Wednesday, April 28, 2010

Selling in the Age of Austerity

In 5 years IT will dramatically change, leaving many IT solution providers at a loss for how to connect and sell to a dramatically changed landscape.

According to a Corporate Executive Board research report: "The IT function of 2015 will bear little resemblance to its current state," with "fundamental changes in how the function is organized and managed."

The report is summarized in this CIO Insight article:
http://www.cioinsight.com/c/a/Trends/Big-Changes-Ahead-for-IT-457574/?kc=CIOQUICKNL04272010FEA1

Some of the most significant changes reported by CEB include:
> Fewer than 25% of current IT employees will remain;
> Many activities will devolve to business units, be consolidated within other central functions such as HR and finance, or be externally sourced;
> The role of the CIO will change - expanding to lead a shared service group, or shrink to manage technology delivery.W

How the solution provider markets and sells to, and what the customer needs to know to make a decision will dramatically change if these trends prove true:

> Sales and marketing needs to establish tighter relationships with the business - the power shift will be dramatic from IT to the business where currently the business units only own 35% of IT purchase decisions versus 40% under IT centralized control (with the rest "shadow" projects / spending). When 75% of decision making shifts to the business units will sales be prepared? What about marketing?

> Solution providers will need to change the dialogue to connect with business focused vs. IT centric buyers - With IT decisions a part of the business, buyers will care even more than ever about business value. Already cost conscious IT buyers will migrate benefits analysis from IT focused cost savings metrics to business impacts when setting priorities and quantifying the business case.

> Business units will need more help than ever determining pain and path - proactive advice will be needed to help business units understand pain points they may not even know they have, and provide consultative advice on path to be taken.

> Business units care more about value than IT - ask any business unit leader if they do a business case for proposed investments, or if they track value impacts / metric improvements on investments and they will say yes much more than IT buyers / leaders. Value realization and proof is a key element of any business unit decision, and marketing / sales needs to recognize that driving business improvements, improving productivity, streamlining business processes and saving costs will be key to selling technology solutions to even more business focused economic buyers.

How will your marketing and sales be ready for this dramatic change in the IT landscape?

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