A comparative study of sales processes amongst software companies in India

Abstract

Sales processes in Software industry, in general, map to the sales processes in any B2Bscenario. Selling is not a new phenomenon, but the practices followed by Sales functions indifferent companies are evolving everyday. As the deals volume decrease and margins come under pressure, the software companies have to come up with more robust sales processes to generate maximum ROI out of Sales and Marketing function. In this scenario, we have tried to examine the practices followed by different Software companies operating out of India, both in Services and Product domain. This study looks at both Small and large companies and tries to compare the process of Selling in these companies. The methodology involved is a combination of Primary research and secondary research. Primary research was done in the form of personal in-depth interviews done with Sales professionals from various IT firms. The basic questionnaire used and the list of the companies interviewed is given in the appendix of this report. Secondary research was used to perform a detailed study of the different stages of Sales process and to develop insights into them. The seven key stages of the Sales process identified by our study are as follows1. Sales team structure2. Lead Generation3. Lead Qualification4. Sales Approach to different customers5. Proposal formulation6. Quantifiable Value Proposition7. Post sales follow-up We have tried to capture the extracts from our interviews with different IT companies in these seven key areas in a matrix appended in this report Some of the key observations of the study are as follows For almost all services companies (Large, medium and small) most of the revenues is from existing accounts. Thus the lead generation function has traditionally remained a weak spot for most of them, and especially for Indian Service companies. Most of the respondents have expressed a desire to stream-line their lead generation and lead qualification processes. There is also an apprehension about the efficiency of the marketing activities as to how much value they actually add. The lead generation activities of the smaller product companies extensively use the web and other e-marketing tools. But the bigger product companies rely mostly on Industry databases and existing customer accounts to generate new leads. As most of the revenues for almost all companies interviewed are from existing customer accounts, we see that there are robust customer relationship management strategies in place in most of them. Sales team or senior management is involved in ongoing interactions with the customer in the post sales phase. The sales team structure of the companies interviewed vary from Complex to Geographical to no structure. The sales team structure of the companies appears to be based on their customer management principles and hence their selling approach. A quantifiable value proposition is not done by most of the companies interviewed. The value proposition for most of the large and medium vendors is qualitative in nature. MNCs do try to provide a quantifiable value proposition for their most valuable customers. The quantification of value is possible for some of the proposals, but for most of the projects it's very difficult to even arrive at a range. For the small product and services companies' value proposition is mostly low cost and technical capabilities. Another insight from the study is that some of the interviewees expressed their apprehension about the risks involved in giving a quantifiable value proposition. In their viewpoint, there are so many other variables in addition to the product or service they are offering that giving the customers a number would entail a huge risk on the part of the vendors.