Characterized by a high degree of innovation and speed of change, the technology industry has changed our lifestyle, our society and our culture. Recently, the world has seen the effects of incorporating solutions around data analytics, augmented artificial intelligence, blockchain and IoT technologies to enhance professional competitive advantage and personal comfort at home.
As companies race to become the first mover in bringing new ideas to life in a rapidly evolving industry, the pace of innovation which has been beneficial to society has brought new challenges to technology and tech-enabled firms. From struggling to create successful lean business models with minimal costs and investing in R&D to overcome the larger market players, tech firms have their work cut out for them.
There are two key areas of focus that players in the technology industry have honed in on to maintain and grow market share:
- Managing external change & matching internal innovation successfully
- Hiring & retaining the best talent in the market
Managing External Change & Matching Internal Innovation Successfully
One of the main concerns for any business leader in the technology space is the competitive nature of the industry and cyclical nature of the constantly changing market demands. As technology grows, so does the landscape of consumer demand and associated solutions. A great example of this is the exponential growth of the marketing technology (martech) space in the recent decade.
A few years ago, the martech arena comprised of approximately a 1000 solutions. Fast forward to present day, the same arena now has over 7000 solutions with new offerings being introduced almost daily. A more poignant observation also brings to light the evolution of roles required in the marketing function. Gone are the days of simple advertising and lead generation. Now we regularly see roles such as marketing technologists, engineers, data analysts, design thinkers and product managers along with creatives in the function. This is simply one example of how market need has given birth to technology and technology has, in turn, drastically transformed a previously known way of life.
For tech leaders, staying ahead of the cycle and maintaining market relevance can make all the difference when it comes to winning market share. In our research we have learned that strong contenders in the space have usually leveraged one or more of the following 3 key strategies to stay ahead of the curve:
- Leveraging data to gain visibility into future performance
- Continued or increased investment in the right offerings
- Strategic M&A to eliminate competition or gain further competitive advantage
Smart tech firms have realized the power that their data holds when it comes to gaining insight into both external forces and internal factors. Instead of simply analyzing the historical performance of the business, tech firms are increasingly focused on applying predictive methods to glean insight into the future performance of their own business in light of competitors and critical industry benchmarks.
With data analysis that enables firms to highlight possible cause-and-effect of performance results, more companies are keen on utilizing both internal and external data to uncover unprecedented nuggets of information that could help them maintain or grow their competitive advantage. A great example of this is how firms are leveraging similar types of performance analysis to review product performance. Product performance analytics helps leaders acquire a rather accurate forecast into strategic courses of action such as increasing investing in or divesting from certain product lines based on performance, market demand, industry trends and competitor data.
Best-in-class Sales Performance Management solutions have become a trusted source of insights as an ever-growing pool of companies look to mine their existing corpus of data to identify areas of improvement and align decisions with strategic objectives with a sense of confidence and accuracy.
Channel partnerships and strategic M&A remain the popular third option to gain market share, penetrate new markets or expand into existing audiences. In such cases, one of the most difficult aspect of performance management comes from integration of business cultures and metrics especially when it comes to incentive compensation and employee performance management. When conducted poorly, the integration exercise could result in the acquiring company racking up losses due to lack of employee motivation or top performer attrition. Sales Performance Management solutions are designed not only to address the management of complexity during these times but also provide visibility into the effectiveness of such activities as they relate to compensation as well as business and employee performance.
Hiring & Retaining the Best Talent in the Market
One of the most prized possessions of any tech company is its employees. More so than any other industry, the high-tech industry requires a diverse set of specialized skills to come together continually and cohesively to create new offerings and grow equity in the market. Unfortunately, due to the importance of top talent, the industry is also known to be one of the most competitive when it comes to hiring and retention practices. This is generally reflected in the employee incentives which have moved from cash-driven compensation to a variety of non-cash rewards along with cash-based incentives.
From parking spots worth their weight in gold in highly crowded cities to paid travel to exotic locations for top performers, non-cash rewards have only grown in popularity since their introduction. This combined with cash-based incentives such as performance-based bonuses, stock options and pay raises makes managing compensation and employee performance an extremely complex task for compensation administrators.
Another added layer of complexity is the crediting process itself. With a multitude of products in existing portfolios and continuous new product launches, a variety of territories, overlay structures and a remarkable use of mechanics such as thresholds, accelerators, multipliers, etc., crediting has the possibility of becoming a nightmare for administrators. To its detriment, the problem with crediting carries with itself a very high cost.
Inaccurate crediting very quickly results in inaccurate commission statements and payouts resulting not only in a high number of inquiries that affect operational efficiency but also an immense blow to employee trust in the numbers. There have been many a times that this cost has been evident in lack of employee productivity, employee attrition and sometimes even in hard dollars.
Given the unique requirements of the industry, whether it is non-cash incentives or complex crediting rules, many leading companies have come to rely heavily on the power of Sales Performance Management to not only automate the management of complex incentive plans but also gain visibility into the details of individual, team and business performance. Administrators can not only eliminate manual, error-prone processes but also integrate a variety of data in a single source to generate unprecedented insights both for themselves, for employees and for management.
More importantly, robust Performance Management solutions allow for data transparency so that sales reps can easily monitor their progress and review related compensation information in detail. This has allowed savvy organizations to further motivate their reps to outperform their targets and at the same time, increase trust, and thereby retention, by providing complete visibility into insights that employees care about immensely.
Contact InnoVyne Technologies to learn more about how your high-tech organization can successfully hire and retain the best talent to outperform competition and effectively manage the complexity that comes with constant change and evolving market conditions.