April 3rd, 2019 | by

Thanks for joining another whiteboard video session with us – Discover: Corporate Hierarchy. I’m Christian Prusia, DiscoverOrg’s VP of Enterprise Sales.

Let’s start by breaking down corporate hierarchy into three basic elements:

1. What in the world is it?
2. Where does it apply? And maybe even some of the, how does it apply?
3. And most important: Why does corporate hierarchy matter?

What is corporate hierarchy?

corporate hierarchy is the parent relationship of the organization

 

Corporate hierarchy is the structure of organizations and people to identify where the decision-making power lies. often maps out how various entities relate to one another.

When we think about hierarchy, we’re looking at how Company A relates to a Company B, and possibly rolls up to Company C.

In some cases, it might just be all just one company.

In other cases, 10 or 20 different entities roll up into one superpower company.

Knowing that really matters!

So we’re talking about people in power, and various organizations working together. Next, let’s look at where we can apply this.

Where can sales apply corporate hierarchy?

Corporate Hierarchy: Speed up the Sales Cycle

 

Let’s look at a couple of different examples: a coffee company and a Software as a Service (SaaS) company.

Example 1: Corporate hierarchy matters less for simple purchases

Coffee: You probably drink it. You definitely know what it is. Now think about this structure of A, B, and C companies: As a coffee salesperson, I’ll bet I can have buyers in each company taste it, love it, and purchase it – all within their own four walls.

I don’t think I’d have to go get corporate approval from Company A to purchase coffee at Company C.

Example 2: Understanding corporate hierarchy is critical for complex sales

But let’s take a more complex example of a sales cycle: cloud storage. Much different sales process than the example above!

Suppose I’m in an individual sales rep within a SaaS company, and I’m trying to sell cloud storage to Company C … but I don’t know their corporate hierarchy. I don’t know about Company B, and I don’t know about parent Company A.

I’m going to engage Company C and educate them about my product. I’m going to listen and learn their business challenges. And if my solution is better positioned than the current vendor, or if they don’t have a vendor, I’m going to try to eventually influence them to take action and buy my product.

So far so good?

Read it: 9 B2B Closing Techniques You Can Use Today

What is Corporate Hierarchy for B2B sales?

 

Selling the technical track

Let’s breakdown the technical track:

  1. During the open competition phase, as they consider Cloud Storage, they’re going to consider many options and vendors.
  2. Through this education, and learning, and collaboration between vendor and client, we’re going to help them understand that we’re the best fit and they might shortlist us.
  3. Through more education and more collaboration, they might select us as a vendor if we’re lucky enough.
  4. Eventually through security work and other parties in their company, they’re going to approve me as the vendor of choice. Congratulations.

Selling the commercial track

In concert with that, I’m also working on a commercial track:

  1. They don’t have any money for it because they weren’t planning on buying it now.
  2. They’ve requested some budget.
  3. They’ve received a budget approval.
  4. We reach final terms, and they agree to purchase it from us for a set price.

Read it: The 5-Point Guide to Overcoming Objections

corporate hierarchy

 

… all of this is a lot of work!

The challenge with complex solutions like cloud storage – and most software products – is that they’re centralized. The parent company is going to want to ensure the cloud storage provider is consistent across all three companies to drive efficiencies.

 

Without an understanding of the corporate hierarchy in these scenarios, you end up with wasted or misguided efforts – potentially not engaging with the party with the ultimate decision-making power.

If I understand their corporate structure, I can go through this exercise here while being mindful of keeping the other groups informed, building groundswell, and earning the approval of the parent company.

Why navigate corporate hierarchy? To speed sales velocity

 

Educating, understanding influence, and driving action can happen so much faster if you’re aware of all related companies. If you miss the fact that there’s a parent company controlling the purse strings, you’ll be reinventing the wheel each time.

Read it: Account-Based Sales Development: 10 Steps to Global Success

Why navigate corporate hierarchy? To speed sales velocity

corporate hierarchy

 

But the real reason to take the time to understand corporate structure is that it can unlock sales velocity.

The key to sales velocity is knowing the company’s structure and involving more people earlier in the process. That allows me to reach more departments, find other use cases, and drive greater dollar.

 

Having each of these companies purchase my cloud storage – versus just one – is clearly a larger ticket.

But additionally, by involving many stakeholders, I’ve found influencers within each different group. I have decision-makers at each locale. And eventually the parent company will agree: All companies benefit!

That’s going to improve my win rate of this opportunity; and ultimately, I’ll actually do it faster by working with all related companies from the get go.

At a 10,000-foot view, corporate hierarchy is critical.

It unlocks sales velocity, more deals, larger deals, and a better win rate – all in a shorter length of time. You’re also just communicating better. You’re mindful of the people and the decision-making power across all entities – not just one.

This holistic, hierarchical approach drives success for both client and vendor!

Thank you as always for joining us for this Discover Whiteboard series. Please share what you like, comment on what you dislike or disagree with, and help us all become smarter. Subscribe to our YouTube channel! We’d love to hear from you!

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Christian Prusia
About the author

Christian Prusia

As Vice President Enterprise Sales at DiscoverOrg, Christian Prusia drives growth at the company's largest clients and acute focus on the top 100 clients. Prusia has a background in global software sales and an MBA from Willamette University.