Finding The SaaS Sales Opportunity-Cost Balance

Author(s): Devon Sparks

Peer Reviewers: Mala Gosakan, Imtiyaz Shaikh, Jared Bloch

Originally a topic of Q1 2024 Horizontal QBR

Last Reviewed: April 2024

Many enticing or prospective Trimble SaaS sales come at the cost of rigid customer requirements, especially with respect to how and where customer data is processed. Historically, it has been challenging for Trimble to answer the question, “Is this a strategic opportunity worth investing in?” To scale, evaluation of such opportunities must be done by a stakeholder responsible for both sides of the equation—balancing business opportunities against their costs.

Trimble’s current sales process often fails to effectively qualify the opportunity-cost balance. Here is a scenario, typical of Trimble’s strategic sales processes:

A Trimble sales team receives an RFP from an influential commercial developer in Dubai. The RFP calls for sophisticated and specific software capabilities, many of which Trimble has in the market. The RFP also makes strict requirements around data residency: all customer data, including user accounts, must reside in the UAE. The sales team takes the RFP to product and service teams, asking what can be done to accommodate the RFP requirements. The product and service teams return with a list of constraints, including the significant cost burden of meeting bespoke customer requirements. If the opportunity value cannot be guaranteed, and the cost outweighs the expected value, the RFP submission window ends, and Trimble passes.

The negotiation takes significant time and energy. Both sales and product teams end up frustrated, even though each acted in good faith: the sales team brought a qualified lead that could create a significant (and potentially recurring) revenue stream for Trimble. the product and service teams did their best to inform them of the costs and constraints of fulfilling the customer’s requirements.

Neither group is at fault. The problem is systemic. Because there is no party that accurately evaluates the complete opportunity-cost tradeoff for large SaaS sales, no objective decision on the net value can be made. Passing on a single RFP whose costs outweigh its projected value is a wise choice; passing on an RFP whose requirements are shared with a dozen other RFPs seen in the last year may be different.

Trimble must evolve a stronger shared responsibility model for strategic sales where:

1. Sales teams are responsible for logging basic information around RFP data and processing requirements, especially regarding data residency and data protection policies. This is a small and natural extension of the existing lead qualification lifecycle.

2. Product and service teams are responsible for providing best-effort capital and operational expense “rate tables” for running their products in different geographic regions and configurations. These rate tables must be updated as services evolve. Product teams will also ensure feasibility, and capture risks and assumptions along with the rate tables, e.g., “Deploying in this region comes with these data privacy implications.”

3. Dedicated Trimble business leaders are responsible for evaluating the opportunity-cost tradeoff, taking into account the historical RFP data provided by the sales team, regional business prioritization, and the latest cost estimates provided by product teams.

Involving three distinct roles - those informed of the opportunity (sales), those informed of the costs (product), and those able to weigh the two (business leadership) - in strategic sales processes create a stronger, more efficient, and more profitable organization.