Technology
Smart selling
Forget the old rules of peddling software.
By Ray Marano
Smart Business Pittsburgh | December 2004
At first blush, SmartAlecs might seem like a more fitting name for software developer SmartOps. After all, many of the company's actions seem to fly in the face of conventional wisdom when it comes to selling software.
"We haven't taken anyone's advice at face value," says Martin Barkman, vice president, sales and strategic services for the North Shore company. "We've challenged every decision we've made."
SmartOps develops and markets optimization software used by businesses to improve the management of inventories. With one of its premier projects being a solution that has saved John Deere Co. $1 billion in inventory costs, SmartOps' approach may be worth a look. And with an approach that challenges everyone's assumptions, including its own, at every turn, the company has collared other large clients, including Kellogg Co., Bayer Corp. and Shaw's Supermarkets.
Barkman says SmartOps, launched in 2000, decided early on that it would go after sales to large companies, bypassing small and mid-sized concerns, in part because the amount of effort required to sell to either doesn't vary much.
"The fact is to do a deal, to do a sale, you have to invest a fair amount of effort," says Barkman. "That effort is not proportional linearly to the size of the deal. It's a lot of work regardless."
The result: Virtually all SmartOps deals are worth at least $1 million, and the companies it services provide a considerable amount of credibility when it comes to approaching other large firms, regardless their industry.
SmartOps defies some of the assumptions that many software companies embrace as conventional wisdom, Barkman says. Here are a few examples of its contrarian philosophy.
* SmartOps sells high in the organization, usually bypassing the CIO and going right to a senior executive. SmartOps CEO Sridhar Tayur, founder and a passionate champion for the company's product, gets involved in most deals at some point and helps to close them.
* Some software companies rely on fancy brochures, expensive Web sites or attendance at trade shows to generate leads.
"Our Web site is uninformative and graphically poor," says Barkman, but adds that it matters little.
Most target executives don't pay much attention to the Internet, anyway, he says. SmartOps instead seeks testimonials from its clients to share with prospects and raise interest. Says Barkman: "That's going to open doors, that's going to raise eyebrows."
* Conventional wisdom is to offer a free pilot to the client, but SmartOps refuses to give away its software, even for a trial period.
"We did it twice, and both times, people viewed us as tremendously unimportant," says Barkman.
The SmartOps approach is to offer a proof of value demonstration to a prospective client, charging as much as $150,000 for the same.
* SmartOps tried using a sales force of software salespeople but scrapped the idea when it failed.
"It was a giant flop," Barkman says, in part because the software industry had earned a reputation for overpromising and underperforming.
Instead, the company hired former software consultants to sell, individuals with real technical expertise who could explain the software to senior executives and manage the entire sales process.
* Some software companies seek growth by forming partnerships with consultants, such as Accenture or Deloitte & Touche. Barkman says such relationships have little value.
"They are unlikely to introduce you to their clients," says Barkman. "Partnerships are a lot of fluff."
How to reach: SmartOps Inc., www.smartops.com
