How worth it is hiring an account manager from a tier-1 company for an IT consulting startup?
I am running an IT consulting firm. It was my first startup, and I'm planning to hire an account manager. Will hiring an (sales) account manager from a big IT company help to boost my startup's credibility in the eyes of these Fortune 2000 companies?
This really depends on your offerings. Although being able to advertise to clients the experience of working for one of the bigger firms, I have found that account reps from major IT companies do not have a broad range of knowledge. This limits them to selling a piece of the solution rather than end to end. I would focus on finding someone who has had success at the partner level and understands the temperature of the local area.
It might under the following conditions:
1.) It is someone that is a known quantity and you know them by reputation or they can prove it
2.) They can bring a volume of business to your firm and has a track record that will confirm their ability to do so,
3.) They can produce volume for your firm within a reasonable amount of time which will offset the expense of hiring them.
4.) You can structure a compensation plan that provides sales incentives which pays them for bringing business to the firm.
5.) The firm can stand the cost while they come on board, adjust to a company learning curve (hopefully short) and use their relationships to redirect accounts to your firm
Hello Sampath, I am in the same exact situation. I have a start-up focused on emerging technology injection within the mid to large enterprise environments. I was weighing between which resources are best to invest in as well, either an engineer or a tenured account manager. Ideally, a sales engineer would fit best but they are difficult to come by according to my rules of 3...
An engineer must be 1. Personable / likeable, 2. Technical knowledge must be superior to the clients resources, and 3.) They must search for future and cross selling opportunities or value adds while engaged.
Why I am seeking a sales / account manager first is this. Sales drives revenue and grows a business. Three features that win business are as follows... 2 out of 3 will win you the business 90% of the time. 1.) A superior product. 2.) A superior price point. And 3.) The better sales person.
We should have a conversation sometime, if you're interested send a message. Good luck with your venture.
I agree with Raj below, I would be careful when hiring non executive Tier 1 people for start-ups, these people are used to detailed processes, procedures and sales / marketing collateral all neatly files away and ready to go. Start-ups are all about chaos, wearing a dozen different hats and thinking quickly on your feet to complete what ever is required to keep the start-up afloat. I have seen many instances of Tier 1 - Superstars failing miserably because they never get out of first gear.
Go find a street fighter instead.
Sampath, I would hire an account manager from a Tier 1 if reputable. knowledge base is verifiable and fit within the specific disciplines of your scope of business. I would also recommend that the individual has contacts and has an established customer base and contact network too.
we just went through something similar.
Credibility is very important.
But, clients all realize that it's the company behind the AM that delivers.
So, I don't think credibility is transferable in this manner.
I'd be more inclined to favor selling-to industry knowledge and basic job competence..
Please keep in mind that this is a delegated role, so be cognizant of providing necessary (presumably knowledge) support. If interested in delegation techniques, you are welcome to read my recent blog - http://www.growthroughpeople.com/#!Delegation-Science-not-Art/c15i6/754F3F03-7B92-4F7C-93D7-8D75A27B4A9D
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I would suggest it depends on your Target market. If your prospects are Fortune 2000 companies, then it would probably be a good idea.
They may have more contacts at higher positions, but there is no guarantee that they will convert them. Spreading responsibility is always good, but within budget. Measure the initial expenses for projected return. If the numbers make sense than it is a good move.
as a founder you need to go out and make sales calls until you can afford a sales man
Imho, you should hire a Senior Sales Manager only if she/he is ready to share his valuable contacts with you and your company. Moreover, your start-up activity shall somehow coincide with the interests of these Fortune companies,'cause enterprise field and a start-up one are 2 absolutely different niches.
But in general, I'll not be creatively different and will say the same as many people have said here before me - it's a waste of time and money. You'd better hire someone young, talented and passionate, who probably has less experience, but definitely more desire to boost your company sales.
That's a great question. One of the issues that you'll have to deal with is the support ecosystem. Many Tier 1 folks are very good at sales and require a vast support system to make them look good. If you're offering simple consulting, the AM needs to know the capabilities of your staff. And know how to translate client needs into your capabilities. The AM will need to speak IT fluently (this is part of the issue with the support team who often do all the translations).
I've worked in large and small consulting firms -- including my own -- and I'm happy to share experiences with you. Contact me off line any time.
Firstly you need to ask yourself the purpose of hiring such an expensive resource (As stated that its Sales Account Manager of Tier 1 IT Firm). Rather you should focus on a quality resource in economical budget as you have just started. It would be an unnecessary expenditure on such a same that would only boost your expenses.
Secondly, even if you have such a huge budget then ask yourself whether hiring such a candidate is feasible towards the growth of your organisation. You need to have a check on the candidates experience and success ratio. Is the candidate able to meet your expectations?
Please think about these key points before you proceed.
Maybe it will boost credibility, but in my opinion that should not be the primary objective.
Hiring high quality sales people that are motivated and love what they do, and creating great team with positive team atmosphere in the company while managing growth is key to addresing the market and serving customers with excelence.
That brings in income and boosts profits. And growing on the scale of profitable companies with good turnover speaks for itself.
Some of the other answers have hit on the core rationale for hiring a Tier 1 Account Manager. It is not about impressing your clients with his credentials. It is about impressing them with his skills.
Tier 1 companies got that way for a reason. One of the most critical reasons: excellent customer service skills. They teach their account managers to communicate well, sell smoothly, and handle disruptions with grace and skill. They hire folks who are self reflective and aware of their surroundings.
By hiring a former Tier 1 account manager, WHO WAS SUCCESSFUL, you are getting the benefit of both the Tier 1 hiring process and the Tier 1 training process. You get someone vetted by excellent hiring managers, trained by excellent customer service professionals, and familiar with proven customer-facing processes and techniques.
Your best option is not only to hire a Tier 1 account manager, but to give him two jobs: act as an AM, and help you to build your own customer-facing processes so that the next AM you hire can be from a second tier consulting firm... and then YOU can train them to be excellent.
Build capability, not just capacity. (Seven habits)
Generally, name dropping often assists with aspects of the outreach process - from prospecting to initial discussions and presentations where your expertise is conveyed and if possible, reinforced with references to background(s) of your team and/or your funder(s)/investor(s) and/or your clients and/or your partners (plus of course any media coverage). Is it necessary to have a account manager from a big IT company? No. Your expertise and performance will ultimately build the most meaningful, long term credibility ... but at the earliest stages of outreach business development, leveraging the name of team member from a big IT firm could help open doors faster [but again, not necessarily boost credibility of the firm]. Talents of people (account managers) from any company (including marquee firms) vary - and prospects are well aware of that.
Hi Sampath, this question will probably depend on the country your working in. If you look at European markets, a key account manager of a 1st Tier IT company will have the access to relevant deciders, but this will not help you to sell consulting services.
Top level consulting is not only a question of being able to deliver solutions, it is first and foremost a question of protecting a decider.
For any executive, every decision is a risk that can be a boomerang against his position, if his decision comes out as a wrong decision. But if he took the decision based on advice of a BIG consulting company, he still can cliam to have hired the best - whereas a small consulting company does not deliver no protection for the executive.
So, if you think that a top account manager will help you win big deals, I bet this attempt will only cost you tons of money.
Better invest in cool projects, fresh and motivated sales people and connect yourself through social media with top executives and their ecosystem. Getting to the top is a hard path which you have to go through without shortcuts.
If you want to gain visibility, invite top managers to be part of your board and let them participate from earnings. If you board consists of TOP executives, your companies gets the credit you are looking for.
I would advise you NOT to spend mone in expensive key accounters from bigger players.
No. You need top talent in terms of what will help your customer(s) succeed. A great sales person may be able to "open doors", but to generate business you need talent that not only impresses but actually delivers positive results. Tier-1 may be good place to look for this talent, but make sure you set your gauge to the talent, skills and experience required for the position, and do not assume it will come by selecting from a Tier-1.
Its all about relationships and their ability to interact with the right people inside your target companies. You would be better off with someone that has done this for another small IT consulting firm rather than from a larger IT company. They can sell better to the capabilities of your company.
Corporate IT and startup don't really go hand in hand. ..its a different animal!!