NeXT INK

Spring Training

Dan Lavin

NeXT sales should be congratulated for making its $10-million software-sales goal for the last half of 1993 almost to the dollar. But how did it know? How did the numbers come in so exactly? Even more importantly: Are NeXT's forecasts for 1994 100,000 seats and $50 million as accurate and reliable as the 1993 numbers?

It turns out that there are almost no surprise sales in the NEXTSTEP universe. Just as major-league ball players can be spotted a mile off as they develop in the minors, a major NEXTSTEP sale is a two-step process. First, NeXT must secure a design win, in which a company commits to buy a few dozen machines and create a custom application. It's like having a phenom on your minor-league team.

Anywhere from six months to two years later, the company deploys the custom app, entering the Holy Grail phase when it orders several thousand units of NEXTSTEP. In baseball, this phase is when the so-called rookie is brought up to the majors after several years of careful nurturing.

Warren Weiss and his team determined that, in 1993, the number of accounts ready to deploy, plus a few new accounts on a fast-deployment schedule, plus the percentage of sales that come from nonmajor accounts, would total that ten million, if it was all carefully managed.

In 1994, because of the long development cycle, most of the $50-million goal must come from accounts now in design phases and set to deploy in 1994.

There are two traps that NeXT could conceivably fall into: First, it could be counting on every single one of these design wins to go to the deployment phase an unrealistic expectation. Also, it could take design wins for granted, forgetting to nuture and serve them all the way to their conclusion.

It is unreasonable to expect that the company will retain all of its potential accounts, just as you always lose a few tadpoles to larger fish like the Pacific Northwest Giant Salmon (Fishus Gatesius). Too often, NeXT has trumpeted a new account as a "1000-unit account" years before the customer had made a final decision. In a very large corporation, several design efforts costing millions of dollars might be in process at the same time to pick the winner for the big deployment. Lesson: NeXT must have far more than 100,000 irons in the fire to make its 1994 numbers.

But in addition to all of the design-win accounts that must be brought to maturity, the sales force must continue to get those new design wins if it expects to have any kind of decent 1995. Existing markets must be exploited, and new Sun and HP customers must be snared into the NEXTSTEP fold.

It seems to me that these require different skills. Bill Weseman has begun to bifurcate the design and deployment functions by having telesales push one- and two-unit pilot programs, but the sales force working with the Object Channel still handles both large design wins and deployments.

I suggest that NeXT align its sales force into teams that have members that specialize in each function. Specific account specialists could be assigned at the time of a design win to shepherd projects #all the way through while the salespeople seek out more opportunities. Patterned on the developer-advocate model, these employees could be termed corporate-developer advocates.

That way, the phenom customer of today could grow successfully into the major-league player of tomorrow, and NeXT could do the same, making it to the big leagues.

Dan Lavin comments on business issues in NeXT Ink.