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The Myth of Time
Let’s have Bill put 20% of his time towards sales.- We’ve got a new initiative; let’s get one of our salespeople to put 30% of her time towards this effort.
- Our project managers should spend 15% of their time focused on developing new business.
I could go on. These are all examples of a critical error people make when they consider sales efforts. They look at the (direct) time associated to selling, determine that it is not a full time effort, and so, they under-allocate resources to sales.
The problem is that the only barrier being measured is time. Ignored are the barriers of attention (often called bandwidth) and disruption. Selling may not always be a full time activity, but it is almost always a full bandwidth one.
The myth here is that people can actually carve out a niche of time and get the same result. We think that a full time job is 40 hours/week, so if we spend 10 hours/week we should technically be able to get the same results in one month that a full time person can get in a week.
The myth would work if the effort it took to sell successfully were predictable and consistent. The problem is that selling is neither.
The myth of carving out time, and expecting sales success fails for three reasons:
- Mindset. I’ve often said that sales is not always a full-time “job,” but it’s always a full-time mindset. The biggest mistake a business can make with its sales focus is to underallocate the focus. The difference between “almost” and “successful” is quite small when measured by costs, and huge when measured by economic impact. Today and in the future, good is not good enough. Sales success requires clarity of focus. The clearer someone is about what they must do, the more creative they will be. They’ll find ways no one else will to overcome objections, or to develop a new method to gain market acceptance. They’ll multiply their ability to gain access to the market and drive profits. Plus, from a management perspective, you’ll be clearer about what’s needed to be successful.
- Disruption. Building a pipeline, launching a new initiative, or pursuing additional business while taking care of the current business are all very disruptive activities. They interrupt you, have loose ends and can even cause discomfort between the parties (not the feeling you want to create if your primary job is “delighting clients/customers). That’s not to say that one’s primary job doesn’t bring with it a tremendous amount of disruption as well. The point is that the disruption caused by selling is very disproportionate to the time it takes to sell. Most people cannot afford to adjust to the disruption caused by sales initiatives (see competing priorities), and that inability dooms the effort. Don’t get me wrong, the activity and effort are there, just not the results.
- Competing priorities. Combining a new business development focus with another focus can make a lot of sense on the surface, the problem is that you have fundamentally conflicting priorities. The question – and the killer – is what do you do when the needs for each priority conflict. The reality is that 90% of the time the primary responsibility wins. That sales initiative is left working with “table scraps.”
I understand the temptation to split time to focus on sales (especially as we enter The Great Recovery). But, please (PLEASE, PLEASE, PLEASE) be cautious when doing so. As yourself two questions before jumping into it:
- If this effort can really make a difference in our company’s performance, doesn’t it justify a full-time focus?
- What would the impact on your business be if you took the time you were going to spend on the additional focus, and reinvested into what you are currently doing?
Defining a Remarkable Customer Experience
The post below originally appeared as two different posts in 2005. Yesterday I was having a conversation with a client and friend. She was asking me my thoughts on different experiences that high end companies provided and what she could learn from them. I pointed her to these posts. After re-reading them I realized how “on point” they still are, and I thought it would be worth sharing again. I’ve combined the two posts into one. Apologies for the length – but I think you’ll like it.
Be a ‘Purple Cow.’ Pursue the ‘Wow’. Make it ‘priceless.’
The buzzwords (and the book sales) are many. Putting them to work is more difficult. I do not have any problem with the ideas offered by Seth Godin, Tom Peters or the many authors that are writing about delivering a remarkable customer experience. As a matter of fact, their writings have given me tremendous insights that I use everyday.
The problem with most efforts to provide amazing experiences is that businesses often forget that it is the customer, not the business, decides what is remarkable and what isn’t. You have to remember, too, that what is remarkable for one company, may not be remarkable for you.
The purpose of creating a remarkable experience is to make absolutely certain no one can find a substitute for what your company offers. When there is no substitute for what you offer, you cannot be commoditized. When you cannot be commoditized, then growth, loyal customers and profits are yours for the taking.
Want a definition of a remarkable experience? How about, Reading my mind?
Really, that’s all your prospects, customers and clients want. They want what they want, the way they want it (preferably, without having to ask for it) – no more, no less.
Now let me give you an example of what is not remarkable.
Recently, a meeting at Starbucks with a client of mine ran long. We decided to get lunch; and, so as not to break our chain of thought, we went to the restaurant next to Starbucks – Fuddruckers. Mind you, we did not go to Fuddruckers for a ‘fabulous dining experience.’ We went to get a burger and a table so we could continue our conversation.
Clearly, this Fuddruckers has undertaken and effectively implemented customer service training. When I placed my order for a hamburger, I communicated that I wanted: cheese, ketchup, lettuce, onions and tomatoes (the way I always get my burgers) and that I did not want fries (my nutritionist would be proud). The order taker then communicated every other option I could have, most of which I did not understand. Placing an order for a hamburger had never been so difficult.
Then we went to the table, where a very kind employee introduced himself to us, told us his name and said that if there was anything else we needed, at all, we should speak to him. He asked if that was alright with us, we responded yes, and he closed by asking us if this was a “good deal.” Okay, I thought, a little over the top; but, hey its Fuddruckers, you’ve got appreciate someone who shows that type of energy in their job. Over the course of our lunch he interrupted us six times asking if we needed anything. Unfortunately, what we needed was to be left alone.
I’m sure that he was doing what he was taught to do. Be of service. Show energy. Smile. Have fun. He did all of these things. What he didn’t do was give me what I wanted.
The Four Seasons, on the other hand, always seems to know what I want before I do. If I want assistance there is someone there ready to give it. If I want to do it myself, they leave me alone. They read my mind, and as a result I pay significantly more for a room than I pay elsewhere. Why? Because the staff there has been trained to respect their customers and treat them as they themselves would expect to be treated under the circumstances. They pay close attention to what their customers are doing at any particular moment and “read” their level of need. That’s how they always seem to be reading my mind. It’s a level of attention for which there is no substitute. I simply can’t find that feeling having someone read my mind anywhere else at any price.
Then there’s Fuddruckers. Will I ever eat there again? Sure, as long as it’s the most convenient alternative and the prices stay low.
When I wrote that post I got lost of comments that caused me some concern. Because I used The Four Seasons as the example, people began to use words like upscale and luxurious as being synonymous with remarkable. As a result I wrote this:
A number of the responses I’ve received made me think the people who wrote feel their companies have always tried to provide a “Four Seasons” type experience. Judging from the tone of their responses, what they meant was that they work to provide a ‘fine, upscale, luxurious’ experience. The point I wanted to make was that one does not need to be ‘upscale’ to be remarkable.
Wal-Mart provides a remarkable experience. Wal-Mart gives its customers exactly what they want and what they expect – no more, no less. (Though as Wal-Mart now talks about moving up-market to compete with Target, I wonder if they will be able to read their new customers’ minds or continue to be in tune with their current ones Editors note: Wow, I was right. Wal-Marts strategy to take on Target was a complete failure. Since then they’ve been trying to recover from that mistake and I am no longer convinced that Wal-Mart still provides a remarkable experience. The point still stands – they DID provide one.)
Southwest has always provided a remarkable experience, and no one would confuse Southwest with The Four Seasons.
So remember, a ‘fine, upscale, luxurious’ experience is only remarkable if that is actually what your customers want.
There’s a questionnaire I use with my clients to help them understand and appraise their customer/client experince and I’d be happy to share it with you if you like.
Thoughts on Harvard Business Reviews Salesperson Study
In December, I shared some highlights from a study conducted by the Harvard Business Review on successful salespeople. In it, I promised to share my thoughts, so here they are.
The study finds that only about 37% of salespeople are consistently effective.
No surprise here. When I speak with CEOs I share the fact that 60 – 70% of salespeople in business-to-business (B2B) sales are incapable of effectively implementing the behaviors needed to sell profitably today. I can live with HBR’s finding of 37%. The bigger question is can businesses?
The study identified eight attributes for a salesperson – 3 of which were indicative of success.
Most studies only give attributes and don’t delineate between those that drive success and those that have no impact, so I like that.
However (and it’s a big however) I think they missed the #1 driver of sales success in higher value B2B sales – Business Acumen. I also preferred it if they had used the prism of “command” rather than the ability to “overcome objections.” I’m very curious to see what the impact on the study would have been had they identified business acumen as a key success driver. My bet is it would have reduced the percentage of effective salespeople.
The study found it takes $1,760 of profit per sale to just cover the cost of failed sales meetings, assuming that the meetings cost, on average, $160.
In my experience, they’re way underestimating the cost of a failed sales meeting, and as such the amount of new profit is also way too low. They’re clearly not accounting for any indirect or opportunity costs either.
Other thoughts:
The biggest oversight is that there was no mention of the importance of an effective sales process on a salesperson’s success. In my experience, an average salesperson in a superior process will destroy a very good salesperson in an average process (IBM proved that!). Small and mid-market companies need to invest in developing such sales process as the likelihood and cost of finding a salesperson who can be successful without one is both too low and too expensive.
The HBR study clearly demonstrates just how difficult it is to build a successful sales team in today’s world. Now it’s up to business to do something about it.
Closed Business Is A Horrible KPI
I’m a BIG fan of key performance indicators (KPI). I firmly believe that you get what you measure and track. My best months, quarters and years always occur when I’m disciplined in tracking my KPI.
It’s important to note that the key word in KPI is indicator. An indicator should be designed to highlight what is likely to happen, not what has already happened.
So far this year (I know, it’s only been 3 weeks), we’ve seen a significant increase in companies asking us how we can help them grow. When we get to the topic of KPI, they all list a series of relatively meaningless or arbitrary numbers (like the probability of a close based upon the salesperson’s gut), and inevitably tell us that the main thing they track, measure, and reward is closed business.
CLOSED BUSINESS IS A HORRIBLE INDICATOR
Closed business tells you what happened, but it doesn’t tell why it happened, nor does it tell you what is likely to happen going forward. It’s like saying, “You should buy Enron stock – it was up 75% last year.”
There is a simple reason why people use closed sales as an indicator – it’s easy to identify and track. Plus, it feels clear.
It reminds me of the story of the man who was looking under a street light for his keys. As he was crawling on the ground, passersby asked what he was doing. He told them he was looking for his keys, so they started helping. Eventually one of helpers asked where he dropped them, and the man pointed to the other side of the street. The helper asked why he was looking in a place different from where is dropped his keys; and the man replied, “Because it’s light here, I can’t see anything over there.”
Effective KPI, especially sales and marketing KPI, are difficult to identify. They need to be focused on the cause of sales or revenue, rather than the result. Spend the extra time to identify and track true indicators, and your results will multiply.
Don’t’ Hire Someone to “Figure it All Out”
The following is a guest post by Bob Corlett, President of Staffing Advisors. Bob is a genius when it comes to staffing issues and, in his own words, is a “Staffing Consigliere.” Bob writes a great blog on strategic staffing issues called The Staffing Advisor. I encourage you to check it out.
To run a company is to confront one complex problem after another. In fact, if you are not frustrated then you are probably working on the wrong problem. But it is always a mistake to hire someone to solve a problem you do not understand. You should never “outsource all your thinking” to a new hire. As an executive search consultant, I know you are in trouble when you can’t tell me your strategy to overcome obstacles, but instead tell me “If I hire the right person, they will be able to figure this all out!”
This is an epidemic problem in sales. Somehow, many people came to believe (incorrectly) that “a good salesperson can sell anything.” Some managers even seem to also believe the reverse is true – that if you cannot sell (whatever it is your company sells), well then it must be because you were not a very good salesperson. These frustrated managers often say: “Where are all the good salespeople? Doesn’t anyone want to work anymore?” Actually, the answer to their question is obvious:
The great salespeople are all out selling for organizations that have a working sales strategy. They are working for companies that already figured out who their customers are, what their value proposition is, and where their sales prowess is handsomely rewarded.
An excellent salesperson cannot make up for all the deficiencies in your product offering. Founders and owners can and often do sell past those obstacles, but you didn’t see top sales pros gravitating into buggy whip sales after Henry Ford came along with the car.
It’s great to collaborate with outside consultants, but please don’t bother trying to recruit an employee to “figure it all out” for you – that is just lazy thinking – and lazy thinking is not attractive to top performers. (I should point out that lazy thinking is very powerfully attractive to other lazy thinkers – the big talkers who want a place to hide out, where the expectations are fuzzy, metrics nonexistent, and the boss is not paying attention … because that is exactly what you end up with, when you start out lazy).
Great salespeople have business acumen. And one of the first things that smart employees look for is your ability to confront the challenges facing your organization. Of course you will have challenges, but what draws top people is your plan to attack those problems. So hire someone who buys into your vision, but please don’t even think about filling a job you do not understand.
We All Need A Coach
I’ve always been fascinated by a key paradox of performance. That is that top performers are always the ones that know that they need help to achieve, and average and poor performers believe that they’ve got it figured out and don’t need help.
I see it everyday in the coaching we provide to salespeople and executives. The top salespeople are excited and engaged in the coaching process from the very beginning. Their attitude is, “Bring It On!” They’re open to being challenged and they soak knowledge up like a sponge.
The average salespeople are the ones who say (sometimes out loud, sometimes with their actions), “Only junior people need coaching. I’m a senior salesperson – I don’t need this!”
I’ve always been a fan of coaching. I’ve had a coach of one form or other (and at times, I’ve had more than one) since I was 18. I’d probably still be working for someone, making ¼ of what I’m making now if it weren’t for my coaches.
I just came across the best explanation for why we all, at least those who want to be top performers and rewarded, need coaching. My friend Brad Farris tweeted a quote from Eric Schmidt, CEO of Google:
Think about it. Here’s a guy worth more than $5 billion, who’s accomplished more than most can hope for. He’s an acknowledged expert and phenomenal businessperson, and he still finds coaching indispensable.
Go figure.
The Ted Leonsis Instruction Book
In June 2007, I took Ted Leonsis and the Washington Capitals leadership team to task for introducing a new jersey as a “brand awakening” for the Washington Capitals. I wrote that, “if you want to strengthen your ties with current fans and attract new ones, you only have to do one thing – PUT A BETTER PRODUCT ON THE ICE. ”
Well 3 1/2 years later, Leonsis and crew have clearly proven that they already knew what I was talking about. Leonsis took a last place hockey team, in a football-crazed town and turned them into the hottest ticket in DC, having sold out more than 100 games in a row.
Leonsis has since taken over the Washington Wizards and Verizon Center, after majority owner Abe Pollin passed away. The Washington Post has a fascinating story about how Leonsis is turning those organizations around as well.
It’s not only interesting if you’re a sports fan, it’s down right instructive if you are trying to grow your business. I highly recommend you read it.
Here are the three points I found more valuable and instructive:
- Leonsis and crew are maniacal about looking at everything from the customer’s viewpoint. Leonsis spends time with them, and no detail is too small. Whether it’s adding cupholders to the urinals, making sure the pizza is hot, or checking the new packaging on nachos, Leonsis’ crew is on it.
- They know who their best customers are and they cater to them. They allow them to participate and really feel like owners.
- Leonsis realizes that you can’t game your way to success. The Wizards (and the Capitals before Leonsis) were notorious for giving tickets away so that the arena looked fuller than it would have been. Leonsis realizes that this just penalizes those who pay full price (pay attention, discounters). Although it can make the arena look empty, Leonsis says:
I don’t ‘dress up’ the arena. I don’t believe in that. We don’t do it with the Capitals. So some nights, it looks like our attendance is down, yet our revenues are way up because you are not giving away free tickets. We will make the Wizards a hot ticket because Washington is a fantastic market. If we can build the team around the right players who can play the right way and get results, we will sell it out.
It would do many business leaders well to follow Leonsis’ example.
What Comes First – The Marketing or Sales Plan
Over the last two weeks, we’ve been inundated by requests from CEOs and sales executives who want to talk about developing new strategies for growth. It’s got me very excited about the prospects for 2011 – not just for Imagine, but for business growth all around.
I am seeing an alarming trend, however. One of the most common questions that I’m getting is: “Which should we do first –figure out our marketing approach or develop our sales approach?”
The answer is simple: Both must be done in an integrated, holistic and parallel manner.
The reason for this is simple: the purpose of marketing is to create sales. That is not a statement to diminish either sales or marketing. As a matter of fact, one of the worst beliefs small and mid-market executives (SME) have is that sales and marketing are separate focuses. Frankly, it’s why marketing is under-invested in 90%+ SME B2B companies.
This is why we never refer to it as a marketing plan or sales plan – it’s a go-to-market plan. We understand that marketing affects what you can and should do in your sales approach and your sales approach affects what you can and should do in your marketing.
If you figure what part of one approach out before the other, you are going to make assumptions that simply won’t hold up. The result of that will be another marketing or sales plan that sits on someone’s shelf collecting dust.
There is a simple reason that SME’s have always done one or the other first. It’s because there are a lot of marketing consultants or agencies that like to do marketing plans – and have limited sales knowledge; and lots of sales consultants who like to do sales training – and have little marketing knowledge.
If you want to get ahead of 2011 and drive the results your business is capable of producing, don’t make the classic silo-mistake. Make sure you’re addressing your go-to-market issues holistically.
The Demand Creator Minute – 3 Rules of the Market
In my latest (in a long while) Demand Creator Minute, I share with you, blog-readers, an insight – and implications – that I shared with a group of great entrepreneurs earlier this week.
The three rules are:
- The market is always right.
- The market doesn’t know what it wants.
- What the market wants is always changing.
Watch the video and tell me what you think.
RSS Readers That Don’t See The Video Can Click Here to Watch.
Competing for Attention
In September 2009, I wrote about the fact that, as marketers, we are all competing in Times Square today. Simply put, people are overwhelmed with commercial messages.
This came to light on my trip to Chicago yesterday. The picture you see here is of the handrail for the escalator. That’s right, they’ve turned the handrail into an ad. I don’t know about you, but I’m no more likely to go to this hotel than I was before.
The moral of the story is that merely broadcasting is a useless strategy at best. More likely than not, it contributes to becoming increasingly irrelevant. Going forward, the only viable marketing strategy is to engage with your market.
It Ain’t Selling Until They Say No
There is probably no sales myth that angers me more than, “a salesperson must be able to get a buyer to say ‘no’ five times, before they say yes.” The myth manifests itself in a variety of ways. It overemphasizes closing, makes the process unnecessarily adversarial, and it wastes a tremendous amount of selling time, and therefore, wastes millions of dollars. To top it off, it’s probably the number one reason why salespeople have such a bad reputation.
That said, if the customer or buying organization doesn’t put up a roadblock, disagree in a meaningful way or attempt to cutoff the process at some point, then it is not really selling – it’s agreeing. After all, the definition of selling is making sales that would not otherwise have occurred.
Selling is all about influencing. It’s about changing mindsets and perspectives. If customers are already thinking what you are, then you don’t really need sales efforts. Anyone who has seen me sell knows that the situation that always makes me the most nervous in a sales situation is when the customer isn’t disagreeing or pushing back on anything I say.
When I’m coaching salespeople, I cheer them on with the reminder that, “the sale doesn’t begin until you get a ‘no.’”
- So when the customer says that they’re not really looking to outsource the function, and you know that outsourcing would have a dramatically positive impact on them; guess what? The sale has begun.
- When the customer says you’re priced too high, and you know that your “higher price” is what enables you to solve their problem in such a way that it can bring superior results; guess what? The sale has begun.
This does not mean that every time a customer says “no,” that you should attempt to plow through them. I encourage you to read my previous post on The Difference Between Barriers and Conditions.
What this means is that if you’ve done your homework, your business case is strong, and you believe in your solution, you cannot be frustrated by a prospect’s or customer’s inability to see it that way immediately.
Rather, you must be motivated by it – that’s why we call it selling.
Is BlackBerry A Dead Product Walking?
There are 2 types of companies in the world today. You are either:
- The best, or
- You’re a “Me-too” company
Only “best” companies will earn margin premiums and enjoy the growth worthy of the hard work of business executives and salespeople.
I’m becoming increasingly convinced that BlackBerry is rapidly falling into the “Me-too” category, and will become increasingly irrelevant (and less profitable) going forward.
Full Disclosure: I’m an Apple fanatic (of course, if you’re reading this blog, you probably already know that). I’ve owned every version of the iPhone within a week of its release. So maybe that colors my thoughts, but I don’t think so.
One of the fundamental precepts of great businesses is to narrow your market focus and expand your yield. Great companies are maniacally focused on who their customers are – and who they aren’t. Jim Collins made that clear in his seminal book Good to Great.
BlackBerry, at one time, was an absolute killer device. I had one and loved it. Ever since the iPhone came out, and the smart phone category exploded, BlackBerry has been struggling with finding its place. The Storm was a disaster (on all counts), and they continue to lose market share.
To fight that, they keep “innovating” and coming out with new products. A recent view of their website highlights seven different models to chose from. So I ask, what is a BlackBerry?
In contrast, Apple offers one model (two if you consider the fact that they are still selling the 3GS), and no one need ask the question, “What is an iPhone?”
Watching BlackBerry’s approach reminds me of the 1991 movie, Other People’s Money. In it, Danny DeVito played the memorable character Larry the Liquidator. In trying to takeover a dying company, he said:
We’re dead alright. We’re just not broke. And you know the surest way to go broke? Keep getting an increasing share of a shrinking market. Down the tubes. Slow but sure.
Here’s my corollary:
You know the surest way to go broke? Keep introducing more new products while you continue to lose share of a growing market. Down the tubes. Slow but sure.
Think about this for a moment. Who loves – I mean really loves – their BlackBerry?
Heavy duty email users – that’s who.
Email was the entire basis of BlackBerry’s success to begin with. They invented technology and a device that solved a critical problem for people.
Now, what’s their newest device? The BlackBerry Style. Huh?! What?! If someone is buying a phone for “style;” guess what – they’re buying an iPhone.
People who buy BlackBerrys buy them for function. BlackBerry is superior to the iPhone if email is critical. The iPhone is superior in just about every other way.
What Should BlackBerry Do?
To ensure its future, BlackBerry needs to stop playing other people’s games. They need to focus on their core market – heavy duty email users.
Is that a smaller market than the size of their current business today? Yup. But guess what, BlackBerry isn’t as big as it thinks it is.
BlackBerry needs to answer the same question that small and mid-market companies are faced with every day:
Do I keep fighting for volume and size which will result in less profit and greater vulnerability, or do I accept the market for what it is and focus on what we do best and become relevant?
What would you decide?
A Thought For The New Year
With 2011 off to a (hopefully) fast start, and we’re all contemplating our big goals for the year, I’m reminded of a philosophy I learned when I was a young baseball player. My coach told us: Don’t worry about the season or the game. Worry about the inning.
Win the inning.
If you win the day, you’ll win the week.
If you win the week, you’ll win the month.
If you win the month, the year will take care of itself.
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Resources
Doug's Washington Business Journal Columns- Intelligent Growth Articles
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