aharon

Slide1: 

Sales and Fails What Sells and what Fails to Sell Aharon Aharon

Objectives : 

Objectives Share my experience of sales cycle & profile Resolve the Sales & Marketing myth Understand the role of strategic thinking and careful planning Understand the CEO responsibility Think how to utilize the benefits we have in Israel … and understand our limitations Have some fun

Key Messages for the CEO : 

Key Messages for the CEO Define your strategic (sales) goals. Think big, out of the box, challenging though achievable goals Build a healthy and professional business organization (sales, marketing) that fits the strategic goals Always believe, in a religious way, in what you do. You might be the only one around … The nice short cuts you have heard about - are not applicable to you – on top of the above, hard work (and sometimes, tedious) is what you should be prepared for, with lots of patience

A Company … not just a Technology: 

A Company … not just a Technology Team CEO Sales Marketing R&D Market Size Growth Competition Access Technology Innovation Barrier Product

Slide5: 

HRL was founded in 1972 by Dr. Yosef Raviv HRL is the biggest IBM Research lab outside the US with 600 technical employees working in a broad spectrum of CS/EE fields 30% percent of the technical staff have Ph.D degrees “home grown”/”boot strap” R&D organization AA: 1983-1996, relevant sales stories: PCI-PCI chip (Chip) Functional Test Generator (EDA) IBM Haifa Research Lab (HRL)

Strategic goal (1992): 

Strategic goal (1992) Sell IBM HRL products in the open market

Sales & Fails : 

Sales & Fails No charter to sell No direct sales organization, no formal sales channels PCI-PCI Chip (main line) Not coordinated with IBM Penetration to Compaq Failure Functional Test Generator (esoteric) STM story Huge success On going business

Conclusion: Corporate Sales : 

Conclusion: Corporate Sales The importance of the strategic goal Main Line Sponsor and buy-in Use corporate channels and policies Niche Coordinate with corporate sales channels Bring value to all involved High value deals

Slide9: 

Founded in 1982, by Dr. Levy Gerzberg (current CEO) HQ: Silicon Valley, R&D: Israel Consumer electronics chips IPO late 1995 ($20M), Secondary late 99 ($120M) Major acquisitions - OAK, Oren Semiconductor, Emblaze Semiconductors Offices around the globe R&D – US, Canada, England, Israel, Eastern Europe, China S&M – China, Taiwan, Japan, Hong-Kong, Korea, India, Singapore $500M annual revenue, more than 1000 employees AA: from $40M marginal positive in 1996-8; 2 offices- to $107M in 2001 nicely profitable; 270 employees; 7 offices

Strategic goal (1998) : 

Strategic goal (1998) Set (DVD) consumer market sales target greater than 25% market share

WW Leader in Consumer Markets: 

WW Leader in Consumer Markets Leading Solutions Provider > 31% share in global DVD market DVD

Open Far East Sales & Channels : 

Open Far East Sales & Channels Internal Sales organization: Western oriented Europe, US (80% revenue, 20% ROW mainly Japan, through FFM) Niche level sales (no market share in mass markets) Opening the first office in China (Jan 1998) China culture and requirements Scalability (for gaining >25% market share) Far east oriented sales (85% revenue)

Conclusions - Scalability : 

Conclusions - Scalability Strategic goal implications (reference design, from a VLSI to a system company) Haifa hasn’t been announced (yet) as center of the world China, Japan, Korea… are (very) different Study the market and its business models Work with excellent distributors Control the distributors (strong internal “same culture”)

Expectations to Reality: 

Expectations to Reality

Slide15: 

Established in 1994 by Avi Domoshivitzki Acquired by Siemens and Newbridge at 1997 100% Siemens-since October 1999 About 300 employees Core competencies in Broadband services networking and technologies (IP and ATM aggregators) Over 8000 systems currently installed More than 50 WW customers Products are ANSI, NEBS and ETSI compliant

Strategic goals (2001) : 

Strategic goals (2001) Generate >10% (consolidated) EBIT Create strategic value for Siemens

Meeting Reality: 

Internal sales organization Myth & reality 2001 revenue around $80M, 0% EBIT (consolidated) 2002 expected revenue $125M … Organization is internally built to support growth The Sales & Marketing myth Restructure (COGS, Sales, Marketing, Operations, R&D, and …) 2002 revenue around $50M, 10% EBIT Meeting Reality

Conclusion – Corporate Sales: 

Conclusion – Corporate Sales Deal with hiccups – you will have such Set strategic goals are relevant to the corporate Build a corporate trusted internal sales be responsible to your destiny Be profitable…based on the metric you are being evaluated against Find a sponsor, buy-in Use corporate sales channels

Starting all over : 

Starting all over Established in 2000 by Gal Salomon (Current CEO) Privately-held by 1st tier VCs (Sequoia, Pitango, Genesis, Accel, …) Focus on robust security in low resource environments comprising of hardware (IP cores), firmware, protocol stacks and applications Market: Mobile; Flash Cards AA: from 2003 chairman

Strategic goal (2003): 

Strategic goal (2003) $100M company in 2 years

Discretix Market Traction: 

Discretix Market Traction Security Infrastructure: Hardware & Middleware IP Licensees Partners Multi Scheme DRM: Software Client Supported Platforms Ecosystem Partners Standards Vendors Software Hardware

From Business Development to Sales: 

Mid 2003 – no sales (accumulative $200K) Sales profile (big deals, a few customers) Concentrate on bringing strategic deals Building value (substance and perception) High level contacts and engagement Israeli “Chutzpa” and the “Doberman” effect From BD to Sales organization 2003, 2004, 2005, 2006 – Sales In scalability stage From Business Development to Sales

Conclusions & Summary: 

The loneliness of the CEO You are the one: myth of “BoD”, “US President” Accountability, responsibility are the name of the game Tough decisions and dealing with hiccups are where leadership is needed Build to last company No short cuts, always believe Set long term strategic goals; and then build business organization to fit it Conclusions & Summary

Slide24: 

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