Hewlett-Packard's Sales Job
In 2010, Hewlett-Packard Co. launched HP Sales University on its campus in Plano, Texas, far from its Silicon Valley headquarters. The purpose: develop core business skills and collaboration among its top salespeople.
Meg Whitman is the fourth CEO in six years. A vaunted computer tablet recently bit the dust. The fate of its flagship personal computer division remains up in the air. Few would dispute the notion that Hewlett-Packard Co. is in upheaval. In the midst of those momentous developments—in part because of them—the Palo Alto, California-based company has set out to transform how its sales force can serve corporate clients.
In 2010, the iconic technology company launched HP Sales University on its campus in Plano, Texas, far from its Silicon Valley headquarters. The physical building encompasses nearly 10,000 square feet and features four large classrooms, several translation booths for non-English-speaking employees, conference rooms and is outfitted with HP's digital and interactive technologies.
Joanne Moretti, an HP vice president and founding dean of the university, says a central goal of the new program is breaking down "silos" of specialized, product-centric expertise.
"In the past, we attacked the accounts very randomly and tactically. But customers have told us they want us to partner with them in a more organized and strategic fashion," Moretti says.
This is a radically different approach for HP, a technology titan best known for making computers, printers, networking gear and related equipment. As HP morphs from a hardware manufacturer to a provider of software, cloud computing and mobility services, greater emphasis is being placed on the necessity of collaborative selling.
In particular, customers want "one point of contact that understands their business needs" and can help them integrate varied HP offerings, Moretti says.
Early results of the program are promising. Executives who've attended the training record sales that are 12 percent higher than their assigned quota.
By beefing up sales training, HP seems to be bucking a broader business trends. Dwindling consumer confidence and corporate belt-tightening heighten the need for improved selling skills, yet most organizations appear unwilling to make the investment. U.S. organizations devoted 6 percent of their training budgets to sales in 2010, according to a report by consulting firm Bersin & Associates of Oakland, California. The figure has declined steadily since 2007, when 13 percent of training dollars was earmarked for sales programs.
Moretti declined to reveal the size of HP's investment in sales training, but Bersin & Associates reports that technology companies allocated 12 percent of all training dollars to improving sales skills.
In recent years, there has been a lot of talk about just-in-time, informal learning that can be done cheaply through YouTube videos or short computer-based courses. But HP is betting there's still an important role to be played by more traditional classroom instruction. Company officials say the long-range purpose of the new sales university is to boost the selling, customer service and business-planning skills of all 28,000 global salespeople by exposing them to products and services outside their usual areas of expertise.
The curriculum in 2011 and 2012 is targeted mostly to 1,800 recently hired executive sales managers, otherwise known as account general managers. As part of their performance reviews, the account GMs will be required to attend a weeklong onboarding session to hasten their productivity in the new role.
Customers like Pete Walsh have already noticed a difference. "The folks who've gone through that training are delivering a pretty consistent message about HP's offerings and how they would support it," says Walsh, chief information officer for Dallas-based Buchanan Technologies, an IT consulting firm. That wasn't the case in the past, when "different reps would give different answers" to the same question.
In an average week, dozens of HP's top-performing sales managers visit the Plano campus to participate in collaborative learning exercises, receive individual and group coaching, and listen to presentations by industry experts and technology gurus. Emphasis is less on selling and more on developing business acuity, financial acumen and industry perspective, Moretti says.
For example, an account GM may run through drills, often with the help of a coach, on how to read, understand and interpret a balance sheet.
Gayle Papadopoulos, a vice president of HPs global accounts organization, says her team of 120 account general managers was wary at first. "We had to sell them on the idea. They didn't want to come out of the field for a week to attend training," she says.
Although the training is mandatory for executive sales managers, Papadopoulos has not had to compel people to participate. Instead, those who have attended proselytize their co-workers. "Folks were coming back excited to share what they learned. That almost created a sense of envy, and other people started to ask, 'When is my turn to go?' "
Still, it remains to be seen whether a dedicated training facility for sales will be enough to reverse slumping HP's fortunes. Just like Willy Loman in the stage play, Death of a Salesman, its sales reps face a world in which customer demands change almost as rapidly as the technologies they use.
Adapting to the new world order won't be easy. Sales of desktop and laptop computers—long a staple of HP's business—are waning as consumers migrate to portable tablets and hand-held "smart" devices. To wit: by 2012, smartphones will emerge as the computing device of choice for consumers, according to a report by Morgan Stanley. It predicts more than 450 million smartphones will be shipped globally, overtaking sales of personal computers.
Despite that forecast, then-CEO Leo Apotheker in August decided HP should get out of the smartphone business. Apotheker abruptly canceled production of devices based on HP's webOS software. That included pulling the plug on the HP TouchPad tablet, just seven weeks after it was launched with great pomp. The decision leaves HP, at least for now, without a competing product in the surging market for tablets.
A month later, HP's board fired Apotheker after less than one year on the job. Replacing him is Whitman, 55, formerly the CEO of eBay Inc., who last year waged an unsuccesful bid to become governor of California. Her job at HP: stabilize the corporate office and map an execution strategy to get the company back on track.
One of Whitman's immediate challenges is fixing HP's identity crisis, reflected by the longtime hardware company's announced plan to shutter its flagship Personal Systems Group, which produces desktops, notebooks and hand-held computing devices. Whitman reportedly will finalize a decision this month.
Meanwhile, Moretti and HP's learning function are juggling the launch of new sales training while sorting through reams of discrete training programs scattered across the 320,000-employee company. She says HP's shifting overall strategies and executive turnover do not change plans to roll out new training in Plano.
In fact, once all 1,800 new account general managers have been run through the training, the next batch of attendees will include hundreds of specialists in HP's different business units. These subject-matter experts form a network of support to help salespeople in the field approach customers with integrated computing solutions, as opposed to selling equipment in piecemeal fashion.
The plan eventually is to expand the currciulum to address the training neeeds of all 28,000 salespeople, probably as soon as 2013, Moretti says.
Six months after the launch, HP hired an independent company to measure the financial impact. Moretti says customer satisfaction scores inched up one-half of a percentage point, while account general managers increased their "time to productivity" by an average of 17 days.
Then there's the above-quota sales performance of trained general managers. Projected across HP's 220 global account leaders, those figures point to $1.3 billion in new revenue, or earnings per share of stock of 39 cents, Moretti says.
That's just the tip of the iceberg, she says. "But it's the most important tip, and it will have the most fundamental effect overall for the company."
Garry Kranz is Workforce Management's contributing editor. To comment, email firstname.lastname@example.org.