Top 5 Reasons Why CIOs and IT Leaders hate buying IT Products and Services:

1) Vendor Marketing

According to IDC* - the B2B IT Marketing spend will top a whopping $45B! How has does that translate to Technology buyers? Most of you already know if you’ve been on email today….how do you like your spam – fried or raw? Cold calls? Unsolicited snail mail? In the last office I worked in, I wandered into the mail room room to gather material from a printer, and was drawn to a dusty machine making noise in the corner. Turns out we still had a fax machine receiving unsolicited marketing materials, and it was cranking away. The recycle bin below it seemed to be reserved just for these solicitations and was bursting with dead trees.

2) Sales People

Maybe this one should be called “Don’t hate the playa’ hate the game” - How many of us really know how salespeople are compensated that call on technology buyers? Yes, we all know they have ‘quotas’ – but what does that really mean to non-sales people, and how does their ‘compensation plan’ relate to how technology buyers are generally treated in the process? Most salespeople have half or more of their total compensation relying on how much of their sales quota they attain. So you can imagine, if a sample sales rep has a total compensation package of $120k – and $60k or more is riding on selling you a bunch of routers – they are going to get aggressive at the end of the month! Vendor sales management will call this ‘creating urgency’ – what I call it is creating enemies – when I really need partners. But cultivating a partnership necessitates patience, credibility, and understanding – which is in direct conflict with how (most) vendors pay and train their salespeople!

3) Noise

Between number #1 and #2 above – there is deafening ‘noise’ in the market. While many white papers and case studies can be helpful – we have to ‘give it up’ – meaning, sign my email address away so I can download something to read for my own research. My reward is then an avalanche of new spam (that is of course if I was crazy enough to use an email address I actually read). Almost every website now has giant ‘peel away’ ads….thank you for the 9,000th full page ad on Virtualization…at least my mouse reflex to the upper right hand button to ‘skip this ad’ has never been quicker. Seems more and more ‘resources’ out there are nothing more than something a product marketer put together. Finding the right partner and provider is getting more and more daunting – and there is less and less time to find them!

4) No Skin in the Game

I read a great blog article by Chuck Musciano, called “Skin in the Game” (http://effectivecio.com/2009/11/09/skin-in-the-game/) which makes a good point – that most vendors don’t put their money where their mouth is! Many contracts today have some SLA’s that have to be met, and when negotiating, the vendor sales team will say that these are ‘painful if not met’ and give us real ‘skin in the game’. In reality – most SLAs don’t come close to getting the vendor truly invested in a successful long term outcome. As Chuck points out in his blog – if your vendor’s failure causes million dollar outages – does a check for a few thousand really cut it?? How about taking the hit along with us! If a vendor’s service fails – the vendor likely will lose future revenue. The IT Exec may lose their job!

5) Trust

Hard to come by these days it seems. Vendors and sales people are under more pressure than ever to deliver results, and IT Execs have less and less time to devote in finding the right partners (of course the irony is IT Execs have less time to devote partially due to #1 through #3 above!). So how can a CIO find the right partner to trust? How can a vendor gain that trust in short order? Most CIOs turn to the only people who they KNOW they can trust – other IT Executives – peers. The old adage – ‘been there, done that’ has never been truer applied here. Fellow CIOs and IT Leaders are paid to get results – so they are all invested the same, and the result is a level of trust that can’t be questioned. Vendors are hindered at gaining trust and credibility out of the gate given how they market to CIOs and IT buyers. Marketing and sales practices that alienate much of the intended audience is a one way street to status quo. Smart vendors would do well to spend their money on organic and word of mouth marketing activity that builds on previous success – not by blasting it on a giant peel away web page ad – but by TRAINING their sales force on the art of building relationships.

AGREE or DISAGREE? WHAT ELSE SHOULD BE IN THE TOP 5? TOP 10?

*Source: Marketing and Investment Planner 2010, Benchmarks, Key Performance Indicators, and CMO Priorities, Oct 2009

Why are (many) vendor sales people obnoxious?

Yes - that headline is a shameless attempt to get attention. As I mentioned in the intro to the blog - not ALL salespeople are obnoxious! The truly successful sales professionals I've known are far from it. However, there are a good number of sales people who try as they might, come across to IT leaders as people they would really like to avoid. An example hierarchy:

Phone calls CIO's want to avoid (1 = slightly annoying to
5 = avoid at all cost):

1) Another call with CEO to discuss a WSJ article they just read on.... (insert any tech topic here)
2) 2nd call from SVP of sales to explain why he can't have a corporate iPhone
3) CFO - topic doesn't matter - thank you caller ID!
4) Call with dentist to chat about an extensive root canal procedure
5) Cold call from technology sales rep

If you think I exaggerate - check out the "CIO Do Not Call List" article by VP of IT Todd L. Michaud: http://tinyurl.com/yjutfha

To cut to the chase - salespeople behave this way because that's how the 'game' has been set up for them. They are just playing it the best they can based on the rules their employers have set up for them, and the resources given them to succeed. "Don't hate the playa' - hate the game"? Maybe...

As I've heard actors say "Where's my motivation for this scene" - well, sales professionals are the same. Where does 'obnoxious' sales behavior come from? In the end, we are all responsible for our conduct and results, but how the game is set up plays a VERY important part. A few of the game's important 'rules' that can impact how sales people behave:

1) Marketing - as a sales rep, I sat through classes, conference calls, and meetings led by marketing folks whose primary goal is to 'sell' the salespeople that this new 'technology' is the best thing since wifi. That the entire future of communications is going to hinge on this 'cutting edge', 'game changing', 'paradigm shifting' product (anyone remember MCI Advantage - VoIP product that ruined lives). By the end of this product training - you are ready to conquer the world! Right up until your best client lays out very clearly why this product is not an option for at least 3 years - even if it works (queue balloon popping noise).

2) Compensation/quota - as a previous boss of mine liked to say "compensation drives behavior" and nowhere is that more true than in sales. Think about having 50% of your income decided by how well you can execute on closing some crazy new product(s) referenced in #1 above! Salespeople have bills and families like everyone else - and if it gets down to the end of the month - what happens if the numbers are light? Full court press on the phone and email to create activity (of course many good reps don't wait until the end - its daily). To salespeople, activity = results. To many CIO's and technology buyers - this same activity = annoyance. Some companies have the rare luxury of assigning compensation plans for sales that allow for relationship building. More often that not however, those compensation plans are tied DIRECTLY to the particular company's monthly or quarterly revenue objectives (think - short term) - which certainly seems logical!? Doesn't it? This can lead to the very behavior from sales that buyers hate.

3) Sales Training - this all by itself is a multi-billion dollar industry. Many companies have great sales training (topic for another day), but many other companies either have no training at all, or worse - they have bad sales training. When I first started at MCI (MCI - many confused individuals), we used to joke that our training consisted of showing you how to login and use your laptop...the rest was up to you. Over time, they actually had some very good training I found - but depending on the company, many sales people are on their own.

Conclusions?

1) If you are a technology buyer (CIO) - know that in most cases, unless a rep has been personally offensive, their persistence or behavior may be more a reflection of the company they work for than the rep them self. If certain companies are repeat offenders, then even if they have a decent product, their marketing and sales mgt may need to get slapped down - not necessarily the reps. More often than not, sales reps are playing the hand that their company has dealt them. Here is a RADICAL idea - ask your rep (if its one you need to have a relationship with) how they are compensated! Not all of them will share this - and in some cases may be prohibited - but if you have that level of understanding, you (or your team) will know how to manage their behavior and maximize the relationship in your favor. One of my best long term clients knew exactly how my quota worked, and if all other elements were equal - I would get the business because they wanted me to be successful. They knew that in doing so - I would run through a brick wall for them and advocate their cause within my own company. This was a GREAT working relationship.

2) If you are a sales rep - do not sacrifice your reputation or best clients/prospects for the 'possibility' of short term gain. I will never forget my first lesson here - one of my best client's were sold a multiple location, managed VPN service... As it turns out, they were one of the first in the entire country (gulp). I ended up spending all of my time doing damage control and finding every way possible to maintain the relationship - because it was just not ready for prime time (thank you product marketing!!). It was months before I took any new orders from them! Don't try to fit a square peg in a round hole with a CIO - you will likely only get one chance to gain credibility. How do you gain this credibility? Understand before you call that your square peg may not be right for them - be open to learning their business, and demonstrate that you know it - BEFORE you pitch product. If you ignore this rule - I hope you have a lot of accounts and prospects to call on - since you will burn through them fast.