Highly successful rollout of a culture and market-specific new sales organization

NEC Display Systems EMEA

We helped NEC creating a one-size-fits-all standard for managing sales in a highly complex organization through:

  • Analyzing, identifying, and creating awareness of the characteristics of a successful sale
  • A series of workshops and training sessions for the sales reps in all the different markets to improve their forecasting accuracy, boost their opportunity win rates and increase the average opportunity size and the number of leads
  • Empowering NEC’s sales reps to advise their partners and customers in the best way possible and assist them throughout the sales process, thereby securing a mutually profitable and beneficial sales solution

The new sales organization was rolled-out across 9 regions in 82 countries, implementing a value-based culture focusing on the customers’ needs. This in turn lead to a 2 % increase of Gross Profit and ROI increase by a factor of 10.

When NEC Display Systems saw their working capital getting tied up in stock, their market shares decreasing and their customers squeezing them on price, they knew they had to do something. They just didn’t know exactly what—or how. To turn things around, the company hired a new VP of sales, who hired Commerzial to help them professionalize the entire sales organization and train their sales reps in a value-based approach to sales.

The changes transformed how NEC approached sales and this case clearly demonstrates the powerful short- and long-term effect sales excellence has on even the most complex sales organizations.

See the full case below


The Case

NEC is a Japanese multinational provider of information technology services and products for business enterprises, communication services providers and government agencies. It was established in 1898 as one of the world’s first IT companies and last recorded annual net sales of $24.54 billion.

The Challenge

In 2012 NEC’s management hired a new VP of sales for its display solutions division to address a number of challenges that had a cumulative negative impact on the company’s working capital. The division had to continually keep a large inventory to meet ongoing demand from its many different customers and also had a lot of outstanding cash with its wide network of partners.

However, when the new VP started analyzing the sales organization in depth, he identified several additional challenges that made things difficult for NEC’s display solutions division.

  1. Poor precision of the sales prognosis due in part to the many different sales organizations operating in different ways in different markets.
  2. Lack of focus. With more than 400 direct partners, the sales organization was spreading itself too thin.
  3. Unprecise pipeline. Because the sellers were not close enough to the customers, they were heavily dependent on their partners to report pipeline figures.
  4. Inconsistent sales contracts. The sales contracts were different from market to market and even customer to customer, and many contracts needed a commercial update.
  5. Inconsistent pricing. Because NEC offered different prices for their products in different markets, some customers started purchasing from foreign sales offices. Consequently, every sales meeting with the customers ended up being a discussion about price.
  6. Lack of knowledge. NEC lacked tools to measure and analyze the effect of sales and identify which sales reps were profitable, which ones weren’t and why.
  7. Organizational complexity. The different sales organizations (9 regions in 82 countries) were structured very differently, which resulted in high complexity and time-consuming management.

The Solution

The first and most important step taken by the new VP was to design the ideal sales organization with a view to creating much closer relations with customers.

The goal was to move away from the traditional product-focused sales culture and toward a much more value-based culture that focuses on the customers’ needs rather than on what products NEC has to offer at which price.

NEC hired Commerzial to create a one-size-fits-all standard for how they should manage sales. The work involved analyzing and identifying what characterizes a successful sale and making the sales reps aware of the factors involved.

Next, Commerzial organized a series of workshops and training sessions for the sales reps in all the different markets—markets that were previously characterized by vast cultural differences.

The focus of the training was to help the reps improve their forecasting accuracy, boost their opportunity win rates and increase the average opportunity size and the number of leads. Commerzial also defined clear KPIs for the sales process.

The main purpose of the entire exercise was to empower NEC’s sales reps to advise their partners and customers in the best way possible and assist them throughout the sales process, thereby securing a mutually profitable and beneficial sales solution.

Commerzial’s deliverables included:

  • New standards for how the reps worked with customers in regard to the sales process, methodology, dialogue and identification of customer needs.
  • Standards for managing channel sales, including a leaner and more effective partner structure and training in how to evaluate, recruit and grow with the partners.
  • Definition of and training in the sales process, from how to generate a lead to how to turn the lead into a customer.
  • Onboarding sales excellence and making it mandatory for all new salespeople.

The Results

NEC first implemented the new ideal sales organization in the biggest and most challenging market, DACH, which covers Germany, Austria and Switzerland. The process was then replicated to other markets, ensuring that each region’s cultural and market-specific situation was incorporated into the model. The results were impressive.

  1. NEC increased its Gross Profit by 2 percent and increased its ROI by a factor of 10.
  2. NEC reduced its number of sales partners from 400 to 256 without any decrease in sales or loss of momentum.
  3. The sales organization saw a dramatic increase in forecasting accuracy across all markets, which significantly reduced inventory needs and freed up working capital.
  4. The classical legal sales contracts with resellers were transformed into actual sales tools. In addition to defining the sales terms, the contracts also include growth targets, rewards and so forth.
  5. New contract agreements were signed with all partners (three-level contract structure).
  6. NEC benefitted from significantly closer customer relations and higher compliance where the clients actively seek and value NEC’s expert advice.
  7. Increased awareness that working with sales policies and focusing on sales excellence is important to the success of the sales organization and the company at large.

The perception of NEC in the market changed significantly from being a company that was easy to squeeze on price to company with a large degree of credibility and data-driven professionalism. Sales became much less dependent on personal relations and chance encounters and more on value-adding activities.

Could This Be You?

When sales are not working satisfactorily, the typical reaction is to tell the sales reps to sell harder. In reality, the focus should be on how to sell better, improving and structuring the sales organization for better efficiency. The best way to do this is to become better at understanding your customers’ and partners’ needs and putting their reality ahead of your own.

The NEC Display Solutions case clearly demonstrates the difference it makes to a company when they choose to focus on the way their customers buy and what their needs are in the different phases of the sales process instead of focusing on the two Ps: product and price. It also shows the value of aligning with your partners with transparency, credibility and clear expectations.

This is where Commerzial can make a real difference. We have several years of experience in optimizing large international multi-language sales organizations and have developed a number of systems and tools that increase transparency, control and sales efficiency. To learn more or to hear more about the NEC Display Solutions case, please contact NJ Flensborg at tel: +45 2689 0816


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