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Summer Cognoscenti Wrap-up with Ian Truscott · What's Broken in GTM and How to Fix It

0:00
Simon: Louis, this week on the What's Broken in GTM and How to Fix It podcast, we're taking a look back across the Summer Cognoscenti series to pull out what those conversations were really telling us, and we've asked Ian Truscott to join us to do so.
0:13
Simon: What's the TL;DL("Too Long; Didn't Listen") for anyone who doesn't have time for the whole episode?
0:19
Louis: So it's this.
0:20
Louis: SaaS, I don't think, has primarily got an execution problem.
0:25
Louis: It may have a governance and operating model problem that manifests itself through execution.
0:30
Louis: What we noticed was the connective tissue throughout our Cognoscenti series this summer has been governance.
0:36
Louis: Organizations can optimize individual functions, metrics, and tactics while still degrading the performance of the whole system.
0:43
Louis: Under pressure, local optimization becomes easier to justify, competitive imitation erodes tactical advantage, and faster execution can compound poor choices just as effectively as good ones.
0:54
Simon: Stay with us for around 55 minutes or so to learn more.
1:00
Simon: Hello, and welcome to episode 59 of the What's Broken in GTM and How to Fix It podcast.
1:05
Simon: I'm Simon Daniels…
1:06
Louis: and I'm Louis Fernandes.
1:08
Simon: We are exploring the challenges facing SaaS GTM leaders that Louis has been discussing in his newsletter, drilling into the topics a little further to provide some solid practical guidance for SaaS GTM success.
1:19
Simon: Now, Louis, before we get to things, you've got a, a couple of items that you wanted to bring up first.
1:26
Louis: Well, firstly, I can't believe it, but next week when I publish, um, What's Broken in GTM the blog, it's gonna be our 100th installment.
1:35
Louis: I can't believe we've got to 100.
1:37
Simon: Yeah, that, yeah, is a, good milestone.
1:39
Simon: So that's what?
1:40
Simon: A couple of years' worth, I guess?
1:42
Louis: Two years.
1:43
Louis: Two years worth.
1:44
Louis: Yeah.
1:45
Louis: So we've been doing it for a while, so people are still reading it, so must be doing something right, and hopefully they're also listening to this podcast.
1:52
Simon: Yeah, great.
1:52
Simon: Well, congratulations on that.
1:53
Simon: Look forward.
1:54
Simon: Have you got a particular special topic in mind, or, uh, do we have to wait and see?
1:58
Louis: Well, I'm actually still in the middle of a content arc.
2:01
Louis: Uh, so read the content arc, but I will be doing something at the end of that content arc just to mark the occasion, uh, and just trying to have a look at some of the themes that we've been exploring over the last 12 months.
2:11
Louis: Um, which has mainly been around revenue architecture, growth architecture, and, uh, revenue operating governance, plus what we've talked about through the Cognoscenti.
2:22
Louis: And that's quite interesting because again, a lot of the themes that have come through in the conversations that we've had over the last, what, six, seven weeks, um, or six, seven episodes rather, have been remarkably aligned to a lot of that content.
2:35
Louis: So it seems to me that there's, there's certainly something afoot in the industry that is gravitating us all towards less of the do more and more of the be smarter, work smarter, be better kind of mantra that we've been banging on about for quite a long while
2:54
Simon: Yeah.
2:54
Simon: Wow, it's almost like the blog and the podcast are somehow coordinated.
2:59
Louis: Oh, my Lord.
3:01
Simon: And secondly…
3:03
Louis: Yes, and speaking of revenue architecture, growth architecture, and revenue operating governance, all of which, as we know, have an association to the work from Jacco van der Kooij and the team at Winning by Design, I am going to be co-hosting the London Impact Roadshow by Winning by Design with Jacco and Mike Bugard on the 7th of October.
3:30
Louis: Now again, we'll put links so that people can request a- an invitation for it.
3:33
Louis: It is by invite only.
3:35
Louis: Um, but it is for revenue leaders, for GTM ops specialists and, you know, folks, uh, at senior levels, uh, COOs, CEOs within SaaS businesses predominantly.
3:49
Louis: So that's gonna be going on in London, like I say, and very much looking forward to that.
3:53
Louis: We've got a great agenda, and it's mainly gonna be about having an open conversation around some of the things that are going on and that we're seeing, in the marketplace.
4:04
Louis: Um, and if anybody's ever seen Jacco live before, he is certainly somebody who is worth watching, listening, and, uh, paying attention to.
4:15
Louis: So, uh, yeah, really looking forward to that.
4:17
Simon: Very good.
4:18
Simon: Sounds great.
4:18
Simon: We will get a link to that in the show notes and look forward to, uh, seeing anyone who can make it along.
4:26
Simon: All right, so for this episode, let's get onto that.
4:30
Simon: We're taking a look back at the Summer Cognoscenti series interviews we've been running over the last few months and trying to draw out what they're really telling us collectively.
4:41
Simon: So we've had the pleasure of speaking to Mark Walker, JD Miller, Kevin Brown, David Keane, Travis Brown, and Gerry Hill on ostensibly a, a range of different topics.
4:53
Simon: Although, in fact, very much a core set of, of common themes have emerged, which we'll get into.
5:00
Simon: And to help us, we thought we'd bring in some outside perspective, so I'm delighted to say we're going to be joined by Ian Truscott, friend of the show and managing partner at B2B tech fractional leadership and advisory consultancy VelocityB.
5:15
Simon: Louis, why did we think it was a, a good idea to have Ian join us and to get his perspective, would you say?
5:23
Louis: Well, firstly, I think it's because we don't have enough expletives on the show, so we, we need to inject some of that into, into what we're doing.
5:29
Simon: I do love clicking that E button, yeah!
5:31
Louis: Yeah, yeah.
5:32
Louis: So but joking aside though, I think the fact that Ian also runs Rockstar CMO podcast and has a, a, a more marketing perspective on things, I think it's quite useful for us to, you know, with my sort of more revenue hat and your more rev- revops hat, to have that third pillar view of what's going on.
5:52
Louis: And what, what again I, I was quite interested by was the fact that a lot of the opinions that are coming from Ian, as we'll discover through the show, were very aligned to a lot of our own thinking.
6:02
Louis: So it says to me that there is absolutely something going on in this space that, you know, as revenue leaders, as marketing professionals, and revops professionals, we all kind of need to be paying a little bit more attention to.
6:15
Louis: So, um, yeah, that's been really interesting.
6:17
Simon: Absolutely.
6:17
Simon: Well, with that, let's get to it, shall we?
6:20
Louis: Let's do it.
6:22
Simon: Ian Truscott, welcome back to What's Broken in GTM.
6:26
Simon: Good to see you again.
6:27
Simon: I think this is your fourth time with us.
6:30
Simon: Thanks for coming back.
6:31
Ian: Is it really?
6:32
Ian: Is it really?
6:33
Ian: I, it feels like my second, but I'm willing to go with fourth.
6:36
Simon: I don't know whether that's a good sign or a bad sign…
6:38
Ian: You've been on my show a few times.
6:39
Simon: That's right, yeah.
6:40
Simon: I think we, we may even be, uh, evens.
6:43
Simon: So, uh, it's, it's, uh, it's all good.
6:46
Louis: If, if this was a tennis match it'd be deuce by now, right?
6:50
Ian: Well, I notice I got the early, early mention of my show in, so, you know…
6:54
Simon: That's right, yeah.
6:55
Louis: Welcome back, Ian.
6:56
Ian: Thank you.
6:57
Simon: So let's, let's launch straight into it, shall we?
6:59
Simon: And so Louis, frame this up for us.
7:03
Simon: Why did we want to have this conversation now reflecting back on, on the, the c- the conversations that we've been having over the summer?
7:11
Louis: Yeah.
7:11
Louis: So I think, you know, we had a, a number of conversations with our Summer Cognoscenti guests, and what was quite interesting for me was that a, a set of apparently disparate ideas started to actually really converge.
7:25
Louis: We talked initially about, you know, governance under pressure when we talked to both Kevin and Travis.
7:32
Louis: We talked based on the Goodhart, blog post that you had around targets reshaping behavior.
7:38
Louis: When we talked to Gerry, we talked about competitive alpha being copied away and, you know, people losing their competitive advantage.
7:44
Louis: And we also sort of talked about buyer attention becoming more and more scarce.
7:49
Louis: Now, the thing is, what we see, across all of those things is, is a common, paradox, and that's this: we've never had more capability, technological capability in GTM.
8:04
Louis: We can send more emails, we can do more research, we can get more LinkedIn posts out.
8:11
Louis: We can do more of this stuff, and a lot of that is largely down to the acceleration of the technology through AI.
8:18
Louis: Now, the challenge with that is the more stuff that we pump out there, the less people are taking notice of it, and the more apathy there seems to be.
8:27
Louis: Consequently, my, my problem with a lot of this stuff is that we see that manifesting itself in the actual economics how SaaS businesses are now orchestrated.
8:38
Louis: I was recently on a call with Jacco van der Kooij from Winning by Design, and one of the things we were talking about was this whole thing about Uh, we, we talked also to David Spitz from Bench Sites, of the things we looked at was the data.
8:50
Louis: And in that data, we can see that far from being triple, triple, double, double, double, the growth rates in most SaaS companies are going down from what was, you know, 40s to 30s to 20s to single digits now in a lot of cases.
9:08
Louis: And people are saying,"Well, w- w- w- well, why is that?
9:10
Louis: What's going on?".
9:12
Louis: That's this paradox, more capability, yet worse results, and that's the thing I kind of wanted to, to sort of explore.
9:18
Simon: Indeed, and like you say, it, it came out across a number of the conversations, didn't it.
9:24
Simon: Ian, are you seeing similar things with companies you advise?
9:29
Simon: And I know you're doing coaching as well, maybe that's something that comes out in those kinds of conversations.
9:35
Simon: What does the picture look like from your perspective?
9:38
Ian: I think Louis nailed it, and he's probably closer to the, um, sales part of it than, than I would be in marketing.
9:44
Ian: But certainly it seems that, as you say, we've got more capability, we've got normal tools with, with AI.
9:49
Ian: There's certainly more, more, more going on, and a lot of pressure to do more, more, more.
9:54
Ian: But of course, the buyer is overwhelmed by this, uh, the, our abilities now, right?
9:58
Ian: And I think, so therefore there's such a low barrier to entry for doing more and to do more BD and to, and to, and to, and to automate that BD.
10:07
Ian: It's very hard for organizations to cut through with a, a buyer who is overwhelmed by this stuff, right?
10:13
Ian: So I think, I think, um, Louis' point is absolutely right.
10:16
Ian: It, it's a paradox.
10:17
Ian: We've got more capability, but because we've used that capability, the results are generally, um, you know, people are finding that the, the results are quite tough.
10:27
Ian: And particularly, I think as well is we're probably in a, in an economy where things aren't as easy as they were either.
10:33
Ian: So you've got that as well.
10:34
Ian: There isn't, it isn't just about what we're doing, the sales and marketing teams.
10:38
Ian: There's underlying economic, um, trends as well that we need to consider.
10:43
Ian: So, um, you know, particularly in B2B tech where I spend a lot of time.
10:48
Simon: Right.
10:48
Simon: And yeah, Gerry, I think Gerry Hill quite a nice comment in, in that regard when he said buyer attention has never been more expensive, and I think that speaks exactly to that point, doesn't it?
11:02
Simon: That like you say buyer attention is fragmented, it's overwhelming.
11:06
Simon: People don't know which way to turn.
11:09
Simon: I've mentioned the statistic a number of times from our Accenture Song Client Buyer Index, where we found that 60% of decisions stall for one reason or another, thr- through indecision or a certain extent, overwhelm or, you know, lack of alignment internally and these kinds of things and, and, you know, this, this all kind of contributes to that, uh, to, to that issue.
11:33
Ian: I think some of this, and this happens with some of the organizations that I speak to, is that we're, we're very quick to leap to execution because execution is now so easy.
11:43
Ian: The hard bit now is the foundational stuff, is like, you know, I think we might have discussed it, Simon, when you came on my podcast, is that that, that stalling could be a, a symptom of something that's happening upstream and that you've not identified your ICP correctly, or you've not identified your buyer personas, or your market category, or your slice of that market category, or the size, or the price and all that stuff.
12:05
Ian: Those are much harder problems to solve these days than execution when you can actually run, you know, anybody can sit down, stick$99 on their credit card and run a, run an automated BD program.
12:16
Ian: And, and that's also part of the challenge of what's happening in our organizations in the, in that BD and marketing and sales are sort of blurring with the, with these tools.
12:26
Ian: But what you have to do is do that foundational work first, and of course, that's not so easy.
12:32
Louis: But this is what I see as being the fundamental problem, and I think you've absolutely hit the nail on the head here, Ian.
12:36
Louis: It's about the foundational stuff…
12:38
Ian: Yeah
12:38
Louis: We, we are trying to compensate for a lack of doing that foundational work through more activity because it's just bloody cheap.
12:46
Ian: Mm-hmm.
12:48
Ian: Exactly
12:48
Louis: I find absolutely ironic because we've just come out of a, an era of ZIRP, so zero interest rate policies globally, where, you know, capital was cheap, so it's fine.
12:58
Louis: I'll just hire another 27 SDRs, throw them at the problem.
13:03
Louis: You know, I'll, I'll, I'll just launch a bunch more ABM, whatever And the whole, whole point is we can't do that today.
13:10
Louis: To your point earlier on, we don't have the funds to be able to do it, yet we're still thinking because it's now cheaper, we're just gonna do more.
13:20
Ian: But the the cheaper option with AI tends to be lower quality as well, which isn't gonna help the, the return on that investment anyway, right?
13:27
Ian: Yes, it's cheaper and you can do it quicker, but the experience for the person you're trying to interrupt is poorer.
13:33
Ian: So, uh, and they've got a million of them already in their inbox.
13:36
Ian: So you know, exactly to your point is y- you can't do this at scale with humans, so therefore I'll do it at scale with AI.
13:43
Ian: But neither solution is correct.
13:47
Louis: where the irony But this is exactly where the irony is because it's, it's the more we do, the less economically viable it comes.
13:53
Louis: If I think about different eras, I, I first came into the sort of tech space 25 years ago when it was all about email marketing, right?
14:03
Louis: Open rates were, like, 30, 40%.
14:06
Louis: Click-through rates were 20%, whatever.
14:09
Louis: And we thought,"Great, this is fantastic." And this then talks back to, you know, th- having this unique ability at the time.
14:18
Louis: Well, we thought it was pretty unique.
14:20
Louis: Then every other Tom, Dick, and Harriet jumps on the bandwagon, and guess what?
14:24
Louis: I've now been flooded with it.
14:25
Louis: Email's a dead channel.
14:27
Louis: Oh, I know.
14:28
Louis: We're gonna try social next,
14:30
Ian: Yeah.
14:30
Louis: it all goes social.
14:31
Ian: Yeah
14:32
Louis: We're now gonna do SEO.
14:34
Louis: Oh, I know.
14:34
Louis: We're gonna do...
14:35
Louis: And the…
14:35
Ian: Yeah.
14:36
Louis: And the next thing, and the next thing, and it's just a series of bright, shiny objects decreasing value over time, and this is something Gerry talked about a lot, actually, when he was talking about the, uh, the, the decay of alpha.
14:50
Louis: You know, this idea that if, if I'm a, an, a hedge fund or an investment fund, I'm looking for alpha,
14:56
Ian: Yeah, yeah
14:57
Louis: I have alpha, and that's what gives me competitive advantage.
15:01
Ian: Yeah.
15:01
Louis: But then as soon as every other bugger jumps on the, the bandwagon, guess what?
15:05
Ian: Yeah, I enjoyed that episode.
15:06
Ian: because what I, what I applied that to from a marketing perspective is that you need to hedge your bets.
15:11
Ian: I've always talked about that with, um, with your marketing, um, budget, is that not everything is going to be measurably successful.
15:18
Ian: You need to hedge.
15:20
Ian: The challenge we've got at the moment with digital marketing is that everything has suddenly become measurable, or you don't do it, and therefore you're not doing that hedging that we talked about.
15:29
Ian: You don't know that that outlier, that event you're gonna do, that piece of branding work you're gonna do is gonna work be- because you never do it, right?
15:36
Ian: Because y- you're, you're not hedging.
15:38
Ian: You're, you're focusing on, like you say, oh, email marketing is 20%.
15:42
Ian: We- then we're gonna be all in on that, and that's what we're gonna be all in on, and then we break it.
15:47
Ian: And you know my expression for that stuff is that, and I know quickly you have it in the notes, is, you know, we can't be trusted with nice things.
15:55
Ian: And that, and so a new channel opens up and, um, you know, uh, Gary Vee talks about this.
16:02
Ian: A new channel opens up, we've got to rush into it, um, so that we get early, early, early advantage.
16:07
Ian: And then what happens?
16:08
Ian: Everybody follows us exactly to your alpha point, Louis.
16:11
Ian: If we think of channels like that, and then suddenly everybody's in there and you can't differentiate.
16:16
Louis: Oh, but it's worse than that because as soon as everybody gets in there, what's the thing we do?
16:19
Louis: Right, it's now something that's, to your point, Ian…
16:21
Ian: Mm-hmm.
16:22
Louis: …it becomes measurable.
16:23
Ian: Yeah.
16:23
Louis: Now the target becomes the measure, and this is what Simon was talking to the other week.
16:27
Simon: Yeah.
16:28
Simon: Well, that, that was the, the Goodhart law, if you like, when we were talking about Charles Goodhart and the, the aphorism that he coined that, that became known as, um, a, a, a good measure is, is not a good target.
16:41
Simon: I- in other words, if, if you start trying to set a target based on a measure, you know, the, the archetypal being MQLs, if, if you make that the target rather than just being a measure on the way to what it is you're actually trying to achieve, then, then it all breaks down.
16:59
Simon: And, um, I mean, Goodhart was a, was an economist in the 1970s writing about monetary policy, and, uh,
17:06
Ian: Yeah
17:06
Simon: it's, uh, come through the decades and, and ended up, um, in, in a kind of...
17:11
Simon: Well, I don't know.
17:12
Simon: He's probably quite widely used outside of just marketing, but certainly it gets, it gets that reference as well.
17:17
Ian: I know we're wrapping up your Cognoscenti.
17:20
Ian: I love those really academic stuff that you bring to the party with your podcast.
17:24
Ian: So re- really good, really good example there of, uh, of, uh, of, of where we can find lessons in all sorts of walks with this stuff, isn't it?
17:33
Louis: But this is what I was gonna say though, Ian.
17:35
Louis: I mean, n- none of the stuff that we're experiencing here is new.
17:39
Ian: Oh, absolutely
17:40
Louis: If you think, e- everything's been round this block before, it's just maybe in a slightly different context.
17:46
Louis: And so what I'm, what I'm kinda looking at here is that, you know, you've got this thing that whereby organizations, GTM organizations, are now throwing more activity, more technology, and more measurement at the problem.
18:00
Louis: But actually, it's, that's not what the underlying problem is.
18:03
Louis: They've got an underlying structural problem because they lack an operating system, and that goes back to your first point, Ian, about you gotta do the hard yards first and understand, you know, who is my audience?
18:18
Louis: Why should they care?
18:20
Louis: What are the segments within that universe?
18:23
Louis: What do the target personas care about?
18:26
Louis: How am I gonna position what I'm doing?
18:28
Louis: This is, like, marketing 101 stuff.
18:30
Louis: It's basic, but nobody does it.
18:33
Ian: Well, there's a couple of things, and I know I, I'm guessing that Simon probably wants to move us on to the next point,'cause I know you've gotta get away, Louis.
18:39
Ian: But, um, the couple of points that are coming through on my podcast, and sorry to keep mentioning it, but I have these interesting conversations much like you guys have.
18:47
Simon: You should actually name check it…
18:48
Ian: Okay, it's Rock Star CMO.
18:50
Louis: I did not know that Ian had a podcast.
18:52
Louis: Oh, my Lord.
18:54
Ian: And there's two things I find talking to my regular guests is whatever the topic is, we tend to end up back on the fundamentals as the solver of it.
19:01
Ian: And to me, sometimes I think,"Oh, God.
19:03
Ian: Yeah, isn't that boring?
19:04
Ian: We're back on the fundamentals." But the fundamentals are the fundamentals.
19:07
Ian: It's important.
19:08
Ian: The other thing I'm seeing as a trend to, to some of the things you're seeing, seeing there, Louis, is that actually people are talking about the new rules of B2B marketing, but actually they're the old rules.
19:18
Ian: It's, it's kind of like we need to get back to a pre-digital age and start doing some of the things we used to do, which are the fundamentals of marketing.
19:25
Simon: I'm glad you mentioned that, the fundamentals piece, because I, I was gonna mention exactly that.
19:30
Simon: You know, one of the things I really like about your podcast is, is how you cycle back to or circle back to the fundamentals, and then essentially demonstrate how they're still relevant and still applicable to, to what we're talking about today.
19:43
Simon: And, and again, I think that's so important because otherwise we lose sight of them and, and start going off in, in the wrong direction, just losing track and, and losing sight with what it is that we're, we're really trying to do.
19:56
Louis: I would ask for five effing fundamentals, but I'm not going to…
20:00
Ian: I we have five effing fundamentals.
20:02
Ian: If you look on our website and under rockstar CMO, Longplays, there are the five effing marketing fundamentals.
20:08
Ian: Thank you, Louis.
20:10
Simon: We'll be sure, to link to them.
20:11
Simon: So Louis, does th- does this bring us on, um, as, as Ian rightly says, to our next point around governance and, and how, how,
20:18
Ian: you
20:19
Simon: know, the role that plays here?
20:20
Louis: Absolutely, because this I think is the spine of the whole series.
20:24
Louis: I mean, at the end of the day, we- we're going back to this fundamental of what, what gets governed is what actually happens.
20:29
Louis: And said this a lot.
20:31
Louis: People think of governance as being a dirty word because it implies bureaucracy.
20:35
Louis: It's not.
20:35
Louis: It's about setting guardrails and making sure we operate within them.
20:38
Louis: These are the things that matter, and this is how we actually the right behaviors.
20:45
Louis: That was a massive theme that, you know, both Kevin and Travis talked about, and something that we explored a lot through the Revenue Operating Governance paper that the two of them and myself produced a little while back with Winning by Design.
21:00
Louis: And this whole idea that who knew incentives drive behaviors.
21:05
Louis: It's what- something we've constantly come back to, and oftentimes those incentives are misaligned to what we want.
21:11
Louis: Think about the SDR problem.
21:13
Louis: I'm gonna compensate somebody based on a number of meetings.
21:16
Louis: So bloody what?
21:18
Louis: I mean, the meetings could all be crap…
21:20
Ian: Hmmm.
21:20
Louis: They're not in the ICP, but we've got a meeting, we get paid.
21:24
Louis: Suddenly we end up in a situation whereby my cost of acquisition is going through the roof, and actually I'm wasting loads of time pursuing things that are never gonna happen.
21:33
Louis: And we know what AEs are like.
21:34
Louis: Yeah.
21:35
Louis: I've got something in my pipeline, um, therefore, you know, happy ears and rose-tinted glasses, I'm gonna make sure I qualify this correctly meaning that it stays in my pipeline, not correctly that I qualify it out because it's no bloody good.
21:50
Louis: And that's what ends up happening.
21:51
Louis: We're almost compounding bad behaviors by having the wrong incentives, and this is where I think that's where we really need to focus.
21:59
Louis: Because leadership's job therefore changes from being good at making, decisions about, you know, what markets should we be in, and how do we deal with things in the moment, to how do I build a system which good decisions get made without us so that reps then focus on the right things, SDRs focus on the right things, we take the right opportunities forward, and therefore that compounds in a positive way.
22:25
Louis: That, which again, is something that Gerry's been banging on for a long time.
22:27
Louis: You know, the eighth wonder of the world.
22:29
Simon: And also Travis Brown when he said,"Show me the incentive and I'll show you the outcome," which I think sums that up quite well.
22:37
Ian: Mmm, yeah.
22:39
Louis: I think it was Charlie Munger that first said that, but anyway, yeah.
22:41
Ian: It's the same as the point we were making earlier about digital marketing and the vanity metrics that everybody's been marching towards in marketing, right?
22:47
Ian: It, and I did some work with, a, a few years ago with a large American financial institution, and the CMO knew of something qu- not quite right about what was coming up towards him.
22:57
Ian: And so we looked at all the different departments be- and below him, and we found that if all of their claimed metrics had been successful, they'd be hitting it out of the park by 1000%.
23:08
Ian: But they weren't, because obviously they were all working with their own metrics, and some of those metrics actually conflicted between the different departments.
23:15
Ian: So you had one team or, that were incentivized by this, but if they were successful, the other team would not have been successful.
23:21
Ian: It was a really interesting piece of work, and you see that in, in large, in large teams.
23:26
Ian: And, and that's happened in some of the interviews I've done on my podcast, I know, uh, that where people have had that same kind of experience of going in and, and looking at organizations.
23:35
Ian: And when the, the, when there's no governance and those metrics don't align, exactly what you're saying, Louis, play stupid games, win silly prizes, right?
23:43
Ian: It, it doesn't work.
23:44
Simon: And Ian, one of the the episodes that you, you came on, we were talking about sales methodologies, which is a, a kind of a form of governance…
23:51
Ian: Yeah.
23:52
Simon: And I think we...
23:53
Simon: one of the things we agreed was that in, in a sense, they should be called go-to-market, uh, methodologies, not, not just kind of limited to sales.
24:01
Simon: Nevertheless, in, in thinking about governance, and as Louis says, it, it tends to be a dirty word.
24:06
Simon: That said, it's not a word that tends to get used so much in, in marketing, is it?
24:10
Simon: It, it, it tends to be used more in a sales perspective.
24:14
Simon: I, I wondered what your perspective was on that?
24:17
Ian: Well, actually, I found your episode really interesting because I'd not really heard governance being used in a sales perspective the way that you guys are e-either, right?
24:25
Ian: I think that I do hear about it in marketing, but it tends to be about content governance and, you know, that sort of thing.
24:32
Ian: But that's extending beyond just compliance, uh, so regulatory compliance and all that kind of good stuff, to being about being governed around the brand and stuff.
24:41
Ian: So I think the word governance is taking shape in sales and marketing teams.
24:46
Ian: The other thing I think about governance is that if you're gonna AI the shit out of everything, how do you know what your processes are?
24:53
Ian: How do you know who makes those decisions, what that governance process is?
24:57
Ian: And I've had some really interesting conversations about where that sits.
25:00
Ian: If you don't have that governance model, the difference with an AI agent is it doesn't know the normal human stuff that we know that you should or shouldn't do.
25:08
Ian: So you need to have a governance thing in, in place that we don't have for our people'cause we assume our people will do the right things.
25:15
Ian: So I think this is a really interesting area, that governance is gonna become more important as more of our work is agentic and not human.
25:23
Louis: This is exactly where I was gonna go with this conversation because, a- again, to your point, I agree with you.
25:28
Louis: I don't think governance is a thing in sales either.
25:30
Louis: It's of like people dip their toe around it and talk around it, about it around the edges.
25:35
Louis: But in terms of what we outlined in the revenue operating governance paper, you know, people are not thinking about short-term versus long-term.
25:41
Louis: They might talk a good ball game…
25:43
Ian: Mm-hmm.
25:43
Louis: …around it, but…
25:44
Ian: Yeah.
25:45
Louis: Actually I'll always take, do the short-term thing because…
25:47
Ian: Yeah.
25:47
Louis: …I've got to save the quarter.
25:49
Louis: People might talk about,"Well, actually, one of the things I wanna look at is I wanna look at data as a way of understanding what's happening in the system." Actually, that's not what they do.
25:58
Louis: They look at, um, the data as a way of saying,"I achieved this, I achieved that, and I achieved the other.
26:05
Louis: Pay me." And…
26:06
Ian: Yeah, yeah.
26:07
Louis: …people look to it to basically feather their own nests in…
26:10
Ian: Yeah.
26:10
Louis: …their own little silos, and it becomes really divisive.
26:13
Louis: It becomes w- you know, people are weaponizing data in their o- organizations more often than not.
26:17
Ian: Yeah.
26:18
Louis: And those are just a couple of examples
26:20
Ian: Yeah, and I think what you guys talk about a lot is like the cu- commun- commu cumulative um, that, you know, you just talked about having a fat blocked pipeline full of crap deals because people are clinging onto them.
26:32
Ian: 'Cause f- as an individual, that doesn't look too bad.
26:34
Ian: I've got a dozen deals on the go.
26:36
Ian: But you scale this up to an enterprise, and suddenly your pipeline is, is just, is clogged, and you can't shift it through without what you were saying about governance and all that kind of stuff, that nips it in the bud early doors.
26:46
Louis: The number of times I have seen on a rep's scorecard there being a metric to say you have to have 3.5, 4, 4.5, 5 times coverage.
26:58
Ian: Yeah.
26:59
Louis: And if you haven't got that on your pipeline, we're gonna put you on a PIP, or words to that effect.
27:03
Ian: Mm-hmm.
27:03
Ian: Mm-hmm.
27:04
Ian: It's
27:04
Louis: absolute bollocks because what it doesn't do is it doesn't take any account of what conversion rates actually are at each stage of the pipeline.
27:10
Louis: This is one of the reasons that back to the point about, you know, a sales methodology that isn't a sales methodology, that actually becomes a go-to-market methodology.
27:19
Louis: One of the things that Winning By Design has talked about consistently for the last 10 years has been around the bow tie.
27:25
Ian: This
27:25
Louis: idea that we take everything through marketing, through sales, through customer success.
27:31
Louis: There is governance around all of that, and not only that, but we have learning loops.
27:36
Louis: We learn from what is going on, and we make adjustments and everything feeds everything else.
27:42
Ian: Well, absolutely because, um, I think sales' role has been, I don't wanna say diminished, um, in terms of buyer education, and we talked about this, right?
27:52
Ian: Is that the buyer arrives a lot more educated than they were.
27:55
Ian: The ability for a seller to, to influence the decision is, is, is limited once they're having that one-on-one conversation with a salesperson.
28:04
Ian: But that bow tie is all of us working together to, to, to do that from a sales and marketing perspective.
28:09
Ian: Now, if you haven't got sales and marketing joined together, and I'm testing this idea of a revenue department, that bow tie's not gonna work, right?
28:17
Ian: I was going through some of my old stuff, and now I've got, like, solution selling that I was taught, right?
28:21
Ian: Uh, re-engineer the, the vision of your buyer.
28:24
Ian: You don't have very much opportunity to do that'cause the buyer ar- arrives so educated and so, so full of what they're planning to do that it's very difficult for a seller to change.
28:34
Louis: So I think the fundamental problem that we have at the moment, and this is what people are experiencing, is the GTM is not principally about people, tactics, or technology.
28:49
Louis: It's that the S- the SaaS particularly is still operating a growth architecture that was designed for an economic environment that disappeared several years ago, and nobody's caught up with it.
29:02
Louis: And the challenge that you have is that AI is now adding to that mix, and it's allowing us to execute that obsolete architecture faster than ever.
29:12
Ian: Absolutely.
29:12
Louis: That's what I think is happening.
29:13
Ian: Absolutely.
29:14
Ian: And, and I know that, um, I mean, how Simon is managing to manage us, it must be very challenging for him as that, as But I completely agree with you, Louis, and that is the challenge.
29:24
Ian: If you don't have the fundamentals in place and the governance in place, all that you're doing with AI and the, and these fancy tools is doing shit faster or, or at scale, right?
29:34
Ian: So you're just gonna send more crap.
29:36
Ian: You're not actually sending anything more effective, right?
29:38
Ian: So if that's, you know, if that's what you're using it for.
29:41
Ian: So I completely agree, Louis.
29:43
Simon: And I think actually does kind of take us, take us on to, to the next point I did want to, to bring up, which was something that JD Miller said, which was around CROs not being able to explain what's going on.
29:56
Simon: Put simply, he said,"CROs don't get fired for missing the number.
30:00
Simon: They get fired for failing to explain what's happening." And I think that speaks a little bit to, to what, to what you're saying there.
30:07
Simon: That, that's to do with the kind of underlying mathematics of, of the revenue flow through, through the system, which was, was a, you know, pretty interesting observation really that again, I-- it, it's this sense that we're trying to keep doing things the way we've always done it, and I-- it's almost a Wile E.
30:26
Simon: Coyote moment, isn't it?
30:28
Simon: We're all, we're all spinning our legs in, in midair and haven't quite realized that the, the cliff is somewhere behind us.
30:34
Ian: Yeah, but I love that about the point that you guys made, and I think it really came, came across in, in one of your episodes, which is that if, if a sales guy is gonna either sand- sandbag things or he's not gonna tell you that a deal isn't coming in in time, you can't manage your business, right?
30:51
Ian: And so y- you can't manage your business because you missed a quarter and found out about it two weeks before the end of the quarter, and that affects us downstream.
30:59
Ian: That affects us in marketing, that affects us downstream in, in, in product development or whatever.
31:03
Ian: Having an accurate forecast is fundamental to the business, and I, I really picked that up from, from what you guys were talking about, was that, oh yeah, of course, right?
31:12
Ian: You can't find out you've missed your quarter at the end of the quarter because your company is now fucked and in panic mode, right?
31:19
Ian: Whereas if we knew that six weeks ago, we could have made some hiring decisions or de-hiring decisions or some investment, different investment decisions.
31:26
Ian: But there's no way we're gonna make up this quarter two weeks before the end in order to save our fucking arse, right?
31:31
Ian: So, uh, you knew you were gonna get the profanity.
31:35
Louis: I, I, I, I think it's, I actually think it's worse than that, Ian.
31:38
Ian: Mm-hmm.
31:40
Louis: Because what people are doing is they're forecasting a number.
31:43
Ian: Hmm,
31:44
Louis: By its very nature, a forecast isn't a number, it's a range.
31:48
Ian: Yeah, yeah.
31:49
Ian: But…
31:49
Louis: And the whole point is different numbers within that range have got different probabilities.
31:53
Ian: Yeah, absolutely.
31:55
Louis: If you start forecasting, this is, this is what my distribution…
31:57
Ian: Yeah.
31:58
Louis: …curve looks like…
31:59
Ian: Yeah.
31:59
Louis: And this is my probability of hitting this number is 95%, whereas my probability of hitting this other number over here is only 5%, and…
32:07
Ian: Yeah.
32:07
Louis: …this is the distribution curve in the middle of it.
32:09
Ian: Yeah.
32:09
Louis: So more or less, this is where I think I'm gonna end up…
32:12
Ian: Yeah.
32:12
Louis: …these are the odds….
32:13
Ian: Yeah.
32:14
Louis: …it then becomes about how do I constrain that?
32:16
Louis: So my 5% and my 95% are very close together?
32:20
Ian: Yeah.
32:21
Louis: And the way I do that is by having governance.
32:22
Louis: So we've come full circle.
32:24
Louis: I think that the problem that we now have that w- software particularly finds itself in a crisis, that crisis is people are just not making the decisions for software because AI's come along and everybody said,"Well, actually, do you know what?
32:40
Louis: It's a much better solution even though we're not quite sure what we wanna do with it." And it's a, it's a hammer looking for a nail ostensibly.
32:47
Louis: What we have in- within GTM is we have the same problem.
32:50
Louis: We have AI has now reared its ugly head, what's happening now is it's, it's being used to accelerate all these things, as we've just said.
32:58
Louis: But what it's doing is it's exposing a crisis that was already there and accelerating that crisis.
33:05
Louis: I don't think the crisis is AI's making.
33:08
Louis: I do just wanna go back though to one other thing, and that was the JD Miller point.
33:12
Louis: And JD I think was right about the whole point of, you know, they can't explain what the problem is.
33:18
Louis: I think it's g- again, a step further than that.
33:20
Louis: Not only can they not explain it, they don't know what to do about it.
33:24
Ian: Exactly.
33:25
Ian: Exactly.
33:25
Ian: I mean, we, we're, we're all talking about AI all the time and a number of different things, but this is just an existential crisis that's happened in the market, right?
33:34
Ian: And, and our organizations have not been resilient to it.
33:37
Ian: Doesn't matter what it is.
33:38
Ian: You know, we've had it.
33:39
Ian: You know, us three have lived through a number of different crises, right?
33:42
Ian: And, and they, and they were extinction events for certain organizations.
33:47
Ian: But I think if you haven't really got a grasp on your pipeline, and, you know, I think, Louis, you talked about this, this crap about, like, you know,"What's my pipeline coverage?" You know, I've got, I've got nine deals that are 45% likely to close.
34:00
Ian: That, that doesn't mean you've got 45% of a million dollars or whatever you've added it up with, and that's your coverage.
34:06
Ian: So a lot of what I think is being exposed at the moment by AI isn't necessarily AI's fault.
34:11
Ian: It's just that the market has changed and the, and our sales and marketing, um, organizations have not been resilient to that change.
34:18
Louis: And I think this then takes us onto the last thing about because as you probably already saw, um, or most people have probably read about, you know Amodei's letter from Anthropic about the existential crisis to the human race.
34:33
Louis: It's an extreme, but, uh, I think if you parse that down, we've got the same problem facing SaaS organizations at the moment.
34:41
Louis: We're so reliant on, on AI at the moment, and we don't know where it's going, and it's just accelerating, you know, bad behaviors that we're not stopping to think about.
34:52
Louis: And we need to s- almost slow take a beat, think about what it actually means, what it is that we're doing, go back to the fundamentals in the same way that AI is crying out for now, uh, uh, on a global level for the governance structures in place and adhere to those governance structures, and that's how we get our way out of this.
35:18
Simon: And all we need is a high IQ US president to do it.
35:24
Simon: I heard a great quote the other day actually, which, uh, I- I'll drop in here.
35:29
Simon: I think, I think it's relevant to, to that point, which is, it's a guy called Edward O.
35:34
Simon: Wilson, who is American, not Irish.
35:37
Simon: There's no apostrophe.
35:38
Simon: And he said,"The trouble with humans is we have Paleolithic emotions, medieval institutions, and godlike technology." And he, he probably should have added,"And we don't have any governance." And here, here's, here's the kicker though.
35:56
Simon: Wanna take a guess as to when he said that?
36:00
Simon: It was 2009.
36:01
Simon: Anyway, let's move on.
36:03
Simon: So we, we were talking there about JD Miller's comment, and so Louis, to close that out, what I...
36:10
Simon: 'Cause you made the comment, not only do CROs not understand the numbers, but they don't know what to do.
36:16
Simon: Can you quickly sum up what they do need to do to overcome that problem?
36:22
Louis: Well, the answer, as ever, is it depends.
36:25
Simon: Hmm.
36:27
Louis: Is telling you through the, the data model.
36:29
Louis: So what happens all the way through my bow tie, where, where have I got the pressures?
36:36
Louis: Where does the revenue engine and the way the revenue flows through the organization have the bottlenecks?
36:44
Louis: That depends on what I need to do.
36:45
Louis: So I could turn around and I could say, look, if I've got a distributed forecast, let's say my, my median number is a million, and my 5% number is two million, and my 95% number 100K, then I've got some fundamental problems in my entire structure because it means I, I'm taking a gamble.
37:09
Louis: My forecast could come in anything between 100K and two million.
37:14
Louis: That, that's not governance.
37:15
Louis: That means I've got no process in place, so I need to fundamentally look at what, what's going on.
37:21
Louis: If I've got a range whereby I'm saying, actually, my 5% number is 900K, my median number is a million, and my top end is 1.3, well, that's a much narrower range.
37:37
Louis: So now I need to start looking at, actually, where can I start moving that curve to the right and have more confidence in it, and what are the things that are fundamentally you know, affecting that?
37:50
Louis: Is it the fact that we're targeting the right organizations?
37:53
Louis: What point of the sales process are people dropping out?
37:57
Louis: Are we engaging the right buyer group?
37:59
Louis: Do we have the right proposition?
38:01
Louis: There are so many different levers that you need to look at, but it's only by looking at the data model that it'll start to point you towards where the likely issues are, and that's where you then need to focus.
38:12
Louis: So you then turn around and say,"Not only have I identified the problem is, and I can tell you why we're missing the number, but these are the things I'm going to do about it, because this is how I've seen it manifest in our organization." And that's the bit I think was, was slightly missing from what JD was saying.
38:28
Simon: Right.
38:28
Simon: Now let's just go back to AI.
38:29
Simon: I think we've done a pretty good job of jumping up and down on its head.
38:34
Simon: There must be some good aspects of AI though, or to turn that around, what are the good aspects?
38:39
Simon: What, what should we be doing?
38:42
Simon: Again, JD, I think did, did talk about the, the time it, it could potentially give you back, and talked around that.
38:50
Simon: One of the interesting things that Mark Walker was saying was to, to the point of everybody wanting to be using AI for stuff, and, you know, he, he kinda said they want to chat to Claude, tell, tell it what they want to do and, and have it go do it, and move away from the plethora of tabs across all the different tools that, that marketers have and, and just basically have one, one chat tab.
39:16
Simon: Is, is that the right direction, or how else should we be, be thinking about this, do you, do you suppose?
39:23
Ian: Well, I've had a number of, um, sort of conversations around this and I think that at the moment, which we're, we're kind of experimenting and figuring our way with this.
39:30
Ian: And I think to understand ROI and productivity, uh, gains or losses on AI right now is very difficult.
39:37
Ian: Because we're doing things because we can, and some of those things we shouldn't be doing.
39:42
Ian: And I think, you know, so for example, people are building their own CRMs and shit like that.
39:46
Ian: And when you actually look at how much effort goes into building something, it's not just the development that you've got Claude to do, it's then the maintenance, it's then the multi-user stuff.
39:55
Ian: It's all that stuff, right?
39:57
Ian: And people forget that.
39:58
Ian: And it's the same kind of build versus buy argument we had 25 years ago around software, right?
40:02
Ian: But people are now able to do that, and it's fun, right?
40:05
Ian: So they like doing that stuff.
40:06
Ian: So there's things that people shouldn't be doing and it's, it's actually costing productivity.
40:10
Ian: And there's things that people can now do that they never could do before that as, as an example that you used, right?
40:16
Ian: Is that, for example, yesterday I was doing something with HubSpot and it was much easier for me to ask Claude to go do it than me figure out all the different UIs, export stuff, import stuff, and all the stuff you need to do to have a little scrap with HubSpot.
40:28
Ian: HubSpot is a product I, I like using, so don't get me wrong.
40:31
Ian: It's just sometimes easier to get Claude to do it.
40:34
Ian: But again, there are other tasks like writing for example.
40:37
Ian: I'm talking to a lot of people who find their writing has slowed down because they're using AI, because they're insisting on inserting the human.
40:44
Ian: But the AI is offering them loads of options around research and stuff like that.
40:48
Ian: And, and, and so you've, you, it's very difficult I think at the moment to ma- to make a good case for AI enhancing or reducing our productivity.
40:59
Ian: And I think that's a big challenge with the ROI on AI right now because we're doing different things and we never price those things.
41:06
Ian: We never said,"Oh, how much does it cost for Ian to do this thing in HubSpot?" I mean, it's gonna take me half an hour in Claude.
41:11
Ian: Or if I fuck around and get really excited with Claude and build my own CRM, that's like, that's like the rest of time taken up.
41:18
Ian: So that's not gonna have an ROI.
41:19
Ian: So although we won't have to pay$20 a seat for, for me to do that.
41:24
Ian: So sorry, I'm having a bit of a rant.
41:26
Ian: I know that you need to sort of move this along and wrap this up, but I think it's ve- it's, it's a complex topic I think when we talk about productivity and AI right now, particularly in marketing, I would say.
41:35
Louis: Again, my, my point of view on this is that, you know, it, it goes back to this idea of AI being the hammer that's looking for a nail.
41:44
Ian: Yeah.
41:44
Louis: Whereas what we need to do is look at what the actual problem is.
41:48
Louis: So far, for me, certainly from a tech stack perspective, the problem been we ha- It goes back to right to the beginning of this conversation.
41:54
Louis: We've got so many tools at our disposal and we don't know how to use them.
41:57
Ian: Yeah.
41:58
Louis: Everybody's running around like headless chickens.
42:00
Louis: The role that AI can play is to be the orchestration layer, a bit like you…
42:06
Ian: Mm-hmm.
42:06
Louis: …you were just outlining with the Hubspot example…
42:07
Ian: Yeah.
42:08
Louis: and actually orchestrate not just HubSpot, but every other piece of technology so that it actually works as a symphony rather than a cacophony…
42:17
Ian: Yeah.
42:18
Louis: …Which is so often the case because you have so many different tools that I'm an expert over here and then somebody else in the organization is an expert over there.
42:25
Louis: Those two people have never met, let alone talk to each other, and they're off running off and going doing different things, and you end up blancmange!
42:31
Ian: Hmm.
42:32
Simon: Yeah and I see there was an announcement from Salesforce and Anthropic a couple of weeks ago to say that there's, there's now a Claude interface into Salesforce.
42:42
Simon: So a bit like what you're saying, Ian, with, with HubSpot, you can ask Claude to do something, and then it will go off and, and talk to Salesforce and, and come back, which again speaks to Mark's sort of one tab to, to rule them all.
42:57
Simon: The, the other thing also that I, I find myself doing, I, I pretty much never bother with vendor help documentation anymore.
43:05
Simon: I just go to, to Claude or, or, you know, Gemini or Copilot, and the answers are generally exceptionally good, incredibly helpful, and you, you just get the sense that it understands what it is you want and come- and goes off and comes back and finds the answer in a, in a timeframe you could never achieve, you know, rinsing through the documentation.
43:28
Ian: We're going through, like, the Gartner hype cycle, aren't we, with this thing?
43:31
Ian: And the difference with this is it's, it's driven from top and bottom down.
43:35
Ian: So it- there's a product-led growth element to this in that we're enjoying playing with the tools, and they've given us them virtually for free.
43:42
Ian: They won't soon, right?
43:43
Ian: So it's all gonna get fucked up soon.
43:45
Ian: And then there's the top-down, which is, you know, Gartner talked about how, like, the third most important, um, goal for CMOs was to use AI, not, not a business objective of do something and, uh, and use AI to get to achieve that goal, but to use AI.
44:03
Ian: So…
44:03
Louis: Which is just bloody stupid!
44:06
Ian: Exactly, so you talk about being, you know, a h- hammer and a nail, but it's coming from both ends.
44:09
Ian: Like we're, we're like,"Oh, great, I've got this hammer." And then people are saying,"Yeah, yeah, go ahead.
44:13
Ian: Go use that hammer." And so...
44:16
Ian: And, and I think the other thing, we, you know, y- you talked about governance and discipline.
44:19
Ian: I think so, so it's a personal discipline sometimes, which is that I can, I might be enjoying the conversational n- and spending my tokens with Claude to get HubSpot to do something.
44:29
Ian: But actually, if I sat back and thought about it, it'd be I could just do it with, with HubSpot, and it'd be cheaper, right?
44:36
Ian: And it might be quicker.
44:37
Ian: But it's at, but, you know, who, who wants to be doing with that?
44:40
Ian: I just ask Claude to get it done, right?
44:42
Ian: And that's why I mentioned the hype cycle,'cause I think that we're gonna start discovering that for ourselves, and as organizations, we're gonna go,"Oh, okay." And then it'll get to, and then the- we'll get to a steady state.
44:52
Ian: And I, for, for me, with the disruption that we're seeing, is I'd like us to get to that steady state as quickly as we can so we can stop talking about the disruption, right?
45:00
Simon: Yeah, that would be great.
45:02
Simon: And a- as that volume of, of AI-enabled activity rises, at least until we, we come down the, the, into the trough and, and onto the plateau, trust is becoming a scarcer resource, and it would be remiss not to, to mention this.
45:18
Simon: I mean, it's a, it's a through theme in probably every conversation we have.
45:24
Simon: We, we've certainly touched on it before, and clearly Ian it's a key of what you talk about with your ART framework.
45:34
Simon: What is in, in overall terms the, the, the kind of role of, of trust here, not just with AI, but more, more broadly?
45:43
Simon: How does that apply here?
45:45
Ian: I think that's what we were talking about in terms of going back to a pre-digital age, right?
45:49
Ian: Is because people aren't trusting the email, the BD emails they're getting, even if they're written by humans.
45:54
Ian: Because we're all assuming now that the email that we get, let's use email as a channel, uh, as an example channel.
46:01
Ian: It could be anything.
46:01
Ian: Could be, could be LinkedIn, any of the things we fucked up and ruined, right?
46:05
Ian: So therefore, I don't care when I get an email from business development rep because I don't believe them to be real, right?
46:12
Ian: And that's an element of trust.
46:14
Ian: Whereas it used to be that I would get an email as a CMO, and it'd be something would be slightly off in their approach or something like that, and I'd...
46:20
Ian: because I'm in the industry, I would, I would reply sometimes and say,"Hey, you're a little off with your targeting.
46:25
Ian: This isn't for me.
46:26
Ian: Go back to your data.
46:27
Ian: Your data's wrong," whatever.
46:29
Ian: You wouldn't do that now.
46:30
Ian: You wouldn't do that now'cause the bloody thing's an, a robot, right?
46:33
Ian: So I think that trust is gonna be that, that differentiation that we can talk about, and that trust is gonna be, you know, we're gonna have to figure out h- the balance between what's synthetic and what's human in this stuff,'cause none of us are gonna be totally human.
46:47
Ian: All this bollocks about detecting AI-generated content.
46:50
Ian: Mate, if you use Grammarly or anything or a spellchecker, it's, it, it's gonna have some robot fingerprints on it.
46:56
Ian: But the trust is gonna have to come about in, in, you know, if, the, the we're gonna need to demonstrate that we know this person, that we can solve their problem, and all the fundamentals that we've talked about, right?
47:07
Ian: Which is why you need your ICP, right?
47:08
Ian: Your persona needs, right?
47:10
Ian: Because if we can, if we can create something that solves somebody's problem, answers their needs, makes them feel seen, does it matter that some of it was synthetic?
47:19
Ian: As long as there's that human in it, right?
47:20
Ian: And that is gonna be...
47:21
Ian: Trust is gonna be everything, I think, particularly in the next couple of years as we, as you say, Simon, gets that, you know, as we all get comfortable with the, the sort of, um, slope of, um, productivity or whatever it's called, where we all get comfortable.
47:36
Ian: The, uh, this is the right balance.
47:37
Ian: Whereas at the moment, the balance is all over the place, isn't it?
47:40
Simon: Yeah.
47:41
Simon: Louis, any closing thoughts on that?
47:43
Louis: I was just gonna say, as in all things in art, the perfection in the imperfection.
47:50
Ian: Yeah, absolutely.
47:51
Ian: It's- but now you're seeing people insisting on swearing on podcasts or, uh, swearing in their copy or, or n- doing, uh, m- mistakes or bad punctuation just to demonstrate that they're human, right?
48:03
Ian: And that's the only reason why I've done it throughout this,'cause I, I know you've experimented with having AI guests on your show.
48:11
Louis: That was a while ago and…
48:12
Ian: I know.
48:13
Ian: That was really cool, though.
48:15
Louis: We, we, we, we never went back to it.
48:17
Ian: No, no, but it's really...
48:17
Ian: It was a fun experiment, though, wasn't it?
48:19
Ian: You did it with LLM Notepad.
48:24
Simon: We need to, to move to wrap up, and so let's just l- close on a, a note on leadership.
48:31
Simon: Louis, where, where does this leave leadership in, in overall terms, and what, what have we learned from the conversations this summer?
48:37
Louis: So again, I think the, the, the main thing is, uh, on leadership is not to be so reliant on these old world playbooks.
48:46
Louis: And, and actually to...
48:47
Louis: It's something we've talked about before, I think, which is around, yes, there is, pattern recognition that really helps in terms of saying,"This is something I can repeat," you need to tie it up with first principles thinking.
49:02
Louis: So I think for me, the lesson from this summer isn't that SaaS needs another playbook.
49:10
Louis: Maybe what it really is, is that we need better mechanisms for knowing when to stop using the old one.
49:15
Simon: Anything you'd add to that, Ian?
49:21
Ian: I think the discipline of leadership is important, right?
49:22
Ian: I don't think that we train leaders, right?
49:24
Ian: And we don't think we nurture leaders.
49:26
Ian: You get an alpha leader in a sales team that's b- that's gone through this, uh, uh, same playbook for the last decade, but they're not gonna introduce, uh, governance or any of that kind of stuff'cause they weren't brought up in it themselves, right?
49:36
Ian: So we ne- we need leaders.
49:38
Ian: We need leaders that can manage, that have that, that discipline.
49:41
Ian: So I completely agree with you.
49:43
Simon: And I think this was a comment made in relation to, to governance than leadership, although it's curiously applicable.
49:51
Simon: Travis Brown said,"If it's slowing you down, you're probably doing it incorrectly." And like I say, that could be governance, and that's definitely true of governance.
50:01
Simon: It shouldn't be slowing you down.
50:03
Simon: It's probably true of leadership as well.
50:05
Simon: That shouldn't be slowing you down either.
50:07
Simon: And if, if I c- you know, we can all think of instances where we've been given, you know, dumbass tasks by leadership that add nothing and just slow you down.
50:18
Simon: So let's avoid that.
50:19
Ian: I think, yeah, I know you want to conclude Simon, but I think the it in that sentence is doing a lot of work.
50:27
Ian: If it, if, if it's slowing it down, defining it is the important thing, right?
50:29
Ian: Because some of this shit shouldn't have been done at all, right?
50:32
Ian: So go, doing, doing, and that's what we were talking about earlier, wasn't it?
50:36
Ian: And so really maybe you do need to slow it down a bit so you stop doing the bad it.
50:41
Ian: Right.
50:41
Ian: Anyway, so I know, I don't want to start another can of worms, otherwise we'll be here all night, and I know that Louis has got places to go.
50:47
Ian: But yeah, I think, I think that's an interesting phrase.
50:49
Ian: It could slow us down, and that might be good.
50:52
Ian: I mean, Robert Rose, who's on my show, talks about friction, and sometimes having a little friction in a process is good because it gives us a bit of time to think.
50:59
Simon: Yeah.
51:00
Simon: Well, that-- And it-- And yeah, I, I remember that discussion and, and, and it's absolutely right, and friction is good, and the world wouldn't work without friction in the same way that it wouldn't work without gravity.
51:11
Simon: So it's,
51:12
Ian: Yeah
51:13
Simon: it's important to have.
51:14
Simon: Well, yes, we need to, to wrap things up.
51:17
Simon: So Ian, thank you so much for joining us.
51:21
Simon: I do want to give you the opportunity because I know I fluffed this up.
51:25
Simon: I think it was in the last episode.
51:26
Simon: Uh, I was gonna try and get it in earlier.
51:29
Simon: So ju-just, just give us the soundbite around, um, marketing, and it, it partly goes to the trust point.
51:36
Simon: But, um, mar- you know, marketers can't be trusted with the nice things.
51:40
Simon: Just, just give us that.
51:42
Ian: You're getting there.
51:43
Ian: That was almost it.
51:44
Ian: Marketers can't be trusted with nice things, and this is talking about the fact that you give us email, we'll fuck it up.
51:48
Ian: You give us LinkedIn InMails, we'll automate the shit out of that.
51:51
Ian: You know, every channel gets polluted, and that's what we were talking about earlier on.
51:55
Ian: So yeah, absolutely.
51:56
Ian: We just can't be trusted with nice things.
51:58
Louis: Quite right,'cause let's, let's leave it to the sales folks'cause they obviously can be trusted.
52:04
Louis: No, no!
52:06
Simon: Ian, thank you so much for joining us.
52:08
Simon: It's been great to have you back.
52:09
Ian: You're welcome.
52:11
Ian: Thank you for having me.
52:12
Louis: Thanks for joining us, Ian
52:13
Ian: You're welcome.
52:15
Simon: Louis, great conversation, as we knew it would be.
52:18
Simon: If you had to draw all this together in a sentence or two, how would you do it?
52:25
Louis: For start, we all know that I can't stick to a sentence or two, firstly, one thing to call out I think you did a great job of trying to manage the two of us,'cause when, when we get going, boy do we get going.
52:37
Louis: Yeah, no, I think for me the thing is, for an industry that built a hypergrowth system during an era of abundant capital, attention, and relatively productive acquisition channels, as those conditions have changed, many of those governing assumptions just haven't kept up with it.
52:55
Louis: We've added more tooling, more automation, and now we've added AI into the mix and have increased the execution speed.
53:03
Louis: But I think what it's done is it's raised a harder question.
53:06
Louis: Are we getting better at executing a model whose marginal economics are deteriorating, or are we actually really leveraging AI for AI's sake?
53:14
Louis: I think there's been a lot that we've spoken about through th- the series.
53:18
Louis: I mean, you know, Kevin was talking about governance before scale was a really important part.
53:25
Louis: David talked about the technological architecture that's underpinning it all.
53:29
Louis: Travis talked about governance at scale and how that then affects.
53:35
Louis: We then looked at you know, your great post about Goodhart and the effects of what we do when we obsess about taking measurements as targets, and we've seen how that deteriorates over time.
53:48
Louis: And then with Gerry, a lot of what we talked about there was that whole idea of alpha, and you know, that competitive advantage.
53:56
Louis: And when I combine that with some of the things that we've seen in the market, so let's think about, we've m- referenced Winning by Design, but in the latest Winning by Design Growth Institute latest trends, we had an open conversation with Dr.
54:09
Louis: Dan Patterson and David Spitz of Bench Sites.
54:13
Louis: And again, one of the things we looked at very heavily there was acquisition economics.
54:17
Louis: Right now, LTV CAC, you're talking about, what?
54:22
Louis: $2.30 to$2.70 on average to gain$1 of revenue.
54:27
Louis: If I look at payback periods for that, you're talking about seven years, and that's, that's just not where the model is at because things are churning that much quicker.
54:35
Louis: Yet we're still optimizing for all the short-term revenue that then churns after two years.
54:41
Louis: Any wonder that, you know, growth rates are falling.
54:44
Louis: One of the things David Spitz talked about at that point was growth rates from this triple, triple, double, double, we were-- you know, rule of 40, all this kind of stuff from a couple of years ago Growth rates have deteriorated from like 30% to 20% to 10% to, in some cases, very much single digits, and we're sort- s- sitting there scratching our heads wondering why.
55:05
Louis: The answer's in a lot of the conversation we've been having over the last two months.
55:09
Louis: So that, that for me is what, what's really, really interesting.
55:12
Louis: So for me, the, the strongest synthesis from the Summer Cog- Dissenti conversations isn't that SaaS has run out of tactics,'cause we've got more tactics than we can ever shake a stick at.
55:21
Louis: It's that the industry initially became very good at discovering sources of growth, alpha, converting them into repeatable playbooks, and then industrializing them until much of that advantage actually disappeared.
55:33
Louis: The management response to declining returns has frequently been to demand more output from that same system.
55:38
Louis: But the real trick though, is to address how the underlying system is architected and governed, and that's what many SaaS companies are just simply failing to do right now.
55:47
Simon: And with that, in more than a couple of sentences, thank you for the kind words.
55:54
Simon: Those are our takeaways for this episode and this year's Summer Cognoscenti series.
55:59
Simon: Thanks to everybody who's been involved.
56:00
Simon: Thank you so much for listening to episode 59 of the What's Broken in GTM and How to Fix It podcast.
56:06
Simon: Check out our LinkedIn page where you can find show notes relating to the episode.
56:10
Simon: You can also get in touch with us via LinkedIn and follow us for regular updates.
56:14
Simon: And don't forget to subscribe in your preferred podcast app to make sure you don't miss an episode.
56:19
Simon: Next time, we will be kicking off a special new series of not-to-be-missed quick-fire episodes, so please join us.
56:26
Simon: Until then, it's goodbye from me, Simon Daniels…
56:29
Louis: and from me, Louis Fernandes, have a fantastic day!