As we reach the mid-year mark of 2023, the effects of trends in the economic and financial sector are changing how organizations are positioning for profitability and growth. During the opening keynote at the recent Supernode conference in San Diego, it was shared the biggest fear amongst CEO’s is getting fired, or their companies going out of business. With just 27% of market leaders indicating they’re hitting their numbers; these are real concerns.
A financial expert at Merrill Lynch recently shared with me how investors have shifted from free-flowing capital to sustainable profitable growth. There is a term, “long duration stocks” which represents companies who have a great idea and promising product but won’t make money for 5 years. These organizations are no longer attractive to the investment community.
Trends to achieve the goal of long term sustainable profitable growth that generates re-occurring value include:
1. Optimize spend. With a background in cost containment, this resonates to patterns that seem to be repeated every time we have rumors of recession or rounds of layoffs; yet a recent IDC global survey of 1,000 CIOs revealed their most critical metric, #1 – is cost optimization. Another study revealed organizations will waste $500 billion in cloud spend over the next 7 years. With all that IT spend moving to cloud and complexity continuing to rise, bringing 3rd party experts in to uncover opportunities and bridge the gap between finance and IT will be necessary to stem the tide fast enough to make a difference for many leaders and their organizations.
2. Shift to ecosystem. Many factors are coming together which point to the demise of the old paradigm of direct sales alone for GTM. Analysts agree, ecosystem models are the path to low upfront cost and massive economies of scale. The numbers support co-selling in the ecosystem: 40% higher close rates, 46% shorter sales cycles and 181% bigger deals. In addition to remarkable sales results, the shared value and human relationships that ecosystems are built on also deliver sustainable profitability in an ever-increasing subscription-based world. Yet building these foundations isn’t an overnight pivot designed for singular success; it’s a commitment to a long-term strategy that requires an alliance mindset starting at the top.
3. Focus on EX + PX = CX. We know customer experience (CX) has become the true north for revenue metrics and it must be achieved each day, in every interaction to gain market share and retain revenue. A Salesforce & Forbes study done in 2020 has been recently backed up by Tiffani Bova’s new book “The Experience Mindset” outlining the critical importance of happy employees (EX) in creating that great CX. My partner Norma Watenpaugh, CSAP, and I published an eBook “Partners ARE the Customer Experience” through The Association Strategic Alliance Partners showing how the contribution of the partner completes the equation.
The relationship between these strategies creates the framework for sustainable profitable growth. Ridge Innovative is proud to be a part of an ecosystem that delivers this framework to forward thinking organizations. Alignment of all the leaders, stakeholders and functions in an organization are key to driving revenue in the existing market.