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Driving performance is the principle goal of many companies. But, how many of them actually manage to build and develop efficient sales and marketing capabilities to be more productive and lead the market?
According to research by McKinsey & Company, companies that grow faster and deliver better results are those with advanced sales and marketing capabilities (30% greater than their average competitor).
How to Ensure Sustainable Competitive Advantage 1. Consider sales and marketing a worthy investment
Many senior executives view sales and marketing as an expense they can avoid. However, it’s been found that they can realise a huge return that could be as much as 10x that of an investment they make on hard assets. Do you take a systematic approach to investing in tactical efforts that guarantee a visible and fast result? Maybe, it’s time to reconsider. You should know that the ROI of building sales and marketing capabilities is measurable and can make a great difference, as long as you associate those capabilities with particular margin and growth opportunities.
2. Measure and track your capabilities
That way, you always know what needs to be fixed. Besides monitoring your KPIs, keep a close eye on your sales and marketing capabilities and compare yourself with your best-performing competitors. To accomplish that, you should commit yourself to diagnostics that will help you identify your capability strengths and weaknesses in a way that enables you to take proper action to make things right.
3. Focus on the capabilities with the greatest potential impact
Determine which of the capabilities you can improve are the most important to your company’s individual objective. This can give you a significant advantage over your competitors and considerable growth in market share.
4. Don’t focus on more than 2 capabilities at a time
It has been proven that companies that work on three capabilities at once fail to deliver the desired results. In simple terms, if you are doing too much at once, you increase the likelihood of failing because changing how your business works takes time. So, simply concentrate on the two most critical capabilities that will help you improve margins (or any other goal you have set).
5. Develop your sales and marketing capabilities in the right sequence
This means that you need to make decisions based on the company’s stage of development. Research has shown that CEOs and senior executives should first focus on any capabilities that provide your business with tools for growth (i.e. customer-portfolio management and performance management). These foundation capabilities will help you go to the next stage, which demands a focus on building capabilities in customer service, life-cycle management, strategic marketing, and branding. As for the last stage, investing in higher-factor skills (i.e. channel performance) is paramount in ensuring high profitability and growth.
6. Make decision based on a set of facts broadly accepted within the company rather than personalities
Given that individuals leave, it’s wise not to make decisions based on their particular capabilities. For that reason, there should be a discussion across all divisions of the company and a clear perspective developed of which capabilities are needed. Creating a commonly-accepted framework will give you valuable insight and also help you prioritise your company’s capabilities.
7. Build sales and marketing capabilities via a measurable operating model
An operating model should be measurable to support change, and include elements such as key accounts, performance reviews per unit, clear yearly performance improvement objectives, and leadership role modelling, among others that will also help shape the culture, which should be long-term customer-focused, fast-moving, and creative.
Driving growth through sales and marketing capabilities may be a long and rather bumpy road, but is well worth it, and knowing where to start is indeed key. Make sure you know (1) what the ROI on your current capability investment is, (2) how you compare with the best-performing companies in your sector (always in terms of sales and marketing capabilities), and (3) what it will take to improve your sales and marketing performance. Answering those questions will allow you to concentrate on building the capabilities necessary grow the business and increase market share.
James Leighton Davis is a Customer Acquisition Consultant and Interim Digital Director / CMO / CDO / CDO, primarily for PE-and-VC-backed companies across B2C, B2B and D2C markets.
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