WHY do it?
Customer success. Revenue. Growth. Profitability. Productivity. These are just a few of many drivers which influence a company’s decision to verticalize or not. The challenge is finding the right balance and effectively deciding when, where, who and HOW to do it. Those will be addressed in a future blog but let’s first look at some of the pros and cons of why to verticalize:
- Specialized skills result in deeper, more meaningful customer engagements
- Vertical model avoids the challenges of geography wars between regional teams
- Focus means more repeatability and probability for success
- Greater success means more revenue and more profit
- Specialized skills are difficult to find, develop and retain
- Vertical (vs regional) model adds travel and expense costs
- Focus could result in key markets and opportunities being ignored
- Greater success may not be worth the acquisition cost
From my personal experience, the benefits almost always outweigh any negatives. I’ve seen verticalized sales teams be as much as 10 times more successful compared to their non-specialized peers. Of course there’s added cost and investment, but this model has proven to be successful for some of the most admired and successful technology products and services companies in the world such as Accenture, Cisco and AWS.
Check back in later this month when we’ll dive deeper into verticalization best practices and examples!