You are one of the many businesses, small and large, in varying phases of deployment of a document management solution (DMS). Investments have been made financially, in personnel to keep the project moving, and in training to ensure some level of adoption. Now your boss comes to you and asks how the project is going?

Of course you think it’s going well. It’s on auto-pilot, right? You built it into the business workflow and things are getting scanned in? That’s the picture of success right?

Sadly, there is not a finish line to success. Sure basic project management training will tell us to set and achieve milestones of success, but success is a journey and not a destination. We often fall victim in the trap of justifying success based upon levels of acceptance and adoption far too low - simply to appease our own egos, ease our conscience, or simply justify our job.

Document management can be extremely complex unless you have:

1. A very firm grasp on your business process,
2. how to apply technology in order to automate processes, and
3. a keen perception of your company’s culture.

My company has been working with DMS for a number of years now, and even in a small company like ours, I am constantly amazed at how easily an initiative can be derailed without an executive level sponsor who both drives the initiative and lobbies for success.

You as the project leader, or business unit leader, must be a strong champion of the solution and constantly beat the drum of applying the solution to solve business challenges. Don’t force a square peg into a round hole, but look for innovative ways to apply the technology and get the true bang for your buck!

Furthermore, you as the champion cannot drive the offering into each nook and cranny in your business. You must rely on departmental leadership to come to your call. This is where it is essential to have buy-in from all unit leaders, and this - perhaps - can be one of the most challenging portions of just about any project rollout, especially one like document management that hasn’t quite crossed into the realm of infrastructure like e-mail and line of business applications.

Without understanding and acting upon these key functions of your document management project, your solution will never take root in your organization, and ultimately will fail.

Before we start, let’s agree to use the official version of The Copier Sales Dictionary definition of ‘solution’: 

so· lu· tion   /

[suh-loo-shuh n]

–noun

Anything you sell other than just copiers. My copier proposal was half the price and I still got crushed! They said that even though we have been their copier vendor for the last 10 years, going forward it was in their best interest to give their business to a more knowledgeable company that can provide more than just copy machines but actual solutions to their business objectives. 

—Related forms

so·lu·tion·al,

—Synonyms key, resolution.

At countless sales meetings you have stood in front of the sales force and extolled the virtues of selling solutions. You regurgitated words like “applying industry leading expertise to…”, “develop and deliver comprehensive, customer-focused…”, and other similar facades when explaining the importance of selling solutions.

You have read all the industry analyst reports complete with the pie charts and bar graphs of industry trends moving towards the solution sale. You tweaked the compensation plan with additional incentives when a solution sale is closed. When all of this did not provide the expected results, you designated some of the more tenured reps to focus solely on the solution sale and you bestowed the sacred title of “Specialist” on their new business card. But still, no sales.

Figuring it can’t be you, it’s got to be them, you looked outside the organization for the answer. Enter the sales trainers and the one-week boot camps.  This was successful.  Successful in taking your reps out of the field for a week and further losing momentum. You were then convinced that you just needed to find the right person and the right person did not exist in your company. Seeming like a good idea at the time, you hired that ex-IKON / ex-Xerox / or my personal favorite, ex-Kodak burnout retread, to carry the company flag. This surely will guarantee your solution sales.  But the only guarantee that occurred was the outrageous financial guarantee you contracted to pay this impaired fossil.  After all this effort your solutions sales have not increased. In fact, your overall sales are down from the year before because all the changes distracted the focus of the sales team.

The Stalled Solutions Sale

The actual reason for the stalled solution sales is very simple. Copier sales people have historically never had to create a compelling reason or unearth a compelling business reason for the customer to buy.

Prove it? Of the sales that were closed last year, the overwhelming majority were triggered by either a lease expiring, a lease close enough to buyout and keep the customers price about the same, a competitor’s proposal to your current customer, or the customer complaining about the copier and demanding a new one. We have relied on the lease expiration date and customer dissatisfaction to create the reason to buy.

Still disagree? You sure you’re not just in denial?  Answer this: What percentage of the sales last year involved upgrading a copier that was initially a cash purchase and was not leased?  I bet it is a very similar percentage of printer management sales closed last year. The idea is the same. The customer owns all the desktop printers. They are not on lease. There is no stated existence of a magical time when the customer is required to make a decision on the future of the printer fleet. They do not receive a monthly invoice summarizing all the associated costs and a reminder that the lease expires in three months.  The only reason a customer would choose to procure a printer management program is a compelling reason that bridges the gap to either move towards a more desirable state or move away from an undesirable one. Copier sales people do not have experience, skills, and many times the desire to build that bridge.

What about software document management programs? If your reps can not develop a compelling case for a customer to modify an existing process (how they currently buy desktop printers, service the printers and procure the associated consumables) why would it be difficult to understand why they cannot sell software document management programs? This type of program is an entirely new process for the customer. I cannot recall a single sales appointment when a prospect has said,

I am so glad you are here. You see Max, 5 out of the 10 people in the accounting department will be expiring in 6 months and I was hoping you had a combination of hardware, software, and professional services that could not only supplement their existing responsibilities but I was really hoping to accelerate the entire document workflow process in that department. Did you bring a brochure with you?

How can we fault the reps? Just because their skills on the miniature golf course have been up to par, we expect them to play golf.  Sure, both activities use putters, require keeping your head down, and use those stubby little pencils without erasers to record the score. Heck, even the 18^thhole is the same as it determines how soon you will play again: If you hit the ball through the blue fairy’s trap door you earn a free game compared to draining one from the cheap seats for an eagle. In either case you can’t wait to play again. We are placing unrealistic expectations, on the reps to embody the sophistication of orchestrating a solutions sales type transaction just because you said to do it. Dead man walking.

If you do not develop an alternative to honing the skill necessary,  the only chance you have of consistent solutions sales will be waiting for the phone to ring and listening to the exasperated caller complain that every time they walk up to their accounting department to submit an order, the department starts making funny squeaking sounds, begins streaking, and then turns red right before deciding to stop working completely.

Max Rosenthal is an analyst with Diversified Business Solutions, a BTA member company in San Diego, California. Diversified Business Solutions works with CFO’s of small- to medium-size businesses that are interested in accelerating the time to cash. He encourages your opinions and ideas and can be reached via e-mail or phone at 858.565.2737.

Many companies have often wrestled with the idea of “owning” software. While most people now understand the concept of intellectual property, business owners are feeling the pain behind keeping up with the barrage of updates, patches, and major releases of the army of software products now required to run their daily business. To mitigate risk, many companies see a value in outsourcing areas of their business that are not their core competency. This has led to the SaaS (Software as a Service - see SalesForce.com) model gaining ground. The thought is that it is typically cheaper to rent the software than to own it. In my experience stand up time is very quick, but integration costs and subscription fees can get to be a little expensive over the life of the solution.

While SaaS in the DMS space has a bit to go before it reaches any true level of maturity, a fast growing example of seed-change can be seen where political campaigns are turning to Salesforce.com’s Campaignforce to help control costs, increase the speed of deployment, and leverage the social-network phenomena to gain votes. Most channel or direct software vendors see this type offering as a loss leader to create a funnel in order to bring more customers to their core offerings. To some extent, this is a bit concerning in that an offering such as this would not necessarily be the best solution for a customer, if a channel or direct vendor is only angling to bring a customer to their core offering.

There also seems to be a division within the SMB segment itself that is causing some introspection among the software vendors and service providers alike. Much like the “copier-industry”, this segment 1 customer base does not have the expertise or budget to manage intensive software projects, nor do they feel they need a “big software package” to manage their business. Generally, this segment 1 ranges from 1-10 seats (possibly ranging to 25), whereas the medium sized, or segments 2-4 customers might have 25-250 seats (ranging as low as 10 or as high as 500). The truly ’small company’ (less than $1 million in annual revenue) simply does not have the cash flow to invest in an offering unless subscribing to a SaaS model, nor does it want a big, complex software package to manage - as being nimble in the market place is a key advantage to scrapping with the big guys. However, some savvy business owners quickly realize the opportunity to apply this type of technology to their businesses, and the ability to offset future costs. As this type of business gains acceptance among the general SMB business community, expect DMS in the segment 1 and 2 markets to grow dramatically. Much like the HP inkjet printer business, the goal is to make money on the residuals across a large base of customers; this helps keep the costs low for the software vendor and partner and keeps prices competitive for end-customers.

With all of this said, there are many dangers that are lurking around the corner for every SMB, some of which have been mentioned above. The greatest obstacle I have seen is still project success and cultural acceptance, by far. While IT project failure has decreased over the decades, it is still dangerous to embark on IT projects in general. The Standish Group, widely regarded as the leader in IT Project risk assessment, publishes the Chaos Report. In a 2006 study, only 35% of IT development projects were considered successful, whereas a project that encountered cost or time overruns or did not meet user needs requirements was a staggering 46%. Even though this study references software development projects, I can tell you from experience many projects are doomed to failure before they even start.

The responsibility of conducting due diligence still rests squarely with the prospective customer - caveat emptor; it has become obvious to me the CMS/DMS companies have inventory to sell and that’s what they aim to do - even if the solution is not everything the customer needs. Only a provider that is willing to truely form a partnership is worth evaluating in the long run, since their business is dependant upon your success.

Integrating emerging technologies into a business can bring important benefits to the company. Look at how revolutionary facsimile technology was at the time, and what a game-changer e-mail has become. An owner must be extremely cautious not to bet the farm on an emerging technology unless they fully understand the value-benefit proposition as well as the cardinal rule, the culture must adopt the solution or it will fail. DMS technology will be important to decrease file-room sizes, allow for quicker access to documents, and aid in the processing of “hard-copy” documents. For all those reasons, I think it is a growing priority from which SMB owners cannot afford to turn away; however, they do have to ensure they understand their business and choose a good technology partner that understands theirs.

In the overly saturated market of electronic content and document management there is a deep divide developing between the enterprise-class content management systems (CMS) and the small and medium business document management systems (DMS). What is interesting to me is there are some programmatic differences between the applications, but the key differences tend to come in with the levels of professional services offerings and general approach or offering to the target account.

Many larger CMS/DMS vendors, like EMC, see the SMB marketplace as a ripe opportunity since their upper end client-base has been saturated. I am not completely convinced they understand the SMB marketplace as it requires strong channel partners or seriously commercializing the offering, thus reducing the lucrative professional services divisions’ opportunities. The smaller players have some interesting offerings, but with all of the chatter in the space, it is difficult for potential customers to determine the best offering for their business without simply jumping in the proverbial water. Therefore, what do they do, they turn to trusted technology partners in their area for advice.

This prompted many software companies into looking at channels instead of investing in a direct sales force - or at least, augmenting direct sales forces. This is a stable model and has some unique advantages, like allowing for localized service - which SMB customers identify with quite well.  However, there is often a wide variation in the level of expertise at each channel partner, so SMB owners would be well served to dig in and understand the bench strength of the local provider as well as what certification programs the software vendors require.

Another disadvantage of a channel-sales model is simply a cost factor. With each hand through which the inventory passes, the costs rise to the end-customer. Add to this any installation, training, maintenance, and customization fees and the price tag for an SMB can quickly rise to a dollar figure that could make an owner’s head spin. But, what an owner must way is whether the expertise of the local provider and on-going support offset a slightly higher cost, many times the answer is, “Yes.”

Learn the tricks to control costs in a DMS project and the benefits and risks of Software as a Service (SaaS), in Part 2 of this story…