The decision to launch a commercial transformation program is one of the most important a CEO can make. This massive undertaking can profoundly impact the business, its profitability, and its prospects.
These programs require dedicated resources to ensure they’re managed correctly and remain focused on the business goals. The benefits of doing so are considerable.
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Increased Revenue
If revenue is a key business goal, investing in commercial transformation should yield a quick payback. By streamlining and simplifying inefficient processes, companies can identify and implement opportunities to accelerate growth more quickly. This includes changing customer engagement strategies, leveraging data to deliver more personalized and agile content, and adjusting coverage, roles, account priorities, quotas, and territories to match market opportunities better.
In a challenging economic environment, businesses face pressure to beat the market in both revenue and margins. While strategic mergers and acquisitions can generate short-term growth, consistently beating the market requires superior internal capabilities – most notably in marketing and sales.
While a traditional approach to upgrading these capabilities often fails, new research shows that 90 percent of companies embracing a different path are successfully growing above the market, with two-thirds achieving this in revenue and profit. Companies must commit to the effort, set clear targets, and provide incentives to make this work. A well-supported program team – including a Programme Director – can be essential to success. They should be provided with sufficient resources to manage the change while continuing to support.
Increased Profitability
Businesses often invest in commercial transformation projects to generate above-market growth and distance themselves from competitors. However, they often need help to create substantial and sustainable value from these efforts.
One of the primary reasons is due to poor planning. For example, the management team may need to align on the direction and magnitude of improvement, or they might need a clear implementation plan. Another major challenge is the need for more resources. A commercial transformation requires a substantial amount of time and effort to be successful, which can strain organizational resources.
To overcome these challenges, businesses must be strategic and resourceful when choosing partners for their transformation projects. For example, they should select partners deeply understanding their sector and industry, using the right plan like the Challenger sales model. This will allow them to assess the current state of their business accurately, identify where they want to be (Target Operating Model), and create a road map for how they can get there. They must also complete an internal leadership team to manage the business transformation process.
Increased Customer Satisfaction
In a competitive marketplace, customer satisfaction is critical. Satisfied customers are more likely to stay loyal, and they can also increase sales by recommending your products and services to others. A commercial transformation program can help you meet increasing customer expectations of responsiveness and customization, for example, by developing new skills, tools, and mindsets to support your teams.
To maximize the benefits of your commercial transformation investment, you need the proper structure to manage it effectively. This means a dedicated team with a clear program sponsor and program management office that can deliver against the transformation roadmap. It is also essential to have the capacity within general management to make changes happen, and this is where bringing in interim executives as backfill or as specialists with additional degrees can be helpful.
Successful commercial transformations require staying power, which means building trust over time. A comprehensive commercial excellence program helps to do this by encouraging collaboration and sharing best practices across the organization. It also allows managers to focus on improving their performance and the performance of their teams.
Increased Employee Satisfaction
Keeping employees satisfied and engaged is critical to commercial transformation success. This requires the organization to maintain open lines of communication to ensure employees are aware of any changes and feel included in the company’s plans. To streamline communication, this can be done through a company intranet, internal newsletters, and chat apps.
Employees must also feel valued for their hard work and know the company cares about them. This can be achieved by deploying recognition processes through a formal staff awards ceremony or more informal things like vouchers, additional time off, or even a day’s extra holiday for a good performance.
The success of a commercial transformation requires the right people to lead it. A dedicated team is essential to drive the program forward. This typically includes a program sponsor and a couple of ‘people’ and ‘organization’ workstreams. The ‘people’ workstreams will drive the change agenda, and the ‘organization’ workstreams will manage business as usual. This approach allows the program to gain momentum and avoids conflict between activities and the commercial transformation.
Increased Customer Retention
Investing in commercial transformation isn’t without risk. However, high-performing companies systematically assess their capabilities and identify areas for improvement to grow revenues and profit.
To implement a successful commercial transformation program, a clear strategy must outline your business’s desired vision and identify the gaps between where you are today and your Target Operating Model. Then, you can create a detailed implementation plan that identifies all the necessary projects, their objectives, scope, timelines, and budgets.
These initiatives can be anything from introducing new customer acquisition strategies to developing more powerful digital experiences that unlock efficiencies for your team and customers. For example, McDonald’s transformed their stores into powerful, internet-powered providers, allowing customers to use kiosks to avoid long lines at the drive-up window and order food ahead of time.
To make the most of your investment in commercial transformation, you need a dedicated, cross-functional team responsible for driving the changes. This team should be led by a senior leader within your organization, such as the CEO, head of sales, or CMO, and include marketing, operations, and other key leaders.
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