In 1992, whereas Hewlett Packard (HP) realized a huge success with its RISC-based products, Manuel Diaz, head of HP's Computer Systems Organization (CSO), implemented a new sales approach to capitalise on the company's new market position. In 1994, the strategy turned out to be very profitable as HP's business grew by 40% when the industry-wide growth was just 5%.
In 1996, Diaz notices that its strategy to reach large enterprises could be refined. Indeed, HP remains stuck on the downstream and middle stream businesses of this market segment. At the same time, content value providers and solution-providers position themselves on the highly profitable upstream business. In parallel, Diaz looks for new ways of developing the business and reducing sales and support costs.
Consequently, Diaz undertakes an audit to identify CSO's possible opportunities. The audit reveals the reasons why HP's present sales approach keeps the company away from these lucrative opportunities.
Among others, it recommends CSO to change drastically its customer relationship management with its large enterprise customers. Before going on for a new reorganisation, Diaz wants to weigh the costs of implementation of a strategy that would go along with his thoughts of migrating:
*From managing accounts to managing a portfolios of sales opportunities
*From viewing the sales process from the inside out to viewing it from the customer in
*From trying to grow sales by adding sales activities to accelerating sales growth by improving the efficiency and effectiveness of the sales process.
The case has stressed two main problems for CSO:
1.Sales processes and sales support system are lagging present sales strategy.
2.Sales department organisational structure is not designed to look for opportunities.
A.Sales Processes Lag Sales Strategy
The reason of this problem is mainly due to an order processes management issue. As salesmen...