Oakwood Temporary Housing has been in business 50 years, providing corporate temporary housing and relocation services. Corporate clients work with Oakwood to provide its employees temporary placements or relocation help.
The industry is in the midst of a transition. Prospective movers can now find information online about nearly any location in the world, and can book their own housing. In addition, multinational firms began to centralize their housing resources instead of leaving it up to each regional office. With the changing competitive landscape, Oakwood realized it needed to move beyond simply providing housing products to becoming an advisor to its clients. To do this, everyone in the organization, especially its sales staff, needed to listen to customers and prospects, says Ken Revenaugh, vice president of sales operations.
Five years ago Oakwood created a Transformation Roadmap with sales performance companies Miller Heiman and ZS Associates that completely revamped the 300-employee sales organization. A new executive team came onboard to enable a fresh direction for the company, and sales and marketing are now jointly responsible for the new sales strategy. Revenaugh details the seven-step sales transformation, which was put into place in 2009.
1. Listen to the customer. The company spent two years listening to customers before making any operational changes. It conducted focus groups, sent out surveys, increased customer visits, and created a customer council that meets every six months. "The new program is designed around what customers want, not what we thought they wanted," Revenaugh says.
Oakwood discovered that customers wanted something different, "not just a cosmetic change," he adds. "Customers said, 'I want you to know my business. Be curious, and ask underlying questions.'"
2. Enable segmentation and targeting. By talking to customers, Oakwood learned that its seven primary verticals have different needs, and should be treated differently. "Before we were just trying to sell features and be everything to everyone," Revenaugh says. But the housing needs of an entertainment client for a movie shoot are different than for corporate relocation services. Oakwood created industry-specific sales kits, presentation templates, and reference materials for its sales staff to help them be more relevant to their customers and prospects.
The company also changed its marketing materials. For example, Oakwood's government clients were bothered by the term "temporary housing," because they consider that to be barracks. Oakwood changed its messaging and its tagline on campaigns to government clients to now say "extended-stay lodging."
3. Define the value proposition. The company's previous value proposition was that it was the market leader as the largest and oldest temporary housing firm. But the company moved away from this outdated, one-size-fits-all model to allow salespeople to customize solutions and act as a trusted partner to individual client needs.
4. Create a sales playbook. "Everything is aligned to how a customer buys," Revenaugh says. The new playbook is based on a "gather, get, and grow" model of selling, and outlines the best practices Oakwood's top performers employ based on 120 specific actions. All sales managers and associates attended a two-day training program based on the playbook, and playbook information is accessible from a new sales portal, built with Savo.
5. Invest in human capital. Oakwood Senior Vice President of Sales and Marketing Chris Ahearn revamped the sales force to adapt to the new sales strategy. Nearly 48 percent of the prior sales organization was managed out because of poor performance and unwillingness to change. Turnover also affected 85 percent of the previous sales leadership. This provided an opportunity to hire new staff. Ahearn created a new sales leadership team composed of three sales vice presidents, two co-directors of marketing, and a vice president of sales operations. He also hired new associates at all levels.
"We've hired salespeople that fit," Revenaugh says. "Curiosity is a core competency we hire for." The company redefined its sales roles away from a one-size-fits-all account executive model to align them to different customer segments.
Oakwood then sent its newly focused account teams out into the field. "Customers said they want to see people face to face," Revenaugh says. "The prior sales leadership never went out and saw customers. We need to be in front of customers." In the past, sales reps would make about two client visits per week. Now the average is about nine client visits per week.
This alignment allowed for more optimal coverage of current and prospective clients while saving $500,000 per year, Revenaugh says.
6. Pay for performance. Oakwood also took the opportunity to change its sales compensation structure. Previous structure based salaries and titles primarily on tenure, not performance. Oakwood realigned its compensation program to foster a culture of accountability. It created minimum threshold levels for compensation, reduced subjectivity with consistent metrics for both sales teams and managers, and simplified the process so everyone understands how they are paid. And in a new step, all employees are now incented on overall company gross profit, which adds a companywide, team component.
7. Share transparent metrics. New CRM, marketing, and sales analytics tools give employees a window into how their activities relate to the bottom line. Sales dashboard reports provide insight into what's working and what needs improvements in the areas of activities, clients, and market opportunities, as well as sales, expenses, and profitability. The company also launched its Marketing Tracker tool, which tracks call volume, click-throughs, and other response to Oakwood's marketing activity in print ads, online banner ads, e-newsletters, and direct mail. All of this new information provides management with better decision making information, Revenaugh says.
In addition to its seven-step initiative, Revenaugh points to two new programs that have had a positive effect on the new sales strategy. First, each new sales rep must solve a virtual crime after receiving "detective training," designed to enhance investigative skills and general curiosity. "We want to take them out of the sales mind-set and truly solve the customer's problem."
Second, the company instituted weekly sales huddles within each region, involving 10 sales reps and a manager. Each week one person presents a customer issue, and the team works together to resolve it. "Everyone brainstorms together on what steps to take to move the process forward," Revenaugh says. "It gets deals unstuck." He says the success of the regional huddles has led to a weekly executive team huddle to work on potential sales, as well.
Oakwood's sales transformation has netted some impressive results. Its sales volume went from 304 wins in 2008 to 1,444 wins in 2009. What's more, marketing spends 30 percent fewer advertising dollars than it did three years ago while driving more qualified leads, Revenaugh says. Revenue jumped from $53 million in 2008 to approximately $188 million in 2009. Additionally, Oakwood won business increasingly faster as 2009 progressed, moving the sales cycle from 5.5 months in January 2009 to 1.6 months in December 2009.
Revenaugh is proud of the company's transformation, because it was done around the customer.
"Listening to the customer is the most important thing we do," he says. Next steps include taking best practices from its sales transformation to its service organization. "As proud as we are, we have to constantly improve. The voice of the customer drove [our sales strategy], so we need to do it with service too."