How an industrial manufacturer reversed its growth decline
Impact by the numbers
The challenge
A global manufacturer of industrial parts was experiencing declining growth due to a contracting economy and diminishing technology advantages, along with increasing competition, globalization and sophistication of buyers.
The company faced a clear imperative for change. To address these market challenges, it launched a strategic imperative to significantly elevate its selling capability. Until then, it had historically made limited investment in sales effectiveness and lacked the experience to execute this imperative independently.
ZS helped reverse the decline with a value-based sales process and a performance-focused sales culture. The company partnered with ZS and focused on achieving three objectives to help reverse its decline and generate substantial growth:
- Improve market coverage
- Increase the impact of customer interactions
- Increase motivation and accountability
The solution
ZS worked with the global manufacturer to develop actionable customer segmentation, along with a new sales structure and geographic deployment. We recommended additional roles to better align sales talent and cost with the needs and value of each customer segment, including a newly identified group of strategic accounts.
ZS created a value-based sales process focused on targeting the right customers and realizing premium pricing. We supplied supporting tools to arm the sales force with winning value proposition strategies and enablers.
ZS built a talent strategy based on new competencies and hiring, coaching and training processes to upgrade people and skills.
ZS also delivered a new incentive plan, along with new metrics and dashboards, to instill a performance-focused and accountable sales culture.
The impact
Our reinvention of the sales process and culture drove significant growth for the manufacturer that exceeded its expectations. In the two years after these initiatives launched, company revenue grew at a 12% compound annual growth rate above plan, driven significantly by market share gains. This growth signaled a drastic change from the manufacturing company’s historical trend of a flat-to-declining market share position.
Revenue more than doubled in the identified strategic accounts, which received increased focus as a result of the new sales structure, roles and deployment.
The manufacturing company also changed ownership after the sales program launched. The seller exited the investment with a 2.6x multiple (a net profit of $340 million), largely credited to the investment in sales effectiveness.