Three Strategies to Increasing Revenue
Elias Mazzawi shares a company post that outlines three strategies to achieve cross-OpCo revenue synergy.
There are 3 core approaches to cross-OpCo revenue synergy: cross-sell, client management synergy and proposition synergy. Most organisations pick a hybrid.
Strategy is typically straightforward to define; implementation requires activity across organisational boundaries, and can present cultural and operational challenges. Trust and alignment of targets, objectives and incentives at OpCo and individual levels are key.
Strategy 1 – cross-sell is usually where organisations start; selling in a discrete product or service from one part of the organisation to a client of another. In terms of potential, typically it delivers incremental rather than game-changing revenue; one product at a time. Organisation and infrastructure-wise, it is relatively straightforward, requiring requires channels and processes to encourage cross-sell; which can be once-off or campaign-based. It needs mobilising typically through pragmatic CRM-based operations and incentives and fairly focused pipelines. It is a robust start point for those with the opportunity; requires very little change, triggers little complexity and can be mobilised rapidly.
Strategy 2 – client management synergy is a step up from cross-sell; actively managing clients across organisational and product boundaries. Unsurprisingly, it’s often more complex to implement though can be managed in a highly focused manner, one client at a time or one region at a time. In terms of potential, for many it can have much higher revenue impact than cross-sell, delivering larger and broader key accounts that are arguably stronger and ‘stickier’. Impact varies; for some firms this kind of co-operation can move clients from ‘transactional’ to ‘strategic’, for others it can cement relationships. Implementation-wise, it is unsurprisingly more complex and far-reaching, deep into specific accounts. Information sharing is essential, often achieved through light-touch client account planning and management. Open-ness and co-operation that spans organisation boundaries is essential; requiring alignment, community and trust supported by effective alignment of objectives, incentives and KPIs at OpCo and individual levels. Light-touch mobilisation and governance are critical to success (more on this in Part 2); typically through an ‘overlay’ to existing client management.
Strategy 3 – proposition synergy is about integrating products or offerings across organisation boundaries and is often closely intertwined with client synergy. It can be once-off for specific clients or systematic and repeatable, with many strategic possibilities including adding-on niche product to a core offering, and at the other end of the spectrum a ‘match of equals’. In terms of potential, it can radically increase competitiveness and even open new markets or segments. Implementation complexity varies; typically harder to achieve than cross-sell and often inextricably intertwined with client synergy.
Key points include:
- Proposition synergy
- Client management synergy
- Cross selling
Read the full article, Whole-greater-than-the-sum-of-the-parts revenue | 3 strategies, on 4h2d-Ltd.com.