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Microsoft Dynamics CRM + DealHub CPQ = A Frictionless Buying Process

The Microsoft Dynamics Business Model

Mike: It’s great to be here with you and looking forward to having a good conversation. I’ve been the CEO of ClickDimensions for five years now. And I was brought in by a private equity firm, Excel KKR, who had bought the company. For my career, I’ve been in either CRM and marketing technology or collaboration technology.

My first company ostensibly had nothing to do with CRM. It was an apparel company that made stuff with pro sports teams’ logos on them. But the thing that made us successful was we built our own CRM that allowed us to get the right products, get the right cross-sell, get the right upsell. And even though we were an apparel company, we had 15 developers working full time on our CRM. I’m going to date myself here because this was back in the late eighties.

So, from that time all the way forward, I’ve been an investor in email marketing and marketing technology. I’ve run a marketing technology business for a New York stock exchange firm. And then after that, I joined ClickDimensions. This is also, I know one of the things that you’d asked me about a while ago was about Microsoft. And this is my third time in the Microsoft universe as a partner and a competitor all at the same time. So, ClickDimensions seems like it was a very natural place for me to land.

Barry: So let’s talk a little bit about ClickDimensions. Later, we’re also going to talk about the Microsoft world because that is interesting and it’s a little different than what we usually discuss with our podcast guests. 

Mike: ClickDimensions started off with one guy working out of his basement, an entrepreneur and his partner typing on his keyboard in his parents’ apartment in Tel Aviv, Israel. And they had a simple idea. They had been early Microsoft CRM partners, and they saw what was happening when they would come up against Salesforce. And Salesforce was a better brand, a more known product in the CRM world.

They also had two things that often caused the Microsoft side to lose deals. They had email marketing. They’d bought Exact Target and they had marketing automation. They’d bought Pardot. And these guys had ideas. Let’s copy Exact Target, let’s copy Pardot, but let’s do it natively on the Microsoft Dynamics data platform.

And that had the benefit that there were no data integration issues. You’re working off a common data set. You’re working out of the same UI, things were visible to everybody. But the other thing that it had that was probably even more important than the technical benefits was that it opened up a global partner channel that allowed the company to scale pretty massively without a lot of capital. So that was then. Microsoft CRM and Microsoft have come a long way. And we’re now 11 years into this company and looking forward to the next chapter of our story, as many of us are post-COVID.

Barry: That’s really interesting, and I love that business model. Take what Salesforce has and just put it onto the Dynamics world. Is that a business model that you’ve seen a few times?

Mike: Well, and talking about that first company, we just basically took the best designs of Adidas and Nike, and instead of putting a solution on it, we put the University of Colorado on it. So maybe that tells you something about me. What is it? There’s some comment about the experts borrow, but the masters steal or something like that. I do think it is useful to find patterns in other businesses and apply them. And so I do think that’s understanding business models and saying, “Hey, what can I learn from that business model and apply it to this context? Is there relevance?” I think that’s a useful skill.

Microsoft Dynamics vs. Salesforce

Barry: Absolutely. And that gap between Salesforce and Microsoft, does that happen a lot where there are some features on Salesforce that aren’t on Microsoft?

Mike: I think a lot less today. I think there are strategically some things that are very different about Microsoft’s approach to business applications and Salesforce’s approach to business applications. And I think it’s going to be a pretty interesting sort of battle over the next five to 10 years and all for the benefit of customers on both sides of the equation.

I think that the DNA of the two companies is pretty different. Microsoft is very much an IT-oriented, infrastructure-oriented business, which means their approach to business applications is very much around data and the importance of data, the ability to do AI on data, and to move data and big quantities of it all over the place in their Azure hyper clouds. That’s a certain, very engineering-oriented way to solve things.

Whereas Salesforce started off much more with what the user is trying to do and how do we make things easier for the user and how do we get rid of IT, originally? And the DNA of those two companies is still very evident in how they’re dealing with the context today, even though Salesforce arguably is a very focused on data company. They bought MuleSoft, they bought a lot of other folks, but the roots of the companies are still driving the distinctions today.

Barry: That’s really interesting. So then I remember Teams, for example, that would be, I guess, a product that would be more focused on the Salesforce world, if you will. And I remember when COVID started, that Teams was, I believe, offered for free or added into a package that most people had that were using Microsoft. That seems to be more of a “we’re going to focus on the user” kind of play. Is that something that you see happening?

Mike: Well, yeah, it’s interesting. I said that my two career themes had been marketing technology and collaboration. So I’ve been working with collaboration technology and Microsoft back when they had live communication server and then Link and then Skype for business and now Teams. And they finally got it right with Teams. It’s not perfect, but they’ve really done an amazing job.

If you had told me five years ago that Microsoft would be able to scale to billions of users on a daily basis in a real-time collaboration, I would’ve said no way because they tried it and failed, but they really did a good job here.

To your point, I think there’s a big difference between Microsoft and the productivity applications. Think of Teams, think of Outlook, PowerPoint, Word, things like that, where they always have had user orientation. The business applications think CRM, sales, HR, finance, things like that, field service, they definitely bring an IT orientation to those as opposed to a user problem and domain.

So I think that’s a really key insight that you call out. And I think one that’s important and defines one of Microsoft’s strengths is that they do have productivity and they do have collaboration. They’re if not the best in the world, darn close to it in that area. And every business application, whether it’s sales or whether it’s HR, needs collaboration.

So they’ve really started to blend those together and take advantage of them. This is one area where Microsoft has had a lead and Salesforce has to catch up as opposed to CRM where Salesforce had the lead. And by way of that, Salesforce bought Slack. That was their approach to collaboration. So again, they’re both headed towards similar components of their solutions, but their DNA is very different. Microsoft, if the battle, if the fight is collaboration, Microsoft’s in a good shape.

CPQ for Microsoft Dynamics

Barry: Yeah. So I guess we’ll have to buckle our seat belts and join the ride for the next few years and see what happens. It’s definitely quite interesting. So this would be a good time to transition to something. One product that Microsoft Dynamics doesn’t have today is a CPQ. ClickDimensions is a customer of DealHub. For our listeners just in case you don’t know what DealHub does, we are a CPQ and we also sell a DealRoom.

CPQ stands for a configure price quote and the software lets sales teams quote accurately at scale through business workflows, approval workflows, and with the DealRoom that brings the buyers and sellers into one place, where people can close deals with eSign technology. They can bring lawyers together to review the contract, and they can also grant access to the generated document or digital sales proposal.

So that’s a bit about how DealHub automates the quoting process. The thing I wanted to talk about with Mike today was specifically how DealHub addresses the buyers and the sellers that aren’t physically present. So the remote world that we’ve all been experiencing for the past two years, can’t believe I’m saying two years, but it’s been two years, and how DealHub can help move deals along, but through a certain process. I guess, the buyer-centric sales process we were talking about before this podcast, how DealHub helps as a technology to move deals along in the remote world and the remote selling world we’re in. I’ll let you take it, Mike, the path that you think is most interesting.

You may be interested in: 7 Essential CPQ Features for Microsoft Dynamics Users

How DealHub Helps Remote Sales Teams Move Deals Forward

Mike: So I think there are a couple things that I’ll weave together here and I’ll start off with a little bit of a provocative statement as a technologist. And it’s funny, we were just talking about the challenges of CPQ and how complicated some of those things are. But what interested us about DealHub was something a little different, and it does have to do with the buying process and how that’s changed and why it’s so important today, post-COVID where people are remote.

And so with the not belittling the trickiness of doing what it takes to configure and price and quote, I want to talk about the impact of the way DealHub approaches things on actually winning deals. And here’s the couple of things that we saw. And I’m going to start first with the most basic.

And that is that every seller in a B2B world is creating a proposal. And if you make a more aesthetically pleasing proposal and one that’s easier to work with, with lawyers or with multiple approvers or getting signatures electronically, if you do that, you increase your chance of winning and you reduce friction in the sales process. So just that simple thing is applicable to every salesperson.

Here’s what’s unique today in the world that we live in, where we believe very strongly that the DNA of buying has fundamentally changed and is not going back. And by that, we mean that there were some trends that were underway before COVID that have now become accelerated and permanent. Let me give you one. Folks, buyers, want to research what they’re buying themselves. They want to be in control of that process. And that means that they want to be able to do their own research and they want to control the time, but they want everything exactly when they want it.

They don’t want to have to look for things too hard. They get frustrated if it’s hard to find. And they want to talk to a human when they need to talk to a human. So basically they are both more independent and more needy. And one of the things that DealHub does that’s fantastic is that it allows you not just to create a beautiful-looking proposal, but to create that hub, that DealRoom.

The Buyer-Centric Sales Process

Mike: And at various points in the buying process, the company and the team of people that are buying are going through different stages. And you mentioned the buyer-centric sales process. I’ll weave these two together. The concept of a buyer-centric sales process is that you really need to map your sales activities to how the company buys and whether they have a formal process with a procurement department and all of that stuff.

And it’s really mapped out with gates and things like that, or they do it ad hoc. They are going through a process and a standard sort of thing is that we tell people there are five things that you have to go through, and the first one is, “Hey, are we going to invest any time to actually think about buying this? And am I interested enough to get my colleagues to want to join in and spend their time? Am I going to use my political capital?” That’s the exploration process, and at the end of it, it’s when the company has said, “Yeah, we’re willing to get into a commercial process.” And so that’s one example.

The second would be problem definition, and whether companies state it or not, there is a problem that they’re trying to solve. As a seller, we teach our people, “Hey, make sure you understand the problem.” And if the buyer doesn’t understand the company, doesn’t understand, try writing it down for them and get them to agree. Yes or no. That’s one way of getting it. I just bring those up. Those are things that at each stage, the buyer, the company has gone through a hurdle, and there’s evidence that you can test along the way.

Now, what does that have to do with the DealRoom? The things that you’re trying to do to get colleagues to decide, “Hey, should we invest our time to buy whatever it is these guys are selling?” The information that they need is different than when they are evaluating five different alternatives. One of the great things about a DealRoom is that you can put the information that’s relevant for where that company is in its buying process.

And you solve the problem of the champion who says, “Hey, I really think we need to buy this stuff these guys are selling, but I need these other five people to agree with me. And I need my CFO to agree, and they’re not interested. They didn’t wake up thinking they needed to buy this stuff. How do I convince them?” And if all that stuff for that stage of where they are is in the DealRoom, it just reduces friction and increases the chance of winning, and the ability to go from that to when they’re in the evaluation stage.

And now, you magically happen to have here are the five questions you should ask this competitor, and here are the six questions you should ask this competitor. And here’s how we fare against them. You’re able to guide them in a concierge fashion through the buying process in one location.

So we looked at the summary when we looked at DealHub, and frankly, we had just implemented another CPQ, and we saw DealHub CPQ for Microsoft Dynamics and we saw what we could do to upgrade the proposal experience, but more importantly, what we could do to manage that buyer-centric sales process through a DealHub. That sold us. And we ripped out what we had installed three months earlier, and went to DealHub. So that’s been our experience with DealHub. And we think that it is even more relevant in this world where not only is buying tough to begin with, but people aren’t together, and you need to be able to quickly find the digital information.

DealHub CPQ Helps Win Deals by Reducing Friction in the Buying Process

Barry: I’m really happy as an employee of DealHub to hear about your experience. I want to go into some of the details about what you were saying. One thing that I was thinking about is that you said it DealHub’s Microsoft Dynamics 365 CPQ helps win deals. Can you be more specific on that? Is it that it helps win deals because the sales velocity is faster and that’s the piece that increases the win rate? What would you say about that?

Mike: Yeah, so I think it reduces buying friction by helping the buying team through the process. I mean by especially in companies where the buying process is very organized. For those of you who deal with enterprises, there’s an RFP process and they’ll tell you, we’re in the RFI stage right now. And we’re in this stage and we have these things. Well, it’s just a nice tidy place to have the right information at RFI stage. And now you’re going to the next stage. Here, we have it. Oh, we now have uploaded all the technical documentation because we’re going through the evaluation process.

It just makes it easier. And the competitor that has the information in an easy-to-find, well-organized place is going to do better than the competitor that sent a bunch of emails with attachments that got lost, that didn’t get sent around to one other person.

So I think that just from the simplest perspective, you can execute on making it easier for the buyer to do their job. That’s if they have a process. If they don’t have a process, you’re guiding them through the process. Our experience is, and I think there’re plenty of other sales consultants that will tell you this, whether you think there’s a process or not, there is. And if you haven’t helped walk the customer through that, they get down to, “Oh, we’re all ready to sign.” And somebody says, “Well, wait a minute, did we evaluate other companies? Oh no, we didn’t.” Well, you might as well guide them through those things. And so, our experience, and we sell a lot to SMBs, is they often don’t have a formal process.

And by starting off by saying, “Hey, we know you’re going into a buying situation. Have you bought stuff like this before or not?” And if the answer is no, then we help work with a joint action plan to help them walk through it. And we go ahead and say, “Here’s the competitors you should think about.” And we try to anticipate all of that stuff, and DealHub helps us do that because we turn the chapter when they get to different parts in the process if that makes sense.

Barry: Absolutely. I read recently that a Gartner report said that 50% of enterprises by 2025 will have a digital sales room. They called it, which is in essence, a DealRoom where it just brings the buyer and the seller together to help in this remote selling world that we’re in today. So that’s really interesting.

One place where I’ve seen it, that people really like it, is that you just have to, I guess, answer a few questions once and then it generates all the things, all the asks that you need for the whole buying committee. So whether that be like the specs, if it’s like manufacturing, so explains what the product is. You don’t have to find those attachments exactly as you said, and then that helps with the velocity because then you don’t have to ask for it. Then you just continue the process because it’s all right there, and it’s all up to date, and it’s all one link. So that’s really interesting the way you guys use it.

Buyers of Microsoft Dynamics 365 for Sales are Enterprise Companies

Barry: Are buyers of Microsoft Dynamics different than those who buy Salesforce since Microsoft Dynamics users are more IT-focused? 

Mike: I think that if you look at Microsoft Dynamics 365 for Sales customers, and if you look at where Microsoft is playing these days in the business application world, their move is very much up towards enterprise, and they’ve done a pretty good job of that. Now they were coming from a pretty small base against SAP and Oracle and Salesforce and other folks like that. So, they’ve always had dominance in operating systems and now cloud and dominance in productivity, and their business applications were a smaller part of their business. It’s grown a lot. And what they’ve really done is they’ve focused on the larger enterprises, and we’ve seen that in what they’ve done with their sales force, where they’ve reallocated people from the mid-market to the enterprise. We’ve seen that in their partners. They’ve really pushed their partners to become more enterprise-focused.

And they have a great enterprise story starting at the data layer and business applications and this concept of power platform, which allows big enterprises to write their own custom things. So it really is beneficial for the large enterprises that the partners, Microsoft Dynamics, the business applications group people, are selling to. And so to those customers, that sort of a DealHub concept is particularly important. It’s even more important, I think, for the larger enterprises than it is for the SMB.

Barry: That’s interesting because it’s a larger buying committee in that sense.

Mike: Larger buying committee, and I would also say that the customers, if you were to look at the breakdown of the industries where Microsoft really dominates, there are some industries in which Microsoft has a big share, and Salesforce has a big share. There are some industries where Microsoft is really strong, and Salesforce, you don’t find that often. And interestingly enough, manufacturing is definitely one of the areas that Microsoft is pretty strong in, and manufacturing typically has more complicated CPQ requirements, number one.

And so if you take that, plus the benefit that we talked about, about how to organize a buying process, I think there’s an opportunity for partners in the Microsoft ecosystem to use DealHub themselves and to sell it to them, recommend it to their customers, especially in some of those industries like manufacturing.

Barry: Yeah, absolutely. So, Mike, there’s a lot I can learn from you, and I hope our listeners get to understand better about the buying process, understand better about your background and your history. I really appreciate you joining and hope to stay in touch.