The Pandemic’s Impact on B2B Selling

Welcome to Advanced Automation, a podcast by Calvary Robotics, where you'll find industry leaders and experts sharing their thoughts on the world of automation. Hello. My name is Joe Gemma, and you are watching watching another episode of CalTV hosted by Calvary Robotics. We work to bring topical discussions around issues and opportunities for business by engaging business and thought leaders. And Calvary is also a premier source for expert insights in automation and robotics across a wide range of industries. I had the pleasure of speaking with my good friend, Christophe Schell, chief commercial officer for HP Inc. We had such a great conversation that we decided to break it up into two parts. In this, the second part of my conversation with Christophe, we explore how commercial efforts are being reshaped by the pandemic and has permanently modified the business environment in general. So now thank you for your insights on that topic. When I said with two important topics you wanna discuss, so if you'll permit me, we'll switch topics a little bit. Although they're still impacted, this is just as much impacted by the pandemic. And kind of a background on it. So the Internet's given consumers more and more information develop to develop more intelligence in their buying decisions, and this is true with business to business and business to consumer. And in fact, prior to the pandemic, this access to information has allowed more buying decisions to move to growth in the ecommerce, for an example Mhmm. But also more savvy equipment buyers, even including selection of machine builders like us before we even talk to them for the first time. So you've used that word. You used it again today, and I like it. I'm gonna borrow it, prosumers, the the rise of utilization of digital enterprise level capabilities. So this is changing the face of selling. So let's talk a little bit about, you know, the the face of selling and engagement in many markets. In in what way has HP adjusted to address this, I'll say, paradigm, and has this impacted your organization's roadmap? Yes. In capital letters. So, I can give a lot of answers on this. So the first one is look. The organization that I'm representing in HP with my team, we call it the commercial organization. And, it's an organization that is twelve months old. And I told you I mean, you you've went a little bit through my resume. The fact of the matter is I've I'm close to twenty three years in HP, and we had a lot of change in these twenty three years in HP. But one thing had never changed. We always had three regions. Americas, EMEA, APJ, and Japan. Always. Okay? What we identified, couple of years ago is that this decentralization of decision taking, whether it's in a b two c or b two b environment, and that's what these three regions did, that doesn't really work anymore. And the reason why it doesn't work is because customers have decided to move their shopping journey, if you want, to online. Again, very much in a b to c and a b to b environment. Okay? I want everybody to understand this is not a consumer play. This is happening across all customer segments. And so what happens with this is that for a company like ours, the consistency of how you present your products and services is super important because customers are really not happy if they search for consistency, in particular, the b two b environment, and they get different answers because your company might be decentralized in their setup, and you might have one information in one country that doesn't match the information in another country. And this could be anything. This could be the specs that you offer. That could be the service level agreements that you offer. It could be price. So what we decided to do was really okay. This doesn't work with three regions. We're gonna have one global organization. We're gonna structure the globe into ten markets. We're gonna have categories that own the four p of marketing, product, price, place, promotion, centrally. And we're gonna have centers of excellence. And we have a bunch of centers of excellence, but the two that I wanna talk about is our HP store, where we bring value propositions, to our customers directly. Whether they buy from the store or buy from a partner, doesn't matter. Okay? But we want consistency in how we present it. And we created a team that I call omnichannel. Okay? And this is omnichannel team is a team think about data scientists that are now in sales. Because one thing is true, Joe. You said this. You have a customer that is much more informed because of the Internet and because of the marketplaces. But through getting the information, that customer actually leaves footprints. And these footprints need to be they can be used by by partners, by by ourselves in order to actually understand what the customer wants. So you can sometimes, if you do it as well, predict what the customer wants before the customer is actually able to articulate that. And if you do that well and you have a direct touch to that customer, if he allows you to have a direct touch, he has to obviously, he or she has to opt in. But let's assume they do that, then you can start a one on one engagement. When you do a one on one engagement, you can have a dedicated value proposition to that customer. This is what's happening. That's why I want you to think positively about online selling, about marketplaces because, yes, you become more transparent, and it's easier for customer to see exactly how good you are, but the customer becomes more transparent as well. So it is a level playing field. You need to embrace it. So what does it mean to me? I said this already. The composition of my teams is changing. They need to have different skill sets. I'm hiring data analysts in sales. Okay? Something I would have never done before. Before that, I hired people that were good in relationships, that were subject matter experts in a category, for example. But data analysts, they don't understand, very often the product that they're selling, but they can analyze footprints, that are left digitally. And so I think that's I'm I'm again, you don't go from one extreme to the other. It's always the balance. It's always the mix. So I still have product experts, but I have more and more omnichannel experts as well. And it's the mix that makes this work. Doing that globally is is fascinating because different markets go at different speeds. It comes back to how customers in markets embrace online buying. You have countries like China where it is through the roof. The US is, a close second, I would say. But then in particular, in my home turf, Germany and Europe, people are a little bit more hesitant. Okay? There is a lot of, concerns about data privacy for good reasons. Okay? I think that needs to be managed well, and they need to have a choice whether they opt in or not. But, obviously, that changes the dynamics for us as well on how we engage. So having and this is where I will stop here. Having a good global idea about what your value proposition is and being able to reinforce this while also having some local abilities to differentiate, that's the name of the game. That's the balancing act that we do every day. But I hope that answers the question. I mean, we had this year from a go to market point of view in HP, probably more change than in the past twenty three years. It's interesting. As you described it, I'm thinking that value of that footprint, it's actually both ways. The consistency of us as consumers and what we do so you can manage and understand what I might need, as you indicated, and be ready before I even ask and vice versa. The consistency of how you present and what the the organization looks like so that I feel comfortable with that that buying decision of the consistency and as you say, across that that value chain, it fits my comfort level. So as you say, as you described, I'm thinking it it's equally as important, that value of that footprint. You know, you've you have noted that consumers are requesting more personalization experience. Some call it mass customization. In this and in fact, you've even indicated it's impacted how HP might design products. Is there an example you could give us of how that might have changed how you design a product to make sure it's it's more else to call personal experience or the mass customization strategy? Yeah. And I think it's a it's it's a great question, Joe. I need to in order to answer it, I need you to to think about a product being a system being a system of different components. And in my world, you know, that can be hardware, that can be software, that can be a cloud service, that can be a workflow or work stream. All of these come together. Okay? So I talked early on about Instant Ink. So let's say, Joe, let's say you are an Instant Ink customer of HP. Okay? Let's say you pay I'll make this up. You pay five ninety nine a month. And for the five ninety nine a month, we give you a hundred and fifty pages to print. But because you have opted in, and I know a little bit your your behavior, I know that you have a big family and that you reach out, or prior to the holiday period to them. You actually send cards. Let's make this up. You send cards to them. Okay? Mhmm. Now let's let's assume that in the month of October, I'll send you a message and say, hey, Joe. I know that you are that you are in the process of designing your cards again. Do you need help? Can I can I give you a design service for that? Do you wanna upload some pictures and we send some proposals back to you? Let's say you engage. I'll do this the first one I'll do for free. Okay? Then we'll we'll have a design. Okay? And we'll follow-up and say, hey. Do you need help? Do you want this to be printed, or do you wanna print it at home? If you wanna print it at home, I can send you the cards, and I I'll I'll I'll do the additional pages. Let's say that for the month of November, in return, you don't pay me five ninety nine. You pay me twenty five ninety Okay? But we'll get this done. Or, oh, you don't wanna print it at home? Hey. Here's my partner, a professional print service provider who can print this for you. Okay? So you understand. This is a personalization, because I know what your outcome, what the outcome is that you want. Okay? And I help you. I facilitate it. You outsource it to me. And because you outsource it to me, you gotta pay me for that. But I guess that the outcome might be better than if you do it by yourself. That's that's the whole bet here. That's what this is all about. So what you what you feel is that in this in this direct one on one engagement, an outcome based engagement, there is room for personalization, for individualization, and we can scale it up and down. I mean, my example is now a seasonality example. So, in December, you don't pay me twenty five ninety nine. You pay me again five ninety nine because we go back to the standard offering. Okay? Now think about this across all categories. I mean, this is a print example. Think about this about personal systems. Think about this in a manufacturing, environment. Okay? You have a customer. You have a partner that manufactures one component for you. But because the this partner actually tries to understand how this component fits in your overall solution, this partner might think about value propositions to you that you never thought about. And may maybe something that was core to you before now is less core because you feel this partner can do this for me. Okay? So I think we need to look at these these these elements of working together, of partnership at a whole new level. I do believe that ultimately, close partnerships, which might manifest themselves in contractual subscription based business models, is the future. The key thing about subscription business models, I just wanna say, the thing that still gets me globally is mobile phones. Okay? I mean, I still need to sign a two year contract in most countries if I wanna have a mobile phone. That's not gonna fly with my kids. Okay? That's not how they think. They wanna be able to cancel every day, any day without penalties. And I think that's how we have to think. The value is not in the contract. The value is in the outcome. And if you deliver a good outcome, then the loyalty will stick. So I think this applies for consumer business. It applies for business to business. It applies to business to industry. Whatever you wanna define it, it it that's the future. That's how this will work. Thank you for that. In fact, I feel so special because I feel like you personalized it for me now. Thanks. Not yet. And for our listeners, certainly, you know, obviously, we know each other and have a I do have a big family. And, so for the rest of you, Christophe's gonna send Christmas pictures to all my kids now. Anyway, so thank you for that. So, you know, with this new paradigm we're dealing with, it's an issue that we face as companies, and and I'm sure you do too, related to the forecasting and this new engagement with customers. And I'm wondering, what advice would you give companies to consider when looking at forecasting in the future? And when I say future, I guess it's actually now because of the this new reality we're dealing with. So what kind of advice would you give, peep companies to try to look at their forecasting model or what that might look like? Yeah. Look. I mean, tough year from a forecasting point of view because the historic data didn't play. It wasn't important. I told you about the shifts in category that we see, some with headwind, some with tailwinds. My historic my history, didn't show that. Okay? So what I what we've learned to do is a couple of things. Number one and I I I I I'm not saying that we are, best practice here at all, but this is what we did. We we went to scenarios. Okay? And in order to build scenarios, we decided to take a more long term horizon. So if in the past, we planned two quarters ahead, now we plan four quarters ahead, five quarters for some of our business. It has to do with length of supply chains. That was number one. Number two, when we start to work on scenarios, we had in the beginning a tendency to boil the ocean. Okay? I mean, we had hundreds of, criteria, and assumptions in it. And at some point, we pulled the plug. And it has to do with me not being so intelligent, so I cannot I cannot go through all of these features. I had to simplify. But I actually think it was important. And that led to something that we are still working on today, but it's it's an interesting thing. It's not so much about forecast accuracy anymore. That's what it used to be in the past. It's more it's more important about accuracy of ambition. So what do you want to achieve six months from now? Is it okay to sell x units even if you call the market wrong? Let's say you undercall the market and you lose market share. Are you gonna be happy if you sell sold the units that you forecasted six months ago and you made an impact on customers and maybe some money sticks to your fingers? Is that good enough or not? It's an interesting philosophical debate. We haven't landed that, but it's a learning from this year. I I am starting to view forecast accuracy a little bit more differently. The third element, and this is what, what we touched on early on, there are limitations, to how good you can be in forecasting depending not only on you calling the value proposition correctly or the market size, but actually calling supply correctly. And that has been a a major, major learning this year where, we had disruptions in in in manufacturing. We had disruptions in logistics. And because of that, we had supply constraints. Okay? And so there, I think this idea of having more flexible, operations, manufacturing setups, logistics strategies, moving more from analog to digital, that's really it. And I do believe and this is a a nice, light, little side effect. We talked early on about more customers going online and leading that footprint. That footprint can help you upstream to define what your value proposition is, But downstream, it can inform you what your funnel is, what the quantities are that you need, how your manufacturing, your S and OP forecast looks like, but also maybe how your financial forecast looks like. So having having more data in the end is something that is super helpful. So I I want you when you think about your online go to market strategies, don't only think about it from an online go to market point of view. You need to think about outcome for customers. And inside the company, what's the digital transformation that this will drive? How will it help you with accuracy or forecasting? Anything. Forecasting of parts, FGI, forecasting for financial purposes. That's the opportunity that we have. Great. Thanks for that insight. And as analytics, I I agree with you. It's very important. And I I'm sure if we went back to most companies around the country, around the world for that matter, to September of last year, what was anticipated in forecast for many of those certainly didn't play out the way they expected to for twenty twenty. Oh, yeah. Even for our company at Calvary, we certainly, and more like you just described, more of a long term forecast planning, but across different we're pretty diversified across different markets. But some of that was, again, maybe opportunistic in that perspective of the PPE and and that we couldn't have forecasted. We didn't even know that was going to be a challenge that needed to be addressed going forward into twenty twenty. So that that'll certainly be taking a different perspective, like you said, of looking at long term understanding analytics, getting the data, and taking advantage of that. Okay. So speaking of that, the future, so to speak, once we get past this lockdown situation we're in now, how do you think the balance will look between what we call the traditional selling methods, boots on the ground, for lack of a better term, and this newer social selling and data analytics discussion we just had. How do you see that balance looking like in the future once the lockdown is over? You will have both. There will be coexistence. But I do believe that what what this year brought to us is an acceleration, in particular when it comes to social selling. I think that, you know, the the plans that we had or that I had a year ago, for what would happen in the next five years, I think that all of those five years happened this year. And so, because of that, we are on a faster trajectory. And there are other impacts that will continue to enable this, and drive it even faster. Give you two, travel. You know, in the past, you and I, for this exercise, we probably would have met somewhere in a room, and we would have recorded together. I will never do that again. I will not travel for an interview. Okay? We can do this virtually. It's perfect. Travel in general, I will think twice before traveling. Okay? And that's a good thing because think about sustainability again. Office buildings. We will have office buildings, but I think that the nature of the office buildings will change. We will not have a desk for every employee. They might shrink in size. We will have an office because we want team building to be done on a weekly level. We want for the team to have fun together. But productivity wise, in particular, in our culture here in the US where, you know, compared with with Southeast Asia, homes are a bit bigger, you can work from home. You can work from home a couple of days a week and then go in a couple of days in the week. That's will have an impact on real estate. Okay? Manufacturing. Digital twin concepts can be operated from home. Absolutely. That will have an impact on how we think about factories. You will invest differently in factories. Security, cybersecurity will be a much more important topic than it was in in the past. So these are I'm just naming a few things in order to say, yes. There will be a coexistence, but don't be surprised if that social, virtual, online selling will increase. Another thing I wanna tell you, my personal experience. I'm not a social media guy. Okay? I I don't have a Facebook page. I'm not an Instagram. The only thing I do is I'm on LinkedIn. And on LinkedIn, the amount of time I spend on LinkedIn has gone up. Not only this year, it has gone up over the last six, but it has dramatically gone up this year. You know why? Because it's so darn difficult to sell virtually. If you don't know if you're in a farm in a farming environment, maybe. Okay? Because you might know, the the the person opposite that makes the call, that makes a decision. You know, might know him or her from pre COVID. But if you're in a hunting environment and you don't know the person and they switch off the camera and you can't see their face, you can't read their body language, how are you gonna pitch? You don't know if they're even listening. So social media is important because prior to that to that virtual engagement of a Zoom call, for example, you can try and build a relationship. You can try and build a relationship maybe on something that is different, than what you're gonna talk in a couple of weeks about from a business point of view. But try and learn about that person. Try and and and and and and make a difference, okay, compared to your competition. Social media helps you with that. Social media, LinkedIn, it's an interesting feature, in in that entire sales cycle. So interestingly enough, I'm learning a lot. I'm learning a lot from my employees, that understand social selling more naturally than I do. I'm learning from my kids, and it works. The funny thing is it works. It and as a salesperson, the success of selling something virtually is as good as selling it in person. You still sell. Okay? And it's a real differentiator. So I think coexistence, yes, with social selling having a much faster trajectory than the more analog traditional way. I I would agree. Certainly, I've been a a, in in our company. They'll tell you. I've been a champion of the idea of using LinkedIn and the and I know. Possible from that. You're certainly prolific there too, but I I think it's a big benefit to getting, kind of exposure in the marketplace, but also people accepting to communicate with you in in particularly in the environment we're in. So, again, I really wanna thank you spending time with us. We know your time is really important to spend some time with us like this and share your insights, your thoughts. You you know, you're well sought after thought leader in the global market, so spending time with us is really a a benefit for our listeners. We appreciate that. But before we go, and finally, if our listeners would like to know more about what HP is doing, is there a website we can direct them to or somebody we should direct them to that we can share, for our listeners today? Yeah. Look. I think, easiest, obviously, to go online. Go on h p dot com and and check our services and and products and value propositions out. And if you wanna connect with me, look me up on LinkedIn and send me an invite. Great. Good. So as always, great seeing you. Great talking to you. I I do hope that we can get face to face sometime in the near future, but this is this is good close second to that, and I wish you as always the best and continued success for you and your team. Thank you again for spending time with us. Thank you for having me, Joe. It's always a pleasure. Thank you again for tuning in to this episode of CalTV brought to you by Calvary Robotics. Stay tuned for future episodes and more topical discussions about how robotics and automation are changing the way the world does business.