    Begin your implementation with a pilot project. This should involve a small group of typical users who will test the system before the rest of the sales force begins using it. They put the system through its paces to determine how well it meets the objectives. The group also finds and reports bugs or shortcomings. The pilot project enables the development team to make improvements before the system is rolled out to the entire sales force.
    

    Provide training and support. Most successful sales automation implementations involve proper training of users and support of salespeople in the field. Besides showing users how to use the system, training entails providing them with helpful, up-to-date documentation. Support includes providing a help line and, sometimes, an e-mail address for user questions.
    
    

12. Measure results. After you've implemented the entire system, you can begin to measure the results. Consider such metrics as the average number of sales calls per salesperson per day, cost per sales call, administrative costs, revenue per order, and product training costs.

FINDING SUPPLIERS

There are scores of contact management packages on the market. Here are a few of the leading ones:

• ACT! 4.0, Symantec Corp. $199.95 single user, $1,800 ten users. (Note: It's cheaper to buy the ten-pack from retail outlets.) Call 800-441-7234 or click on http://www.symantec.com.
  
  
• Goldmine, Goldmine Software Corp. $295 single user, $995 five users. Call 800-654-3526 or click on http://www.goldminesw.com.
  
  
• Maximizer Sharkware, Maximizer Technologies. $179.95 single user, $899.75 five users. Call 800-804-6299 or click on http://www.maximizer.com.
  
  
• TeleMagic, TeleMagic Inc. $99.95 single user, $400 five users. Call 800-835-MAGIC or click on http://www.telemagic.com.

Finding companies that provide enterprise-wide solutions is difficult, because the practice hasn't been around long. The following companies have established a track record in the field:

• Baan, Baan Software. Call 800-683-8855 or click on http://www.baan.com.
  
  
• Siebel Systems, Inc., Siebel Systems. Call 650-295-5000 or click on http://www.siebel.com.
  
  
• Bedford Associates, Inc., Bedford Associates. Call 203-846-6240 or click on http://www.bedford.com.

To find a supplier, go to #9520, Supplier Finder.

ASSOCIATIONS

• Customer Relationship Management Association (CRMA), the only professional association in the field, includes users, suppliers, training firms, and consulting groups. It offers events and publications to help educate members. One-year membership: individual $149, corporate $647. Call 978-470-8608 or click on http://www.crma-saa.org.
  
  
• CRMCommunity.com provides the latest news, products and strategies available in Customer Relationship Management. Members will find that CRMCommunity.com is the complete resource for networking and research. Call 978-470-3880. Go to http://www.crmcommunity.com/

TRADE SHOWS

For a list of Industry Events, go to #9510, Calendar of Industry Events.

RESEARCH

The following companies do research on a variety of technological subjects, including sales force automation:

Aberdeen Group. Call 617-723-7890 or go to http://www.aberdeen.com.

Forrester Research. Call 617-497-7090 or go to http://www.forrester.com.

Gartner Group. Call 203-964-0096 or go to http://www.gartner.com.

International Data Corp. (IDC). Call 508-872-8200 or go to http://www.idc.com/.

BOOKS

Following are three basic sales automation texts:

Guide to Implementing Sales Automatin, edited by Paul H. Selden, president of CRMA, gives an overview of sales automation and business goals, sales culture, and the sales process. It discusses supporting users and monitoring results and lists types of sales software modules. Available through Amazon.com, $139.

The Guide to Sales, Customer Service and Marketing Automation, by Information Systems Marketing (ISM), compares the 50 leading sales and marketing software packages in detail, using 87 criteria. It discusses trends in the industry and addresses key issues, such as benefits and problems, determining requirements, and selling your salespeople on automation. 478 pp. $995. Information Systems Marketing Inc. Call 800-SFAGUIDE. Go to http://www.ismguide.com.

Sales Force Automation: Using the Latest Technology to Make Your Sales Force More Competitive, by George W. Colombo, offers practical advice for getting started and using the right system for your company in addition to detailing the specific benefits of automation. Many real-life examples are used to demonstrate the strategies. $27.95. Available through Amazon.com, $19.57.

PUBLICATIONS

Sales Automation Advisor, a monthly newsletter published by Influence Technologies, is written by industry experts George Colombo and Ginger Kernachan. Each issue focuses on a specific topic and includes interviews with experts and end users, case studies, and industry news and trends. 12 issues. $249/year. Corporate subscriptions available. Call 800-618-3623. Go to http://www.influencetech.com.

The Sales Automation Report, a newsletter published by Dartnell, features tips on choosing and implementing a system, industry news, profiles, and Internet information. 10 issues. $188/year. Corporate subscriptions available. Call 800-621-5463. Go to http://www.dartnellcorp.com.

Sales and Field Force Automation, a monthly magazine published by CurtCo Freedom Group, features case studies and articles on management issues and specific facets of sales automation. Buyer's guides and reviews help readers make informed buying decisions. $23.95/year (12 issues). Call 800-332-5264.

ONLINE SERVICES

• Sales Automation Success, a newsletter published by Richard Bohn and the Denali Group, is available online, but the print version has been discontinued (for information about the company's other print materials, visit the Web site or call 425-392-3514). The Web site includes a needs-analysis questionnaire, a listing and description of leading automation software, links to suppliers' sites, and a directory of consultants and resellers. Click on http://www.sellmorenow.com/.

ACKNOWLEDGMENTS

The following people helped with the development of this article:

• Alison Sandor, sales and marketing consultant, HNC Telecommunications Systems. Call 203-399-2608.
• Ginger Kernachan, president, Research Technologies Inc. Call 205-859-6929.