Georgia State University and Spencer Stuart: Sales Executive RoundTable Meeting

Prepared by: Tim Henn, Atlanta May 17, 2013

Table of Contents

Introduction Overview of Spencer Stuart International Why is Spencer Stuart Any Different than Other Global Competitors?

Sales Officer Practice What’s Hot? - Key Trends and Skills Set Needs in Sales Leadership Compensation Observation and Trends Tips on Executive Recruiting 2

Timothy J. Henn

Atlanta office

Tim Henn is a member of Spencer Stuart’s Technology, Communications & Media Practice and leads the firm’s sales officer business in North America. He also is a member of the Private Equity and Information Officer practices, and a core contributor to the firm’s Cloud Computing initiatives. Bringing more than a decade of executive search experience to his work, Tim conducts assignments for clients across North America, Europe and Asia. He concentrates on chief executive officer, general manager and other senior-level positions for technology and communications clients. Tim’s technology clients include communications service providers, wireless and wireline networking equipment and software companies, mobile device makers, and providers of cloud computing services, datacenter services, and optical systems and components — from early-stage venture-funded startups to the largest multinational corporations.

In-depth technology expertise

> Before joining Spencer Stuart, Tim was with a global retained executive search firm for more than seven years as a senior member of its technology practice.

> He also has 14 years of technology industry experience in strategy development, product line marketing and sales. Tim worked for Motorola for six years, where he led strategy efforts for the company’s communications equipment businesses. In addition, Tim contributed to Motorola’s most significant acquisition, General Instrument, and to the strategic assessment of Motorola’s broadband wireline, wireless and satellite investments.

> Tim spent seven years in Silicon Valley working in senior marketing and product management roles for early-stage companies in data networking, communications software and semiconductors.

Tim is a graduate of Cornell University with a degree in electrical engineering and also holds an M.B.A. from Harvard Business School.

Contact Information

Atlanta office [email protected]

dd +1 404.504.4418

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Introduction to Spencer Stuart International

Our Firm

Who we are Where we are

> Founded in 1956 and still privately held, Spencer Stuart helped establish the senior-level executive recruiting industry > More than 300 consultants with a unique blend of professional search experience and specialized industry and functional expertise > Experienced and highly knowledgeable associates, researchers and executive assistants round out client service teams and contribute to our knowledge of relevant candidate pools > In 54 offices in 29 countries around the world > With select clients, from major multinationals to emerging companies and nonprofit organizations, helping to address their senior executive leadership requirements > In the boardrooms of companies around the world, from the largest multinationals to private equity backed businesses

What we do

> Partner with companies to find CEOs, presidents/COOs and their senior management teams, conducting more than 4,000 assignments each year > In addition to executive search, we: • Recruit exceptional directors and provide counsel on governance issues • Assist boards in CEO succession planning • Conduct management assessments of senior executives 5

Our Services

We provide an integrated suite of leadership services, including: Executive Search:

Executive recruitment focused on CEOs, COOs and other top-level functional leaders

Board Services:

Boardroom recruitment and governance counsel

CEO Succession Services: Executive Assessment Services:

Consultative services for boards’ CEO succession planning needs A proven, proprietary approach to helping clients more accurately evaluate the strengths of their senior leadership teams 6

Our Practices

Through our practices, we offer a deep understanding of the challenges our clients face in each industry and sector we serve, and of the competencies required for success in a variety of functional roles. Industry and functional specialists work in partnership and across borders to provide clients with the most comprehensive access to candidate pools.

Industry Practices

> Clean Technology > Consumer Goods & Services > Education, Nonprofit & Public Policy > Financial Services > Industrial > Life Sciences > Private Equity > Professional Services > Technology, Communications & Media

Functional Practices

> Board Services > Chief Executive Officer > Diversity > Financial Officer > Human Resources > Information Officer > Legal Search > Marketing Officer > Sales Officer > Supply Chain 7

Sample of Spencer Stuart CEO Searches

Spencer Stuart conducts more than 300 CEO Search and Succession assignments annually and has the leading market share among S&P 500 companies.

Succession/Search with Internal Candidates

Sherilyn McCoy, CEO 2012 Bill Brown, CEO 2011 Hubert Joly, CEO 2012 Brian Krzanich, CEO 2013 Jose Almeida, CEO 2011 Ray Lane, Chairman, 2010 Leo Apotheker, CEO, 2010 Meg Whitman, CEO, 2011* Brian Kelley, CEO 2012 Chip Bergh, CEO 2011 Bryan Stockton, CEO 2012 Mike Polk, CEO 2011 Marc Lautenbach, CEO 2012 Frits Van Paasschen, CEO 2007 Mark Thompson, CEO 2012 John Lederer, CEO 2010 Dave Calhoun, CEO 2006 Marissa Mayer, CEO 2012

Why is Spencer Stuart Any Different than Other Global Competitors?

> Focus at the Top of the House: Leading Board of Directors practice and CEO Succession Practice. CXO and VP level work in the U.S. with flexibility to do director-level work outside the U.S.

> Speed: Spencer Stuart understands the urgency of recruiting new executives quickly. Our process is geared toward both speed and quality. Heavy company investment in knowledge managers, proactive ID, local and central research, etc.

> Senior Recruiters Lead the Effort from Start to Finish: Spencer Stuart recruiters have, on average, 10+ years of corporate experience and 10+ years of executive search experience. Our team remains engaged throughout the search to lead the effort.

> • • • Focus on Culture Fit: Given our extensive knowledge of the candidate pool, our energies will be focuses not only on identification of an experienced executive but also on the “culture” and “business” fit of an executive who will excel in the client setting: Highest integrity with reputation for excellent quality work Focused on accountability and business results and accustomed to aggressive growth goals A collaborator who can play well in the “sandbox” with the existing senior team > High Accountability on Recruiting Consultant: Client surveys at end of engagement are tied to bonus payments and are circulated to board members and senior management. This motivates us to meet and exceed your needs.

Potential Timeline for Completion

> > > > > > Environmental Interviews with senior management Finalize the position specification Confirm target list of companies First slate of candidate interviews

Key Milestones

Meeting to review long list of candidate profiles Introduction of first 2-3 qualified candidates Start 48 hours 48 hours 2 – 3 weeks 4 weeks 4-5 weeks > Timing for key milestones is subject to travel schedule and availability of client team members and candidates.

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Sales Officer Practice

Chief Sales Officer Practice at Spencer Stuart

With specialized sector and functional expertise, consultants in Spencer Stuart’s Sales Practice bring to each search an in-depth understanding of talent needs and marketplace realities.

> > > We are a global, dedicated team of 25 consultants, many with a sales background. We have conducted more than 1,000 sales searches over the past three years for clients that range from large multinational companies to private equity firms and their portfolio companies to emerging companies and nonprofit organizations.

For each assignment, we assemble a “best team” combining industry knowledge with functional and geographic expertise. We also conduct ongoing calls to review market intelligence and candidate pool development.

SALES FUNCTIONS Vice President Sales Major Account Sales Channel Management Sales Operations Licensing Sales Chief Revenue Officer Vice President Sales & Marketing Business Development Government Sales CANDIDATE POOL EXPERTISE

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Spencer Stuart Representative Sales Searches

Consumer Financial Services Industrial Life Sciences Private Equity TCM

Defining the Sales Officer Role

The sales officer function demands a combination of experiences and competencies that vary by organization

Sample Experiences Sample Competencies

Revenue Growth Major Account Management Execution for Results Solutions Orientation Sales Processes and Tools Business Services Expertise Client VP Global Sales Cross-Functional Collaboration Recruitment and Development National Account Management Communication, Influence & Impact at CFO level Ultimately, needed experiences and competencies will be determined by requirements of the specific situation. Strategic Sales Skills Building Teams 14

Spencer Stuart Sales Officer Practice - Candidate Qualification Diagnostic

Multilayer Assessment of Potential Sales Prospects in Conjunction with Candidate Specification Performance Data

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Revenue Quota Environment

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Revenue Growth

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Revenue by region

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Reasons for revenue growth related to Strategic Impact Sales DNA & Culture Fit

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Revenue by product line

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Margin growth

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New Products

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New regional markets

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Development of new sales strategy to match new/existing corporate strategy

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What decisions were made to impact sales effectiveness related to:

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Evaluation of key behavioral leadership competencies which map to:

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Customer segments

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Channel mix

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Competitive dislocation

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Customer segmentation

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Best in class sales leader DNA

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Account coverage

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Hardware, software, services revenue split.

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Maturity level of products and markets

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Processes and metrics

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Specific client competencies

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etc.

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Degree of maturity of operational processes

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Channel model dynamics

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Leadership reputation internally and cross-functionally

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Incentive compensation changes

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Growth in revenue compared to market share growth

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Turnaround? High growth? Mature with slow growth?

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Performance management to raise individual and team effectiveness

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Ability to balance sales growth and profit maximization

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Ability to create a winning culture

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Philosophy on utilization of A, B and C talent across the organization

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Big company with matrix management, small company PE funded, etc.

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Talent management skills to attract and retain top talent

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Line experience and operating orientation

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Evolution of the genus “Sales Officers”

The Science of Sales Has Become More Sophisticated

Recruitment & Development Sales Strategy & Organization Rotation & Succession Planning Performance Management & Compensation Plans Sales Process & Methodology Sales Operations Account Management Rewards & Celebration Technology (CRM, Pricing, Quoting)

T R E N D S

Emerging Sales Officer Trends

… and their leadership implications

Four Channel Model

Inside Sales Field Sales Indirect Sales eCommerce

Sales Operations & Technologies

Accountability Global Methodology Consistency Maximize Selling Time

LEADERSHIP IMPLICATIONS

> Lack of effective customer segmentation and mapping of sales channel > Lack of effective collaboration to drive activity to the right internal organization > Invest in world class sales operations not sales support > Adoption non-negotiable at all levels > Consistent cadence to increase chance of success 18

T R E N D S

Emerging Sales Officer Trends

… and their leadership implications

Dated Go-To-Market Structures

Value Chain De layering Shorter Product Profit Cycle Vicious Price Competition Solutions Selling Requirements

Localization of Global Markets

Exploding Emerging Markets Regional Customization Local Channel Preferences Expat Expirations

LEADERSHIP IMPLICATIONS

> Cost to serve specific customer segments way too expensive > Outdated structure provides for coverage model > Lack of clarity around selling skills to serve each customer segment > 3 region structures no longer adequate > Local language leadership required > Cultural complexity with one region (i.e. Asia Pac) 19

Emerging Sales Officer Trends

… and their leadership implications

Scarcity of Strategic Skill Sets T R E N D S

Fewer Sales Academies Churn of top sales leaders Short term pressures on CEO Crushing 30/60/90 pipeline requirements

LEADERSHIP IMPLICATIONS

> Develop skill sets in-house or recruit externally > CEO’s and Vice Presidents of Sales need to agree on time required to develop sales strategy > Recruit rigorously to find scarce skills.

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Compensation Observations

> • • • • My data is a colored by B2B TCM, Industrial, Business Services: $100Mn revenue- $200K-$225K base, 50% bonus plus equity – North America $100Mn revenue - $300-$350K base, 50% bonus plus equity – Global $500Mn revenue $300K-$350K base and $50% bonus plus equity - Global $6Bn revenue - $450K base, 100% bonus, $400-$1M per year in annual equity > Sign-on bonuses much less frequent since 2001. You must be leaving unvested equity on the table.

> Shift from options to RSUs and PSUs has been dramatic > Overachieve plans on annual bonus are negotiable. Be prepared to discuss > Initial equity grants most common. Clients encouraged to be generous to attract best talent. Candidates need to be around in 3-4 years to collect!

> Keep the recruiter in the middle on negotiations – ability to speak openly, get a reality check, and to enlist the recruiter to negotiate on your behalf without burning bridges.

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Tips on working with Executive Recruiters

> Develop one or two key contacts per firm in your industry vertical (i.e. consumer, industrial, technology) or function (i.e. sales officer practice at SSI). No need to meet every partner at the firm – we all talk and share candidate ideas.

> We are retained by clients to pursue candidates that meet our mutually-defined specifications. We cannot conduct a search on your behalf, but can be helpful in recommending you to our colleagues around the world. Please let us know your willingness to move to Asia or Europe.

> Develop your career as a “pure play” stock – excellence in a given function or industry segment is always well rewarded.

> Add data to the resume (dates, revenue before and after, team size, graduation dates).

> Be a good source and help with suggestions for others; this is much appreciated and expands your mindshare across the firm. We will not reveal your name as the source if requested.

> SSI conducts high level and high impact searches for small, medium and large companies but quantity per consultant per year is 10 15. If you do not hear from us, it does not mean we do not think you are terrific. Each search is a very unique combination of required skills, experiences, channels to market, products, etc.

> During interviews, there are only two real ways to crash and burn – huge ego and providing long-winded answers to short, concise questions.

> Self-awareness and self-assessment are extraordinarily well received and put you in another league of executive talent. Expertise, candor and humility are a great combination.

> “Check-ins” every 4-6 months are fine. Any more than that may produce a negative impact.

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