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Sales Engineer Process and Methodology

April 30, 2008 By

I think, or at least I hope, that if you are part of any company that has made it beyond the startup phase you will have some type of sales methodology in place. I have come across my fair share of reps and SEs that see little value in such a process-some will go so far as to say it hinders their ability to sell. I’ll be the first to agree that implementing sales methodology does add some overhead to your sales team, especially at first. It would be a bad idea though to judge anything just based on the negative without looking at the positive. For those who actively resist, I pretty much guarantee will never have been accountable for anyone’s forecast except his/her own.The bottom line is that a forecast is a promise, especially from the viewpoint of the CEO, CFO, and shareholders. The company doesn’t really start operating without the sales forecast for the year. If the company’s forecast is based on anything other than science and repeatable process, you’re gambling pure and simple. Variability is your worst enemy. Minimizing it fosters stability-and thus trust-in your company.

I believe this trust is worth the extra effort.

For SEs that are reading this, it probably isn’t hard to step back and agree that reps should be doing thing. But what about SEs? Whoa, hold on a sec. How does this impact me as the SE? I participate in the account review sessions and I work with my rep to even develop the requisite account plans. Aren’t I doing my part?

As an SE you manage a technical sales cycle within the sales cycle. The technical portion of the sales cycle is mostly yours alone to manage and move forward. So here are some questions to ask yourself. Do all SEs perform the same basic demo (allowing for some tailoring) to the customer? What about presentations and product evaluations? Is everyone emphasizing the same 3-5 competitive differentiated benefits of your product to the customer and are these consistent between all touch points with the customer?

When you can answer yes to these questions you have the basic building blocks of a repeatable process with your customers. When it’s repeatable (good or bad) at least you’ll have a pretty good idea of what the outcome will be. This is how an SE organization builds trust within the sales organization.

So as a leader in your SE organization, I say it is your responsibility to drive towards the same level of process and consistency as our peers. If we want to think of ourselves as pivotal to the sales team (of which I whole heartedly believe) then we should not except or expect different treatment in the level of professionalism we bring to the table.

It’s just too damn important to ignore.

Filed Under: Management, Roles & Responsibilities, Sales

Thoughts on Sales Engineer Compensation (Commissions)

March 29, 2008 By

Coming from someone who has made a career in sales this may seem like an odd question, but are pure sales-based commission plans the right way to incent reps and SEs? After giving it some thought as of late, I believe that answer to be no.

Just to be clear here, I’m speaking specifically of the how, not how much.

Before you dyed in the wool reps and SEs stop reading and write me off as an egalitarian idealist, reflect on the following:

  • Do quotas put our needs ahead of the customer?
  • Do time-based (e.g. quarterly) quotas incent us to close the deal before it should?
  • Does this behavior promote short-term gains at the expense of longer-term results?
  • Does any resultant behavior negatively impact the customer’s perception of the company? of us?
  • Does it build trust with your customers?
  • Could it incent us to recommend solutions that aren’t in the best interest of the customer?

I believe the answer to these questions is YES! Unless you can offer a staunch justification of no for these questions, hear me out.

What if we were all measured on customer satisfaction scores, or how many references we are able to obtain, or by how many customer referrals we receive, or by how many junior reps we mentored? There will always be a place for sales-based rewards, but if we don’t look first at rewarding long-term trust and relationship building, is it any wonder customers will do almost anything to avoid our calls?

Customers actually LIKE to buy things. Shouldn’t customers enjoy working with us?

My Recommendation

If you like your job-especially as a VP of Sales/Engineering-it’s probably not a wise idea to muck with the commission spigot overnight. Take a phased approach:

Year:

  1. Make base pay a larger portion of total compensation (upwards of 60% – reps; 70% – SEs). If we can’t put food on the table if a deal doesn’t close, most of us will stop at nothing to get the deal and nothing else you do will change that. Overly “hungry” sales teams do indeed bring in more revenue in the short term, but as a consequence burn bridges long term.
  2. Add a customer satisfaction portion to variable compensation. Start with 10-20%.
  3. Round out your customer focused incentives and get it closer to 50% of variable compensation. Ensure your metrics are encouraging long term partnering between various sales teams and customers.

A change of this magnitude will almost certainly result in the voluntary attrition of some sales team members-probably even some high performers. I would make the case that these are the folks who are not as in tune with their customers’ long-term needs as they should be. They are likely the same folks who change jobs every 2-3 years after they are able to make some sales but have difficulty building lasting relationships that most large companies are trying to develop today with customers.

Every situation is going to be different so fine tuning of the percentages can take quite a while, but there is definitely an upper limit to my methodology. I think most people can visualize what would happen if reps and SEs were mostly compensated on customer satisfaction. You would have us fighting even harder for discounts than our customers at the expense of shareholders. Finding the right number is a quantitative exercise assuming sales management has both access to past performance data and a repeatable sales methodology in place that minimizes the variability in forecasting/revenue generation. More on this last bit in a later post.

Filed Under: Compensation, Management, Sales

What’s in a Name?

March 27, 2008 By

If you’ve been a part of a large sales organization-or several-you’ve probably heard your fair share: sales engineer, systems engineer, customer engineer, (pre-sales) consultant, technical account manager, etc. All of these terms describe a customer-facing member of the sales team that is primarily responsible for recommending a combination of product(s), options, configurations, and services that best address the customer’s business need. This individual often qualifies, proposes, positions, and validates the solution with the customer during the sales cycle.So is one name better than another? Actually, yes.

I have probably heard every argument made for one or the other. Do any of these sound familiar?

“We should use the term system instead of sales engineer so that customers do not associate us with the sales team so that we are seen as more trustworthy.”

“Technically we aren’t engineers at all in the exact sense of the word. We should be called consultants, or sales consultants, or pre-sales consultants. Uh oh, how do we get rid of the sales part without the customer mistaking us for a services role?” Note: In certain countries the use of the word engineer in a business title is restricted to certain fields.

“We need the term sales in the title to show the sales reps that we are truly a member of the sales team and not a glorified tech support team.”

“If we use the term sales, maybe customers will be more likely to stop calling us for support after they buy the product.”

So which one is best? The answer, in my opinion, is the one that best allows you to identify yourself and your role to your customers. Because this differs among industry norms, the best choice may be different if you are selling medical equipment or ERP software. In my field of enterprise software, the term SE is ubiquitous. If you ask customers what this stands for, most will reply Systems Engineer.

We have a winner (in my case).

But that is not to say it is the right answer for every SE in every region of your company. My recommendation is to standardize internally on the most common term to minimize confusion between departments, but always give local SE teams the freedom to put the title on their cards that best matches the expectation of their customers. Drive consistency where possible, but always remain flexible.

If you still don’t have the answer, go ask your customer. Rarely are the best answers found in your office.

If by now you are wondering why I use the term sales engineer around here, it’s pretty simple. Do a web search for systems engineer, sales engineer, etc.  I think you’ll see that using sales engineer gives my potential audience the best chance of finding this site. Case closed.

Filed Under: Definition, Management, Roles & Responsibilities, Terminology Tagged With:
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