KloudReadiness, LLC Confidential 1 · 2018-08-07 · KloudReadiness, LLC Confidential 2 Deeper development of D&H partners subscription-based monthly recurring revenue sales framework.

KloudReadiness, LLC Confidential 1

Thi Ph t b U k A th i li d d CC BY SA

Session objectives

Focus on sales model, process and compensation.KloudReadiness, LLC Confidential 2

Deeper development of D&H partners subscription-based monthly recurring revenue sales framework.

1

Ensure that D&H partners achieve subscription-based revenue and margin goals.2

3

Why move or accelerate now?

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1. The shift…2. The inhibitors…3. The outcomes…

The revenue and profit shift is on

2016

8%

2017

12%

2018

16%

2019

21%

2020

25%

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35+%

Packaging and pricing not linked to objectives…

Marketing approach not capable of velocity required…

Sales model and compensation not aligned to strategic business growth…

Financial impact not understood, nor modeled…

No strategy or plan in place with an owner identified…

Sales

StrategyGo-to-Market

Marketing Financial Criteria

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The big six (6) inhibitors

Many partners believe they are “ready”…

Empower you to Disrupt or ultimately be Disrupted

Adapt to capture today’s & tomorrow’s opportunities

Apply education and KloudReadiness digital platform experience to enhance partners subscription productivity

Advance and grow subscription revenue by identifying and aligning you with D&H Distributing and Microsoft’s Cloud solution-stack

Business Acumen

Digitization

Line of Business

Business Model

Sales Model

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The desired outcome and stateStrategy: Accelerate Revenue by Transitioning

Partners Business Models to Drive Subscription-based Cloud Solutions

The trap awaiting us

The biggest factor that needs to be considered and overcome is commitment…

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Are you ready and willing to create and develop a true recurring revenue friendly business?

Building business & sales strategy

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1. The What…2. The Why…3. The Where…

Create a business within the business…

Strategic direction

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Microsoft Cloud Stack via D&H Distributing…Concentration

Bundle Packaging & pricing your solution-stack…

Market Segment

Healthcare vertical applications…

Focus on net-new logo acquisition…

You make 3 sales to each prospect

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Sale 3 – Why change with you?

Sale 2 – Why change now?

Sale 1 – Why Change?

SALE

Today’s session

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• Will our current model and approach need to be altered?

• Do we drive our current sales professionals to take on cloud?

• Who will transform and make the effort to succeed?

• How do we create a plan that drives them

Sales Model1. Peanut Butter Approach…2. Dedicated Specialists…3. Dedicated Team…

Sales Process 1. Pipeline Build…2. Close Velocity…3. Wash, Rinse, Repeat…

Sales Compensation1. First Month Upfront… 2. Pay like its Product…3. Partial Upfront + Monthly…

Digital sales structure verses traditional approachHigh-level thoughts:• Cloud and digital-based services require a different selling motion than traditional IT solutions…• Partners still need to be able to deliver services based on all deployment models, on-premise, private, public and hybrid

cloud…

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Sales model considerations

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Subject Matter Experts help Core Team sell cloud

Dedicated sales professionals selling subscription-based solutions…

Marketing and Telemarketers setup appointments for… or close remotely…

Every sales professional sells everything…

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Sales model options & approaches

Subject Matter Experts are sellers of new

subscription-based business…

Focus on the Core

Incent – but don’t focusLimit Distractions

Eliminate confusion

Keep your current sales professionals focused on driving the core business

Sales model - recommendation

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Remove Compensation Issues

Dedicated

Create and resource a Tiger Team that is mission-based…

Potential Targets

Structured Cadence

Closer

Prospector

Will generate a 7 – 10 point increase in your close rate…

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The secret to increased productionYou close more when you specialize & narrow your focus

Account Manager

Increased Sales

Volume

Building business & sales process

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1. Consistent…2. Repeatable…3. Regimented…

Sales process – more and faster

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Your cloud sales process must be repeatable and address three (3) critical areas:

The new sales engagement model

CUSTOMERACQUISTION

CUSTOMER SUCCESS

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Traditional solution selling motion

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Cloud accelerated sales motion

KloudReadiness, LLC Confidential

Buy-In Demo

55% 30% 15%

AlignmentE-mail

Demo/TrialPlan

Proposal Summary

Proof30%

Solution15%

Close15%

Deploy100%

Qualify25%

Develop15%

Sales Strategy21

Cloud sales motion

Call #1

Docu

menta

tion

Marke

ting

Sales

Connect: 3 – 5 Days Confirm: 5 - 7 Days Convince: 3 – 5 Days

No

Marketing Lead

Proposal

Convince

Discovery Questions

Anchor Demo Scenes

Qualified

Proposal Presentation

Connect

Engag.Comms.

Alignment E-mail

Discovery Survey

Demo PlanQual.

Checklist

Anchor Demo

Confirmation Discovery &

Demo

Proposal Presentation

Project Lead Profiling BDM Profiling

Yes

Further Proof Required

Research

Confirm

Solution Demo

Yes

No

Nurture of Exit

Trial Plan

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3 – 5 call close

KloudReadiness, LLC Confidential 23Connect (1 – 2)

Convince (5)

Sales process – three (3) stages

Close

Proof

SalesProcess

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With the Cloud, cost of sales is important, margins are tighter and the number of opportunities is potentially much greater.

A solid process that provides consistent and ever increasing

velocity is vital

Qualification and

Discovery

Lead triage

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10% – 20%Active

Opportunities

80% – 90%Nurture

Marketing

ResearchYou must educate

Active selection processYou must profile & close

Courtesy of Neural Impact

High-velocity Sales Process… Knowledge and Marketing 2.0KloudReadiness, LLC Confidential 26

Bridging sales process and marketing 2.0

+

Building sales compensation plans

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1. Options…2. Ideas…3. Recommendations…

Typically the #1 InhibitorMost organizations do not have an appropriate subscription-based monthly recurring revenue sales plan

Sales compensation

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Sales compensation don’ts

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Expense and Operating Profit – where does a $ go?

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Sales compensation principles

Engineering Cost

Service Administration Cost

Service Management Cost

Sales and Marketing Cost

General &

Administrative

Taxes & Benefits

Non-compensation Expense

Operating Profit

Your text hereBusinessModel Tenets The PlanObjectives

1. Book as much new recurring revenue as possible…2. Collect as much cash upfront as possible…3. Sign longer term contracts…4. Make sure customers are happy…5. Drive the maximum renewal rate…6. Drive expansion revenue with existing customers…

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Sales compensation - objectives

1. Align compensation with your business model… 2. Don’t overpay or create something unsustainable…3. Don’t become the bank….4. If you’re starting now, remember you’ll need runway…

a. Awareness pipeline opportunities dealsb. Value proposition segment solution-stackc. It’s an 8 – 14 month journey for most to become a digital athlete

The PlanObjectives BusinessModel

Tenets

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Sales compensation – alignment

1. On Target Earnings have to be competitive…2. Great reps must be able to make good money…3. Bad reps cycle out no incentives for mediocrity…4. Reps should be paid to love and service customers…5. Keep it simple everyone can explain pay plan...6. Your legacy plan won’t work…

Financial Success

BusinessModel Tenets The Plan

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Sales compensation - tenets

1. Leveraged (50% base | 50% variable)2. Base needs to be covered before commission kicks in…3. Think about paying ~2X commission…

a. One (1) accelerator – cash up front… 4. Variable paid upon receipt of cash…5. ACV quota $380K to $550K per sales professional…

Financial Success

BusinessModel Tenets The Plan

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Sales compensation – the plan

Pay the 1st Months revenue as commission…

Pay commission upfront as if it’s a transaction…

Pay commission on a monthly

basis…

There are many options – know your strategy and growth objectives Sales compensation

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Pay % of commission upon close and remainder on a

monthly basis

Year 1: $78K

Year 2: $222K

Year 3: $366K

$1,000$2,000

$3,000

$4,000

$5,000

The rule of 78

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Year 1: $390K

Year 3: $1.83M

$5,000

Year 2: $930K

$10,000

$15,000

$20,000

$25,000

The power of the multiplier

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1. Sales Guide2. Sales Model Reference Framework3. Sales Plan Modeler

Final pieces – tools and process

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Plan

• Change model

1• Change sales process

2

• Change sales compensation plan

3

• Change marketing approach

4

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Summary – remember these

Mobile: (617) 851-4515Phone: (508) 747-0963Email: gmellor@kloudreadiness.com

Address: 124 Long Pond Road Plymouth, MA 02360info@kloudreadiness.com

Contact Us

.

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