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Sam's Club digitizes sales cycle with Salesforce change management

With dwindling memberships among its key constituency, Sam's Club needed to digitize its sales process and step into the modern era with a CRM system.

At Sam's Club, membership is core to the success of the company. But over the past few years, membership was dwindling. While Sam Walton, founder of Sam's Club, said  members were at the center of business, Sam's had lost sight of that customer-centricity.

Sam's Club has various customer segments, but two focal ones are its business members, or small businesses, and savings members, or individual households; the focus had been on the latter, to the exclusion of the former. "Over time, we drifted away from the business member," said Tim Simmons, vice president of member management at Sam's Club, the big-box store chain based in Bentonville, Ark. "This was all about rebuilding our base of members."

Moreover, Sam's was stuck in old technology and processes. It had no official sales team or CRM system. So, Sam's Club chose to digitize its sales cycle with Salesforce change management in an effort to reconnect with its core customer base.

"When we decided to bring the business member back, we knew we had to put them in the center, but we also had to figure out how to interact with business members optimally," Simmons said.

But Sam's Club was hobbled by antiquated practices. At the 650 clubs, associates were trying to acquire new members on paper or on desktop computers. Lead data was inaccurate by as much as 85%; associates were approaching defunct businesses or those that were already Sam's Club members.

"We had some legacy tools and systems that didn't make this a successful process for our associates," Simmons said. "We're a little bit of a quilt work, with a lot of homegrown [systems], and we weren't effective in our member acquisition."

Sam's chose Salesforce Sales Cloud CRM, ran some pilots, then rolled it out within months to all 650 clubs.

There were several guiding principles, Simmons said, which centered on getting back to basics on membership, improving data quality and making Salesforce change management the focus:

  1. Member acquisition. Rebuilding the base of business members that had been shrinking.
  2. Lead quality. "If we sent associates across 650 clubs out to bad leads, we would lose them immediately," Simmons said.
  3. Adoption. In a paper-based environment, there was little reliability surrounding the data. Sam's Club understood, however, that having employees embrace Salesforce Sales Cloud would require serious change management. "We knew we had to do change management right, and we would show value with these new tools by enabling them in their jobs," Simmons said.
  4. Home-office support. Simmons said providing insight on what was driving sales conversion would be critical to selling the tool. "It wasn't just about the field, but also executives in the home office. We knew it would drive support from the home office," he said.

Balachandra Visalatha, senior director of B2B portfolio at Sam's Club, added, "We needed to think through the navigation [of Salesforce], as well as the folks throughout the chain, so we would have good top-down adoption. We did a lot of interviews and talked with a lot of associates in the field to learn the way they actually sell."

Sam's took the pilot CRM to two clubs and got feedback. Salesforce's default configuration involves a seven-step process, which makes sense for high-ticket items that take several months to sell, such as a million-dollar account. But for a $100 membership, the sales cycle doesn't require so many interactions; it might require two or three calls, Visalatha said, so the CRM needed to be reconfigured to reflect that shorter cycle.

The process of test, gather feedback, test, gather feedback also helped improve the CRM implementation. Simmons noted the process of ride-alongs also helped Sam's Club understand how associates were using the system and identified possible breakdowns in workflow that could be improved. "Unless you are riding along, sitting in their shoes all day, you will miss all kinds of insights on what's broken, as well as best practices to adopt."

Another improvement to the system involved the introduction of lead scoring, which Sam's Club turned to in order to better understand its most promising leads. "Associates can see Yelp reviews, Facebook accounts and are going in armed with a lot of information," Simmons said. "And we have assigned scores on the probability of that lead closing, so associates know whether it is a lead that is likely to close or further down and might just require a phone call."

Salesforce change management extends beyond platform to sales journey

So often, we mistake change management ... for training.
Tim Simmonsvice president of member management, Sam's Club

After the initial test, the pilot was extended to 28 clubs, Visalatha said, and "we ran that test for five or six months. We had to keep developing the product, and after we launched in March, a whole new journey [of change management] started up. We used multiple forms of training." Sam's did in-person training not only on Salesforce, but also in sales best practices.

Research indicated change management is core to success and centers on the human element, rather than just technology training, per se. According to 2016 data from Forrester Research, 38% of respondents said their problems were the result of people issues, such as slow user adoption, inadequate attention paid to change management and training, and difficulties in aligning the organizational culture with new ways of working.

As Simmons noted, companies often equate user training with change management, which is one reason why technology initiatives fail. "So often, we mistake change management ... for training," Simmons said. "That's very risky when you get into that mindset. Training is the tail end. The front end is, 'What is our strategy? How are we going to roll this out?'"

In the case of Sam's Club, there was a strategy of test, roll out, retest, broader roll out, with constant data gathering in between. Sam's Club is at 90% adoption of Sales Cloud, and sales associates are working with more fruitful leads based on the better data. "So, by the time we rolled it out, we were well-informed on how this would benefit our associates," Simmons said.

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