I know of one tier one software and service provider whose lead generation starts in a call center in Bangalore-3,000 full-time employees with its own physical and management infrastructure. Those employees come in at night and start calling U.S. and European companies to verify contact information [for corporate IT leaders]. Once they validate the lead, it's sent to the inside sales organization where someone else makes a follow up call to determine interest. Then it goes to the channel manager who conducts an interview with the lead. Then it goes to the channel partner for that region. The ratio they're looking at is 1,000 to 1: 1,000 phone calls for one opportunity. And the IT buyer community is doing a better and better job of disguising themselves to avoid the whole process.
It's all based on consumer advertising models originally conceived in the 19th century. It's the demand generation model. You put juicy hamburger on the TV screen and you load it up with cheese and bacon. You make it look really good, and put a lot of sex behind it, and people will say, 'Wow, I want that!' and go to Burger King and buy it. But that doesn't work in corporate IT. You don't have a CIO in the enterprise saying, 'I didn't think I needed storage. But, wow; now I do!'
CIO.com: The process, you note, breeds discontent and distrust. Can that work its way into the day-to-day outsourcing relationship that results?
Hall: I think that everyone knows to differentiate between sales and the ongoing relationship. Salespeople are their own breed.
One thing I think it does make a difference in is the outsourcing decision. A good salesperson-one that's good at building relationships-can sell you a bad service. And a bad salesperson may actually have the better service. What wins the day is the best salesperson rather than the best outsourcer. If you're looking for better outcomes, you have to cut through the noise and make a decision based on rational assessment.
CIO.com: What about after you sign a contract-does the hard selling continue?
Hall: If it's an IT services relationship, there's always the question of renewal. The salespeople love you for two months prior to the purchase decision. Then they may go away for ten months. Then two months before renewal, you get a new salesperson calling you. That's the way accounts are managed.
If you're already in relationship with an IT services company, the switching costs can be enormous. The vendor's goal is to get ingrained as much as possible so the switching costs are even higher.
CIO.com: What's the best way to handle the upsell or renewal calls from an outsourcer?