By Peter Klinge, Jr.
The great recession led to cost cutting, layoffs, retrenchment, and a good deal of fear. Today with an improved outlook, more companies are turning their attention to the question of how to build profitable top line growth.
Our experience indicates that if a company does not look aggressively at how to change their approach to revenue generation they’ll be disappointed if they expect the economy alone to bring back strong revenue growth.
Here we’ll outline strategic and tactical approaches for companies to address ‘how’ to change the trajectory of revenue growth.
If a company does not look aggressively at how to change their approach to revenue generation they’ll be disappointed if they expect the economy alone to bring back strong revenue growth.
Six Steps to Revenue Growth
Experience and best practice development with mid market companies in diverse industries helped us to identify six essential and interrelated steps to revenue growth.
- Value proposition: What is meant here is whether you have a clear company purpose and differentiated offer to customers that is easily understood and fills a need.
- Do you have the right value proposition? How do you know?
- Are you offering solutions or transactional sales to your customers? More profitable revenue is derived from higher margin solutions.
- Is your organization and sales team crisp and concise in how they present the company offer to customers? Do they understand the purpose and direction of the company?
- Ideal Customer Profile: Not all customers are equal. In fact some are much better and far more profitable. Explore why that is the case.
- What does a good to excellent customer look like? What are the differences between poor customers and great ones? How can that be changed?
- Are there adjacent market opportunities to pursue that are within the company’s core competency but up to now under developed?
- Are there other channels and products that could reposition the company to the right customer prospect?
- Critical Success Factors: Simple keys to measure and monitor business performance.
- Does the organization understand the 3 to 5 factors that will materially help the company in the next 90 to 180 days?
- Maintain focus on just the most concrete, measurable factors. This instills for the entire organization communication clarity, accountability, and appropriate resource allocation to priorities.
- Accountability: Who are the individuals and teams responsible for delivering sales success?
- Do these people understand their role, and are the expectations clear both for delivering high performance, and for falling short of those goals?
- What is the compensation alignment to the critical success factors, and how is it maintained?
- Along with accountability is the company providing appropriate support with tools, process, and resources to achieve success?
- Reporting: How do you really know and track how the company is doing?
- Is there a method to track weekly or monthly to follow progress against the critical success factors?
- Quantitative measures are necessary. However, qualitative indicators are also necessary to add context to objective facts and better evaluate the performance of the individual and team assigned to deliver.
- Do you have an executive summary dashboard to review your company’s success factors at a glance?
- Test, Validate, Refine: Continuous learning and adjustment to customer situations enhances revenue opportunities.
- Are you listening to customers? Are you evaluating their feedback on the company’s value proposition? Are there unsaid yet recognizable clues to affect a revenue opportunity that the sales team must adjust to?
- Ask for feedback among valued customers? Discern the issues you’re having with more difficult customers?
- Probe interest in a new product or solution offer by testing and evaluating their interest and ‘what if’ scenarios.
- Evaluate and refine your message and solution value and periodically check in with the customer away from the sale situation to gauge and identify changes. For example, changes or events that occur as a result of economic shifts, changes in a customer’s business or personnel changes that can affect your relationship with the customer.
Consistently profitable revenue companies tend to have a strong foundation of these 6 Keys to Revenue Growth and maintain a disciplined focus on execution to deliver results.