Is internal friction slowing your company’s momentum (i.e., stifling its growth)?
In many organizations, product, marketing, and sales work in silos. They don’t speak the same language. They don’t understand each other’s needs. They play the blame game every time sales quotas aren’t met.
Your functional teams may understand and execute their own strategies well. But process bottlenecks and miscommunication between teams slow strategy execution and undermine sales revenue goals. To make your number in 2016, you must bring product, marketing, and sales together. And get them rowing in the same direction.
To make your number in 2016, you must bring product, marketing, and sales together. And get them rowing in the same direction.
Internal Alignment: a Huge Leap Forward
Achieving functional alignment (Level 4 of our Revenue Growth Maturity Model) yields big gains. Both performance and revenue improve significantly. We outline Level 4 on page 13 of Make Your Number in 2016. It’s our latest research report, based on a comprehensive study of companies across the B2B spectrum.
Make Your Number in 2016 includes a six-step methodology for achieving strategic alignment. And more predictable revenue growth, long term. Download the report here for free.
How far is the leap from Level 3 to Level 4? How significant are the gains? Let’s compare the before and after.
Level 3 (Before): Every Function for Itself
Functional teams understand and abide by their strategies. They go beyond documenting strategies to demonstrating positive changes in behavior. Each function, on its own, is performing consistently.
What’s not working
Friction still exists between functions. Product and marketing, and marketing and sales, are working at cross purposes. There’s no established cadence among functional leaders. Functional teams are unclear on their distinct responsibilities. The customer experience suffers as a result.
Since Level 1, Customer Acquisition Cost (CAC) has gone down by 1%. Customer Lifetime Value (CLTV) has risen by 8%.
Level 4 (After): All Functions in Sync
Functional team members understand their own strategies. They also understand how product, sales, and marketing strategies depend on each other. All functions are operating in unison in support of the corporate strategy. Common Key Performance Indicators (KPIs) allow managers to identify problems before they impact performance. All functions are focused on cultivating and sharing best practices across the organization.
What’s not working
The company is not yet fully aligned with the market. It’s slow to adapt to changing needs in the marketplace.
Since Level 1, CAC has gone down by 16%. CLTV has risen by 13%. In terms of revenue growth maturity, the jump to Level 4 is most significant. Until, of course, the jump to Level 5 (once market alignment is achieved).
Paving the Path to Progress
Functional alignment depends on a clearly defined and understood corporate strategy. Every functional strategy must align with it. Reaching Level 4 also requires a big cultural shift. The CEO must lead it, and functional leaders must embrace it.
Having a roadmap in hand makes it easier to reach your destination. Make Your Number in 2016 is the roadmap we’ve created for you. It’s proven and precise. And it’s based on our in-depth research of B2B companies in every sector. Download it here for free to get started.
The Final Frontier: Market Alignment Level 5
Companies have reached the pinnacle of our Revenue Growth Maturity Model. They’ve gone beyond eliminating internal dysfunction; they repeatedly disrupt and conquer markets. In terms of revenue growth, they’re virtually unstoppable. We’ll examine this select group in tomorrow’s post.