Inside Our Head

Sales Results = What you do? + How you do it?

First, let’s look at how you sell relates to the care you show the customer during the sales cycle.  Since customer care is now a commodity, how you do things is no longer a source of differentiation.  That leaves what you do on each sales call, and the planning you put in to each sales call, as the remaining portion of the sales results equation that you can differentiate.

 

What you do during the sales process is comprised of the specific questions you ask, and your ability to get your sales process in sync with the customer’s buying process.  You need to persistently pursue.

I have a book published by Harvard Business Review titled Business Classics: Fifteen Key Concepts for Managerial Success.  The book contains the 15 articles in HBR’s history that have sold the most reprints.  One article, published in 1964, was titled, “What Makes a Good Salesman,” by David Mayer and Herbert Greenberg.  The author’s research found that there are two qualities that make an effective salesperson: ego-drive (or personal ambition) and empathy.  Empathy is your ability to project yourself into the heart and mind of your customer to see things as our customer sees them.

 

And yet, nearly five decades after that article was published, salespeople are seldom selected for or taught empathy.  The predominance of sales training literature is still focused on the steps of the sale, the things that salespeople need to do to sell the customer: prospect, approach, question, qualify, present, handle objections, close, etc. Are we still in the 1950s or what?

In my book, “Getting Into Your Customer’s Head, I describe the “buy-learning” process customers go through when making an organizational buying decision. But don’t for a minute think that your customer is doing a good job of buying.

According to studies referenced in the leadership book, For Your Improvement: A Guide for Development and Coaching, over 90% of the problems that middle managers and above experience are ambiguous – it’s neither clear what the real problem is, nor what the solution ought to be. These are some of the same problems that you are trying to solve by selling your solutions. And the higher up your customer’s organization an executive goes the more ambiguous the issues are. As a salesperson, if you can tap into this lack of customer clarity on the underlying issues causing that problems that you solve, you will significantly improve your odds of winning the sale, because the salesperson who wins is the one who defines the customer’s true problem. Why is it that the most experienced salespeople see the customer’s need before the customer does? Why do salespeople come across as the “expert”, talk too quickly about their solution, and ruin the best chance they have to build mega-credibility at the beginning of the customer’s buying process?  

Situation: a company's top sales rep is promoted to sales manager, but does not receive sales training on how to perform a sales manager's duties and responsibilities. Here's what happens next...

Untrained sales managers:
Don't know how to be an effective sales manager, so they continue to do what comes naturally -- they continue to sell. But this leads them to spend more time with their top salespeople, who are working on the biggest deals, which leaves the rest of the sales team out in the cold, without a leader/coach.

Allow the inmates to take control of the asylum. Untrained sales managers don't define standards of performance and they don't coach to standards. When unsuccessful sales behaviors occur the manager fails to confront the situation, and what you don't confront you condone. Without sales discipline there can be no team excellence.

Hang on to low producing salespeople far too long. Because sales managers aren't coaching reps on a consistent basis, the manager doesn't know why the rep continues to turn in a poor performance. The manager then reacts to a rep's poor production by "buying" the rep's excuses, erroneously assuming the rep will turn it around. But by this time the problem is too old to fix, the sales manager's opportunity to correct this problem with the sales rep occurred months ago, and the coaching opportunity was missed. Intuitively the sales manager knows this. She blames herself for the rep's continued failure to perform and, out of guilt, gives the rep even more time on the job to fail some more. The manager's acceptance of one salesperson's mediocrity brings the entire team down.

Become high paid, administrative assistants to the salespeople. Untrained sales managers think that if they solve the problems that salespeople bring to them then reps will automatically sell more. Not true. Managers need to expect salespeople to solve their own problems instead of doing their thinking for them. When a salesperson comes to the manager with "a monkey on his back" it is the manager's duty to
a) ask the rep how the problem should be solved
b) see that the rep leaves with the monkey!

Fail to follow-up. Untrained sales managers make suggestions to salespeople on how to improve and then assume salespeople will implement their suggestions. After all, when the manager was a salesperson, he/she implemented the boss' suggestions. Managers who fail to follow-up create a team culture that's lacking in accountability. Without accountability there can be no team excellence.

Don't manage time effectively, or set priorities. There are actually 29 specific timewasters that sales managers suffer from. Sales managers become buried in "stuff" work, reactive fire-fighting, feeling overwhelmed. They're working harder than ever, but unable to catch up, and no time for what should be their #1 priority - to coach. The result? The individual on the team with the most highly developed sales skills - the sales manager - has no time to coach. No time to teach his or her talents, skills and energies to those individuals on the team who need and want it the most.

When sales managers somehow do find the time to coach, they jump in and take over the customer meeting, which prevents the salesperson from learning, and implies to the customer that the salesperson is unskilled. This is the syndrome I refer to as, "Move over Rover, let the great one take over."

Unsure how to diagnose a sales performance problem, so problems in sales competence and willingness persist. Managers harp on the bad results, but don't address the unsuccessful behaviors and activities that created those poor results.

React to the issues of the day with no strategic plan for developing the team. Questions that sales managers should consider in their strategic/team development plan include:
Which salesperson is ready to step up and assume the role of the "bell cow" on this team?
If I were to set a team goal to increase sales by 30% over the next 12 months, what obstacles would stand in our way?
Is there anyone I need to de-hire?
What step of the sales process are we weakest in, and what specifically can I do to correct this?

Think primarily of job tasks, spend little or no time thinking about non-task issues such as team morale, individual rep motivators, career planning for sales reps, etc.

Effective sales management is a skill set that is altogether different from selling. I don't understand why many companies seem to believe that, without any training, a great salesperson will automatically become a great sales manager. One thing I do understand, however, is that the companies that do train their sales managers will see faster ramp-up time for new-hires, increased sales productivity and morale, and more satisfied and loyal customers. In short, the entire sales team will improve results if a company will make a training investment in a their sales managers.

Mistake #9 Inconsistent recruiting and selection program.

We have all hire somebody that didn't work out the way we thought they would, so we all know the cost of a bad hiring decision....or do we? What about those candidates that we don't hire? I learned this lesson years ago when I rejected on particular candidate who then continued to pursue a position with our company, was eventually hired by another region manager, and within 12 monthes was ranked in the top 5% of our 1,500-person sales organization. He re-introduced himself at our company's Achiever's Club trip with, "Hi remember me?" OUCH!!

Here are the most common mistakes sales managers make in the recruiting & selection process:

► Fail to try new methods of recruiting to increase applicant flow.
► Fail to identify hiring criteria (must-haves and nice-to-haves).
► Fail to develop targeted questions that uncover whether or not a candidate possesses the success charateristics.
► Fail to expose the applicant to the realities of the job before a hiring decision is made.
► Fail to identify indicators in past behavior that may indicate future success.
► Talk to much during the interview.
► Fail to poll others in the organization for their opinion on the candidate.
► Becoming distracted by daily pressures and short-circuiting the interview process.

Negotiate Price Late in the Sales Process, Never Early

There is no reason to discuss price until buying desire has been aroused. If you customer doesn't need it, any price is too high. Discuss price only when buyers recognize what they need and why the need it. Lowering price does not necessarily make a product or service more attractive to a buyer, in fact it rarely does.

Carefully Consider the Consequences of Any Concession You Make

Without profit there is no purpose. Therefore, carefully analyze each concession before making a commitment. Any concession will become an expectation later on. Don't give away the store or that's all you wind up doing, all the time.

Don't Propose a Solution with an Already Discounted Price

Purchasing agents are often evaluated by how much they save the company. If you cut price right away in your initial proposal you may actually be doing that purchasing agent a disservice. If you don't start with significant gross profit built into the deal you don't leave yourself any negotiating room. There are exceptions of course. If you get into a deal late, you may have to shoot your best price just to be considered.

Be Patient

Relax! Slow down! If the prospect wasn't interested, you wouldn't be negotiating. Take the time necessary to achieve a true win-win.

Never Give a Concession Without Getting One in Return

To a prospect asking for a lower price you might reply with a willingness to discount if the prospect will agree to purchase several more units during a specified time. The prospect wins by obtaining a lower unit price. You win by increasing the size of the sale. (Discuss other real life requests prospects make and how you might respond by asking for a concession.)

Customers have higher expectations, and more buying power than ever. They have more options as well. Therefore, companies striving to be the best have made customer satisfaction and retention the cornerstone of their business strategy. To achieve business success, the best companies add to this cornerstone product innovation and quality, and a productive and responsive group of employees who are encouraged to focus on customer service in a vibrant corporate culture.

With radical, comprehensive and pervasive changes in technologies and markets have come changes in the way sales people achieve customer satisfaction. The days of "hit-and-run selling" are over. Sales people must now act as account managers who are responsible for the ongoing quality of the company's relationships with customers.

The message is clear: to be successful today, sales people must get closer to customers, not just during the sales process, but after it, too. By applying the last role, that of a Farmer, you can solidify your customer relationships for years to come.

The number one killer of customer satisfaction is complacency on the part of the seller. The day you take your customer for granted is the day your competitor takes that customer away from you.

Just because you do not hear complaints does not mean your customer is satisfied. According to a recent consumer affairs study, 96 percent of unhappy customers never complain.

To avoid becoming complacent with your customers, stop thinking "account maintenance" and start thinking "account development." Don't just hold your ground, move forward. The best way to keep the business is to grow your business.

The requirements for a long-lasting and profitable relationship are mutual trust, understanding and value achieved. If you put extra effort into achieving customer satisfaction by becoming proactive with your customer after making a sale, you will be generously rewarded.

Your role as Farmer entails nourishing the relationship with the customer, sowing new applications for your product, cultivating the account, reaping the fruits of your labor, and planning your next season.

You accomplish these tasks by keeping in mind: your customer wants to realize the results expected, that the product is performing as promised. The customer also expects to be treated in a way that makes them feel as important after the sale as before. And the customer wants to be reassured that he paid a fair price.

Achieving this quality relationship with your customer allows you to grow the account, and it allows you to ask for referrals! To truly understand selling you must understand buying, and that's why you must get into your customer's head!

You can increase your sales and enjoy greater customer satisfaction by changing your approach to match your customers' changing perspective throughout the sale. At TopLine Leadership, we teach eight specific roles that match customers' needs at each of the eight buy-learning steps.

Your client has certain expectations of you and your product or service. If their expectations are met, or exceeded, they will be satisfied. Simple.

Not always.

For your product to be successfully implemented into the client's daily working life, the client must move through a learning process. This process can be described through five phases, helping you understand the way people learn, and your responsibility in helping them.

Phase 1 | Unconscious Incompetence | Your customer does not know that he does not know.

Your customer has signed the order, product is delivered and they are enthused. They expect to realize the benefits of this product, benefits you have described and promised throughout the sales process. However, the customer's expectation of benefit is at its highest point right now, and their understanding of the learning required is underestimated. To derive benefit they must learn, you must teach them, but they aren't ready for the learning just yet.

Phase 2 | Conscious Incompetence | Customer knows he doesn't know.

Customer frustration mounts during this phase as they come to realize that change / learning will be difficult. Habitual ways of working must be altered. Productivity may suffer in the short term while people learn to use the new product. The customer may wrestle with a feeling that they are worse off than before.

Phase 3 | Conscious Competence | Customer works hard at what he doesn't know.

With application, the customer begins to learn how to operate the equipment. They begin to seen the benefits in the real work environment. The product begins to make a real contribution, as promised.

Phase 4 | Unconscious Competence | Customer begins to make the new habitual.

The customer has a real sense of accomplishment now that the product is fully integrated into their office and the daily routine. Results are being realized. Everyone is happy!

Phase 5 | Conscious Unconscious Competence | Customer easily explains the new benefits of the new product, and how to derive them.

In-house experts can now train others in the office as the entire team develops an appreciation for the equipment. It has become part of the family.

Other considerations: if the product is complex, expect the learning process to take more time, and expect it to be more frustrating for the customer. Likewise, have these expectations if the customer is inexperienced. Often, the people who actually make the purchase decision are not the end-users. Therefore you may experience outright resistance to the product by end users who did not participate in the buying decision.

Bottom line: meeting and exceeding customer expectations is not easy, but it is well worth it.

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Negotiating power plays a major role in every type of negotiation, whether it's a labor negotiation, political negotiation, or a buy-sell negotiation.

Both the buyer and the seller have power in a negotiation. Power is each side's perception of its strength or weakness in comparison to the other. This perception of power affects the ability of each party to achieve its own goals. The more negotiating power you have in comparison to that of your buyer, the fewer concessions you'll have to make.

For each party in a negotiation, there are eight sources of power. These are:

• Need
• Options
• Time
• Relationships
• Investment
• Credibility
• Knowledge
• Skills

Just remember the acronym NO TRICKS

"N" stands for Need

The essential question here is: who needs this sale more, the buyer or the seller? The more intense the buyer's need, the more power the seller has. The more intense your need to make the sale, the more power your buyer will have.

"O" stands for Options

What are the options for each party if an agreement is not reached? A buyer who believes that your product or service is unique has no other options. Your other options consist of the other sales opportunities you have waiting in the wings. The more options you have, and the fewer acceptable options your buyer has, the greater your negotiating power.

"T" stands for Time

This refers to any impending events that place a deadline on either the buyer or the seller. If the buyer is under time pressure, it usually gives the salesperson negotiating strength. In commercial real estate, for example, the expiration of an old lease may put time pressure on the tenant to find new office space. The time factor also affects many other purchases related to the move, such as hiring a contractor, selecting office furnishings and business equipment, and so on. A deadline creates time pressure and limits the buyer's opportunity to shop around.

If you are feeling time pressure, perhaps to close the sale by the end of a quota period, your buyer will have time power. Several years ago, I had the opportunity to win my company's annual incentive vacation - a trip to Bermuda. On the last day of the year, I needed a $2,000 sale to achieve my annual quota of $3 million. I felt time pressure! I made some hefty concessions that day, but I won the trip.

"R" stands for Relationship power

How strong is your relationship with your prospect? If you have a high quantity of high quality relationships with your customers you have relationship power. But some customers may not allow you to develop these relationships. They may tell you that you can only talk to purchasing. In such a situation, you'll have a hard time developing relationship power.

"I" stands for Investment

How much time and energy has been invested in the buying process? The more effort someone invests, the more committed he or she will be to reaching an agreement. The more energy your buyer puts into a buying process, the more negotiating power you'll have. Conversely, the buyer's power of investment is enhanced when you've put a lot of time and energy into a prospective sale. If you put 20 hours into preparing a proposal, you'll have a hard time walking away from the deal.

"C" stands for Credibility

When I was selling dictating machines for Lanier Business Products, a salesperson in our Washington D.C. office, whose sales territory included the White House, sold a portable dictating machine in the Oval Office directly to the President. Subsequent photographs of the president showed his dictating machine on his desk. Lanier's credibility was enhanced by having the president as a customer.

"K" Stands for Knowledge

Knowledge is power. You have knowledge power when you thoroughly understand your customers' problems and needs and can foresee how the products or services you are offering will help them achieve those needs. If you do not have this knowledge, we suggest you attend on of our 2-day sales seminars to help you get a leg up on your competition.

Conversely, if your customers know as much as you do, or perhaps more, about the application of a particular sales solution, they're less reliant on you. A few years ago, IBM reorganized its sales forced to emphasize industry-specific expertise so that their salespeople would become more knowledgeable about their customers' businesses. IBM has 14 industry sales teams dedicated to areas such as health care, travel, and financial services. IBM recognizes that salespeople are not adding value to the buy-sell relationship unless they know more than the buyers.

"S" stands for Skill

Who is the most skillful negotiator? Buyers are making more buying decisions today, and are getting better at it. Many buyers have attended seminars to improve their negotiating skills, which means they're gaining more skill power. Today, you must constantly improve your skills, just to keep up.

For over 200 years the US Constitution has served as the system of fundamental laws and principles of our society. This amazing document has served as the cornerstone of our democracy. A reflection of our Founding Fathers' core values, the Constitution has kept our society on track since 1787, and has certainly contributed significantly to the growth and success of the United States.

What is the Constitution of your sales team?

Have you, as yet, identified and communicated your cornerstone? If I was to ask five of your salespeople to describe to me what is expected of them in areas other than sales results would I receive five different answers?

The Production Equation: B+A=R.

Behavior plus activities equals sales results. Or, another way of saying this is that every successful sale is the outcome of a series of behaviors (how something is done) as well as activities (how many times a behavior is performed).

Unfortunately, many of us sales managers try to manage results. We wait until a rep has a bad month before we decide to get involved in "coaching" them. So then, when a rep produces a bad month, we rush over and smother them in coaching trying and get their production back up quickly. Sales managers who try to manage results are like a driver of an automobile who only looks in the rear view mirror... chances are they will be surprised when they collide with something that is unexpected. Looking only in the rear view mirror is not an effective way to drive a car, but it happens to be the way that many sales managers drive their sales teams.

Sales results can't be managed, but behaviors and activities can.

To be the best sales manager you must get in front of the result, get the best sales management training possible, and put in writing your expectations of the behaviors and activities that contribute to sales results.

Think of this issue – a team without well-communicated performance standards - from your salesperson's perspective. As a salesperson, you have a clear understanding of the sales quota results expected of you, but you're unsure exactly how to produce those results. So you do what you think you should. You "make it up on the fly." Then, because nobody tells you you're doing it wrong you assume it is acceptable behavior. So you keep doing it, and form bad habits. It's an unproductive cycle.

How to Draft your Sales Team's Constitution

Think of your top salesperson... what specific behaviors does he/she do that contributes to sales success? For example, "makes at least five new business prospecting calls every day." Then, what attitudinal qualities does he/she have which contributes to success? For example, "attempts to solve problems before seeking help."

Make a list of behaviors and activities that describe your top salesperson, and then share this list with everyone on your sales team. Have each of your salespeople assess themselves on a quarterly basis against these behaviors and activities: Meets, Exceeds, Needs Improvement. Then, sit down one-on-one with each salesperson, discuss his/her self assessment, and put a plan in place to improve those.

Four Components of a Sales Constitution are as follows:

• Written
• Well communicated
• Understood by everybody
• Equally applied