Europe is a major target for B2B SaaS firms seeking to scale their businesses internationally. A region consisting of 750 million people and 50 sovereign countries, with multiple languages and countries, means there’s plenty of opportunity to get it right.
During Q1 2019, Intrinsic surveyed over 400 CXO, VP and director-level executives, mostly based in Europe, for their views on the market. We’ve released the results in our survey and highlighted a few of our findings below.
The biggest challenges facing SaaS firms in Europe
It’s clear to see that finding new logos in Europe has given many scaling SaaS firms a big headache during the last year.
Further research from Intrinsic shows that top-notch business events and personal referrals are by far the most successful channels in engaging with new prospects. We’ve also found that cold emailing appears to be becoming less and less effective each year as alternatives such as LinkedIn InMail appears to have stronger results.
The toughest EU country to hire senior sales/commercial talent
As we can see from the above, hiring great sales executives is a major challenge here in Europe. In fact, 72% of the respondents claim that is has become harder than ever to recruit great SaaS sales executives.
Once again, Germany was ranked as the hardest EU country to find great enterprise SaaS Senior Sales Executives!
So why do so many SaaS firms find it difficult to attract and hire successful German executives?
The main reason seems to be a lack of understanding of the German culture, buying habits and appreciation of how the German economy operates. Our German network claims that US firms assume that they can make a few small tweaks to their US/UK business plans and the revenue will flow in. How wrong can they be!
Furthermore, it appears that the sales cycles and time to become successful can take much longer than the US, UK and other countries, so extra patience is required.
The best EU city location for an inside sales team
Where is the best EU city for a SaaS firm to locate and build its inside sales team? There are many choices in Europe and from the research, there’s no obvious answer. London and Dublin have been popular in the past, but the cost of labor is expensive and the hiring market is highly competitive.
Does The Netherlands provide the answer?
Amsterdam and Rotterdam
These Dutch cities received the most votes under the ‘other’ section. The Netherlands has certainly become a location of major consideration for many companies in recent times, especially with all the uncertainty around Brexit.
English is widely spoken. Culturally, The Netherlands is well-aligned with the UK and the USA. It also has great transportation networks around Europe, entrepreneurial individuals and a favorable tax system, making it a magnet for US and European B2B SaaS companies. We’ve found that Amsterdam, London, Dublin and Barcelona are the main inside sales centers of the B2B SaaS industry here in Europe.
Salary levels in Europe
The chart below represents SaaS firms that target their Senior Sales Executives with a quota in the region of circa $1 million, with an average deal size of $250k. The size of the target and deal size can affect the size of an individual’s base salary. For instance, a lower target and deal size may reduce the base salary.
*The basic salaries below do not include car allowance/physical car or other benefits such as pensions and health insurances.
One thing is for certain – salaries for the above roles are only going in one direction – up!
58% of the respondents have experienced a fixed salary increase of at least 10% over the last 12 months, with over a third having their best total earning year in 2018! In Germany, B2B SaaS Senior Sales Executives are earning around $110k – $140 as a base plus the same in commission.
Further, the demand for Customer Success Executives is outstripping demand, which results in salary inflation across the European Union for these individuals. SaaS firms are now paying up to $170k base salary for senior leadership, individual contributors and customer success executives!
Scaling a SaaS firm across Europe is no easy task and there are many different considerations to make due to the diversity of the European region. Where do you locate your European HQ and your inside sales team? What is the best approach to finding new logos?
Further, when it comes to hiring senior commercial talent, the hiring market is tough! Countries like Germany and Sweden often have full employment for the best senior sales executives, meaning many candidates can pick and choose who they work for. The hiring process is typically much slower in these regions, taking 3-6 months in some cases due to longer notice periods.
To succeed in this region, it’s best to talk with the experts who have personally scaled teams within Europe or VCs/PE firms who have invested in the European market.
For even more highlights from our survey, you can access the entire B2B SaaS Survey Report 2019 here.
After a decade, it was finally time to make a change to SurveyMonkey’s pricing. In this episode, learn from Pri Carr (SVP, Strategic Development) and Jordan Nolff (Senior Manager, Business Strategy & Monetization) about how they were able to pull off a massive revamp of the pricing and packaging of a beloved PLG brand without seeing a meaningful impact on acquisition or churn.
When bringing new sales reps into an organization, one of the most valuable investments of time you can make as a sales leader is to ensure those new hires are set up for success. That starts with understanding what success looks like. How many deals do your fully-ramped AEs need to close each month in order to hit quota? How much pipeline do they need to carry? How many meetings should they be having each week? You need to have a clear set of expectations for your fully-ramped reps in order to determine what goals should be set for new hires as they ramp.
Set Ramping Goals
If you know what success for a tenured rep looks like, you can work backwards to determine when leading indicators need to be reached. For example, if you expect a new AE to reach full productivity four months from their start date, and you have a 60-day average sales cycle time, then that AE will be best set up for success if they are carrying a full pipeline within two months of their start date. That will ensure they have the length of a full sales cycle to close that pipeline and attain their full quota. When you think about building that pipeline, if you know that it takes, on average, two weeks for an initial meeting to convert to an opportunity with a pipeline amount, then those same new AEs should be carrying a full load of meetings within six weeks of their start date.
This same logic can be applied to new SDRs. Call and email goals should be hit as soon as they complete their training, while conversion rates on those activities should increase as they ramp. If you know, on average, how many activities it takes to create an opportunity for your tenured SDRs, then you can set expectations around their activity levels starting from the first week they are working while giving them time to increase the effectiveness of those activities over the duration of their ramp. If you expect them to hit a sales accepted lead or sales qualified opportunity goal in their second month, then you should likely also have a clear path for them to hit fully-ramped meeting creation targets during their third week.
Communicate Goals & Track Progress
The reason to take this kind of approach to setting clear ramp goals, by week in many cases, and by month even in those organizations with long enterprise sales cycles, is that you’ll be able to clearly explain to your new reps why they’re being asked to hit certain milestones as they ramp and how hitting those milestones will set them up for success in consistently attaining quota.
Tracking progress against ramping metrics in weekly 1:1s will also help to surface any issues quickly so that they can be addressed immediately. New hires will have the opportunity to receive coaching throughout their ramp in a manner that will make them successful over the long term.
Iterate through Sales Maturity
If you don’t have the metrics to do this readily at hand – maybe because in an early stage company, the founder has been doing all of the initial selling – you can still use the information that’s available to you to set some initial guideposts and see how well those stack up to reality as you start to have cohorts of reps to test them against.
You may find that, in an early stage company without a dedicated sales enablement function, your initial expectations of ramp were too aggressive given the level of training you’re able to provide, and you need to adjust your plan to account for early hires taking longer to ramp. However, that time to productivity should shrink as you become more practiced as an organization at integrating and teaching your new members.
For organizations who have already ramped multiple reps, you may be able to set up a more sophisticated ramp plan that uses the data you have on how individuals in a given role have previously ramped. How long did it take prior classes of mid-market AEs to build pipeline? How long did it take your last ten enterprise SDR hires to set your target number of meetings per week consistently? Being able to compare a new hire to the average of their peers in an apples-to-apples way that adjusts for tenure can provide another data point in understanding what a successful ramp looks like in your organization.
Whether you’ve been using account-based marketing for some time or are considering giving it a try, here are 10 ABM hacks you can do to hit your goals.
1. Create account-based entitlements
ABM will sure bring in lots of leads to your business. But that doesn’t mean that you’ve got to spend equal amounts of time and effort with all of them.
In fact, you shouldn’t, especially if you’ve got a small team to work with. And that’s where account-based entitlement comes in. I first discovered the insight listening to New Sales Simplified which was recommended to me by my friend Pete of Databox. It guides you on how much time, effort, and resources should be devoted to each tier of leads.
As a rule of thumb, leads that qualify in your top tier should receive more than those belonging to the lower levels. For example, you can opt to use to engage with leads in the lower tiers. But those that are in your top tier should be sent personalized direct emails from you or someone from your sales team.
2. Inject lead scoring
This ties in with #1. Lead scoring is the process of how you’ll determine whether a lead qualifies in your ABM’s top-tier or not.
Here, you assign points to each of your leads based on how close they are to your ideal customer profile and how they engage with your content.
Through this, your marketing team can pinpoint which of your leads are red hot and ready to buy your services. Members from your marketing team can then send these leads over to your sales team. This not only helps shorten your sales cycle. It also ensures that your sales reps won’t find it difficult to convert them into customers.
3. Nurture your leads with highly personalized content
Personalization is essential in ABM. You’ve got to make sure that when your leads read your content, they’ll feel like you’ve written that email or blog post just for them.
An effective way to make this happen is by optimizing your content for local search. 46% of people searching on Google are looking for local businesses. That includes those key decision-makers from those companies you’re targeting.
Here are some tips on how to create engaging and highly personalized content optimized for local SEO:
Create dedicated landing pages. If your business has physical offices in different geographic locations, it’s a good idea to create a landing page for each of them. Keep them cohesive by using landing page templates.
Go for long-form content. Studies show that blog posts with an average of 1,890 words are more likely to land on the first search results page (SERP) of Google.
Include your location in your keywords. For example, if you’re targeting to rank for the keyword “bookkeeping services” and you’re based in Baltimore, opt to use “bookkeeping service in Baltimore” in your content and metadata.
4. Blend in omnichannel marketing to your ABM mix
For years, businesses using ABM engage with their target accounts through email. So while email marketing still brings you results in 2019, it’s no longer enough.
That’s because by the time key decision-makers from those accounts you’re targeting visit your website, they’d have already completed 75% of the buyer’s journey. What that means is that they’ve already done their research elsewhere.
If you want to increase your conversion rates in your ABM strategy, you’ve got to get the word out about your business and services to other channels and platforms, both online and offline.
Examples of these are digital displays, telemarketing, trade shows, conferences, and social media.
5. Sniper, not shotgun
Most marketing strategies tend to use what I call the “shotgun approach.” They launch their campaign and pray under their breath that the ones they hit are the right target.
Unfortunately, many that make the switch bring this approach with them when they start doing account-based marketing.
Thing is, ABM works best when you approach it like a sniper. That means you first get to know who your target is. Then, you pick out that target from the crowd. Only then do you shoot.
With this approach, you can make sure that you don’t just publish the right content and personalize them. You also get to carefully choose which channels to distribute them so that your target accounts see them.
6. Don’t turn away from outbound marketing
Marketers have begun to shy away from outbound marketing because of claims that it’s no longer as effective as before. Not to mention that it tends to cost more.
On the contrary, incorporating outbound marketing campaigns like Google ads can help boost your ABM campaigns.
According to Zara Laeeque, Content Marketer at GigWorker:
“Google will put your links you include in your ad campaign at the very top of its first search results page, even if your business is completely new. Since the majority of people click on the first 2-3 links on the first page of Google’s search results, you’re giving your business the exposure it needs to get those target accounts to click.”
7. Retarget dormant accounts
Let’s face it: not everyone in your email list is engaging with you or your content. One reason is that they’ve signed up for the services of one of your competitors. That doesn’t mean that you should take them out from your list. In fact, you should do the complete opposite.
Maybe they’re reconsidering the service they purchase and are looking for alternatives. Reaching out to them by sending a personalized email may jog their memory and spark their interest with you and your business again. Some of them may even decide to give you a try. But you’ll never know until you begin reaching out to them.
8. Hire the right salespeople
The people who make up your sales team are those responsible for closing the deal on your behalf. So make sure that they got the right skills and experience to get the job done.
When choosing who to hire for your sales team, take a peek inside their LinkedIn profile, and see how they “sell” themselves there. After all, if they can’t sell themselves, how sure are you that they can do a good job selling your services to your target accounts.
During the interview, get them to describe the sales process they use. This gives you insight into two areas. First, it’ll tell you whether or not they’ll fit in your business’ culture. Second, it gives you a better idea of how well they know not only what the job entails, but also help you achieve your set goals.
Of course, you’ll still need to get new clients to your business. Even more important is to make sure that you get your existing clients to keep doing business with you.
For starters, having a list of long-standing clients serves as a testimony to your product’s quality and level of customer support they receive.
Repeat customers spend more than first-time buyers. Results from Bain & Company’s study show that the amount of returning customer spends is directly proportional to the number of times they return.
Above all, satisfied customers become your unofficial brand ambassadors. They’ll not hesitate to recommend your services to those in their professional, and even personal, network. And because people would opt to patronize a business recommended to them by someone they know, they won’t need too much convincing to make a purchase.
10. Invest in the right tools
You got to have the right tools in place to make it easier for you and your team to develop, launch, and track your ABM campaigns.
Here are the essentials:
CRM. Aside from serving as a database of your leads and existing customers’ data, it also monitors your lead’s interactions with your content, lead scoring, and gives you more information about your ideal customer profile.
Marketing automation tools. These will make sure that you’re sending the right content at the right time across different channels to nurture leads you’ve generated through your ABM campaigns.
Analytics. You’ll need this to track your campaigns to see if you’re hitting your set goals. It’ll also show you which landing pages and channels are giving the most and least conversions, so you’ll know what’s working and what needs to be improved.
Account-based marketing is a strategy that’ll help you get more leads, acquire more customers, and earn more profit. Implementing even just one of these tips to your current ABM strategy can exponentiate your results.
On more than one occasion in the last few months, I’ve had a conversation with a client that goes something like this:
“These candidates are GREAT, but we need to see more… who else is in the hopper?”
When I dig in further as to “why” the qualified people in front of them aren’t enough, it is always a result of the same thing: they’re afraid they might find someone better.
And unfortunately, on more than one occasion, I’ve seen this FOMO cause them to lose remarkable salespeople and sales leaders that were previously beyond excited to work with them.
The truth is, A+ candidates will always have options… they are investments that make startups money and they know it.
But because unemployment is at unprecedented lows (3.6%), they have more options today than they have ever had.
So in today’s competitive landscape, there isn’t any time to waste – if you have a person in front of you who can do the job and checks off your ‘boxes.’ hire them immediately.
One client of ours who hires like this has grown 5x in 2 years!
Here are three reasons FOMO is the kryptonite of high-growth sales organizations… and how to conquer it.
FOMO is an anchor… but decisiveness cuts the rope.
There is a reason you need to hire, right? Whatever that reason is (whether it be bandwidth, market opportunity, growth goals, etc.) it means every day you go without hiring is a day that you’re not achieving your goals or solving your problems.
Great example – a client we stepped away from got their Series B in Q4 last year and came to us with the goal of 4x’ing their team. But they’ve only made 1 hire since then as a result of FOMO (in fact, they are the example I quoted above).
All the while, their runway is shrinking and they still aren’t any closer to their goal! Whereas if they had been more decisive, they’d have already been well on their way to 2x’ing their team!
(I know this can sound like sour grapes from a recruiter. Just FYI, this is a problem within the organization that multiple people backchanneled me about after the fact … including their VC).
FOMO turns the right people off… decisiveness gets them excited.
This is especially true the more senior of a hire you’re trying to make!
Take a client of ours who was searching for their first VP of Sales as an example. We presented them 3 candidates.
After interviews with the 2nd candidate, we delivered the feedback to him that the client and the board thought he was perfect and checked every single box. But they had a 3rd candidate in the process and wanted to see them through.
The 2nd candidate’s response was, “If I’m their guy, what are they waiting for???”
We delivered that feedback quickly to the client and they wasted no time extending an offer. When the candidate received it, he was so impressed that they ‘got it’ he wanted to work even for them even more.
The truth is, if you can’t be decisive, candidates will start building a case against you. But when you are, it shows them you know what you’re doing and are serious.
It’s like dating… if someone can’t make up their mind whether they want to be with you or not, it means they don’t really like you that much, no matter what they say. But someone who is decisive sends the signals that they are ready to commit.
The same applies in recruiting (and let’s be honest, sales too)!
FOMO makes it harder to hire in the future… decisiveness makes it easier.
Think about the last time you went to buy something and had an awful experience with a sales rep (in any capacity – the mall, a store, online, or at work).
How did you feel? Were you eager to buy from them? How about telling your friends about how great the product/company is?
FOMO is a big deal for the same reason – it creates a bad experience for the people you’re trying to hire. The most talented sales candidates care about candidate experience immensely for the same reasons your customers care about the purchase experience with you.
And that will impact your efforts to hire in the future!
According to a CareerArc study, 72% of candidates who have a negative candidate experience tell other people about it.
However, when you’re decisive, it signals to the right people that you’re a place where they will thrive. And that comes back in so many ways.
When people are thriving, they’ll tell their network. Just imagine how a post like this helps you hire others in the future!
The common theme with every single one of our clients above is that they weren’t 100% sure who they needed to hire… so they hesitated.
The best way to fix that is simple: know exactly who you need to hire, so when you see it, you can act.
Unfortunately, I know this is not so easy because not all salespeople are created equal! So here are 5 questions to ask yourself that will help you define the exact profile of the person you need to hire.
Top salespeople want to believe in what they are building. So make sure you can speak to that in a compelling way. It will help you be magnetic to the right hire!
2. Which market are you targeting with this role?
There is a big difference between the Enterprise market and the SMB market. And many startups forget that the skills associated with each (as well as the prerequisites to get into each) are very different.
Make sure you’ve defined each market appropriately before you hire!
3. What stage/size is your business?
Different stages of growth come with different goals and needs. So you need to evaluate where you are and what your goals are from this lens as well.
Jason Lemkin illustrates the point well for VPs of Sales:
Which type of VP of Sales to hire and when, via SaaStr.
4. How much selling has been done so far?
Have you sold as a founder? Or are you just getting started? What did you learn? You need to know where you are currently and where you want to go to make sure that the person you hire will be able to connect the dots appropriately.
5. What specific activities will your new hire need to do?
Part of defining where you are is knowing what tasks your hire will need to complete in order to be successful with you.
Do you have a solid lead-gen pipeline established? Or will they need to generate these themselves? Have you mapped out your total addressable market yet or will the said hire be doing this heavy lifting for you?
The specifics are critical to being able to identify a good hire for your business!
6. What kind of sales culture do you have?
Culture is the number one thing candidates we talk to care about, from CRO all the way down to AE. So finding a match here is crucial!
This isn’t about “finding someone you’d like to grab a beer with.” Real culture fit is about an alignment of fundamental beliefs (as they tie to your mission), your leadership, and whether you’re aligned on how to approach the task at hand.
It’s important to be conscious of making a mishire. Many startups are still struggling to get this right! However, balance is everything and you CAN take it too far.
Find a person who can do the job and is excited about your mission (look for that ‘connective tissue’ – that what’s important is also important to you)… and hire them. As long as you’ve been transparent with them throughout the process, there is no reason they won’t be ecstatic to accept your offer and do great work for you!
A few years ago, that great business thinker George Carlin shared one of his trenchant insights. Carlin posted that much of life was about the accumulation of “stuff.” For instance, a house is merely a pile of stuff with a cover on it.
Carlin’s observations were funny, but they also had some truth to them. For instance, do we really need to own cars? After all, they are rather expensive to maintain and house. About 100 years ago, no one owned a car, but most people got around and visited their relatives without having to pony up thousands of dollars and attach a garage to their homes. The average cost for a new car was $36,270 in January, which was up 4 percent over the year before, according to Kelley Blue Book.
In light of such costs, many consumers may want to ponder Carlin’s position. After all, if one decided to use Lyft or Uber for most transportation needs and forego buying a car, then one would arguably save money.
Alas, the math isn’t that simple. AAA calculated last year that if you drove 10,841 miles annually that you would spend $10,049 a year. If you relied on services like Uber and Lyft, then you’d spend over $20,000 a year, according to KBB.
But that estimate doesn’t take into account the cost of repairs or a garage. Plenty of others have done the math and decided that they come out ahead by Ubering or Lyfting.
This movement isn’t just among tree-hugging bloggers though. Lyft went public on March 28, raising $22 billion. At one point, Lyft’s stock price has swooned to about $18 billion. Critics of Lyft point out that it’s much smaller than rival Uber, which went public on May 10th.
The sharing economy
While I’m not going to predict what Lyft or Uber’s stocks will ultimately be valued at, allow me to assess the sharing economy: It makes total sense for goods that are not disposable to somehow be shared and in an economically viable way — and Uber and Lyft are.
These are some of the great inventions of my lifetime. Airbnb is another really good example of people being able to arrange lodging or long-term stays without signing a lease, as is Rent the Runway, which I don’t use, but it allows you to get something new to wear to a black-tie affair without having to buy another outfit. I hope that people will realize that they don’t need to own as much stuff and they don’t need to buy bigger and bigger houses to store more and more stuff.
My hope is that the sharing economy will show people that they may actually be happier with less stuff, which would be good for the environment. People have apartments or homes or condos that they can lease out for short periods for the greater utility of the world. Hopefully, it will lower the world’s waste production and the world’s carbon footprint. It can also get people more variety, which should improve their lives.
As for the economics, Uber and Lyft may need to raise their prices a bit to be more economically viable as companies. Yet relying on ridesharing instead of car ownership may still be more economical for many people.
The great truth that Uber and Lyft have brought to us is that people actually need fewer possessions. If they can get easy access to rides, clothing, or vacation homes then they can avoid the headaches that come with ownership. Right now, we’re in the early innings, but Uber and Lyft have proved that there’s a market for what they’re selling.
That will be true in the future, too. Places you book with Airbnb could become much more standardized. Things like jewelry could become less owned and more rented. We could experience more and be less cloistered by our possessions.
That’s why Uber and Lyft’s real innovation has nothing to do with cars. Instead, it’s a challenge to the American belief that puts emphasis on ownership. Until recently, renting goods was far from the ideal. But what if Carlin’s right and all we really need is a small place for our stuff. We can rent the rest.
For a business to be profitable, it must offset its business costs with the lifetime value of its customers. While multiple factors inform a customer’s lifetime value (CLV), none of them are quite as essential as customer success. Customer success is the foundation businesses can build their continued success on top of.
Without a serious investment in your company’s customer success, your customers will inevitably grow frustrated with the customer experience. As a result, they will slowly, but surely, drift away from your company’s offerings in favor of an alternative that will provide them with the personalized experience they’re looking for.
What is Customer Lifetime Value?
CLV measures the amount of profit a company earns from a single customer over the course of their relationship. Typically, companies use it to determine their customer acquisition strategy—the higher your CLV is, for example, the more you can feel comfortable spending on marketing, sales, branding and incentives.
However, CLV is also critical for planning your customer experience and CS strategy. And providing exceptional customer service can increase your CLV as well, creating a positive feedback loop that will benefit your company for years to come. A higher CLV enables you to invest more in customer success, which increases your CLV.
How does customer success drive CLV?
If you’re hoping to boost your customer lifetime value, then here are just a few (of the many) reasons why customer success is the single most critical investment you can make to increase your customer lifetime value.
1. Customer success drives customer acquisition
Most U.S. adults want to do business with businesses that can offer consistent customer success both online and offline. Where bad service drives customers to talk about your company negatively, excellent customer success will encourage your customers to talk about your business and its services positively.
To illustrate this fact, consider the results of a recent study that surveyed a representative sample of 15,000 people from 12 countries:
43% of all consumers would pay more for greater convenience.
42% would pay more for a friendly, welcoming experience.
And among U.S. customers, 65% find a positive experience with a brand to be more influential than great advertising.
This paints a pretty clear picture that, when it comes down to it, a large percentage of American consumers are looking for businesses that prioritize the customer experience. If you can provide an exceptional customer service experience to each new prospect you interact with, then the chances of that prospect coming back to your company as a customer will skyrocket.
For example, consider how Shopify explains the ways that customer success “can turn a customer question into a sale or a customer complaint into a resolution,” regardless of where that customer is coming from.
The point is, the more people you can convert into paying customers, the higher your CLV will become, and the higher your CLV is, the easier it will be for you to devote resources to your customer success team and keep the acquisition cycle going.
2. Customer success drives customer retention
According to a report from Frederick Reichheld of Bain & Company, even “a 5% increase in customer retention produces more than a 25% increase in profit.” With a profit margin like that, you can see why it’s so necessary that you continue to nurture and delight a customer even after they’ve done business with you.
The higher the quality of your service, the more loyal your customers will become. Shopify also says that, in a lot of cases, “an effectively resolved complaint or problem can turn an unhappy customer into a loyal, repeat customer.” If you can turn a negative experience into a positive one, you’ll not only increase customer loyalty but also make it easier for them to tell others about your company.
This will send new leads your way, allowing you to acquire new customers, repeat the customer service process, and ultimately improve your CLV even further.
3. Customer success drives customer spending
If you’re looking for a way to maximize your business’ CLV, then you need to commit to your customer success team. When you invest in your CS team—whether they’re an in-house or outsourced team—you’re effectively investing in your customers. And the more you emphasize the quality of your customer experience, the more willing they’ll be to do business with you.
Earning a customer’s business is one thing. Earning a customer’s repeated business is another thing, and showing your customers that you’re invested in the quality of their experience will encourage them to spend more on the services and products you offer. Increasing customer spend is the kind of reward that not only amplifies your company’s CLV but also helps keep your expenses low and profits high.
Mike is currently the Head of Marketing at Reflektive, but was at Lever and Glassdoor during periods of hypergrowth, where the name of the game was to double in size every year. Mike explains why you should lean on your sales reps throughout a pricing change, how to think about pricing as a competitive advantage and how his background in product marketing has benefited his role in pricing projects.
The days of 9-to-5 in-office facetime are becoming a distant memory as more and more companies adapt their definitions of workplace flexibility to meet the wants and needs of their most prized employees.
Flexibility and work/life balance are some of the highest rated benefits by employees today. OpenView recently conducted a survey of 360+ full-time workers in the technology industry and a whopping 70% of respondents said having flexibility at work is “critical.” What was once considered a rare luxury is now being viewed as a core offering for companies that are competing for top talent. But despite its rising popularity, there is still quite a bit of gray area when it comes to flexible work policies.
What is flexible working? Why is it the way of the future? How do I make it work for my company? Read on to find out.
OpenView’s survey results
The proven benefits of flexible work policies are numerous, and with 51% of employees wishing their company offered more flexibility, it’s in a company’s best interest to listen. Flexible benefits cost an employer nothing to offer, yet yield hugely positive outcomes. Employees with flexibility in their jobs are more likely to stay put. According to a 2017 Owl Labs “State of Remote Work” report, companies that support remote or flexible work have 25% lower employee turnover than companies that don’t.
Furthermore, fully distributed companies take 33% less time to hire a new employee than companies that hire in specific locations. Additionally, flexible benefits can make a company more attractive to job-seekers with different life situations (i.e. parents with young children), which means a bigger talent pool to hire from. A 2016 survey by FlexJobs found that working parents ranked workplace flexibility ahead of salary. OpenView found that a staggering 84% of working parents said work flexibility is the most important factor in a job. But above all else, giving your employees flexibility in their work schedules is one of the best ways to acknowledge that their well-being is important. It creates a culture of accountability, maturity and balance, which can only mean positive results for the business.
Implications of a non-flexible work environment
While many believe that the benefits of flexible working speak for themselves, the potential implications of not offering such benefits are palpable. Flex benefits are fast becoming a must-have for employees and job-seekers today. Companies who refuse to offer such flexibility could find themselves in a bind. Not to mention they’re already in the minority – according to Zenefits’ 2018 Flexible Work Report, 67% of respondents claimed their employers currently offer some form of flexible work arrangement.
It’s a known fact that hiring is getting more difficult by the year. Upwork’s Future Workforce Report states that 39% of surveyed managers agree that hiring is getting harder (3x higher than last year’s findings). Out of those that agreed with this sentiment, 53% cited local access to skills as the biggest hiring challenge (AKA, they can’t find the talent they need in the location they’re seeking it). And of the entire 1,000 managers surveyed, they predicted that ~38% of their full-time employees will work predominantly from home or remotely.
By not offering remote or WFH flexibility, a company could shut itself off from talent located outside of the desired region. However, by denying any type of work flexibility, a company could also risk losing currently employed talent – 36% of workers claim they are likely to leave their current job due specifically to lack of flexible work benefits.
What policies are right for your organization?
Once you’ve come around to the pros of flexible benefits, the first step is to evaluate the right policies for your organization and understand the different forms and arrangements that currently exist. According to the U.S. Department of Labor, anything outside the typical 40-hour, 9-to-5 work week is flexible. Some possible/common flex arrangements include:
Flexible hours: Coming in at 6:00 am and leaving at 2:00 pm
Partial work-from-home (WFH): Working from home 2-3 days a week or at one’s discretion
Remote or telecommuting: Working primarily from one’s home or remote office
Compressed weeks/hours: Working longer hours on certain days to build up flexibility on others
Although these are some of the most common arrangements, the variations are extensive and it’s important to recognize that there is no one-size-fits-all when it comes to choosing which arrangements will work best for your particular organization.
It’s also common to offer varying flex benefits to employees based on their particular roles within the company. For example, a tech support team that depends on certain technologies and in-office resources to do their jobs probably likely isn’t the best candidate for a partial WFH policy, but could be a great match for flexible/staggered in-office hours. A sales team that’s often on the road with customers could benefit greatly from working distraction-free at the home office. Taking into consideration the day-to-day demands, requirements and deliverables of the various functions/teams within your company will allow you to create customized flex policies that not only make for happier employees, but for a high performing business.
Enforcing new policies
The internal success of flex benefits, regardless of which arrangements are decided on, depends greatly on how they are communicated and enforced. Although it’s enticing to skip the dreaded step of documentation, it’s crucial to record the flex policies in writing and to incorporate them into your handbook so that they can be referenced at any time. See below for an example of a written flex policy.
Although some companies choose not to formally communicate the policies and leave it up to the employees “best judgment,” the lack of clarity can lead to murkiness around what’s “allowed” and “not allowed.” This often results in employees having to ask managers for permission to act on the unspoken flex benefits, ultimately defeating their purpose. Gray areas can easily result in internal friction and confusion.
Communicate the new benefits at a company all-hands and be transparent that some teams have different benefits than others. Encourage managers to host follow-up meetings with their individual teams to walk through the details of their policy and to be explicit that expectations and goals will not change in any way despite the added flexibility with schedules. Managers should also emphasize that team members will need to be flexible themselves with regard to their new flex benefits based on certain deadlines that may arise or high-priority projects that need extra attention.
Lastly, it’s important that managers lead by example by leveraging the flex benefits themselves. If employees see leaders enjoying the perks, they’ll feel more comfortable doing the same. By communicating and enforcing flex benefits in a clear, transparent and thorough manner, you’ll avoid the internal backlash of ambiguity and allow for an environment of accountability and ownership.
The bottom line is that if employers want to keep winning top talent, they must embrace the concept of flexibility at work. If company leaders do the work to educate themselves on the different forms of flexibility, realize the huge benefits that come with it and are intentional in their internal communication of such arrangements, they’ll be well on their way to creating a workplace centered around accountability, maturity and understanding.