Will sales and marketing be crushed by too many tools?

By Sam Balter

New employee onboarding…what joy. After hours of training, product reviews, company culture rah rahs, and riffling through bags of swag, many employees feel they have officially started their jobs. Truth be told, one of the most important events during new hire onboarding is getting set up on the wide range of digital tools you will need to do your job.

Because you’re only truly employed after you logged in, right?

Most employees get accounts for email, calendar, messaging app, video app, and HR portals. Plus Docusign accounts for all the signatures needed. Then, if you work in sales or marketing, you have your Google analytics, Adobe, CRM system, sales acceleration tools, CMS login, Wordpress login, project management, and ooooh so many more.

Today, the average company is using anywhere from 20–200 tools, with an average of around 75+ technologies. Many believe that we adopt software to accomplish a task, what we choose to adopt, and how we use the tool has a large impact on how we market, sell and go to market. As one media scholar once said:

“We shape our tools and, thereafter, our tools shape us.” — John Culkin (1967)

To better understand the tools that shape us, ZoomInfo ran an analysis of the number of technologies at companies based on employee size. This helps us better understand how companies adopt technology as they scale.

As companies grow, things get more complicated

In a post by the venture capitalist Tomasz Tunguz he tries to answer the question:

How many technologies can a company adopt at once, successfully?

He postulates two answers

1. Change management limits the number of tools a company can absorb.
2. A company can adopt an infinite number of tools.

Based on ZoomInfo’s data, headcount is one of the biggest factors of how many tools a company can adopt. Although there are variations by industry, very little deviates from the pattern: as businesses add employees they adopt more tools.

Figure 1: As companies grow headcount, the average number of technologies adopted increases. Source: ZoomInfo

The chart above is a clear example of the increasing complexity of larger businesses. As companies scale, the number of tools they add reveals a need to take on new initiatives and expand.

Businesses may start by adopting simple tools to host a website, send a newsletter, and schedule a few social posts. As companies scale, they need lead routing, social media analytics, CRM systems, and more. Scaling up brings complexity, and software is procured to simplify work processes, provide actionable analytics, and develop new go-to-market plays.

In addition to monetary cost, more software means more systems to learn, integrate, and train people. This begs the question for companies considering their technology stack.

Where’s the limit?

There is no limit.

While technically, a company could adopt an infinite number of tools, clearly one of the largest limiting factors to technological adoption is headcount.

At first pass, this might indicate a future where there is a ceiling to software adoption. When considering the number of tools per employee, the ceiling for software at businesses rises sky high.

Figure 2: As companies grow headcount, employees log into a smaller set of technologies. Source: ZoomInfo

More employees, fewer tools used

As businesses add employees, more people are logging into an increasingly smaller set of tools.

This means more and more teams are finding themselves overlapping. Marketing software is tied to sales teams CRM which is also tied to product usage software. With each of these tools, employees can draw on a richer set of data to make more informed decisions.

The average number of tools per company will continue to grow as enterprise functionality is brought down to smaller businesses, but that growth will be limited by the ability of new tools to integrate effectively with existing solutions.

The modern company is not successful because it adopts technology. It is successful because it is able to use it more effectively.

Sam Balter is a writer, podcaster, and maker of charts. Director of Editorial Content @ ZoomInfo.

Do you have a (data-driven) story?

We’re always looking for ideas on unique ways we can use ZoomInfo’s breadth of data on businesses, the people who work there, and the tools they use.

If you have something in mind or questions we might be able to answer, we would love to hear from you: editorial@zoominfo.com