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Good Is No Longer Enough
For at least the last 20 years, businesses have had a wind at their back that has driven growth and forgiven many mistakes. With this wind at your back, good was good enough. As we head into 2010, you can no longer count on the wind to drive your growth efforts, and good is no longer good enough.
This is true in every aspect of your business. It’s especially true when it comes to your sales efforts. Never before has there been more pressure to succeed, and more urgency that your selling efforts be great, than there is today. Mistakes are punished as never before. That is probably why I’ve been writing so much about selling efforts recently.
I’m going to continue the conversation I started a month ago when I asked if your salespeople were pests, peddlers or demand creators. My question today is what type of approach do you need to be successful.
There are three types of approaches that selling organizations take:
- Order-takers. This approach isn’t selling so much as it is, at best, servicing.
- Catchers. In this approach, you are selling (and you may even be selling well), but your sales efforts are limited to the pre-acknowledged needs of your buyers. An indication that you are a “Catcher” is when you find yourself (or one of your salespeople) saying that, “once I’m given an opportunity I know how to capture it.” The problem with this approach is that your opportunities are limited by your buyer’s ability to become dissatisfied with the status quo, and further, that dissatisfaction must be in line with your offerings and positioning. This can be quite a challenge today if you have a premium offering, as the natural “dissatisfaction” today is being driven by the need to cut costs, and price is often a proxy for “cost.” In my experience working with hundreds of sales teams over my career, the vast majority of “great” sales teams fall into this category, and when there is a wind at your back and demand is naturally increasing at faster and faster rates you can be very successful as a catcher. When there is no wind, let alone a head wind, “catching” is not enough to drive growth.
- Demand Creators. This approach creates business opportunities. It stimulates and creates demand. Demand Creators do extraordinarily well when there is a wind at their back, but the real reward of this approach comes when there is no wind. Demand Creators create opportunities. They stimulate dissatisfaction in the status quo. They’re not salespeople so much as they are business people who sell. Their business acumen enables them to become resources to their buyers. As a result, they can have conversations that no one else can have. They’re also extraordinarily proficient at winning competitive business – an uber-critical skill for the future.
The vast majority of selling organizations take the catcher or the order-taker approach. Their systems are built to respond to customer demand – not to create it. The trouble with this approach is that its efforts only work effectively after the buyer has decided they need something. With fewer buyers and lower budgets, purchasing decisions are being delayed and avoided. Additionally, selling organizations are most vulnerable to competition and commoditization in these situations. When demand was jumping, you could get away with it. Sure, there was lots of pressure on margins, but that could be made up in volume. Today, there’s even more pressure on margins and volume is down.
Creating demand is tougher. It requires better strategy, better execution, and better people, but, as they say – if it were easy, everyone would do it.
Mistakes & Improvements
The people over at RainToday.com just completed an interesting study on The Sales Mistakes That Turn Buyers Away. They interviewed more than 200 buyers to find out what major problem they experience when buying services, and what areas of improvement would have the greatest impact in increasing the likelihood they would buy. The study focuses on the sale and purchase of professional services, but don’t ignore this study if you’re not a professional services firm.
According to the study 80% of buyers experience at least one major problem during the purchasing process. Now my bet is that if we asked the sales side how often they made a major mistake, that number would come in well below 80%. This means that even if you think you’re not making one of these mistakes, you probably are.
Another statistic that jumped out at me is how loyal customers are to their current provider. If you’re looking for new business, the news is great, however if you’re looking to keep your business, it’s scary. Depending on the industry, a whopping 52% to 72% of buyers would consider switching providers. So, if you’re complaining about the economic downturn – STOP – get out there and start winning business.
The study combined two important questions to allow selling organizations to focus on areas of improvement. First, they determined what the high probability mistakes are, then they determine what the high impact areas were. High impact areas were areas that received greater than 90% positive response to the question “would you be more likely to consider a new providers services if they improved in a specific area.”
Here are the top three impacts (none surprising if you read this blog):
- Craft a compelling solution to my needs.
- Listen to me.
- Understand my needs.
Of course, if you don’t master the second and third points, there’s no way you can master the first.
So, there you have it. Another way of saying, “understand the customer better than the customer understands themselves,” and “sell results.” It’s that simple.
Best Friend Conversations
I’ve had lots of conversation in response to my last post on cutting your sales cycle time. What’s mot interesting to me is the varied disciplines that are commenting to me. I’ve already posted a comment from a physician friend of mine, and over the weekend, I had another conversation with another physician.
We were talking about the oft-quoted statistic that the number one indicator of whether a doctor will get sued for malpractice is not competence, but how much time they spend with a patient. The doctor I was talking with told me that while that was true, another key skill that drives better patient-doctor relationships is how they ask questions.
He asked me to guess what the average time is before a doctor goes from a general question (which is important to make the patient feel understood) to a directed question. Take a moment and make a guess yourself.
Eight seconds – that’s it.
Actually, I’m not surprised – most salespeople aren’t much different. It’s one thing to ask a question; quite another to let the customer/prospect answer, and I mean really answer, the question. I work a lot with companies and salespeople to develop the types of Resonating Questions™ that I discussed in my previous post. While asking these types of questions are critically important to sales success in today’s world, the way you ask the questions is equally important.
I call the most common style used by salespeople “the interview.” I refer to it as such because the person selling goes in with a list of questions (either written or in their head) and goes about asking them. The problem with interviewing is that the focus is on the question and the answer. However, little to no attention is paid to the implication of the answer; and as a result the conversation never goes deep and as such the selling organization is commoditized.
I call the most effective style “The Best Friend Conversation.” When I’m training salespeople I ask them how would they ask questions, and how would they behave if they were talking with their best friend. Here are the components of a Best Friend Conversation (as least as it applies to selling):
- There is a clear understanding of what you want to discover in the conversation.
- You have a few Resonating Questions in mind to get the conversation started and moving if the conversation gets stuck. You know that, by no means, will you ask all of the questions on your list.
- You are intently focused on the answers you are given.
- As you listen to the answers,you dig deeper to understand the implications of the answers. You are constantly comparing what you know as a result of the conversation against your intent going into the conversation. Any or all gaps are areas for additional conversation.
- You do all of this is in the engaged, low pressure method, as you would do if the person (or people) you were talking with were your best friend. As a matter of fact, a pretty good filter as you get stuck when figuring out what to do in a sales situation is to ask yourself what would you do if the customer/prospect were your best friend.
While you begin developing your Best Friend Conversation capabilities, you’ll find that they require more preparation that traditional interviews do. That preparation, however, will be rewarded exponentially with more sales, faster sales, less competition, and better customers.
Promotions Gone Awry
I love this time of year. We’ve got the 3-F’s: friends, family & football. There’s the wine, the turkey, the stuffing, and the wine. It’s great fun.
And I have a tradition at this time of year that I would like to share with you. I often write about how the old paradigms of business, sales and marketing are letting businesses down. Well, today, I’m not going to get that deep. Today, I’d like to focus on one of the all-time promotion fiascoes, from one of my favorite shows.
The tradition: Watching The Turkey Drop from WKRP in Cincinnati. Have a great holiday, everyone!
RSS Readers that don’t see a video below, click here to watch the video.
The Secret to Cutting Your Sales Cycle Time
I remember it like it was yesterday. It was my first “official” sales job in a stereo/furniture store. Having botched my first “presentation,” my manager pulled me aside and said to me, “Doug, it’s far better to ask a question than to make a statement.” That was my first lesson – questions matter.
Then I engaged in formalized sales training, where I was told that there were different types of questions. I learned that open-ended questions (those encouraging the prospect to respond freely) were typically better than closed-ended questions (those that limited the responses).
In 1991, I read SPIN Selling
Since then, I’ve spent almost 20 years learning more about the power of questions. There is no skill more valuable to anyone wanting to grow business than the ability to ask powerful, thought-provoking questions. I’m left speechless though, when I see just how little progress most of the sales profession has made in the area of asking questions. The only word I can use to describe 90%+ of the questions selling organizations and salespeople ask is – BORING.
In blog after blog, and article after article (I won’t name them here as I don’t wish to embarrass anyone), I’m shocked by how low-value and manipulative the questions are. Too often the sales questions asked have these attributes in common:
- The only party learning anything in the process is the selling organization.
- Questions are based upon assumptions that (to steal a legal term) are not in evidence. The salesperson (and for this post salesperson refers to anyone selling, whether they consider themselves a salesperson on not) burrows in and attacks the customers. The question, “what concerns you about…” is actually an attacking question. The buyer realizes that by answering such a question they are giving up any power or control they may have and, in essence, they know they are about to “be sold.”
- The questions are narrow in scope at best and myopic at worst. The questions are asked from the viewpoint of the seller, instead of being asked to mutually understand the viewpoint of the buyer (and the buyer’s organization). If you come in and ask a question such as, “Explain the challenges you are having with your IT.” You’ve narrowed the scope to IT, which is your solution. As I’ve written before – your solution is not my problem. The reality is no buyer has an IT problem. The problem they have is that they are failing to get a critical business result that IT should be delivering – focus on the result.
- The questions don’t probe very deeply. Recently, I was working with a sale rep who was preparing for a major meeting. She reviewed the questions she was going to ask. An example of one of the questions she was going to ask was, “How should your performance management system work?” The problem with this question is it is based on the belief that they customer knows how the process should work. The rep needed to remember that if the customer knew how performance management systems should work – they wouldn’t need the performance management consulting service the rep was proposing. Asking this type of question (which get asked all the time) is the equivalent of your doctor asking, “How should your cardiovascular system work?”
- They fail to create any value.
For the last 20 years, salespeople could get away with asking boring questions. With so many “fish jumping out the water,” salespeople were able to “paddle their boat around and let the fish jump in.” Today, it’s the opposite. Not only are fish not jumping, they’ve gone down deep. I’ve written before about the drought we are in (and probably will be in for some time); and with fewer buyers, disappearing discretionary budgets and intense competition, salespeople are penalized for failing to create value. Today, if you want a buyer’s attention, you must bring something special to the table – and that “special-ness” has nothing to do with your offering. Buyers expect you to know their business, their strategies, and their problems – without having to ask sales questions to get there.
If you want to cut your sales cycle time and sales costs, the best thing you can do is build your diagnostic selling skills. At the core of your diagnostic skills is your ability to ask powerful, provoking questions. I call these types of questions Resonating Questions™, because they cause the person being asked the question to think, at multiple levels, about their situation and impacts. Selling yesterday was about having the right answer; tomorrow, it’s about being able to ask the most powerful questions. Here’s a guide to know if you’re asking powerful questions:
- The person answering the question benefits from answering it more than the person asking the question.
- They create context. Ask any good coach and they’ll tell you that the difference between average performance and top performance isn’t knowledge; it’s context. Top performers don’t know more, they’re just able to do more with what they know because they understand better. Context creates understanding. Powerful questions allow the buyer to understand their world and their issues better. Just yesterday I had a client, who utilized one of our questioning structures that we call The Belief Conversation™, tells us how fast her prospect opened up to her and bought their ideas. She was surprised how fast the trust developed and how little they had to say about themselves to earn a trusted resource status. The reason was because the questions created context that allowed the buyer to understand their needs better, and because the seller was the one who created the context, trust and action came with it.
- They’re results oriented. Remember, nobody wants your stuff; nobody wants to buy anything from you. What they want are results; the challenge is that buyers aren’t always clear on the results so they focus on the stuff – and the stuff has little value.
- Powerful questions take the conversation deeper. They trace symptoms to causes and explore the consequences of various actions and inaction. Buyers understand their symptoms, but rarely understand the cause, and as a result they try to treat the symptom. Because the symptom is not really the problem, no solution truly resonates and sellers get commoditized.
- They’re asked in the interest of the buying organization. We work with a really powerful sales team, they’ve got everything going for them. Their people are strong, smart, and capable. Their firm has a great reputation. Their challenge is that they are not comfortable asking questions that might have answers that aren’t in the seller’s interest. They think that either the answers have nothing to do with them (the seller can’t do anything about it) or they may open up a potential weakness in the seller’s offering. While this is not unusual in the sales world, their failure to fully understand their buyer’s world has limited their ability to accelerate the adoption of their higher margin offerings which they define as the core of their future competitive advantage.
- The questions are asked in a conversational format. (Download Steve Yastrow’s free ebook on Encounters to learn more about this.)
The great thing about Resonating Questions is that once asked the person being asked the question can’t help but consider it – even after the salesperson leaves. Resonating Questions are like a great workout – while the benefit during the workout is good; it’s in the time after the workout, as the body adjusts to the disruption caused by the workout, when the real benefit kicks in. So, stop asking boring questions and take the time to build powerful, resonating ones. Your buyers will reward you with faster, more profitable sales.
Build Marketing Assets, Don’t Spend Resources
I live by a philosophy that guides virtually every marketing decision I make – it’s okay to utilize assets, but spend resources only when it’s absolutely necessary. To understand why this philosophy is so important, we must first understand the difference between building what I refer to as “marketing assets” versus “spending marketing resources.”
Traditional marketing efforts are virtually all built on spending marketing resources. It is for this reason that the marketing budget exists solely on the income statement (or, more appropriately the expense statement) and doesn’t exist on the balance sheet.
The reality is that more than 95% of the time when a business owner, executive, or salesperson uses the word marketing they really mean advertising and/or promotion. Built upon the campaign mindset, traditional efforts focus on creating results through the sheer force of effort.
Tactics like cold calling, direct mail, print advertising, etc. all fall under this category. But, so do efforts like “going viral,” to increase “brand awareness;” and many other “new” marketing efforts. All of these tactics search to create an “event” that causes a message to break through the noise and gain the attention of a desired audience. The problem is that there is no foundation, relationship, or value creation to support the event or campaign. So, the only way to maintain their effect is to keep doing them.
Worse, because the rate of noise is increasing exponentially, what you did yesterday is not enough for tomorrow and you need to do more to raise the volume. To add insult to injury, as you get bigger, the only way for these tactics to support your growth is to scale them up with you. There’s simply no leverage or long-term benefit when spending marketing resources.
Marketing assets, on the other hand, build in value, impact and effect over time. While they don’t (always) have as an immediate impact as traditional efforts, the results you gain from them last. Because they last, as you do more, the value of doing them increases as well. They benefit from the network effect.
The biggest advantage that building marketing assets that once built, because they are assets and not campaigns, they take progressively less (never zero) effort to maintain them. As you maintain them, they continue to drive better results. This makes them highly leveragable (as virtually any strong asset is), and becomes a moat, or competitive advantage, if you will, that protects you and makes your competition increasingly irrelevant.
What are examples of marketing assets. As Seth Godin has made famous, probably the highest value-marketing asset is the permission of defined group of people. Tactics such as blogging, creating conversations on platforms like Twitter, and content marketing are prime examples. But, please (PLEASE) don’t ever confuse the tactic as being an asset. It’s the tactic driven to support a specific purpose, regularly monitored and constantly refined. The difference between these two approaches is best illustrated by this chart, created by Paul Hebert, at I2I.
So, why not just drop all of your traditional marketing tactics and focus exclusively on new ones? Obviously, the challenge with this is that if you’ve built a reliance on campaign driven advertising and promotion and you stop that cold, the inflow of business potentially stops as well. Your objective should be to develop a plan so that over the course of the next 18 to 24 months you realign at least 90% of your traditional efforts to new, asset based efforts. My experience says that it will take about six months to build a baseline of content, and you should consider this time an investment. At about six months, you’ll want to begin reducing your investments (time, money and energy) from traditional tactics and put them towards a new strategy. Keep in mind that the biggest investment barrier in new strategies isn’t money as much as it is time. You need – must – put in the time, or you will fail to build an asset.
One final note for all the traditional marketing cynics out there who may be saying that achieving “front-of-mind” status through traditional marketing tactics is in fact, an asset. You may even be rationalizing that the investments in traditional tactics create awareness and “build the brand.” I’ll concede that if you are McDonald’s, Coca-Cola, Proctor & Gamble, Wal-Mart, etc. this may (emphasis on may) be true. But, these companies spend billions (with a “b”) on advertising. As a small and mid-market business (SMB), you do not have the resources to “build the brand” that way. Besides, the smart “big guys” like Proctor and Gamble are already implementing the approach that I recommend – so why should you wait?
The Key To Business Growth? Boring, Critical Tactics.
There are few bigger fans of strategy than me. Truth be told, personally, great ideas and thoughts capture and keep my attention far more easily than great tactics and execution. But, here’s what I’ve learned (and, yes, I understand that this is not news), tactics matter. Strategy defines your game and puts you into a position to win. Tactics, or more precisely, properly executed tactics are what actually win the game.
In my experience, I’ve learned that growing companies (especially those that get excited about transformative opportunities) love strategic conversations. What isn’t there to love? Strategic planning is filled with unlimited possibilities, dreams, and brainstorms. Little to no action is required. Too often, strategic conversations provide no constraints, no trade-offs. You can plan for the gains, without experiencing the pain.
But then the time comes when you actually have to do. The doing is never as easy as the planning (especially the dreaming). As you and your company are thrust into new situations and the trade-offs becomes apparent, life becomes filled with complexity. Inevitably, you hit the point where instead of every idea being filled with potential, every action is fraught with difficulty. As the insightful saying goes, “Everything looks like failure in the middle.”
What happened to the excitement? Thoughts drift. Clearly, there must be something wrong with the strategy. Besides, virtually every “thought leader” has posted about how strategy drives everything (yes, I include myself in this). So, clearly, because results aren’t coming “effortlessly”, executives become convinced that the strategy needs to be re-worked.
This decision is rewarded with great psychic joy as the possibilities flow back and excitement returns. Unfortunately, no progress is made and the business gets or remains stuck.
What’s the moral of this story? Sure, tactics can be boring and difficult. But, they are critical to your success. So, the next time you read a blogger like me singing the (deserved) praise of strategy, remember what we really mean is that when great strategy meets great tactics and execution – great things happen.
Winning Competitive Business
I don’t typically get jealous of people. We all have our own stories, but I have to admit I’m jealous of Seth Godin. I’ve always admired his thinking – both in style and outcomes. Even more, I enjoy his witty way of communicating very complicated ideas in extraordinarily simple fashion.
Well, today Seth topped himself. In 5 (very) short paragraphs Seth nailed the key to winning competitive business. The gist is that you don’t take business from a competitor by being “better”, you doing it by focusing on the things that matter to the buyer, that are being focused on by the competitor.
Do yourself, and your business, a favor and read it here.
Your Solution Is Not My Problem
Do you have a great solution?
Do you do something different, or better yet, unique?
Great. Now, if you want more sales, faster sales, and more profit per sale – forget about your solution.
I always know when a company or a salesperson is in for trouble. When asked about their company, they spend all of their time talking about their solution. They may have a great story, but what they all struggle to understand is that your solution is not my problem.
I wrote about this more than three years ago and things seem to be getting worse. Back then, I said:
Let me explain something that is very basic – if there is not a problem, there can be no solution. Period. No questions or discussion. I’d like to request that all salespeople and marketers stop talking to me about how wonderful their solution is. When they talk to me this way, all they do is demonstrate that they clearly have absolutely no understanding of the problems that matter most to me.
Here’s your challenge. If your customers and potential customer don’t understand their problems – and they don’t, then they cannot understand your solution. Nor can they understand how your solution is any different than any other solution. And they certainly can’t figure out why your solution is an absolute, must-have, can’t be without. In this drought, anything less is not enough to get access to budgets.
What should you do – start talking to me about my problems. Demonstrate that you understand me, my business, and my desired results as least as well as (preferably better than) I understand myself. If you can’t understand me at least as well as I understand myself – how can you possibly create any value? And if you don’t create any value, why should a prospect or customer spend any time talking with your company.
Now, you don’t need to understand every problem I have, just the important ones that align with what you do. At Imagine, we teach selling organizations to focus on what we call “high probability indicators/symptoms.” The likelihood is that 80% of the businesses that fit your Best Few Profile suffer problems that are 80% similar, so you don’t need to invent a new wheel every time you sell. The buying organization’s challenge is that they don’t understand their problems (think about it, if they did, they’d be getting the results they want). What’s new and unique to the buyer is standard operating procedure to you (which is why they need you).
Your job is to give the language so that the buying organization can trace the symptoms (that they are aware of) to the real problem. Just today, I had two conversations with someone who thought they had one problem and I helped them understand that the real problem was something entirely different (while this was a surprise to them, it was SOP to me). I spent no time whatsoever talking about my solution, and the buyers went from “looking at alternatives” to proceeding only with me.
Remember, my problem is my problem – and until I fully understand it, and understand that you understand it, you’re solution is a commodity at best and more likely an interruption. Stand out and make your customers feel understood.
Is It Time to Kill The Cold Call?
In my efforts to stay abreast of what is going on in the world outside my office, I follow the thoughts of several sales training and consulting organizations. Over the last couple of weeks I’ve seen a significant increase in the chatter surrounding cold calling.
While everyone has had a slightly different take on the practice, the thoughts were probably best summed up by @solutionselling’s blog post: Cold-Calling Beats Aggressively Waiting by the Phone…. EVERY TIME!
When I first got into selling, I wore my ability to cold call as a badge of honor. I remember when I started at Merrill Lynch, a good day was when I made 300 calls in a day, and on my “best” day I made 500 dials. I look back on my “smiling and dialing” days much the way a high school football player looks back at their “great” plays.
But, I got to thinking. I’ve built (IMHO) a pretty good business over the last five years and I haven’t gotten a single client from cold calling. When I look at the best clients I got when I was at Merrill Lynch, not one came from cold calling. Don’t get me wrong, cold calling has certainly helped me in my sales career. But, I wonder if it hasn’t caused as much harm and it has helped.
So, I ask you, Is It Time To Kill The Cold Call?
Here are my thoughts:
We first need to define cold call. There is absolutely nothing wrong with making a first contact by phone with someone who may not know you. If you are making that call with purpose, you’ve done some research on the company, you have a least a hypothesis of the problem they have that you can help address and you have a dynamic, multi-pronged account entry strategy to support that call; then I would not define that as a “cold” call. Let’s call these initial calls. In reality, if this isn’t the sole part of your job, you may be able to make 5 of these types of calls a week.
A cold call, in my opinion, is where you deliver a generic message to a defined (or not) group of people in an effort to generate interest. You know little to nothing about the potential customer and you script yourself (whether written or not) to create a “lead.” With this type of call, you can make a virtually unlimited number of calls..
Now the observations:
Pros:
- There is absolutely no tactic that can be taken on the part of a salesperson that will lead more immediately to creating a sales opportunity than cold calling – NOTHING. So, I agree with the post above that cold calling is far better than waiting for the phone to ring. The reason for this is that cold calling allows you to cover significant ground faster than any other tactic. By the nature of its force, you are able to shake opportunities loose. Now, these are not always (actually rarely) the best opportunities nor best positioned, but they do create opportunities faster than any other tactic. The post I referenced tells the story of a sales rep who continued to cold call a prospect for 18 months. My experience is that this rarely works – and I would challenge the rep with what he could have done to accelerate the process if he hadn’t relied solely on cold calling (and if he didn’t rely on solely on cold calling, then that goes against the author’s argument).
Cons
- Cold calling creates a lot of negative equity. Much has been written about interruption marketing, and I won’t re-hash the arguments here – they’re easy enough to find. While cold calling can thrust you into opportunities, it can also really irritate a lot of people and diminish your authority.
- Cold calling takes a toll on the salesperson. There are two types of people in the world: those who hate (or at least don’t like) cold calling – and those who lie about it. Cold calling is monotonous and forces a lot of rejection. No matter who you are, that eats energy.
- There is little leverage in cold calling. It works only as long as you are working on it. There are few, if any, strategic byproducts that come from it, and the only chance it has of working is if you continue to do it. If you get busy and can’t follow up on your calls from “3 months ago” as the post above referenced, you are basically starting all over again.
- What is it that they say about the first impression? Well another problem with cold calling is that it is the junior people who most often do it. Cold calling itself doesn’t require any unique skill set, however, managing the unexpected opportunities that arise in conversation does. So often, a very high-value salesperson is forced to do a low-value activity.
I could go on, but I think my opinion is becoming clear. That said, I do realize the underlying, even if un-desired, need for tactics such as cold calling. So my answer is that it’s not time to kill the cold call, but it should only be used as a tactic when absolutely necessary.
Here’s my prescription:
- If you are a salesperson responsible for more than just lead generation, your goal should be to get in position so you NEVER have to make another cold call within 18 months. Cold calling should be no more than a secondary or tertiary tactic within 12 months.
- If you are a business and you need this for lead generation, develop a highly specialized individual or team that is responsible for doing this – and doing just this. This becomes a marketing function more than a sales function. Additionally, you should hire a research assistant to develop more of the cold calls you are making into initial calls.
What do you think? Is it time to kill the cold call? What changes do you think we need to make to this tactic?
Health Care Reform & Fast Growth
With the passage of sweeping health care reform by the House yesterday, I got to wondering: what will the impact be on a company’s ability to grow profitably. I decided to try an experiment, and here it is.
What do you think? How will the proposed package impact your company’s ability to grow faster and more profitably? I’m going to ask that we keep as much of the political polarization out of the conversation. I’d like to know how you think it’s going to impact growth. So, give me you opinion and feel free to provide what you think would be a better idea.
Leave your thoughts in the comments section.
Recovery? Who Cares!
There’s been a lot of chatter in various circles about the economy – whether you’re watching the Sunday talk shows, listening to CNBC, or following Twitter. All one need do is watch the gyrations of the stock market to become clear that no one is certain what lies ahead.
The point of this post is not to add to the speculation. Quite the opposite, it’s to remind everyone seeking fast, profitable growth that FOCUSING ON THE ECONOMY AND WHETHER THE RECESSION IS OVER IS THE WRONG FOCUS.
I’m getting concerned. As I see more executives talk about the possibility of the end of the recession, it reminds me of the wartime movies when everyone would talk about the possibility that the war was ending. I’m sensing a false sense of hope that “things will return to normal.” That, soon, we’ll be back to the hyper-growth, fish jumping out of the water times we had before.
The last time I saw this was in 2001-2002 when I was a financial advisor. I remember sitting in a senior advisor’s office one day when the market rallied like 500 points (I do not remember the details). He commented (and I believed) that this meant the downturn was over – we could get back to things as normal. Of course, the “correction” wasn’t over, and as we went into 2003 we allowed the illusion of normalcy to further erode fundamentals.
I’m not pessimistic about a recovery – I just don’t care. Why don’t I care? Several reasons:
- I have no control over it.
- We’re a sneeze away from just about anything.
- No one has any idea what the future holds, and all this speculation can do is create more illusions
- Most importantly, it doesn’t matter. Whether the economy “recovers” or not has little impact on the decisions that I have to make as a small, mid-market business (SMB) executive.
I’m sure that the executives at Coca-Cola, GE, Amazon, etc., need to worry about GDP, consumer-spending rates, inventory levels, etc. I also understand that these issues will impact the results many SMBs experience, it just doesn’t have any meaningful relevance to the decisions executives need to make.
Look, there are only three scenarios that can occur:
- We enter what economists call a recovery – though I highly doubt it will really feel like one for a while,
- This is the recovery – welcome to “normal” everyone, or
- Another shoe drops and things get worse.
Now, ask yourself how are the critical, strategic decisions you need to make impacted by any of these scenarios? My bet is that the decisions you make are no different at all. I wrote about this at the early parts of the recession, and I think it’s important to reiterate it now.
Here are the dominant questions EVERY executive should be asking – and actively answering:
- Who are our core customers? What are our core markets?
- What are we doing to be/become indispensable to these people?
- Is our business model really sustainable? Please note that if you don’t have a clear, powerful answer to the question above then by definition your business model is not sustainable.
- What is our relentless growth execution plan?
- Can the people we have execute the answers above? (Ask the question again. This is probably the most difficult and important question, there are no points for self-deception.)
- What are we doing to immediately and permanently lower our cost structure, without it negatively impacting our ability to become indispensable and to execute our growth plan? If you can’t, again, your business model is not sustainable.
As an individual, there’s nothing more that I’d like than a strong recovery, a significant reduction in unemployment, and an increased sense of security for all of us. As a business executive, the more time I spend trying to figure out if the economy is “in recovery”, the less time I have to focus on the critical questions above – and the more likely my business fails to grow regardless of what the economy does.
What are the critical questions you would add to my list?
What Bach, Beethoven, Bruce Springsteen & Eminem Can Teach You About Growth
This post first appeared more than four years ago on this blog. Recently, I’ve had several conversations with clients and staff that have reminded me of this post. I thought it would be worth sharing with you again. Here it is:
I just attended a conference where Boris Brott, one of Canada’s most famous symphony conductors was a keynote speaker. In his speech, he noted that in the history of music, there are only 12 notes. He also noted that most musical compositions only use 5.
Despite all of the creativity, the beauty, and the memories for which music has been responsible, it has a very simple foundation. I realized how much businesses could learn by looking at the composition of music. Every musical composition from the most nuanced, classical music, to rock, rap and reggae involve the same 12 notes.
Companies are constantly trying to “differentiate” themselves. They are constantly trying to “add value” and to “innovate.” Too often, companies make life complex for the sake of making things complex. They claim the complexity is necessary so that their clients and prospects will understand how they are different. The reality is the complexity just further commoditizes the business.
No one will mistake Beethoven’s compositions with Bruce Springsteen’s. They are clearly different, and they use the same 12 notes. Apply this principle to your marketing and product development. Simplifying can be the greatest differentiators of them all.
What could you simplify? Where are you being unnecessarily complex? What notes should you be playing?
Stop Closing
Look, I like Glenngary Glen Ross as much as anyone. And Alec Baldwin’s famous scene where he explains that the ABCs of selling are A – Always, B – Be, C – Closing is one of my favorite scenes in any movie.
But, please, PLEASE, can we retire the myth that to succeed in sales you must learn to close early and close often? Can we drop the statistical mumbo-jumbo that you must ask for the sale at least five times before you have a chance to get it? (Neil Rackham destroyed this myth with research in his seminal book SPIN Selling. Remarkably, a couple of days ago I came across a sales consultancy’s website that claims it’s now NINE times.)
Now, I understand just how difficult it is to get people to make decisions. This is true in good times, and it’s especially true in difficult economic times. When I do sales training, I share the fact that decision and homicide have the same Latin root – they both mean to kill or to eliminate. Simply put, people hate to make decisions.
It is the job of professional salespeople to facilitate decision-making. The goal should be to facilitate a mutually beneficial, long-term decision – not to “close the sale.” The problem with the whole idea of “closing” and the idiotic idea that you’re supposed to “go for the close as early as you can and as often as you can” is that it naturally creates an adversarial relationship, and even worse, causes salespeople to miss or speed through critical steps that can both shorten the sales cycle considerably and create much larger opportunities. Four years ago, I wrote an article about the myth that objections are good. The focus on closing only increases the likelihood that you’ll trigger objections that diminish the selling organization.
You don’t facilitate decisions by closing. You do it by diagnosing, by understanding your buyers, and their critical results – better than your buyers do. You do it by being useful and creating deep, results-oriented relationships. You don’t do it by trying to artificially shorten the sales process through the variety of manipulative techniques taught under the banner of “closing” or by celebrating the myth of “the closer.”
So, are you with me?
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Resources
Doug's Washington Business Journal Columns- Intelligent Growth Articles
Third Wave Selling Blog
Products to Grow
