Executive Insights
The Connected Commercial Organization: How Industrial Companies Can Capture More Share of Customer Wallet
was written by Michael Connerty, Managing Director, Tanay Bhatia, Senior Engagement Manager, and Chris
Rogers, Consultant, in L.E.K. Consulting’s Industrials practice. Michael, Tanay and Chris are based in Chicago.
For more information, contact [email protected].
Volume XX, Issue 10
Challenge 1: An abundance of data but no 360-degree
view of customers
Industrial companies increasingly find themselves swimming in
data — data about customers, products, services and more. Often
the problem is that the data isn’t available in a single, centralized
source that can be mined for actionable insights. Rather, it’s
stored across internal sources, such as in the customer relationship
management (CRM) and enterprise resource planning (ERP) systems
and with customer service, as well as across external sources, for
example in industry research, on the web and in social networks
(see Figure 1). And with the rise of the Industrial Internet of
Things, that volume of information will only grow.
Results. Companies are unable to harness sales insights from the
vast amounts of data in order to identify customer-specific cross-
selling and solution-selling opportunities.
Case study: How EMC consolidated its data to
promote smarter, insights-driven marketing
EMC, a provider of enterprise IT infrastructure solutions and
now owned by Dell, wanted to increase its market share in
underpenetrated markets and accounts. But after acquiring more
than 80 companies over the previous decade, it found itself
with multiple siloed data stores and no coordinated approach to
customer data management. As a result, it was unable to fully
exploit the data’s potential for use in targeted marketing and lead
generation campaigns.
In recent years, many industrial companies have
expanded their product and service offerings,
through both organic and M&A efforts.
Companies within subsectors such as industrial
equipment and engineered products, distribution,
packaging, agricultural equipment, and logistics
are especially keen to take advantage of cross-
selling and solution-selling opportunities.
However, even with a broader portfolio of products and services,
many industrial organizations are still struggling to capture
greater share of their customers’ wallets. While it is easy to
assume a broader product and service offering will naturally lead
to higher sales, in practice this is often not the case.
L.E.K. Consulting’s research has uncovered four key sales
challenges that industrial companies face when it comes to
increasing their share of customers’ wallets, along with four
examples of how some leading organizations have overcome
them. What do all four have in common? They have connected
their commercial data, people and sales efforts to routinely
uncover customer insights and execute against them.
The Connected Commercial Organization: How Industrial
Companies Can Capture More Share of Customer Wallet
Executive Insights
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Solutions. The company consolidated multiple siloed “islands” of
data into a single stream. The stream ingests structured data from
customer information (such as past purchases), demographics
and marketing history, as well as unstructured data from sensors,
social networks and the web. It provides a 360-degree view
of customers, which can be leveraged for targeting, planning,
reporting, lead management and campaign management.
“We can now use high-speed, advanced analytics
against a single source of truth containing over
1,300 tables of detailed data that is now shared
and agreed upon by users in Sales Ops, Finance
and Manufacturing as well as Marketing and
Operations to give us a unified go-to-market view,
which solves many problems.”
Since its sales and marketing team did not have the right
analytical and statistical skill set to deploy the new data sets
and additional tools, EMC created a team of data scientists,
data analysts and data engineers to assist them. The firm also
developed and launched an in-house training program dubbed
“Addictive Analytics” to teach marketers and other non-analytics-
focused employees how to leverage analytics in their day-to-day
work.
Results. EMC now uses the wide-ranging and diverse data set
to predict customer behavior with greater accuracy and, in the
process, enable greater cross-selling.
“We are able to correctly predict what and when a
customer is going to purchase 80% of the time.”
The company is also able to better target the right customers for
cross-selling — and to allocate sales efforts accordingly. And it’s
using the data to develop additional tools aimed at improving
the customer experience overall. In the meantime, data query
timelines have been reduced from four hours to less than a minute.
Figure 1
Challenge: Generating a single source of truth for customer data
• Customer service data, including
orders, delivery, payment, open
cases and account data
• Transaction data, purchase
history and financial data
• Job performance, outage,
maintenance and repair,
and customer support data
• Customer and prospect
contact information,
accounts, leads and sales
opportunities
• Search and website
metrics for owned and
external websites
• Third-party industry
and market data
Big data (e.g., Industrial Internet of
Things) will exacerbate this challenge
• Digital advertising and
marketing campaign
data and engagement on
promotions
• Owned and external social
network data, including
comments, followers, likes,
dislikes and complaints
Customer
service
Field serviceCRM
ERP
Web
Campaign
Social
networks
360° view of customer
Industry
research
Source: L.E.K. analysis
spread out across various teams throughout the organization,
making it difficult to generate customer insights leading to sales
opportunities, as each team was focusing its analytics capabilities
solely on its own area of responsibility. In the meantime, GE had
added more technology-based solutions to its offerings, so its
transactional approach to sales within the oil and gas market
needed to be revamped.
Solutions. GE, working with leaders representing teams in sales,
digital technology (IT), commercial excellence and marketing,
took 2.5 million disparate customer accounts and put them into
350,000 clean commercial entity structures. Once the actionable
data insights needed to identify customer insights and offering
tailored solutions were at the fingertips of GE O&G’s sales teams,
it then set about training the entire organization to adopt a more
solution-focused approach.
“Instituting software-solution selling techniques
required us to embark on both a training exercise
and an effort to infuse our organization with
software selling expertise, working with our
GE industry experts who have held customer
relationships for decades.”
GE O&G also realized that with its move to software-heavy
solutions, it needed to change who its salespeople were engaging
with at the customer company. Rather than the VP of operations
or engineering, it directed its sales teams — now armed with the
analytics capabilities they needed — to engage with the buyer’s
CIO and/or CTO.
Results. GE now expects to deliver new market insights that
enable 5% growth, or $25 billion, by 2020, while it enables its
sales teams to serve customers 50% faster — which translates
into roughly $30 million in productivity.
Best practices
Industrial companies looking to enable solution selling by closing
their firm’s analytics gap should embark on these best practices:
• Identify analytics capability pockets and bring them
together. Companies can systematically identify where in
their organizations there are analytical responsibilities and
strengths to leverage and connect them — data, people and
processes — to ensure alignment exists and a more holistic
view is then taken.
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Best practices
In order to better predict customer behavior and enable more
cross-selling, industrial companies can take the following steps:
• Consolidate customer data into a single source of truth.
Sales teams need access to data insights that may otherwise
go unnoticed by those in other departments. Companies
need to give their sales teams full access to all customer data
and ensure they have the ability — or necessary support — to
effectively analyze the information.
• Build technical capabilities into the sales and marketing
organization. Leading companies are creating new roles,
such as data scientists and marketing technologists, to bridge
the gap between marketing and business intelligence/IT. They
are also pushing front-line sellers to become sophisticated
data users in order to reduce the influence of old-fashioned
gut instinct in driving the decisions of sales teams.
• Invest in the right tools and systems. Leading companies
are supplementing their CRM systems with predictive
analytics tools.
• Incentivize marketing teams in order to drive close
collaboration with sales. Similar to sales teams being
rewarded for closing deals, marketing teams’ compensation
is increasingly being tied to the impact and results of their
business goal activities.
Challenge 2: Analytics capabilities needed to identify
customer insights aren’t connected across the
organization
When it comes to analyzing data, especially data deeply focused
on customers and necessary for generating potential sales leads,
individual teams — from product development all the way to
marketing — tend to be focused on their own area of expertise as
opposed to taking a holistic view of the organization. Moreover,
sometimes the analytics skill sets of such teams aren’t needed to
generate the kinds of insights that can lead to cross-selling and
solution selling.
Results. Teams with disparate responsibilities and focus areas
can lead to an analytics capability gap, resulting in missed
opportunities for identifying customer insights and offering
tailored solutions.
Case study: How GE centralized its data analytics
capabilities to transform its selling approach
GE Oil & Gas is a subsidiary of the energy giant that is now part
of Baker Hughes. Like the rest of GE, its customer data was
Results. Time is lost, problems are ill-defined, proposed solutions
are off-point, customers get frustrated and win rates are lower
than they should be.
Case study: How a leading industrial services provider
applied a top sales rep’s approach to enable more
solution selling
After several years of strong performance, a leading industrial
services provider experienced a flattening of its growth trajectory.
The flattening took place across the sales organization — all
except for one rep, the top performer in the firm.
Solutions. Upon closer inspection, it became clear why this one
rep was outperforming his peers. In-depth analysis and interviews
revealed that he spent far more time early on in his discussions
with the customer to learn its strategy and key priorities, what
it was struggling with, and any constraints it had. He also pulled
in technical solutions support from his own organization in order
to glean a deeper understanding of the customer’s underlying
issues. And he mapped out the customer’s purchase decision-
making approach as he networked with people in the business,
procurement and other stakeholders, which gave him critical
insights into how the customer was likely to make its decision.
Armed with these insights, he was then able to define a high-
level solution that a key customer executive aligned with, leading
to a multiyear contract that was unprecedented in his company
for its size and solution scope.
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• Implement tools and techniques that support solution
selling. Companies need to give employees more than just
access to data; they need to give them tools and techniques
to effectively leverage it. Organizational changes, such
as bringing in new talent with an analytical skill set and
mandating ongoing training sessions, may be required to
ensure their adoption.
• When selling digitally focused solutions, engage with
digitally focused customer representatives. Companies
selling digital solutions need to be engaging with like-minded
executives on the buyer side.
Challenge 3: Too much reliance on the efforts of
individual sales reps
Solving a customer’s problem typically requires in-depth
knowledge and technical expertise of the underlying issues. But
many sales reps are generalists and prefer to work on their own
unless absolutely necessary, in the process neglecting to get
technical sales experts involved early enough to properly define
the customer’s challenges and help scope the potential solutions
(see Figure 2). At the same time, sellers may fail to uncover the
strategic imperatives that impact the customer’s needs or to map
their decision-making approach — including distinguishing between
the influencers and/or gatekeepers and the true decision-makers.
Figure 2
Typical B2B customer purchasing process
Awareness Research Evaluation Decision
Needs
identification
Needs
specification
Supplier
search
Supplier
outreach RFP process
Evaluate
responses
Select
supplier
Negotiate &
sign contract
• Sellers may fail to uncover their
customers’ strategic imperatives
that impact their needs
• Mapping the buyer’s decision-
making approach, including who
really makes the decision vs.
influencers and gatekeepers
• Significant solutions sales
opportunities are often missed
or identified late
• Subsequent sales efforts are
not focused enough on the real
decision-makers
• Opportunities to engage
with customers to shape their
buying approach and develop
customized solutions early are
often missed, opening the door
to other suppliers
• Proposed solutions miss the
mark or are focused on the needs
of the wrong stakeholder
• Win rates are lower than they
should be
Challenges
Results
• Sales reps are typically generalists
and, due to lack of internal
connectivity within the organization,
often fail to get technical sales
experts involved early enough
to assist the customers in defining
their needs and help scope the
potential solutions
• Sellers often focus on technical
merits of their solution, missing
strategic imperatives and decision-
maker needs
• They fail to bring the right team
(e.g., executive sponsor, subject
matter experts and operations) and
effort to critical sales opportunities
• Companies too often rely
on individual sales reps
to close deals
?
Source: L.E.K. analysis
customers to find the information they need or to connect with
the people who can help them. And instead of having their
account and ordering information linked among a supplier’s
various channels, a lack of integration between back-end
applications and customer data often means existing customers
have trouble transacting across those channels. Meanwhile, sales
and service people miss crucial opportunities that connecting
integrated information across customer channels would provide
for proactively upselling and cross-selling.
Results. Prospects get turned off early in the sales process, and
frustrated customers look to other suppliers who will make it easy
for them.
Case study: How Grainger connected its back- and
front-end systems to deliver a great omnichannel
experience
Grainger, a supplier of maintenance, repair and operating
products, wanted to better facilitate the purchasing abilities of
its customers, who often place orders via their phones while out
on job sites. It was particularly important to purchasing managers
to get workflow approval on the spot and to easily view their
purchasing history in order to not lose valuable time while out in
the field.
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Best practices
Solution selling can be supported in any industrial organization as
long as the company can:
• Train sales reps in how to identify the client’s broader
strategic needs and its decision-makers as well as the
solutions the company has in place to serve them both.
To enable solution selling to customers, sales reps need to
have a deep understanding of their client’s business challenges
and desired outcomes as well as know who the key decision-
makers are and the products and services that make up the
solution.
• Involve technical experts. Companies need to put in place
defined processes in order to involve technical experts at the
right time during the sales process.
Challenge 4: A seamless omnichannel experience falls
short of expectations
B2B customers, who have grown used to the seamless
omnichannel retail experience spearheaded by Amazon, have
come to expect it in every purchasing environment (see Figure 3).
But many industrial companies have underinvested in developing
their digital presence, making it challenging for potential
Figure 3
Omnichannel: Customer experience falling short of expectations
• Customers increasingly conduct supplier
research using various channels,
including online, mobile and social
• Many industrial companies have
underinvested in developing their
digital presence, making it challenging
for potential customers to find the right
information
• Customers expect to track their
account history, orders and
billing through website, mobile
apps and customer support
• Lack of integration between back-
end applications often leads to an
inconsistent customer experience
• Customers utilize support
provided through online chat,
forums, email and contact center
• They expect their past information
to be seamlessly tracked between
the various channels
• Customers expect to
seamlessly use the
supplier’s website, mobile
app or contact center
to find specific pricing and
payment methods, check
product availability and
identify where products are
(e.g., the closest location if
needed for pickup)
• Customers look for
recommendations on
products and services
based on past purchases
• They expect online and
mobile channels to allow
for quick and easy repeat
purchases of products
Supplier
and product
research
Account
management
and billing
Customer
support
Repeat
purchase Purchase
Contact center
Omnichannel
connected
customer
Online
Sales rep
Field services Channel
partners
Social
Mobile
Source: L.E.K. analysis
Executive Insights
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Solutions. The company integrated its back-end systems to
allow customers to see specific pricing and payment methods as
well as check product availability (including, if applicable, brick-
and-mortar pick-up locations). It also seamlessly integrated the
Grainger mobile app and Grainger.com ecommerce platform,
both of which feature a single-page checkout that displays the
customer’s account information, including the payment method,
shipping address and default branch, along with an easily
viewable six-month history of ordered items to enable repeat
purchases.
Grainger ensured that many products in the mobile app were
pre-authorized for purchase. The app also enables personnel
out in the field to send more specific purchasing information
to a manager with purchasing authority if they don’t have
it themselves. Using Grainger’s order management system,
customers can set up their own approval workflow, which
identifies who can approve an order request and at what dollar
amount. Integrated workflow management features allow
multiple customer staff members to accept, reject or forward
purchase requests made in the field.
The company provides automated tours of its mobile app
functionality to help customers quickly understand how to use its
features. And customers can chat with a Grainger expert online
to quickly answer questions about products and any other needs
they may have.
Results. Customers now get a true omnichannel experience,
one that is accessible 24/7 from the device of their choice and
seamlessly integrates real-time Grainger product information
with their own profile, ordering history and a purchasing process
complete with approval-workflow capabilities.
“Our Grainger consulting group performed
studies with our customers and found that the
average procurement process is comprised of
five people, six handoffs, 42 steps and three
approvals. Our mobile capabilities, coupled
with our order management workflow system,
dramatically reduce this complexity and increase
the speed of the approval process, with 0% to
40% faster approval rates.”
Best practices
In order to provide their customers with a true omnichannel
experience, industrial companies should:
• Enable customers to engage with/purchase in the
way that is most convenient for them (e.g., phone,
online, mobile, in person, etc.). Companies need to
make purchasing available through every channel while
paying special attention to the most common purchasing
environment of their customers. If the majority of them
are ordering from out in the field, for example, a powerful
mobile app that minimizes the steps to checkout will be
especially important.
• Ensure ecommerce or mobile platforms are fully
integrated with back-office systems. Providing buyers with
access to real-time inventory information avoids shipment
delay. Giving them a way to easily see their ordering history,
including related purchasing terms, significantly streamlines
the purchasing process.
• Provide a consistent, personalized experience across
each platform. Customer interactions with the seller should
be consistent across each platform; in addition to consistent
messaging, customers should have access to the same terms
and product/service offerings.
• Deliver a user-friendly experience. Ecommerce and mobile
sites should have a clean, visually appealing layout. Products
should be arranged into well-defined categories that make it
easy for buyers to search for and view products.
While many industrial companies have expanded their product
and service offerings in recent years, they’re still struggling to
capture greater share of their customers’ wallets through cross-
selling and solution selling.
To create those selling opportunities, industrial companies need
to take a connected approach to their data, their people and
their sales processes. By seamlessly connecting those three critical
components across their organizations, they will be able to create
a 360-degree view of each of their customers, centralize the
analytics capabilities of their various teams, lessen their reliance
on individual sales representatives and provide their customers
with a genuine omnichannel purchasing experience — all of
which will lead to greater cross-selling and solution selling and, in
turn, to increasing their share of customers’ wallets.
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About the Authors
Tanay Bhatia is a
Senior Engagement
Manager in L.E.K.
Consulting’s Chicago
office, where he works
in the Organization &
Performance practice.
He focuses on helping
clients with strategies related to growth and
commercial transformation, operating models
and organizational design, and M&As.
Chris Rogers is a
Consultant in L.E.K.
Consulting’s Chicago
office. He joined L.E.K. in
2016 from The Wharton
School’s MBA program.
He has experience
developing impactful
solutions and growth strategies for clients across
multiple industries.
Michael Connerty is a
Managing Director and
Partner in L.E.K. Consulting’s
Chicago office, where he
leads the Organization &
Performance practice for
the Americas region. He
has 20 years of experience
and focuses on helping clients execute growth
strategies, improve their organizations and achieve
their targeted outcomes.
The Connected Commercial Organization: How Industrial Companies Can Capture More Share of Customer Wallet
While it is easy to assume a broader offering will naturally lead to higher sales, in practice this is not often the case. Download the white paper now to learn more about the key sales challenges many industrial companies face and how to overcome them to increase customer wallet share.
Jun 12, 2018
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