Transcript:
Monica Evans:
This is the Marketing Hero podcast by ClearPivot, turning marketers into heroes. Welcome to the Marketing Hero podcast. I'm your host, Monica Evans. Today's episode is going to be a little different than what we normally do. We're going to talk about sales execution and why it's important for marketing to drive leads for sales and then sales delivering. We know it can be very frustrating for us in marketing when we were doing events and generating leads, and then it feels like there's a lack of sales execution. That's what Steve's on to talk about today. Our guest, Steve Ammann, is the managing partner at Sales MEDDIC Group. How are you doing today?
Steve Ammann:
I'm good, Monica. How are you?
Monica Evans:
I am fabulous. How is Bend, Oregon?
Steve Ammann:
Bend, Oregon, is fine. There's some fires raging in the Western part of Oregon, but us on the other side of the mountains, we just have a little bit of a haze, but we're pretty good. We're kind of protected. I hope everyone is safe on the other side of the mountains and those get put out soon, but for right now, I'm just staying put in my little bubble over here.
Monica Evans:
Yeah. Things have been pretty normal over here in Hereford, England, but the weather is getting much chillier. I don't think I've really enjoyed much of a summer this year.
Steve Ammann:
Time for sweaters.
Monica Evans:
Yeah, exactly. Well, tell the audience a little bit about yourself and what Sales MEDDIC Group does.
Steve Ammann:
Sure. Just a little background on myself, I always think it's interesting for people to know how you got started and what you're doing now, and so I thought I'd start with that. Basically, I was at a nice, safe job at a large aerospace company, where I was a frontline manager, had about five people working for me. I read about this new technology, software technology that actually was a company that had tools for what I was doing at the time. It was revolutionary in terms of what I heard from the marketing pitch on what this product actually could do. I called them up, and I told them to come and show me this stuff. They did, and it was one of those things where I could see the vision of where this technology could improve in productivity big time.
I'm not quite sure why. I think it's because I have like an entrepreneurial DNA gene or something, but I called them up and told them I wanted to come work for them. They were under 10 million and a little startup company, and they had like two salespeople. Anyway, I went and interviewed and joined them. What happened was we took that thing from 10 million to over a billion in about seven years, and it ended up changing my entire life. That's kind of how I got started in the high-tech selling. Then as far as SMG is concerned, while I was at that software organization, it was called Parametric Technology Corporation, two very smart people interviewed a bunch of other smart salespeople, and they came up with a sales methodology, kind of codified, that was the brain of the VP of sales at the time, John McMahon.
That sales methodology ended up being a common language, not only between the salespeople, but between the system engineers, the technical people and marketing and customer success. One of the reasons we're talking about this MEDDIC methodology today is because the common language of MEDDIC can help bridge information between marketing and sales. It's very good for sales execution and then also down to customer success. That's a little bit about me. Then the next thing, and I'd like to give a little background on why I started Sales MEDDIC Group with my partner, Jack Napoli. Basically Jack was doing sales training with MEDDIC, for a select group of people that he kind of already knew that had left PTC and went out to different other companies. They were CROs or VPs of sales or sales leaders. What I told Jack was, "Hey, you're kind of keeping this thing a secret. I think we should expand and tell more people about it."
I'll put it in this context. When I was at PTC, actually my inside salesperson found this gentleman named Abe Taylor, who was working for a small reseller of ours in Iowa, not really the hotbed of technology, like Boston or San Francisco. Abe had this drive to be better, and he was unafraid to make lots of phone calls and set up meetings. Based off of those character traits, I went out and started working with Abe and I taught him this MEDDIC methodology. I went on sales calls with him and showed him how to use it, and he transferred the knowledge and everything. To give it reference, Abe was doing like $4,000 net to PTC a quarter, at the time that I started working with him.
Then within six months, we got that up to a hundred thousand plus per quarter, which was a huge leap, and it was because I helped Abe learn a new skill. Fast forward to today, Abe is now VP of sales of the largest PTC or second largest PTC reseller in the US. He'll attribute a lot of that career path advancement to the fundamentals of the MEDDIC common language. Basically I told Jack, "We need to create more Abes." Monica, he's doing a disservice to the world by not creating more Abes. Really we started SMG to create more Abes.
Monica Evans:
We need more Abes in this world.
Steve Ammann:
We do. We do. There you go, SMG was started to create more Abe Taylors.
Monica Evans:
For the audience, what is MEDDIC methodology, briefly? I know we can go down a rabbit hole with it, but briefly at a high level.
Steve Ammann:
Yeah. This is good for marketing folks too. There's, what it does or what is it, and then there's, what it does for a company. Let me start with what it does for a company, the outcomes. I call it, outcome based selling and outcome based messaging, and it ties into the M of MEDDIC. The bottom line is MEDDIC, it's a sales methodology that gets embedded in your stage-gate sales process, but it's probably, one of the biggest outcomes that it produces, is it reduces no decisions. Those are opportunities that marketing gave sales, sales is working on them, but the potential customer or prospect isn't ready to buy yet. The sales reps think they are, and so they end up in the forecast. Then when it doesn't close, the poor seller has to have a conversation with the sales leader about why it didn't close on time and all those resources were used on it. It's a very bad conversation to have. Those sellers are known as leakers. Okay?
Monica Evans:
Mm-hmm (affirmative).
Steve Ammann:
From an outcome standpoint, MEDDIC's really good at immediately reducing a lot of no decisions. Then when you do that, you can take your resources and put them on deals you can win, so your win rates go up. When your wain rates go up, everyone's happy. Marketing's happy, sales is happy, CEOs are happy, VCs are happy. It's very good at driving increased win rates and also very good at forecast accuracy, because if you're a sales leader and you have slip deals, so it goes down, or you're known as a sandbagger, because you bring in a bunch of stuff, which is great, but to upside things, but what the CEOs and the CROs need is accuracy.
MEDDIC's really good at increasing forecast accuracy, dramatically. Then, because it's an outcome based selling methodology, it's very good at this last thing, which is increasing the amount of large deals that you have in your pipeline and the size of those deals. A lot of times some of our clients, they have a couple $1 million deals. Then after training, they have $20 million deals, 20 in terms of quantity, and they might change that number from 1 million up to 10 million, on four or five of those deals. That's the other thing that this methodology does really well. I'll do a quick thing on what the letters stand for, just so people have reference. Right?
Monica Evans:
Mm-hmm (affirmative).
Steve Ammann:
The M is for metrics, and it actually, it's in two components. There's metric proof point stories, which are really short case studies that have definable measurable outcomes. If you have those, it allows the sellers to talk about what you've done for others to new prospects, so they can see what you could do for them. That leads to what I call the M2, which is then the outcomes that that particular prospect wants. That's M. E is economic buyer. They're the people that create budgets. They're the people that can take money and move it here and there and final approval to spend, because budgets have gone out the window. People get budgets, but until an EB decides to spend the money, they can't spend the money.
Then the first D is decision criteria. That's is a shopping list of the right criteria that you have for picking a solution to solve a problem. It should also be tied to outcomes. Then decision processes, Sales 101, the second D, that's the events that need to be orchestrated for the client or the prospect to make a decision. Then the I is identify initiative or identify pain. That links into what problem you're trying to solve for that customer, what outcomes are you producing. M and I are cousins, they're very closely related. Then the first C is competition, and your biggest competitions usually do nothing or DIY or something, but there's also other competitors, so you got to have a strategy for your competition and the DC and the DB.
Then the last C is the most important letter, it's champion. Even though there may be eight people on the stakeholder committee, there's usually one person that's really driving this initiative, because they're held accountable to it from the C-suite, and that's the business person you need to align with to make them your champion, in order to get any deal done and big deals done. That's a brief description of the letters. It's a sales execution methodology, so that if you're in marketing and your sales people are tuned into MEDDIC, and you're feeding them some M1's, okay-
Monica Evans:
Mm-hmm (affirmative).
Steve Ammann:
-and maybe some of the initiatives they need to go after in the I's, so marketing should be good at M and I, you can be much more confident that those leads that you're generating with the right messaging around M and I, will lead to sales, if they're using MEDDIC, because it's a smart way to buy stuff. Then that means that that lead to sales execution to closure is happening, increasing the win rates, like I talked about before, and then marketing gets more money to do more events. Sales is getting paid good commissions, and you have things that happened like at PTC to go from 10 million to a billion.
Monica Evans:
Yeah. It's also interesting too, because I mean, if marketing is doing their job, it should be easy for sales to be able to get those metrics easily, those case studies and get those points together. Working together really, I feel like helps both sides of the coin.
Steve Ammann:
Yeah. I mean, I see these a lot when we do a training session. I ask for that M1, that metric proof point. Marketing's really good at doing what I call one or two page PDF case studies. There's a story, there's initial challenges, there's the outcome of what products they bought. Those are fine, but there's a thing in sales calls called sales consumability, and you have to understand the sales animal. They're ADD. What they need is short stories of what your solution has done for the customer. Those are the outcome-based stories like, "Hey, we helped to increase revenue by 22%. We reduced IT operational costs by 14%, which for this company was $6 million."
The thing about the M1s is you don't even have to say the name of the company. You can just say like, a large US-based retailer or a large AMEA based, whatever. It's the outcomes and the story and the conviction that you tell that. A lot of times marketing provides sales with too much information, because the salespeople are trying to transfer it over to the champion and to the stakeholders, and there's a lack of attention span from everybody. If marketing can help sales with condensing into these one page type metric proof points versus the two page case studies, which are good, they can be up follow up stuff, it really helps sales can tell the story of what your product or the solution has done for a customer in a short way, that the champion can then tell internally. All right?
Monica Evans:
Mm-hmm (affirmative).
Steve Ammann:
That gets momentum going with the prospect, which is the whole goal of messaging anyway.
Monica Evans:
What type of companies are best suited for this MEDDIC methodology? Is it only SaaS companies, should other industries and companies do it?
Steve Ammann:
Yeah. Others can, but let me give you its sweet spot. A MEDDIC is really targeted at enterprise level technology companies that are doing transformational change. Let me just give you a list of some of our clients. On the security space proof point, on AI and big data, Splunk. A smaller one that I'm working with now that's really cool, is called Zipline. They make these drones that deliver medical supplies instantaneously. We're looking at a bunch of different use cases. GuideSpark, Transpose, it's this little, small company that's working on transforming how incident management works.
Then to give reference of some of the customers that are also doing well with this methodology that are in the news, like, Snowflake's about to pop an IPO, I think Warren Buffett's going to put 500 million into the company, and they're going to be valued at 2.4 billion. They're using MEDDIC. It's really targeted toward enterprise level software companies. It can fit in some other niches, but that's its sweet spot.
Monica Evans:
What does training look like when you're implementing MEDDIC sales?
Steve Ammann:
Oh, sure. Obviously, in our virtual world here that we're in now, right now, we're doing everything virtually. We used to do a mix of onsite and virtual, but it's actually pretty simple because MEDDIC is really a smart way to buy things and so sales reps kind of get it. They just didn't know the code. We're kind of teach them a little bit of what they already know, just in a succinct, common language with some nuances on each of the letters that takes all their other training that they already have, from Sandler or Miller Heiman or whoever, and it condenses it and codifies it into this common language. It doesn't take them that long to get it.
Basically we go in and do a understanding where they're at now with their methodology or sales process, getting a bunch of configured information from them, like the case study info that we can turn into proof points, what kind of discovery questions they asked, how to identify pain. I need to know the pitch deck that they use when they go present their solution to a customer. I want to know if they have any existing decision criteria, who their competition is, and then some details on maybe the buyer personas and things like that. We get all that information upfront and then we customize the material, so that when Jack or I, or Bill or Dick Thomas does training, we can speak that company's language. We know their competition, we know why they win, why they lose, how they position themselves, the marketing positioning and all that, so that when we embed teaching them the different elements of MEDDIC in a how to basis, we're speaking like we work for that company.
Then it's really simple. We can do the training in a half a day, and we split it up. We usually train the sales leaders first, then the sellers, and that may be in a different session. Then we do two other things. Besides teaching them the how to's, we have them do these exercises, which they can do virtually in breakout rooms. It takes about an hour and a half. Then we do something that our customers really like, because we do live deal reviews. We have each seller bring a live deal that they're working on now, and we do a MEDDIC assessment, and then we give them like, what's the next best activity, so that the sellers leave our training with not only how to use MEDDIC, we test for their understanding of it, with the exercises.
Then we do a live deal review so that they are walking away with, wow, this is what I should do on this opportunity based off MEDDIC. It's not [ferry 00:20:44], it's put into practice right away, and the sellers really like that.
Monica Evans:
Do these companies normally have additional tools that they use when they implement MEDDIC methodology?
Steve Ammann:
Yeah. There's a couple of things like, one it's good to operationalize MEDDIC into your CRM systems. The most common one that we deal with is Salesforce. Right?
Monica Evans:
Mm-hmm (affirmative).
Steve Ammann:
We work with this company, Close Plan, that we helped them with some of the MEDDIC stuff. It keeps track of where you're at with the different MEDDIC elements. There's actually a MEDDIC scoring system, along with really, really strong relationship maps. You can see where your champion is and where your EB is and what the power chart is versus the org chart. That tool really helps operationalize the methodology inside the CRM. Then in your CRM too, you want to have, connected to a library of metric proof points and different decision criteria templates for your different solutions.
Then from the marketing side, like helping the sales reps get those proof points and documenting them, and then what initiatives are you looking for that your solution can align with at companies, and then what's your discovery call talk track. There's documents or content that marketing can help with sales inside of CRM, that's MEDDIC related, that helps them with execution.
Monica Evans:
We talked a little bit about obviously the sales team themselves and how they utilize it, but for leadership, what do they get out of their sales team using MEDDIC? What kind of, I guess, proof points can you see or metrics you can see of your sales team, if you do have these tools kind of set up where you can actually see the scoring of MEDDIC? Does it show on each of the deals? Do you get a higher level of where your sales are at?
Steve Ammann:
Yeah. When I look at leadership, sales leadership, they're in charge of the resources, and they need visibility. When they can look at a dashboard, and I know dashboards are overrated and stuff, but with MEDDIC, you'll get a MEDDIC qualified scoring system that gives you an idea of where you're at with the different letters and what the overall qualification of that opportunity is. Then you can drill down on it that way. The tool provides the documented visibility. You're still going to have a conversation with that seller, but you can have a shorter conversation, because you're, A, using the common language of MEDDIC, and then B, you might be drilling into a couple different points of what they've done in CRM to just to test, to make sure that they have evidence.
I'll give you an example. If they've checked that they have full decision criteria, a sales leader would be like, "Well, show it to me." It should be attached in CRM. Right?
Monica Evans:
Mm-hmm (affirmative).
Steve Ammann:
Then they can look at it and maybe it's just a list of capabilities. It's like, well, why isn't that tied to the outcomes that they care about, that are going to drive the execution of the initiative? Oh, I forgot to do that piece. Okay. Well, let's get the champion on the phone and have that conversation about why these capabilities are going to drive these outcomes and what the priorities are in the outcomes, versus just a list of capabilities. Then that way your sales leader can coach your sales rep based off evidence of what you have, and then come up with a next best activity, like, let's call the champion that you say is your champion. Let's get them to beef up this decision criteria, so it's tied to outcomes. It's like, you have evidence, you look at it, you make a decision on the next best activity, and then you go do it. That kind of quick execution done properly leads to the increased win rates, which drives up revenue.
Monica Evans:
What types of things have you seen where MEDDIC hasn't worked? What is the most important thing companies need to know to ensure that the methodology is working for them?
Steve Ammann:
Yeah. Yeah. This is a really good question. Okay. A, MEDDIC is an outcome value based selling methodology. If your main value proposition is price, MEDDIC's overkill. Okay. That's in a kind of a fit thing, but the main thing is here's the deal. Any sales initiative that you do, whether it's led by marketing or led by sales enablement or whatever, unless your frontline sales leaders are bought in, and these are the people that have five or six sellers working for them, unless those frontline sales leaders are bought into the change of that initiative, it won't work. I don't care what the initiative it is. It doesn't have to be methodology. It could be sales stages. It could be new messaging. It doesn't matter, because the sellers know that if the frontline leaders aren't holding them accountable for learning the new thing, then it's just a new thing that's going to go away and they're going to keep doing their old activities.
The number one thing, Monica, is frontline leader buy-in. That's why we do specific frontline leader MEDDIC sessions before we [inaudible 00:26:45] the sellers, so that the CRO knows that the frontline leaders are bought in. The smart CROs that I see out there, they ask at the end of training, "Hey, are we in? Do we get it?" They test for it, so they're not just getting a, "Yes," to appease the person. There's a commitment there. When you get that out of the frontline leaders, that's my biggest factor of success of methodology. Again, I'll point out any sales methodology, any sales initiative needs to have that frontline leader buy-in.
Monica Evans:
We're kind of towards the end of the podcast, but do you have any advice for companies that are looking to possibly do something with their sales team? They're just not getting the sales that they want to, they've hit a plateau. When is the right time to implement MEDDIC, and do you have any advice for these companies?
Steve Ammann:
Yeah. Well, let's put it in the marketing context. You're in a scenario where there's ample amounts of leads being generated. Then on the backend, the revenue or the sales closures, your win rates are lower than you want, your revenue's lower than you want. Sales can point the finger at marketing and say, "Well, the leads suck, they're horrible leads." Then marketing points at the sales, "Well, you don't follow up on them." Then you have this horrible situation of, hey, the company is not performing like you want. Then two of the biggest groups in terms of executing properly are fighting with each other and playing the blame game. I'll do three scenarios.
There's the scenario of, we got a problem, too many slip deals, not high enough win rates, revenue is not where you need it to be, and you need a change because there's pain. I can go back to MEDDIC and say, "I have pain." That's a good time, because you can turn that around if you have a good product, and it's not some product flaw or something. Then the other one is, is that you reached the hundred million mark or something like that, and you know you got something. Your VCs are like, "Hey, here's 200 million. Scale up the sales team and get us to a billion. Get us to the unicorn billion." Now you've got to hire a whole bunch of people, and if you don't have a common language, you're going to have a lot of issues in terms of forecast accuracy and those kind of things, because you don't have a common language when you go to that major scales standpoint.
Okay. That's the second scenario.Then the third scenario is, and I just did a couple of these, you got four or five reps, and your CEO is probably selling with the reps. You got enough product definition that you solve some outcome problems for a company, and you're like, "Hey, it's time to scale this thing to 10 reps," which isn't a huge jump, but let's put in a common language right now, so that we have the basis for getting from our 5 million or 10 million, to 100 million, because we got something, and we're going to hire five more people. The companies that I see do that, get to 100 million a lot faster, because they put in the core common language of MEDDIC at that stage, in their startup stage, or the going from series B to series C, or maybe it's A to B.
The cool thing about that is they don't have to change it. It just expands in terms of different products, maybe, or solutions that they have, but the core MEDDIC methodology can take them all the way to the billion dollar revenue number and beyond. Doesn't stop there. The CROs that do that early are, I would call elite CROs, because they know how important having a common language is to scale and then to get the win rates up and the other outcomes I talked about. That's the third scenario.
Monica Evans:
Perfect. Well, thanks, Steve. I really appreciate you hopping on with me today.
Steve Ammann:
Sure. Monica, it was a pleasure to have you. Again, Jack and I's mission, and Bill's, is to create more Abes. I really like it when marketing people come to our MEDDIC session. I tell them, "Hey, just listen to M and I, and then you can bow out after the other letters. The more marketing people we have at least speaking at M and I of MEDDIC, as a bridge to sales, will help everybody, because you'll have less friction, and you'll help produce those outcomes of no decision reduction, win rates, forecast accuracy and big deals. Everyone likes that.
Monica Evans:
Perfect. Well, thanks again, and we'll talk soon.
Steve Ammann:
Okay. Thanks, Monica.
Monica Evans:
Thanks. You've been listening to the Marketing Hero podcast by ClearPivot. Be sure to join us next time. For more information, visit www.clearpivot.com.
