It’s becoming self-evident that Web 2.0 is providing new avenues for identifying and engaging with customers, but are there benefits being seen in the processes behind customer engagements –such as processing orders and managing customer relationships?

Ideally, given the open nature of Web 2.0 and social networking, salespeople and sales managers will be more empowered to manage the sale process more responsively and profitably. “The theory behind this is sound,” notes Dennis McDonald, Ph.D. in a study of about 300 sales managers from various enterprises. “When salespeople can pick and choose what information they want to see and subscribe to on a regular basis, whether it’s from their parent company’s CRM system, from a local area network database,
from a commercial subscription service, or from the public cloud, they can use Web 2.0 tools to select the information that makes the most sense to them and the tasks at hand.”

But often, what sounds good in theory often gets messy in practice. For example, McDonald observed, survey respondents pointed to how salespeople can be a competitive, feisty bunch. “Despite the value of ‘collaborating’ in order to better understand and respond to a customer’s needs, for example, many salespeople are reluctant to share information about a sale with their peers if they think they might lose competitive advantage—or a potential commission—in the process. You really need to modify how sales commissions are awarded and shared in order to reward collaboration.”

This was one of the great failings of the sales force automation systems that were introduced in the 1990s — they were great technology that nobody wanted. As McDonald points out, “providing the technology that supports collaboration is not sufficient. Salespeople need the skills, time, motivation, and support to customize and/or use Web 2.0 technologies.”

Despite these natural reservations, McDonald, who has done a lot of work in the enterprise social media space, observes that  Web 2.0 and social media are having an impact various stages of the sales process, beyond the most apparent impacts of improving the outcomes of prospecting and customer qualification.  (Complete PDF of McDonald’s findings available here.)  The study came to my attention when McDonald responded to my recent post on Social CRM Should be a Redundant Phrase, which discussed some of the issues with fusing social networking with existing CRM processes.

McDonald’s survey covered about 300 sales managers from a range of enterprises, and discusses how “web 2.0” systems and applications can support management of sales processes. The survey did not focus on adoption of specific technologies such as social networking, blogs, wikis, or other technologies but instead sought to address sales manager satisfaction with the different processes currently involved in locating, managing, and closing sales, and where Web 2.0 applications could provide the most benefit to the overall sales process.

McDonald sought to separate the internal aspects of sales-related communication and collaboration from the external aspects. He suggests that collaboration involving outside communities could be tainted by both lack of control and involvement by competitors. “When addressing Web 2.0 support for sales-related communication and collaboration, it’ important to distinguish whether participants or processes being considered are internal or external to the sales team’s organization,” he writes. “For example, while involvement with the social and professional communities surrounding business prospects may improve market intelligence about business prospects, such communications are not as controllable as traditional one-to-one communications between buyer and sellers. Internally, collaboration that cuts across organizational boundaries might be impacted by existing organizational rivalries.”

Another area of concern is the impact of Web 2.0 and social networking on compensation. “Some within-sales-force collaboration may be resisted by salespeople if this raises fears of reduced competitiveness or shared commissions. To promote such collaboration it may be necessary to modify compensation plans to reward certain types of collaboration.”

Web 2.0 and social media processes may help move lengthier and more complex sales processes along, he also concludes. “The more participants will be involved as the process evolves. Making information gathered at one stage available to other participants “downstream” will help ensure a smooth transition from sales to delivery and servicing of the customer. Organizational or departmental barriers that restrict collaboration across groups should not be allowed to disrupt the sales process and satisfaction of the customer.”