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Scarcity vs. Abundance
I had the pleasure of spending an evening this week with two of my favorite entrepreneurial advocates – Dan Sullivan and EO. Dan was sharing his thoughts on creating a 10x mindset, and he made two points that I think are critical for all of us. A Front Row Seat to Creative Destruction We live in crazy times today. Let’s face it, things are messy. Messiness never creates comfort, and in today’s 24-hour news cycle that discomfort is multiplied. But the reality is that, that’s what progress is all about. As new innovations kill old standards. It’s never pretty, and the amazing rate of progress we are all able to take advantage of, also means there’s an amazing rate of destruction. As Dan shared, we’re at a crossover from a world ruled by the laws of industrial production to one ruled by the laws of the microchip. Think about this. Dan pointed out that the very iPhone sitting in my pocket would have been valued at $1.7 billion in 1972. I can only imagine what the iPad I’m writing this post on would have been valued at. Scarcity vs. Abundance The real battle we’re witnessing is a battle between the philosophy of scarcity and the philosophy of abundance. While entrepreneurs tend to naturally have an abundance outlook, we must remember that many institutions and industries have a highly vested interest in scarcity. If it’s a zero sum game, we need institutions to protect us from ourselves. If every time there’s a winner, there’s a loser (and the bigger the winner the bigger the loser), then we must have authorities to referee the game. A scarcity mindset leads to resentment, guilt and destruction. Abundance leads to creation, gratitude and cooperation. As economist and business profession Julian Simon professed, there is one – and only one – natural resource. It’s called human ingenuity…and I wouldn’t bet against it.
Dealing With Crazy-Busy Buyers
This book review originally appeared in Baltimore and Washington SmartCEO Magazine July 2010 issue.
One of the major points that I make to CEOs and salespeople whenever I speak with them (and a point you may want to make note of) is: NOBODY WANTS YOUR STUFF!! Nobody wants to buy anything from you. Early in my sales career, I had a coach who told me that everyone woke up in the morning with the same goal in mind. When I asked him what that goal was, he told me: “They don’t want to meet you.”
I’ve spent more than 20 years immersed in the world of selling, sales training, and sales leadership. Over that time, I’ve gotten more and more discouraged with the vast majority of approaches to selling. It’s not that the approaches, per se, are wrong or bad. The issue is much more nuanced than that. The fundamental problem with the vast majority of traditional, solutions-oriented sales approaches is that they all presume the prospect’s interest and/or awareness of their need for the product or service being sold.
This approach is fine for markets that have abundant demand, limited supply, and clear differences between one product/service and another. However, in busy, hectic, and complex markets where sellers are aggressive and everyone claims superiority, this approach leads to an ever-accelerating rate of commoditization.
On my blog, I’ve written a lot about The Drought that virtually every seller is experiencing. Today:
- There are fewer buyers and the buyers that are left have lower budgets.
- Despite the decrease in demand, competition and choice is as plentiful as ever.
- Buyers have less time and that means they have less attention to give to sellers or to understand a seller’s offerings.
The Drought is a double-edged sword for sellers. Fewer buyers and greater competition is a major obstacle in its own right. But, the bigger barrier is that solutions today are more complex than ever (especially if you are providing any type of superior offering), and the differences between your offerings and your competition are more nuanced than ever. Be honest for a moment. While you may provide the best alternative for your prospects (I certainly hope you think you do), they are more than enough adequate alternatives. The fact that prospects and customers have less attention to give you, creates an extreme barrier that enables them to understand the complexity of your offerings.
Selling organizations and salespeople must fundamentally change their approach in order to be successful tomorrow. Merely mastering sales techniques and being persistent are no longer enough to survive in the competitive jungle.
Jill Konrath, author and selling consultant, echoes this in her new book SNAP Selling: Speed Up Sales and Win More Business With Today’s Frazzled Customers. I became aware of Jill’s book and she was kind enough to send me a copy to review. Jill is a superstar saleswoman and has been helping small and mid-market businesses successfully sell to big companies for years.
She shares her story of how these changes virtually killed her business and the adjustments she had to make in order to thrive. Luckily for us, she shares these insights openly. SNAP Selling is one of the few books (or articles) that I’ve come across that accurately reflects just how customers really view salespeople today. The reality check she provides makes it worth the read itself.
While I’m not a fan of manufactured anagrams, SNAP Selling does address four critical success factors in selling today.
- Simple – Sellers today must eliminate complexity from the decision making process. Too often sellers, in the efforts to demonstrate just how great they are, make the process seem even more complicated than it is. This is proved by a recent survey of buyers that revealed that more than 40% of buy processes are ending in a no-decision.
- Invaluable – The only viable success strategy when there are so many adequate alternatives is to become absolutely indispensable to your customers. This is also true for salespeople. To succeed, salespeople need to be critical resources for their customer, not merely peddlers.
- Aligned – You must be customer centric today. The single, most important action a salesperson can take is to view the purchasing process from their buyer’s eyes. This will ensure that you stay relevant through the entire buying process and will speed up the process as well.
- Priority – Here’s the paradox: buyers have always been swayed by the tyranny of the urgent. Sellers, by helping buyers get a picture of the long-term, could overcome by clearly demonstrating importance. Today, your offering must be important and urgent.
Only by understanding the mindset, life, and needs of your buyers will you be able to position your offerings and your sales process to be successful. SNAP Selling provides a great place to start that understanding.
Growth For The Fast Growth Blog
Wow! It’s hard to believe that we’re already into the second quarter. The first quarter was crazy at Imagine. It’s exciting to see companies and executives putting growth and expanding their margins back at the top of their agendas. While there are certainly struggles and challenges that lie ahead, more of you are realizing the wise words I learned long ago (sorry I can’t remember from whom).
The future holds opportunity, mixed with difficulty. The greater the difficulty, the greater the opportunity.
Imagine Business Development is growing to support companies in these efforts. I’m excited to tell you about two people who’ve saddled up in the battle to End Bad Selling!
David Fletcher has joined us a our newest Sales Coach. Fletch has worked in the sales and marketing field for over 15 years, doing everything from field sales to executive management. Like everyone at Imagine, he’s worked in a variety of fields such as software, technology, and commercial and residential construction. He’s also worked quite a bit in sports management. A former professional baseball player, Fletch is the Assistant Head Coach for Anne Arundel Community College and the Head Coach for the 11U Maryland Orioles where his oldest son, Connor, plays (you can guess which team he is more proud of).
Anyone who’s played baseball will quickly realize that Fletch played catcher and has a catcher’s mindset. He’s got a tremendous ability to size up a situation and see the most effective action to take. His coaching (and playing) background mixed with his sales experience makes him perfect for providing leadership, guidance, and a sounding board to help the salespeople we work with multiply their best results. Fletch lives in Pasadena, MD with his wife and four sons – the aforementioned Connor as well as Max, Jacob, and Jackson. Fletch is new to social media, so we’re still working on getting him on Twitter.
Vaneska Adams joins Imagine in the newly created position of Marketing Development Director. Vaneska has been charged increasing the spread of Imagine’s message, approach, and programs, as well as supporting our clients in the development and execution of our their marketing efforts. She brings a fresh marketing perspective to us, having spent several years working with direct marketing and consumer brands. She’s worked with (and within) small and large companies (and small companies that became large). Having grown up with parents who started their own business, Vaneska understands the unique challenges and opportunities of running a business provides. Vaneska lives in Crofton, MD with her husband and three children. When she’s not helping companies communicate their message more effectively, you’ll find her watching her kids play, painting, or cycling. You can follow and engage with Vaneska on Twitter @Vaneska_Imagine.
Feel free to send them an email, give them a shout out and otherwise engage with them. Please know that we are all here committed to helping you make 2010 and beyond the best years ever!
Teaching Business Acumen
Anyone who has heard me speak about the sales process knows that I’m crazy about the importance of business acumen in creating a successful salesperson or sales team. As I’ve written, business acumen is the key driver of success.
I’m constantly asked the question, how can we increase the business acumen of a sales team. Other than taking advantage of our Business Acumen for Salespeople program (okay, guilty as charged, a shameless self promoting plug), my answer is usually very complicated.
I thought I’d share a simple step to improving business acumen for salespeople (one that we’re going to weave into what we do). Simply assign one of your salespeople to one of Warren Buffet’s annual letter to shareholders (my recommendation is that I’d assign different reports to each rep, but assigning one to all of your reps will certainly save time and could enhance some learning). Then, have them deliver a synopsis. Have them share what they learned and “teach” the business points within the report.
To make the exercise really useful, make sure you’ve read the report and ask questions. Buffet’s Annual Letters are some of the best business teaching tools I come across. If you and your salespeople understand how the businesses of Berkshire Hathaway make money, you’ll naturally see an increase in business acumen.
My favorites for this are the reports from 2006, 2007 & 2008. Personally, I found this year’s report (2009) not to be as effective a tool.
An Open Letter to Barrack Obama
In this blog, I work hard to stay away from politics, or anything that can be perceived to be political, but I’m going to risk deviating slightly. Below is my open letter to President Barack Obama and anyone else in government. This letter expresses my opinions about accelerating growth (and therefore hiring) in small and mid-sized businesses. It is not meant to be a Republican or Democrat opinion – instead it is meant to be a Fast Growth Opinion:
Dear President Obama:
I read a summary of your speech today about creating jobs. While I admit I haven’t seen any details, I’m concerned about the approach you are taking and would like to encourage a different one.
If you want to increase jobs and utilize small and mid-sized enterprises (SMEs) as the means for that goal, it’s not a particularly difficult or complex thing to do. The more complicated you make it – the less likely it is that it will work.
Here are three keys to stimulating job growth through SMEs:
- We need capital. At the risk of offending many, I don’t think a reduction in the capital gains tax is going to do anything to stimulate hiring, nor will a tax credit for hiring (though that will have more impact). A hiatus from payroll taxes is not the difference between hiring someone or not (and the failure to make such a contribution just puts the entire system even further at risk). Hiring people is risky and the cost impact of hiring is far greater than just the salary being paid. The only way an SME can hire people that stick is to grow revenues. What companies need is growth capital. Take the money that you’ll save from cutting “small business taxes” and create funds that provide capital to SMEs that show viable plans for growth – of revenue and staff.
- Target investments that will grow employment. Your announcement earlier this year that the government would increase its funding for SBA was nice, but did little to improve the hiring picture. The problem with most traditional bank lending is that it is all based upon collateral. While this type of support is great if you want to buy a building or other capital expenditures, it does not directly connect to hiring. I’m not against supporting this need, I just don’t want you to confuse it with job stimulus. This is also the problem with cutting taxes alone. Frankly (and I’m being honest here), a business owner is more likely to pocket the tax savings than they are to spend/invest such a cut in their business to increase hiring.In uncertain economic times, the most logical thing for a business owner to do, actually, is to pocket the savings. With increased market risk, business owners are prudent to retain whatever sources of cash they have. They’re also encouraged to take funding to buy other companies – which further reduce jobs. So, if you want to impact jobs make sure the funding you create actually impacts them – directly.
- Change the accounting rules to accurately report the value of tomorrow’s growth businesses. America is becoming an intellectual property (IP) economy. All types of IP are driving America’s growth businesses. Everything from the design of Apples next notebook computer, to the methodology my accounting firm uses to advice its clients, to the communities and “tribes” companies are creating and leading. However, there is nowhere to list such IP as an asset or to capitalize the expenses. These assets are actually the most valuable assets a business can have; yet they show up nowhere on formal financial statements. The crazy thing is that as IP drives SMEs, it becomes even more important for these same SMEs to employ people to help spread the word and manage the process. It is here, more than any other area, that traditional funding mechanisms let us down. Lending money to a company that is buying a building to support a declining business appears to make more sense than providing capital to a company that is leading a movement to create new ways to solve old problems – even though it’s the new approach that offers the best opportunity for jobs today and growth tomorrow.This does not mean that you should blindly throw money at any company that claims to have a new idea or a new way. The problem is that there is no mechanism that allows those companies that are really doing it to gain the funding necessary to support those efforts. Updating accounting rules to properly value IP is critical to supporting tomorrow success stories.
If you made it easier for growing SMEs to access growth capital at reasonable costs, without the risk of losing one’s home, SMEs would be lining up to hire people. Now, certainly some of these efforts would fail, but most would not. Next, you’d materially increase employment (thus increasing the tax base with which to pay for such measures), and the cost of the failures would certainly be lower than what you are currently outlining.
While there is much detail that needs to be worked out in these three ideas, I think you’ll find that, as approaches, they’ll support the creation of far more job and far more growth than the traditional methods you are currently pursuing will.
Thank you,
Doug Davidoff
So, what do you think? Do these ideas make sense? Do you have better ones? Let me know in the comments section.
Are You Ready To Be Ridiculed
I’ve written a lot about change recently. I guest the reason for this is because of all the conversations I’ve been having with clients who seem to be reborn with excitement about creating a new future, now that it appears the “world is not ending.” One of the things I’ve noticed is that after an initial burst of energy a great idea emerges. The idea is then immediately watered down to the banal, trite and common.
Yesterday, I told one of my clients to “stop being ‘reasonable.’” Think about it. A definition of “reasonable” is “of sound judgment, fair and sensible.” How great can “fair and sensible” be. If you want a future with above average top line growth and way above average bottom line growth, “fair and sensible” isn’t going to cut it. You’ve got to be crazy. Creating something great is not an act of balance, precisely the opposite. Anything great, by definition, is an outlier.
The challenge with being an outlier is that you threaten the status quo – and the status quo doesn’t like to be threatened. As a result, the people who are being held back by the status quo will do whatever they can to bring you back to pack. One of the most effective means of doing that is ridiculing you. Experts will talk about how “silly you are,” “how you lack the facts,” or “how it can’t be done.” Friends will think you’ve gone nuts. Employees will think your crazy and will begin to hide from you (while deep down they’ll be hoping you don’t fall for this trap as they want to break free from the status quo as well but are afraid). Being ridiculed is tough. You’ll feel isolated. You’ll experience doubt and you won’t be allowed to show it to anyone.
But, if you allow yourself to be ridiculed and you stick to your vision (while of course making adjustments), you’ll begin to seem less crazy. People will begin to be inspired by what you’re doing. The market will show increasing curiosity about your “new” thing. And before you know it, they’ll be jumping on your bandwagon. As long you you implement solid business principles, what once seemed ridiculous will become genius, and you’ll experience the personal and financial gain that goes with it.
So, are you ready to be ridiculed? Go for it!
Let’s Go Crazy
We’re in a war for business today. Any reader of this blog knows that I am by no means a “doom-and-gloomer,” but I also don’t want to downplay the urgency and crisis nature of where we are today, especially for small and mid-sized business enterprises (SMEs).
I just got off the phone with a reporter from The Wall Street Journal. We were discussing Obama’s recent “small business stimulus plan” and just how much impact small and mid-sized enterprises (SMEs) were going to fuel any economic and job recovery we would see of the next year to a year and half. The gist of my comments was that if SMEs aren’t the engine, we’re in (what shall I say) deep kimchee.
After hanging up, I realized how much the executives of SMEs are contributing to their own problem. Reviewing a client’s marketing materials, the only thought that came to my mind was: wow, what a reasonable – and BORING – argument. I’ve noticed that reasonable and boring often go together. Seth Godin talks about this all the time. He points out that it’s better to be hated than it is to be liked. The objective, of course, is to be loved; but if you’re not doing something that can be hated – it’s highly unlikely that you’re doing anything worthy of love.
I guess the underlying cause is humility, but I can’t get over just how difficult it is for SME leaders to make the bold statement and to take the bold positioning they need to take. It’s as if SME leaders don’t want to be thought of as crazy. Though I know of nothing great that was ever initiated by someone that wasn’t, at least, a little crazy. Here are some of my crazy role models:
- John F. Kennedy (Going to the moon)
- Richard Branson (A record company, an airline, an insurance company, and hundreds of other companies all under the banner of Virgin)
- Sam Walton (A nationwide network of big box discount retailers)
- Bill Gates (A PC on every desktop)
- Warren Buffet (If you think Buffet wasn’t crazy, just check out the restrictions he put on people who wanted to invest with him early in his career)
- Steve Jobs (A thousand songs on an MP3 player)
- M. Night Shyamalan (I see dead people)
Here’s the point – stop making rational arguments, they are not enough to get through the noise and fear. Embrace the very insanity that led you to start or run an SME to begin with. Be bold. Scare yourself and your staff.
Then work like hell to make it happen!
If you do, you’ll make my role model list. Who are your crazy role models?
Kill Differentiation
For quite some time, the word differentiation has been driving me crazy. Similar to the term “brand,” the term “differentiation” is a result that has been turned into a mean by marketing consultants seeking to create revenue streams.
- It has become a verb – “I want to differentiate my offering.”
- It has become a value judgment – “We are more differentiated than our competitors.”
- It has become a battle cry – “Differentiate or Die!”
The reality is twofold: a) we are by definition different, and b) differentiation correlates with success, but it is not the cause of it. People do not buy things because they are different, they buy things because they perceive them as better.
I recommend that we replace with word “differentiate” with “uniqueness.” I like unique better – it’s clearer. You’re unique or you are not – you can’t be “a little” or “very” unique.
Thank You, Apple
I admit it – I bought the iPhone early. I paid $599 for the 8GB model. Yesterday, as I’m sure many of you are aware, Apple announced they were cutting the price by $200. At first I was upset, but I got over it quickly. I bought the phone so that I would have it when everyone else didn’t. To me, that story was worth the $200.
There had been rumors for some time about Apple introducing a new model for the holiday season. I heard all about them from my ‘friends’ who thought I was crazy to have bought the phone. I replied, “It will be interesting to see how they handle that, if it’s true. A company like Apple,” I said, “has to honor its early adopters.”
Check out this open letter from Steve Jobs. He demonstrates respect to his loyal customers – and gives us a $100 credit. How about that, I paid more than I had to and I like Apple even more. Treat your loyal customers with respect and we’ll take care of you.
I’m sure this move ‘costs’ them a lot of money. A company with a more short sighted view of the world wouldn’t do it. I’m also sure that it will be worth every penny. This is a lesson we can all learn from.
Brands & Performance
I’m a big hockey fan (from the ratings, it appears there aren’t many of us). Being from Washington, DC; I’m Washington Capitals fan. The Capitals just announced that they are changing their uniforms to be a modernized version of their original uniform.
As a fan, I think it’s great. I never liked the new uniforms or the fact they went away from their red, white and blue color scheme. As a growth executive, I’m concerned they are missing the point. The Washington Post reported the news, and I was fascinated by what Tim McDermott, the team’s chief marketing officer said. Apparently he is referring to it as an “identity change” and a “brand awakening.” One which he hopes will strengthen the organization’s bond with current fans, while helping to attract new ones.
I’ve got news for the Capitals – 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. Make the game more entertaining and build a team that has a chance to win a championship. The uniform is merely window dressing.
I have to admit, when I hear the word “brand” these days, I just want to explode. The idea that changing uniform colors will have any impact is crazy, and worse – insulting. It’s like saying, “Hey fans, don’t worry about the fact that we’ve finished LAST FOR THREE STRAIGHT YEARS, because we’ve got new uniforms.”
And this doesn’t apply to just hockey – it applies to every business. Always remember – and never forget – the reason that people are buying from you. Keep the focus on that and you will build a strong brand. Focus on ‘the brand’ and the likelihood is you’ll never have a good one. Businesses no longer ‘control’ their brands and colors don’t drive brands – customers do.
My advice to the Capitals (and every other business): Give us (your customers) a good offering and we’ll take care of the rest.
Who Cares?
No!
You’re full of it!
Your offering doesn’t make any sense.
I can’t see why anyone would pay for that.
You want me to pay how much for your product? Are you crazy?
You can’t prove that.
Anyone who’s gone to market with any type of offering has certainly heard statements like these. If you haven’t, you’re probably doing something wrong. While it’s natural for any business executive, entrepreneur or salesperson to get frustrated when people say these things; I’ve got a question for them – who cares?
I have a friend who is an author. He’s sold quite a number of books. I know a lot of people who think his books aren’t very good. They think the ideas presented are over-simplified, that the data is based on false logic or that they don’t like the writing. Here’s what else I know, my friend doesn’t much care about their opinions. He cares about the thousands of people who have bought, enjoyed and benefited from his books. By the way, those people I know who say less than kind words about the books are still talking about writing theirs.
I have a client company that needs 15 new clients to achieve their 2007 sales goals. Those 15 clients come from a universe of about 4,000 prospects. In coaching my clients, they expressed concern over whether or not their message went into enough detail to support their value proposition. I reminded them that we are only worried about 15 people. The other 3,985 people could think our message was light and fluffy, as long as there are 15 who thought it was compelling.
Dan Sullivan, the founder of The Strategic Coach cautions his clients to “only test ideas on ‘check-writers’”. He means that the only people whose opinions matter are the ones who are in a position to buy the offering. Unless your employees, advisors, family, etc. are target clients, their opinions are not that important.
Last week, I was working with another client. We were working to develop their customer segmentation strategy. I asked him to identify the attributes that made up his Best Few™ clients. We developed his list, and as I read it back to him, he gave me the response that is the biggest roadblock to an effective messaging, marketing and/or sales approach: “Well, don’t get me wrong. I have some really good clients who don’t fit that description.”
Let me explain why that statement is a problem: My company, Imagine Business Development, works primarily with business-to-business (B2B) companies. Does that mean that we don’t work with companies that are business-to-consumer? Not at all. We have several clients who are business-to-consumer companies. Our target clients range from post-startup companies to those with about $20 million in gross profit. But we have clients that are pure startups and clients with gross profits greater than $20 million.
Here’s the point. If you look at our message, read this blog, listen to what we talk about at the office, you will notice we are obsessed with B2B companies with a value-added service focus, that are run by their owners (who happen to be smarter than most others – intelligence is an important attribute for us) and are in the post-startup to $20 million of gross profit segment. We know that market cold. We get results for them. We care about them. We don’t care that a $154 million company thinks that what we do won’t work – we’ve got plenty of companies in our sweet spot that would disagree with them.
Jim Collins said you need to be the [best in the world] at something. Because you’re the best at something doesn’t mean it is only thing you will do. But if you fail to be the best, who cares?
Solutions, Solutions Everywhere – But No Value To Be Found
I seem to be ranting a lot lately about words and phrases that drive me crazy. Forgive me, but I’m about to add ‘solutions’ to the list. Everybody is out there talking about their “solutions.” The problem is that most of them have no idea what the “problem” is that their solution is supposed to solve.
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.
Let’s just say, for the moment, that you sell printing ‘solutions.’ Further, let’s say that I am a prospect for your printing ‘solution.’ Let’s go out on a limb and say that I own a business development consulting company and that I both advise clients on marketing implementation and do my own marketing implementation. As a leading provider of printing ‘solutions’, you want my printing business.
Let’s be clear, no matter how bad my current situation may be – I do not (repeat, do not) have a printing problem. No matter how expensive my current printing is or how bad and ugly the current printing may be – I still do not have a printing problem.
I may have a client satisfaction problem. I may have a cost (and, therefore, a gross margin) problem. I may have a time problem or a resource allocation problem. I may have a client acquisition or growth problem. I remind you that I do not have a printing problem. Now, I may talk about my printing as a problem. I may be excited and interested to discuss my dissatisfaction with my current printing ‘solution.’ I may even buy printing from you. However, if you don’t identify, diagnose and discuss my actual (underlying) problem then you are not providing a solution, you are providing a commodity. Don’t confuse the two.
If you go to market with a solution, you better be trained and prepared to demonstrate your understanding of your client’s real problem first. I encourage you to read this about how to begin to make the transition from selling solutions to actually creating value by making client problems go away.
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Resources
Doug's Washington Business Journal Columns- Intelligent Growth Articles
Third Wave Selling Blog
Products to Grow
