Jason Hoover: ChatGPT Strategies for B2B Transformation

ChatGPT for B2B

Just as a machine’s design must account for the capabilities of its parts, leaders must evaluate how the introduction of ChatGPT and other advancements might reshape organizational capabilities, processes, and tools.

In fast-changing markets, especially in times of disruption, leaders need to maintain a strong awareness of the business, markets, competitors, and current and future forces affecting the firm.

Forward-thinking organizations can swiftly and cost-effectively leverage these game-changing technologies to enhance efficiency, foster innovation, and strengthen their competitive edge.

Introduction

Several ingredients are critical for businesses to plan the right adaptation strategies and execute at speed:

Visionary leadership and urgency.
Integration into workflows and process redesign.
Strategic alignment.
Driving execution.
Change management and culture of innovation.
Continuous evolution and agility.

ChatGPT, Bard, and other LLMs represent the way in which humans will interface with machines and thus how we will access all the other capabilities of AI and computing in the future.

Language enables humans not just to communicate with each other but also to think — to organize, frame, and structure thoughts and ideas.

While previous disruptions such as computers, the internet, or smartphones eventually became immense, none of them occurred instantaneously.

Though there are many important human considerations (which we’ll also explore), the front end of your business is much like a machine in that it puts components together (like people, processes, and tools) to translate inputs (like capital and OPEX) into outputs (like new customers).

Adoption ≠ Adaptation

Consider three methods of deploying ChatGPT or similar tools:

Public. Using a mere web browser.
Embedded. Many common software tools will embed LLMs to improve user interface and enhance the software’s capabilities.
Local. Using API interfaces and other means, companies can adopt specific, local, trained variants of these tools.

CRM in particular will present the biggest initial opportunities for adoption as compared to highly specialized, less communication-centric and/or more repetitive functions like supply chain management (SCM) or product lifecycle management (PLM).

ChatGPT adoption and adaptation are two entirely different concepts.

To fully harness the power of these new technologies and adapt to this new paradigm, businesses must:

Adopt these new technologies.
Redesign processes and workflows.
Reboot productivity expectations.
Reconstruct hierarchies and organizational structures.

Leaders must recognize the need to redesign processes for optimal functionality given ChatGPT’s enormous impacts on employee capabilities and productivity.

Activities that previously took days might now take only hours, or even minutes. This will require some serious recalibration of productivity expectations, by both leaders and affected employees.

Three Initial Example Use Cases for Sales and Marketing:

Example # 1: Supercharging Sales Prospecting with ChatGPT
Example # 2: Revolutionizing Account-Based Marketing with ChatGPT
Example # 3: Unleashing the Power of ChatGPT for Customer Retention

It is not uncommon for firms to discover that — at least theoretically via value – stream mapping and end-to-end analysis — they can reduce SG & A expenses by 50 percent or more by applying ChatGPT to replace tasks and traditional ways of performing many activities.

Repurposing Sales-and-Marketing Activities. With such significant impacts of ChatGPT on front-end productivity, how will your sales and marketing personnel now use their freed-up time toward other important activities in the business?

Redesigning and Rebooting Your “Sales-and-Marketing Machine”.

Firms can build a set of direct push processes that rivals much more expensive methods, services, and software for a small fraction of the cost, while better engaging front-end personnel and overcoming many of the inherent roadblocks associated with modern sales and marketing.

Adaptation Principles

Basic Adoption Principles:

“ChatGPT first.” Leaders must proactively motivate employees to overcome inherent resistance and excuses, encouraging them to develop new habits.
“Trust but verify.”
Prioritize ChatGPT skills. As ChatGPT’s capabilities continue to advance, it is crucial for organizations to stay abreast of the latest playbooks and best practices that govern its optimal utilization.
Pick the right beachhead. Sales and marketing present the largest array of opportunities for improving efficiency and innovation using ChatGPT.
Drive both efficiency and innovation. While it is important for firms to embrace both efficiency and innovation, efficiency levers will tend to be more intuitive and instinctive for businesses.
Sensible IT security policies. With the recent advancements in AI, it is advisable for companies to proactively reassess their existing data and information-security policies and adapt them to incorporate the new considerations presented by ChatGPT.

Innovation Principles:

“Zero to one.” Imagine the capabilities and efficiency your company could achieve if every employee could fully leverage the immense power of tools like Microsoft Office or other general applications, even to the extent of writing code.
Digital DIY (do it yourself). These “zero to one” realization provide compelling reasons for SMBs to reconsider the value of their current front-end software, systems, and services. By leveraging ChatGPT and general tools, SMBs can achieve comparable outcomes at a reduced cost, while avoiding some of the drawbacks associated with expensive specialized software. CRM tools offer certain benefits but can come with integration costs, high annual expenses, maintenance obligations, disruptions to productivity, and disengagement among sales personnel. With the capabilities of a ChatGPT-enhanced salesforce and general software, smart SMBs can create DIY solutions that match or even surpass the capabilities of systems used by larger companies, exploiting some of their natural advantages, all while incurring significantly lower costs.
Systems of engagement. As companies begin to extract and automate corporate knowledge, leaders should think about building and expanding “systems of customer engagement” and how they might better utilize current “systems of record”.
New offers and services.
Personalization. With the help of ChatGPT, any asset can now be easily customized or personalized. These assets can be tailored to industries, specific accounts, buyer personas, or even individual recipients (such as using LinkedIn profiles). Firms can now realize the potential to shift the creation of some custom assets from marketing to sales. Even salespeople with limited software expertise can use ChatGPT to revise and personalize preexisting assets to suit the unique needs of individual customers.
Predict new customer behaviors. ChatGPT has the potential to reveal “what the internet thinks” about your company and products, which can be surprising for many firms.

Adaptation Principles:

Continuous improvement. Continuous improvement is the cornerstone of a culture equipped for digital age transformation.
Increase delegation. As organizations witness the impact of ChatGPT on employee capabilities, they will need to reevaluate their workforce composition. A shift may occur, with fewer senior personnel and a greater number of lower – level employees utilizing ChatGPT.
End to end and in between. Don’t expect all of ChatGPT’s improvement opportunities to fall neatly within the functional organizations in your business.
Corporate knowledge. Years ago, Ray Dalio, founder of Bridgewater (the industry-leading hedge fund), recognized the potential of computers to exceed human capabilities and enable better decision-making. Dalio created and continuously improved central computer algorithms that could analyze data and guide better decisions with reduced biases.

In today’s age, the value of automating corporate knowledge is orders of magnitude higher with ChatGPT.

Early-adopter advantage. Some useful new principles:

Encourage “ChatGPT first” for all tasks, unless prohibitive.
Trust but verify. Accept ChatGPT’s current limitations.
Start transformation in the front end and perhaps customer service.
Drive both efficiency and innovation levers.
Revise current information-security policies, and manage risk appropriately.
Upskill to take advantage of ChatGPT’s capabilities.
Reconsider DIY digital solutions
Think about all your data, information, and documents and how you might translate those “systems of record” into “systems of engagement.”
Exploit capabilities for personalization via account-based marketing.
Acknowledge that customers will now use ChatGPT to a large extent, and begin preparing for (or to exploit) that shift.
Focus on producing an initial step change in the business.
Retune leadership habits and delegate tougher assignments, as people are now much more capable with ChatGPT.
Search end to end for innovation and efficiency opportunities.
Use ChatGPT to document corporate knowledge.
Become an early adopter.

New Design Requirements

Over 90 percent of B2B salespeople have never read a sales book.

Many firms have not adapted to a new sales game, where winning now requires effective virtual selling, using modern social platforms and producing network effects, and using other digital means. Those who aren’t sufficiently skilled and using technology are inevitably losing ground.

As a few key foundational premises, B2B marketing needs to account for forces not normally as relevant as in B2C, including the following.

“Other people’s money.” The disconnect between personal costs and business benefits poses a difficult barrier for firms seeking to displace incumbent suppliers.
Loss aversion. Loss aversion, a concept from behavioral economics and prospect theory, significantly influences B2B decision-making.
Bottom-line impacts. B2B decision-makers wear two hats: the individual’s self-interests and the representative of the company’s interests. These two perspectives often have different decision drivers.

B2B marketers should prioritize lead generation and prospecting over brand marketing, especially in SMBs.

Digital age disruptions. When constructing an overall strategy, firms must include considerations for the multitude of new risks that have become more threatening in the digital age. The digital age can disrupt business models previously thought to be untouchable.

“People sell to people” has been replaced in B2C; we buy most of our goods these days from machines (think Amazon). Why would one think that the B2B industrial space is immune from following the same path?

Consider several of the common major forces posing threats today and risks for tomorrow across a multitude of B2B sectors and how these might impact your own firm.

Market consolidation.
Online retail disruptions.
Disintermediation. Digitalization is gradually diminishing the relevance of traditional reseller value-add. Overall, B2B distributors and resellers face significant challenges as their historical roles diminish in relevance amid digital transformation in the industry.
Ongoing supply chain crisis and other aftershocks.
Heightened “fat tail” risk.

In the digital age’s consolidating and disrupted markets, the majority of SMBs will fit into one of three categories:

Adapters.
Acquirees. These firms will eventually become acquired.
Harvesters. These firms will fail to adapt.

In many ways, digital transformation has become a euphemism for simply “becoming ready for the future.”

Foundational elements. Many new foundational levers will be required to adapt to new digital age challenges, like those discussed in the previous section.
Messaging: a critical prerequisite for effective front-end digital transformation. Many B2B firms struggle with their messaging. An effective message has become a crucial fundamental in capturing attention and standing out from the competition in today’s saturated market.
Today’s infinite options for software. The concept of a singularity in technology, where the pace of development surpasses human capacity to keep pace, is increasingly relevant for businesses.
Updating the digital playbooks. ChatGPT has revolutionized the concept of digital transformation, rendering many existing playbooks obsolete. This presents a significant opportunity for laggard firms. It’s as if the game’s reset button has been pressed, offering these businesses a fresh start at the starting line.

SMBs need to break away from the playbooks and extensive solutions designed for larger corporations, along with the wasted effort and investments associated with them.

Remember that with ChatGPT, unlike other technologies, nobody has anything to sell you! ChatGPT is free, and it’s likely going to stay that way.

Innovation is often achieved by putting similar ingredients together in a different manner.

Igniting transformation. With all our talk about machines, it’s important to also focus on the human element. Firms need an ignition spark to launch transformation, mobilize the business, and mobilize people.

Many firms don’t know how to accomplish this at any level of significance or impact. Many companies implement the wrong, unimpactful levers. Other firms do some of the right things, but they just can’t seem to link the pieces together.

Strategic threads. When creating their transformation strategies, businesses would benefit from searching for levers that touch and influence more than one thing in a positive direction. Strategists should seek to create strategic threads, a term we use for levers that can stitch together and drive several things at once or in series, like a row of dominoes.

Today’s new governing rules for SMBs, considering customers, the market, and technology:

The digital age necessitates an unwavering focus on producing scale.
New customer acquisition is therefore critical.
Digital is key for producing scale, but not only digital.
A holistic approach is necessary, combining foundational and digital elements.

And new high-level design requirements for the front-end machine:

The machine shall prioritize lead gen and prospecting over brand marketing and avoid irrelevant B2C ingredients.
The machine shall deploy regular, engaging, value-add content for pull and to build brand awareness.
The machine shall use the full, combined capabilities of general software in conjunction with ChatGPT.

Redesign

Last generation’s front-end B2B playbooks, structures, and tools can be described as centralized.

Consider the possibility that these top-down processes, divisions of labor, and central command-and-control tools and structures from the immediate pre-ChatGPT generation may now be hindrances to performance.

Organizational structures must promote the culture of ownership and entrepreneurial behavior needed to compete in the digital age.

Many SMBs might still be several generations behind with old, decentralized processes that lack any degree of scale.

We’ll examine four representative examples of how these new principles and requirements can converge:

Personal prospecting push
Social media pull.
Value-add marketing.
Do-it-yourself CRM.

Think of these as the new subassemblies for our machine.

Boost Push via “Personal Prospecting”. We’re going to combine our two initial use cases for sales prospecting and account-based marketing. Push versus pull marketing. Some combination of both push and pull marketing strategies will be the right approach for most companies.

The old paradigm. In the previous paradigm’s playbooks, pull largely dominated, and businesses were told to rely on lead generation and marketing automation as the primary means to develop leads for their sales teams. We need to recognize the limitations of this approach. Marketing automation has led to generic and impersonalized outreach, whose proximal effects include ignored calls or emails being flagged as spam, which ultimately results in overall low engagement from prospects. The paradigm shift. The emergence of new technologies, such as ChatGPT, play a crucial role in reshaping the new paradigm.

Playbooks can change significantly, even with a wholesale reconsideration of the roles of sales and marketing. Instead of relying solely on a centralized marketing team, even sales professionals without extensive software expertise can customize and personalize assets, creating bespoke materials that resonate with customers’ unique drivers, largely using ChatGPT’s capabilities.

Though the playbook for this approach will be different for various businesses, here are a few general, high-level steps firms can take to accomplish this transition. Upskill and enable sales teams. Salespeople must realize the need to become more capable to create content, effectively prospect, deliver new business, and track and report progress and results.

Rethink the sales-marketing dynamic.

Bring content development closer to customers to enhance relevance and impact.

Combine personalization and traditional prospecting.

Streamline prospecting mechanics. Acquire cost-effective lead lists from various sources, including those offering email contacts.

Enhance content creation and personalization.

Track progress. Employ ChatGPT to develop macros that analyze master Excel data, enabling monitoring of progress, gaining valuable insights, and refining prospecting strategies accordingly.

Implications. Integrating ChatGPT in sales prospecting introduces a new mode of operation for sales-and-marketing teams, emphasizing proactive engagement, personalized interactions, and tailored content.

Boost Pull via “Social Media Scale” In addition to the previous push approach, many firms might seek innovative ways to enhance pull, including improving their brand awareness and generating inbound leads.

Enhancing social media engagement. By integrating ChatGPT into their social media strategy, businesses unlock numerous opportunities for sales to produce scale of outreach.

Collaboration for customer-centric content. To create customer-centric content that provides genuine value, businesses can collaborate with other key functions such as technical support and application experts.

Initial implementations.

Couple pull with effective push.

Implications. The new approach yields significant implications, including the creation of engaging topics that surpass traditional advertising, enabling personal and authentic advocacy from real customers and product / service users.

Value-Add Marketing. Content Value-add content goes beyond mere advertising by offering customers utility, insights, and education.

To develop such content, leverage two guiding principles we’ve discussed before: documenting corporate knowledge and systems of record/engagement.

Through workshops or cross-functional collaboration, companies can explore innovative ways to leverage existing and easily retrievable information. In today’s world, the process of refining rough concepts into polished content has been revolutionized thanks to the remarkable capabilities of ChatGPT.

Whether it’s transforming notes from a service database into a professional customer report or converting audio recordings into polished written text, ChatGPT is the key to effortlessly refining content. It possesses the power to transform rough ideas into compelling articles, engaging scripts, captivating posts, and many other ways to engage customers.

Do-It-Yourself (DIY) CRM.

The old paradigm: complex tools and hierarchical reporting.

Challenges: the costs and value of CRM tools. For SMBs, a CRM system might resemble a cluttered Swiss Army knife, with numerous tools that serve little purpose in their day-to-day operations.

The new paradigm: embracing simplicity and personalization.

Enhanced by ChatGPT, a combination of widely used tools like Microsoft Office and other generic applications can achieve results that previously required stacks of custom software. Implementation: unleashing the power of ChatGPT and general tools. Implications. The integration of ChatGPT and general tools allows businesses to replace specialized software, resulting in cost savings.

Remember the new powers salespeople now possess, and remember that previous generations of non-technology-enhanced salespeople were largely self-sufficient with prospecting and lead management.

Traditional big businesses are realizing that to compete in the digital age, they need to decentralize.

As businesses recognize the potential of ChatGPT as a catalyst for comprehensive transformation, they can also integrate other complementary elements essential for digital transformation. As previously discussed, successful digital transformation requires a holistic approach.

The ongoing changes in front-end protocols prompt reconsideration of existing organizational structures. With changing expectations, some individuals may be left behind, unable to adapt. Processes will require significant revisions.

Firms will face the choice of upskilling and revamping the roles and responsibilities of existing teams and personnel or adopting new structures to promote optimized workflows, aligned team goals, and reduced costs, perhaps accompanied by personnel changes.

Consider a few factors that might prompt the need for different organizational structures.

Business segmentation. As discussed, a properly segmented business can grease the skids for a more personal approach with customers at scale.
Virtual selling. Customers are less attentive, and traditional approaches like building rapport or discussing pain points no longer work. Engaging prospects requires capturing their attention within a short time frame and maintaining it in different ways.
Automation of support functions. At the same time, ChatGPT and other efforts will further automate support functions and create large efficiencies.
The importance of digital age marketing.
Other structural considerations across the enterprise.
The most fundamental consideration, leaders have the option to optimize the size of their workforce, reassign individuals, and/or reallocate time to more productive and efficient endeavors. Leaders of larger organizations should consider process excellence projects to map ChatGPT impacts end to end across a business.

Customer service, project management, and product management represent low-hanging fruits and potential next-focus areas of opportunity.

A Transformation Playbook

To ignite meaningful change, a critical mass of activity is essential.

For SMB leaders, the daily chaos and relentless urgencies often overshadow the pursuit of long-term goals.

Leaders will need to choose between deploying a program merely oriented toward ChatGPT adoption or one encompassing a more comprehensive set of objectives and initiatives.

The Agile Strategy Framework has three main ingredients, which we’ll elaborate in this chapter:

Ingredient number one: Develop the strategy. The Balanced Scorecard’s four perspectives — financial, customer, process, and employee — serve as a helpful framework for organizing objectives, establishing linkages, and ensuring comprehensive focus across different aspects of the business.
Ingredient number two: Execute with Agile. Unlike traditional long-term strategic planning that can result in slow progress, Agile sprints create a mindset where every week matters.
Ingredient number three: Manage change.

The Agile Strategy Framework is further comprised of six key steps.

Develop and Plan the Strategy.
- Develop.
- Organize. An initial backlog of initiatives is created for execution in subsequent sprints. Responsibilities are assigned, and sequential execution plans are developed.
- Align. Alignment is crucial across all levels of the organization. Our “Barbell Model” can give leaders an effective way to think about their digital age strategies and put the right combination of ingredients in place:
  - Top-down change. Leaders must drive change.
  - Bottom-up change. Leaders must also not bottleneck progress.
  - The program. The bar itself — the connection between these levers — represents the Agile Strategy Program.
  - Manage change.
Iterative Agile Sprints. Firms should adopt a balanced approach of “Think slow but act fast,” recognizing the importance of both thoughtful planning and swift execution. At the lower end of the transformational spectrum, the predominant focus lies on leveraging ChatGPT for front-end transformation. At higher levels, the objective is to prepare the entire business for the multitude of challenges posed by the digital age.
- Plan.
- Execute.
- Learn.
Managing Change. Don’t underestimate adoption hurdles. Even for those who understand ChatGPT’s immense capabilities, using it remains unintuitive.

Conclusions

Businesses will need to triangulate between new components and new design requirements and begin to redesign and reconstruct their machines.

The playbook. Be prepared to confront the “complex system problem” of effective transformation and the need to address all the ingredients required to quickly mobilize a business for this new paradigm.

Visionary leadership and urgency.
Integration into workflows and process redesign.
Strategic alignment.
Drive execution.
Change management and culture of innovation.
Continuous evolution and agility.

AI is likely to become the new dot-com bubble. Investments will pour into AI firms, and its evolution will become limited largely by new governance and regulations.

Compound interest. As much as ChatGPT is a complex system problem, it’s also a compound interest opportunity.