Sales Advocate Newsletter

Key to Telebusiness Success: Keeping It All Together

October 2000

Bay Area technology firms looking to implement an effective telesales or telemarketing organization should start with a simple question: Where to put it? The physical location of a telebusiness department can be one of the most essential factors to its success. In this regard, telebusiness models fall into two broad categories: centralized and decentralized. In this edition of our newsletter, we will compare these two fundamental models to answer a simple yet important question about how to build a telebusiness program that works.

Centralized versus Decentralized: What's the Difference?

If a telebusiness department is decentralized, its staff is spread among two or more offices. For instance, telesales representatives might work out of regional offices, sharing space with their corresponding field sales reps.

Centralized telebusiness departments come in two flavors. They can operate at the corporate headquarters or might do business out of a single location that is separate from the corporate offices. Some Bay Area technology firms employ the later option in order to avoid local staffing challenges and space constraints. Either way, the entire telebusiness staff, including telebusiness management, operates out of a single location.

The centralized telebusiness model is by far the most prevalent in the technology sector-and for good reason. Let's look at some of the more compelling reasons to operate your telebusiness staff out of a single location.

1. Clear Communications. Clear Communications. Nothing beats face-to-face internal communication, especially with the rapid change that takes place at technology firms. Centralizing your telebusiness team enables you to better manage the entire staff and control the quality of telemarketing and telesales efforts. Training is far easier when everyone's in the same place. Centralizing also allows the telebusiness staff to easily compare notes ("Hey, Charlie, try this on your next call!"). 
   
   Another key point here is that telesales and telemarketing messaging is ever evolving. As products change, competitors appear and markets mature, the value proposition communicated by your telebusiness staff must quickly press forward. Furthermore, the lines of interdepartmental communication must work both ways. For example, your telesales team must relay information back to product marketing in order to keep your development staff up to date on customer needs and what messages resonate with prospects. All of these are much easier when the telebusiness department operates out of a single, easily managed location.
2. Better Teamwork. The importance of morale cannot be overstated. A single, cohesive telebusiness team will encourage and motivate each other through long hours of hard work on the phones. Group exercises, such as role-playing, will improve the productivity of each telesales and telemarketing rep. Managers can set more accurate metrics and fairly judge who's producing leads and who's simply running up the phone bill.
   
   A centralized telebusiness organization also enables you to make the most of your team. With a close eye on the skills of each member of the group, your managers can better judge when to promote an employee from in-bound calls to cold calling, or from qualifying leads to making sales. As in most lines of work, a clearly defined career path motivates Telebusiness reps. Another common problem with decentralized telebusiness models is that telesales reps spend far too much time with tasks other than sales. They often become administrators to the field sales rep. This might be great for the outside rep, but is probably not in the company's best interest.
3. Reduce Costs. Here's a topic that everyone understands. It can be more expensive to spread a telebusiness staff across multiple offices. Decentralized models can create higher system costs, the need for additional phone switches, greater time requirements for management and human resources, a larger yet less productive telebusiness staff-the list goes on. Centralized telebusiness operations can quickly achieve economies of scale that dramatically reduce the cost of doing telebusiness.

The Bottom Line: Centralize

In the last ten years, we've seen a great deal of changes in the way telebusiness programs are handled. Today, telebusiness models are a topic at board meetings, where executives discuss telesales and telemarketing strategies. The resources dedicated to telebusiness operations have grown dramatically-especially in technology firms, where rapid sales growth is paramount. As a result, much greater attention is paid to the structure and management of telesales and telemarketing programs.

Where to house the telebusiness staff is a fundamental concern. High demand for talented staff and limited office space make this an even greater interest in the Bay Area. The advantages of a centralized telebusiness department are clear: effective management, clear internal communication, high morale, successful division of labor and low systems costs, among others. Some technology firms operate a single, centralized telebusiness unit outside of the Bay Area in order to reduce overhead and avoid local staffing concerns. There are instances when a decentralized model is preferable. For instance, mature organizations-whose marketing messages, sales targets and product development strategies are clearly defined-might benefit from spreading their telebusiness staff across two offices. However, the technology firms with which we work are almost always best served by a centralized model.

Of course, there are many more factors to creating sales momentum. Employing a centralized telebusiness model will not single-handedly ensure success. We'll explore some of these other sales concerns in future editions of this newsletter.

You can reach Phone Works at 510.749.9073.