Solutions Success Story: HP backs solutions rhetoric with organization change and investment
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Everyone talks about "solutions" these days but few seem to invest in the changes necessary to move beyond the rhetoric. For example, truly developing, marketing, and selling integrated B2B solutions typically requires both a strong focus from the top down and a new alignment from the bottom up.
Far too often, companies talk the solutions talk but fail to walk the walk. They don't invest in new mechanisms to work across business units, new ways to connect with customers, and new skills for selling higher value offerings. As a result, we see companies promoting "solutions" that are really just bundles of existing products and services, launching marketing programs that neglect real customer needs, and falling back on the old feature-function approach to sales that customers long ago rejected.
Walking the Walk
Organizational initiatives at HP over the last several years suggest that the IT giant is indeed walking the solutions walk. HP has developed and sold enterprise IT solutions for years but a renewed push in 2009 led to a much sharper focus on 10 critical areas of business customer need, such as enterprise security, converged IT infrastructure, and application transformation.
As Magdy Assem, Senior Director of Enterprise Solutions Marketing, explained:
Not everything is a solution. You have to look outside-in to really understand the key areas to highlight. HP and other big tech companies all have tens of thousands of products and even so-called solutions. But you need to know what matters to clients. What keeps them up at night? Then you can focus new resources on these areas, not on everything, and create integrated offerings to address those needs at a higher level rather than just selling a bunch of products.
Customer focus and integrated offerings are critical steps for solutions but perhaps even more impressive are the organizational changes that HP has made to invest in success. "This is a key point for solutions," according to Assem:
We've been working on solutions for years but you need to go beyond just aligning the organization and actually put a structure in place and hold it accountable. We've done this in sales, in field marketing, and in solutions planning and marketing. These are stand-alone teams that are not part of any product team. This was a big 'aha' for us.
New Organizational Investments
On the sales side, HP has added a new layer of Account General Managers for its top global accounts to serve as leaders in positioning and selling integrated solutions. Instead of just adding incentives for existing teams to sell higher value solutions, the new structure reflects an understanding that companies like HP need senior level sellers to be solely focused on meeting customers' most important business needs.
"To drive growth, we need to sell HP, not just one or two products," says Assem. "This means we have to elevate the discussion and have a business dialogue. You want the top people from the sales organization focusing on the highest value solutions. They can then bring in all the product specialists when they need them."
Along with the new global account leaders in sales, HP has also invested in a substantial sales education and training effort to strengthen the bias toward solutions. This has included the creation of HP Sales University, reorganizing the annual sales kickoff, rethinking training programs, and refreshing sales education curricula to include monthly activities focused on solutions.
Beyond sales, HP has also added new solutions marketing groups in the field to support the new push in the Americas, Europe, and Asia-Pacific. "You can't just align the product groups around solutions," according to Assem. "It won't work. You need dedicated people on the larger solution issues so we've added new teams headed by a VP for solutions marketing in each region."
Finally, at the corporate level, HP has added a new team for solutions marketing which Assem himself leads. The team's mandate is to define the key areas of solutions focus, develop and support key offerings, and work with marketing and sales teams across HP's business units and regions to bring solutions to market. The team includes dedicated specialists for each of the 10 major solution areas.
Overall, "This has been a huge investment to address customer needs and drive growth," says Assem. "We needed new skill sets to complement existing skills so we've done a lot of hiring and a lot of shifting within marketing and sales. Ultimately, finding people with business skills and teaching them the technology is a better route to solutions leadership than the other way around."
Return on Investment
Assem is quick to suggest that HP still has a way to go with enterprise solutions, and that the journey thus far has not been painless. "Building bridges and alignment across the organization is always a challenge," he notes. "You can't just add separate new groups or you'll risk duplicating efforts and losing support. And you really have to earn respect. It's never easy telling people a new way when they have been doing this for a living for many years."
Less than two years into the new push, however, Assem can see substantial ROI in three major areas: Average deal size has increased significantly with our global accounts and that's a key metric. We've also seen revenue growth in general with these accounts. Third, we have seen real growth in the solutions portion of the pipeline, which is another key metric for us."
Clearly not every company has HP's deep pockets. But the larger point holds for any organization looking to sell complex, high value solutions: If you really want to talk the walk, you're likely going to have to invest in new people, skills, and teams to move from rhetoric to reality. HP's investments in new groups within corporate and field marketing as well as sales help point the way forward.
What about you? How are you investing in people and organization to grow your solutions business. Please let us know in the comments.
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There are many factors that would help company succeed in being solution company. 1. Understand and be able to identify clients' needs / pain / business problems. 2. Have capability to address clients's needs / pain / business problem. 3. Solutions strategy need to be address and support from the CEO. 4. Company as whole should be responsible for the solutions strategy, not only one or two departments. 5. Last but not least, turning into Solutions company cannot happen over night. It takes time. Therefore, everyone has to be patient. All factors above were not only proven from this HP case study, but I also believe that they were proven from EMC case as well
This post describes a number of things that are very critical for a company such as HP to make a successful transition to become a solutions company. For starters, they are clearly aware of the troubles that can arise if their sales staff is not fully aware of how to actually sell solutions. This is a major hurdle that a lot of companies are not able to clear as they do not properly plan for when making the switch. They also made stand-alone teams in sales, field marketing, solutions planning and marketing to solely focus on the customers needs and wants instead of bickering between business units. My concern though is this; while HP is making every effort to make a full on switch to solutions with their Enterprise Services division and have it run as smooth as possible, the post makes no mention of HOW they go about getting these clients. What types of marketing are they using to make it know that this is what they offer? Do they do PULL marketing and wait for customers to come to them? I would be very interested to find this out.
This blog post gives very practical reasons, how a big multinational company like HP in-spite of having large range of products and services lacks in providing customer- centric Solution. Also touches critical issue of investing in Solutions. Though HP has been selling solutions for years, they are still not able to produce an entirely client base solution. I am surprised that they are still approaching traditional Push strategy over pull . Also most important take away I feel is big companies started realizing the importance of Solutions and started investing heavily to achieve positive results.
It seems that every case that I have read about solutions talks about an increase in human capital and their knowledge as well (through training and classes). There's also a remark on how the structure of organizations has to change to improve alignment and communication of solutions. But where's is the HR department? After analyzing most of the documents that I have read about solutions and a company structure, it is always mention Marketing and Sales along with product design, manufacture, etc. However HR has never appeared. At the beginning I thought it was because it is obvious that they will play a role in the transition to solutions but is it really that simple? According to this case, HP had to go through a tough process of change in the company increasing skills of their employees - and maybe even hiring new human capital. But how does the HR department know what to look for? Which kind of qualifications does the HR department has to look for a solutions sales representative? Where do they start looking for them? What kind of education does a solution brand manager has to have? I wonder if HP would have work closer to HR the results or "the walk" would have been different. I consider that HR involvement has to be one of the key strengths of a company to go for the change process.