Making the Business Case for Sales Performance Management in APAC

April 30, 2013

On April 22 and 23, OpenSymmetry and IBM hosted two joint sales performance management (SPM) events in Malaysia and Singapore to help create more dialogue with business leaders in the APAC region. Our goal was to help attendees learn how SPM solutions can help them achieve their strategic goals and increase profitability. In the process, we learned two key things from attendees:

  1. Reducing costs is important, but SPM vendors have to show how they can deliver the strategic results these companies need stay out in front of their hyper-competitive markets.
  2. Business intelligence (BI) is becoming a critical component in every sales performance strategy. SPM vendors, take note: BI is no longer an afterthought but a top-of-mind need for APAC organisations.

We approached these events as an education opportunity because the SPM adoption rate in APAC is less than 10 percent of the global SPM install base. However, countries in the Association of Southeast Asian Nations (ASEAN), in particular Malaysia, Singapore, Indonesia, Philippines and Thailand, are investing heavily in SPM to give them a competitive advantage in the market. Within these countries, the insurance, banking and telecommunications sectors are especially interested in leveraging SPM to replace legacy systems and better manage channel sales and incentive compensation requirements. Within ASEAN countries, strong economic growth forecast at six percent year-over-year until 2015 is supporting significant adoption of SPM solutions. SPM providers clearly see this as an opportunity because leading SPM vendors have been investing significantly in these countries since 2011.

Why all this interest? For one thing, the APAC region as a whole has a rapidly evolving compensation culture, and organisations are clearly looking for new ways to manage, empower and drive sales force effectiveness. So the need for incentive compensation and sales performance management effectiveness is growing fast. Second, APAC economies are predicted to grow between 5.5 and 8 percent in 2013, while the overall global economic picture is far less optimistic. The business need, combined with rapid economic growth, is creating a tremendous market opportunity for SPM.

That being said, we know there are several challenges and barriers to SPM adoption in APAC. For instance, many industries are struggling to manage massive volumes of data — particularly in telecommunications. In addition, organisations must comply with highly complex local regulations, language requirements and multiple currencies and sales channels.

Above all, despite the increasing prevalence of CRM and CPM cloud solutions in APAC, many industries are still slow to adopt SaaS-based SPM solutions. While this may be due in part to local legislation and requirements, I think the bigger issues are concerns around performance and security. SPM solutions are still mainly hosted in the US, creating justified worries about performance. There are also big concerns about the security of financial and payroll data stored in the cloud. Moving forward, SPM vendors are going to have to resolve those problems if they want to drive SPM adoption across the region.

Perhaps the biggest surprise (and the biggest opportunity) is that APAC companies now consider BI to be a key driver of any sales performance strategy — not an afterthought. In the past, market research indicated that BI was regarded as more of a nice-to-have but a secondary priority for companies in the APAC region. Solutions that can deliver mobile intelligence to key decision makers are likely going to be in the forefront in the coming months.

Ultimately, our takeaway from the APAC events was this: Focusing on operational cost efficiency is not enough to make a business case for SPM in the ASEAN. The business leaders we met with want to know how SPM can deliver top-line strategic results and set their company apart from the competition. And BI is going to be the foundation of those strategies moving forward. SPM vendors: Are you listening? Did you attend one of our recent APAC events, or are you a business leader interested in SPM solutions? Let us know your thoughts in the comments below!

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