I recently had a call with an executive centered around his company’s growth through a M&A strategy. His observation was that with financing for these deals returning and the number of under-valued assets (companies) left in the wake of the recession’s creative destruction, this was for many companies a chance of lifetime. But he qualified this comment with a warning: as long as you know how to do this stuff.
He had me. A bit. “What stuff?”, I asked. He responded that most of all the immediate value used to justify the purchase would be in increased sales through the combining of customers and products (more opportunities to sell more). As we talked further he summed up the pitfalls as:
- Sellers will instantly have 40%-60% more new products and solutions to sell (that they know little about): Where will sellers get the necessary knowledge or find an expert just-in-time?
- Customers with trusting relationships will want “what does this mean to us” meetings: Has marketing (or management) given sellers the up to date details?
- The combined companies will begin a process of choosing what stays, what goes – a complete restructuring of offering portfolio will have to happen: How will you get your sellers on the same page and focused on selling?
We spoke about how these challenges could manifest and about the best ways to address them. Basically, he emphasized that C-level executives recognize that critical nature of communication and collaboration of the selling community (sales reps, expert or support roles, and marketing) to maintain focus on the essential goal of selling. His point was simple: You got to keep selling.
Reflecting on the call, I realized that innovative technology and consulting methods, specifically Sales Enablement solutions, can go a long way to address these needs. I made the following list to send to this executive:
- Given the rapid nature of combining the teams, being able to provide access to all relevant content (regardless of where it is stored) explaining the new offering portfolio – but within the context of the customer conversations – is the key.
- Within this newly established enterprise context web 2.0 collaboration methods become very powerful. Sharing content instantly leveraging blog and twitter like functionality across sales teams can boost the effectiveness of communication to the customers.
- With the virtual doubling of the team’s size, even the guy with the deepest networks will be severely impacted – often sellers need the expert not just the white paper or slide and integrating to unified communications (VoIP / chat / presence information / etc.) would be hugely powerful.
Additionally, I found an article at Forbes.com that was written by McKinsey & Company titled ‘Master sales force integration in a merger’, that explores this topic beyond the technology aspect I cover.
Please share your experiences and comments if your company is embarking on this strategy. I would be very happy to have further discussions with you on this subject.
See also:Knowledge Management
Sales Enablement
[...] January 5, 2010 On January 5, 2010 Matthias Roebel from EnableYourSales.com/blog wrote the post ‘M&A strategies shouldn’t miss the Sales Enablement dimension’: “I recently had a call with an executive centered around his company’s growth through a [...]
Keeping sales up to speed through a M&A phase is indeed a very challenging task and ofthen neglected, especially when cost benefits are the primary focus of the M&A.. It would extend this thought also for companies going into strategic partnerships
Companies also need to remember they are usually changing one or the other sales processes, technology, corporate culture, internal HR processes, and go to market strategies. Sales Enablement tools can help communicate the new information in real time and in one location, so everyone can be on the same page quickly.
When sellers are on top of the changes (content, culture, contacts, etc), customers of these companies feel more confident and comfortable with the changes, whether dealing with their trusted seller or someone new.
Having been through numerous restructuring in my previous company, the people changes are what caused consideral road blocks for sales. They would talk to someone today, who was gone tomorrow, and it would takes hours if not days for sellers to track down their replacement.
Another point here is that during any M&A, staff become concerned and restless and this causes disruption not only to sales but further upstream to product development. The human element cannot be underestimated, but often is. I have experienced M&A several times, and beyond the addition of new products, there will be an impact on the brand story; we had to re-brand our offering following a big acquisition. Sales needs to be armed with FAQs and battle cards, amongst other things and frequently this gets overlooked, or happens late after the event.