Our newest Product Management Confessions interview features Mark Cranney, currently a partner at Andreessen Horowitz. As a veteran tech executive at companies like Hewlett-Packard, Opsware, and Parametric Technology Corporation, Cranney has spent his career in enterprise sales, working closely with product teams of all sizes.
Drawing from his years of selling SaaS and advising startups, Mark chats with host Matt Pasienski about the challenges of selling software, why sales and product teams need each other, and how companies can be successful. Some highlights:
- To be successful, sales should be the bridge between product management and engineering teams and the customer
- In enterprise sales, the salesperson’s job is not to communicate value; “the real job is to create new value”
- Companies need to think about their customers through three distinct lenses — users, mid-level management, and CXOs — in order to understand the different buying criteria and processes
- Putting yourself in the buyer’s shoes and the three questions product managers need to ask themselves
Watch Part 2 and 3 here:
Part 2: Mark Cranney of Andreessen Horowitz: Enterprise Sales Tips for Startups
Part 3: Andreessen Horowitz’s Mark Cranney: Key Advice for Sales and Product Teams
Matt Pasienski: Are you ready for the interview?
Mark Cranney: Yeah. We've got to get you built up before we take you out in the field.
Matt Pasienski: One hundred. All right, we're here with Mark Cranney. Let's do this.
I'm here today with Mark Cranney at Andreessen Horowitz and we're very lucky today because Mark is one of the greatest sales leaders in the world according to at least Ben Horowitz and anyone else you talk to. You've had many years of experience in enterprise sales and specifically you've talked to thousands of product managers and really have been selling the gospel of you've got to work with your sales team. Your sales team is the key to success especially in enterprise sales, so that's what we want to talk about. Where do you think most product managers are missing the boat when it comes to sales? Why don't they get it?
Mark Cranney: Well, you brought up the gospel word so I'll go with that. I'm a little more Old Testament, so you're either a disciple or a savature. Probably the biggest thing from a VP of sales' standpoint, particularly the enterprise space to concentrate on if I'm talking to VPs of sales is you really need to take it upon yourself to take charge of that type of situation and pull product management and engineering a lot closer to the customer. I mean it's a bridge that you have to be responsible for building and maintaining versus let product management and product development run on their own. Probably the biggest thing to concentrate on if you're new or up and coming VP of sales is go grab that product management team, that engineering team and take them to your customer, right?
One of the things that a lot of people don't really understand in the enterprise world is if you're going to market particularly in the global 2000 or going after big government agencies or large private companies, the value of a sales force is a lot of times misunderstood. A lot of people I think think that from a product side or from a marketing side think that the job of sales force is to communicate value, when the real job is really to go create new value. Another thing that they don't understand is from a product management standpoint, they're so focused around the product from a bottoms up standpoint features and functions, that they don't understand that the audiences that product that you're going to market with and sell.
One of the first things I like to do is explain to them. I mean when we're going to market after large companies, there is really 3 lenses they need to look at the customer from. At the bottom, more product centric are the users of the product and/or user managers. In the middle is what I'd say are the mid-level management line of business leaders across multiple functions and at the top is the CXO level. Each one of those lenses or each one of those buckets have different set of buying criteria and a different buying process. Go pull your product management team out to the customers. Get out and see as many prospects and customers as early and often as possible. Help them understand the different requirements in those 3 different buckets.
Matt Pasienski: The sales team is acting as both a translator or here's this complex company, here is what all of these 3 different groups, they have specific needs, but you said something the sales team is going to come in and create value. I think that's a critical insight that I think a lot of engineering and product teams don't understand because they haven't seen it in action. What are some examples of a sales team going in and creating value better than just explaining what the product is and given the ...
Mark Cranney: Yeah, let me back up a little bit. The first thing you really do from a sales and product management stance is put yourself in the buyers' shoes for a minute. No one knows your product and your value proposition as well as you do. You can't assume. I mean a lot of times you get in particularly the confines of Silicon Valley and your company, well this is just obvious to everybody but you roll out into other parts of the world and in the big complex organizations that are dealing with legacy issues and things of that nature, it's not as obvious to them. It's not as obvious to product management or product people what the as is environment is. If you put yourself in the buyers' shoes, for them to go through a process engagement with your company, you really have to answer 3 basic questions. There's 3 basic questions the buyer is asking.
That's why should I do anything different than what I'm doing now? That's where you go apply your sales process and your marketing type value proposition to that. Teasing out what's differentiated about that particular prospect or customer and really understanding them. Spending a lot of time in the discovery process early on. That's where you can start to answer that question. Eventually you get to okay I get it, I understand why I should be looking at your solution start-up company or technology company. Then you're moving to the second question is why you over the alternatives. All your competition can come from the start-up world, that's typically a different competitive motion than competing with incumbents. The biggest competition in a lot of cases is do nothing, do nothing different that what I'm doing now.
The third question you have to answer or the buyer or the prospective buyer is asking is why now, right? Why now versus why ... I could be putting capital, process, and people into another area of the business. It could be a competing solution that has nothing to do with your company.
Matt Pasienski: Or I love you guys but I'm going to come back in 6 months.
Mark Cranney: Yeah, 6 months or 9 months. I've got this other big initiative and program going on. It's not the right time, so why do anything, why you over the competition and why now? Helping the product people in the organization understand that these are the questions they go through. It's obvious to us why they should do it, but there's a process that they have to go through. Being able to map that sales process to answering those 3 questions is just crucial from a go to market standpoint. That goes from marketing as well as sales. The best product managers I've seen are the ones who're spending that time in the field, they understand those 3 different levels, what are the users, what are they thinking about, what is that mid-level management because the criteria is different.
Users, they care about using the product, the features and functions. Mid-level management, they might be aware of that and productivity issues and things of that nature but they have a different set of criteria. Then the CXOs, I mean that's more financially related, right?
Matt Pasienski: When you say the product managers got to be out in the field, I think one of the things that I've heard you say before is just the amount of time you actually need to spend. How long does it take to go out and close? When you were at PTC, how long does it actually take to go out and close some of these big businesses on a new software product that they might not have used before? Is it 2 trips, 3 trips or is it something way, way more than people were expecting?
Mark Cranney: It could be dozens. I mean you remind me of I had a large campaign. I was a second line manager at PTC which is New England's largest software company and then the product life cycle management space. We've sold primarily to discrete manufacturers. The biggest, baddest, most productive companies in the world that make things, just manufacture things. There's a little company up in the northwest that make footwear and apparel. I don't want to name the company, but it's the biggest and baddest. We had this product life cycle management product built on the web, started in the late 90's. The footwear and apparel business was completely different from our old business of selling computer rated designed CAD, CAM, CAE, where we primarily sold to discrete manufacturers.
The CTO of the company didn't think we had a product market fit with footwear and apparel. This footwear and apparel company was a very small customer for CAD, CAM, CAE, but this bigger product, this product life cycle management product, he didn't think there was a fit. I started chipping away on this with my team. I probably made just personally as a second line manager 50, maybe 77, maybe 100 sales call and that's not counting what my team made. At one time, going through the technical validation of that process of proof of concepts, and pilots and things of that nature, we probably at times had between pre-sales and consulting resources. You might have 25 to 30 people working on it, not counting. That's where I was fighting with the product people, they didn't want to do it, it's too complex.
Matt Pasienski: The product people at PTC?
Mark Cranney: Yes. Too complex, not in a real house. When we finally closed the first multi-million dollar deal, I was actually threatened to be fired if I didn't get off that account. I kept working on it. It was a make or break type of a deal as an up and coming sales manager at that company and t hat turned into a whole vertical.