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In my last post I talked about how changes in customer behavior have made our growth goals harder and harder.  Specifically, customers may be more open to buying a vision, but getting a deal to completion has gotten a lot more challenging, and less predictable.  And our biggest leverage point for helping navigate customer organizations to get a deal done?  Managers.

The first-line manager has arguably always been the most important (and least-defined) role in a sales organization.  But recent changes in customer behavior, coupled with the shift to solution selling, have changed what matters most for managers.  So here’s the new story of manager excellence.

As a reminder, we amassed a huge dataset from our Manager Effectiveness Survey – over 5,000 returned surveys regarding over 1,000 managers – to explain the primary drivers of manager excellence.

Our first finding is no surprise:  managers need to be good at the fundamentals.  These are things like integrity, reliability and listening, which are important to any manager, not just sales managers.   Luckily, it turns out most managers are good at these.   For the 3.5% of our sample who failed at the fundamentals—they’re probably not cut out for a job in management.

More interesting are the sales-specific activities that matter most.  These fall into three high-level categories, with the impact on performance in parentheses:

• Selling (26.6%) – being personally effective at selling, particularly the Challenger™ behaviors
• Coaching (28.0%) – helping others improve, particularly with tailoring and asserting control
• Owning the Business (45.4%) – when managers run their territory as if it were their own business

Owning the Business breaks down into two parts:     Read More »

Tacit selling skills have always been important, but as our work on the new high-performing sales rep has shown, these skills (things like tailoring and asserting control) are absolutely crucial for success in today’s more complex selling environment.  

The problem is, tacit skills don’t lend themselves well to traditional rep upskilling approaches. Classroom training alone is insufficient because these skills require judgment and context (things that that can’t be accurately captured with process and how-to guides), and coaching by itself can also be insufficient, because managers may struggle to explain and demonstrate these intangible concepts.

In fact, the best way for reps to acquire tacit skills is through experiential learning.

One way for reps to gain this experience is to practice in live-fire settings, in front of the customer. But I think we’d all agree, that can be incredibly risky—things can go horribly wrong if not done well. 

So, the other way to provide reps with experience is to practice via role plays in training and coaching sessions. But the problem with role plays is that they typically feel so artificial. Usually, you break up in pairs and someone says, “OK, you’re the rep, and I’m the customer…” and off you go. Not only is the exercise too fake to feel real, it’s too fake to feel valuable. 

So how do you find the compromise?  How do you simulate a customer interaction with a high degree of reality, but a low level of risk?

St. Jude Medical came up with a pretty ingenious answer to those questions. St. Jude split the difference between the fakeness of internal coaches and the riskiness of actual customers by having reps role play with someone they named the “customer proxy.”    Read More »

This week marks the official release of the Customer Effort concept into the “wild” with the publication of our article, entitled “Stop Trying to Delight Your Customers,” in the July/August issue of Harvard Business Review. If you haven’t seen the article, feel free to download a complimentary copy. You will also find some cool podcasts and our Customer Effort Audit tool available to download.

As you’ll read in the article, our research shows that “delighting” the customer—in other words, going above and beyond—yields only marginal additional loyalty from the customer.

We also found that customers are four times more likely to leave a service interaction disloyal as compared to loyal, and the primary thing companies can do to mitigate this disloyalty in the service channel is to focus on reducing the effort customers must put forth to get their issues resolved.

Put succinctly, loyalty in the service environment is a matter of reducing effort, not delighting the customer.

One thing this article pushed us to do was to think about the prescriptive advice we would give companies who want to pursue this low-effort journey. It’s not easy summing up more than four years of research around effort, what causes it and what leading companies are doing to eliminate it, but we managed to come up with the following list of five things that low-effort companies do (and are different, we have found, from what most companies do):     Read More »

We all know by now that Sales can learn a lot from the field of psychology, but it is worthwhile from time-to-time to have a refresher on some of the more surprising findings coming out of university psych departments.

Here I’ve summarized a few such findings particularly relevant for Sales. A word of warning: it wouldn’t be a psych study if the findings weren’t a bit quirky!

Finding #1: Customers are more likely to say “yes” if you give them coffee and speak into their right ear

• Explanation: An Australian study finds that consuming even a moderate amount of caffeine makes individuals “more likely to agree with persuasive arguments.” Additional research conducted in Italian discotheques finds that people are twice as likely to give a stranger a cigarette if the request is made into the right rather than the left ear (which allows the request to be processed via the “preferred,” left hemisphere of the brain).
• Implication for Sales: Train your reps to suggest a refill and to choose their chair carefully before sitting down at the negotiation table. Then have them use our Controlled Negotiation Roadmap to seal the deal.

Finding #2: People spend most of their time in meetings sharing information everyone already knows         Read More »

By Andrew Kent

The Gulf of Mexico oil catastrophe is quickly spiraling from “worst oil spill in US history” to “one of the worst man-made disasters of all time.”  Scientists worry that massive undersea plumes of oil could kill plankton and cause a collapse of the Gulf of Mexico food chain. 

We all know hindsight is 20/20.  Still, according to the Wall Street Journal, there’s some evidence that all this could have been prevented by a US$500,000 “acoustic trigger”–which rig owner Transocean opted not to install on its rig to backup the supposedly failsafe blowout preventer.  Which makes you wonder, what did the Transocean procurement rep say to the acoustic trigger sales rep?

At the risk of grossly oversimplifying an incredibly complex, highly engineered transaction, the tragedy in the Gulf may just bust the most cherished myth in all of business: “the customer is always right.”

In fact, the customer is often wrong – and it’s the job of Sales to teach the customer why.

For example, with BP and Transocean, it appears they grossly underestimated the chances of catastrophic failure of the rig’s blowout preventer.  CEO Tony Hayward recently called the device’s failure “unprecedented,” praising the blowout preventer as “the ultimate safety equipment on a drilling rig.” In reality, an AP investigation based on Minerals Management Service statistics found that blowout preventers “have failed or otherwise played a role in at least 14 accidents, mostly since 2005.”  And a 2003 report coauthored by Transocean’ executive Earl Shanks warned of blowout preventers’ “poor reliability.”  That’s the type of data a sales rep needs.         Read More »

I love summer reading lists – they give me ideas and it’s fun to see what other people want to learn more about. With that said, below is a reading list of books somewhat related to Sales. This is a personal selection and I’m hoping that everybody will chime in with their own ideas below.

Though it’s nice if the book has some relevance to business, that isn’t necessarily the most important thing. In fact, I find it’s often things that are only tangentially related to Sales that provide the most stimulus for me.

First, I’m going to recommend some older books. These seem especially relevant because of the current economic environment in which we cannot rely on continued private sector growth and where sales organizations have to work hard to get customers over their fears.

1)      Everybody in Sales and Marketing needs to have read “Influence: The Psychology of Persuasion” by Robert B. Cialdini. This is one of the best-known books examining how we make decisions and how we prioritize different kinds of information. It has some obvious implications for how to position and leverage the sales process, but it’s also a great read. And once you’ve read Influence, you can skip the mountain of related books such as Nudge or Predictably Irrational, all of which, to greater or lesser degrees, are based on the idea that we are all systematically prone to making the same mistakes over and over when it comes to making decisions.

2)      Similarly important is “Positioning: The Battle for Your Mind” by Al Ries and Jack Trout. While the stories and anecdotes are beginning to show their age, this is probably the single best book on Marketing that I have ever read. It ties in nicely with the Cialdini book because the authors leverage many of the same behavioral insights, though theirs were substantially derived through practice rather than formal analysis; and the book is none the worse for it.

Moving on to some newer books, here are a couple that recently stood out for me – and please use the comments section to add yours below.     Read More »

How many key accounts can one person handle?  It’s a hard question to answer and it depends on a number of variables: deal complexity, sales cycle time, team size, specific customer attributes…the list goes on. 

Here’s some quick data that will at least give you some perspective on how other SEC members have structured around this question.      

As background, the Council recently hosted a webinar aimed at helping members reinvigorate their key account management programs.  During the session we were able to do some surveying and found:

• Nearly half of the members that joined us described the state of their key account programs as in the process of restructuring.

And this isn’t just restructuring to maintain the status quo, it’s restructuring to create growth in the near term: 

• 47% of members polled are expecting a 5+% growth rate from their key accounts in 2010 alone (and 28% are expecting 10+% growth), compared to core accounts.

So, what tweaks can you make to your key account programs to achieve those kinds of growth numbers this year?     Read More »

In a lot of conversations I’ve had with heads of sales lately, their CFOs have been reaching out to sales to discuss reinvesting in growth.  CFOs are currently mulling over how to reinvigorate top line growth without killing margins.

During the last year or two, most companies have gone through significant cost cutting.  This has meant that despite the destruction of demand, most companies were actually able to expand margins.  As we come into what most CFOs believe will be an upswing, we’ve seen them turn attention from a sole focus on managing cost/margins, to a joint focus on top and bottom line.  Put simply, they want to get back on the growth train but without killing the margins they’ve worked so hard to attain. 

Over the last 3-6 months we’ve seen CFOs starting to loosen the purse strings to get growth going; they’re doing things like fund more innovation, look into M&A adjacencies, and remove restrictions on hiring and travel.  We expect to see this trend continue over the next few quarters but it will likely still be slow.  And CFOs are struggling with where and how to make smart investments. 

There are several ways for sales organizations to help CFOs as they think through these joint objectives.  A few questions members are asking are:

• What can sales do to drive the top line without sacrificing the bottom line?
• How can they identify wins that will help make a case for more robust investment in sales?
• What role should sales play in making broader growth investment decisions?

Here’s how I’ve navigated these conversations with CSOs – by helping them change their conversations from driving sales value to driving enterprise value.     Read More »

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In my last blog post, I introduced the idea of sales innovation, and how it is the most important thing a sales manager can do to drive growth.  I left you hanging about the specific activities inherent to sales innovation–and I promise to get there–but to really understand the concept, we need some context.

This story starts with why growth is so hard right now: changing customer behaviors.  There has been a lot of change in customer situations–increased price pressure, decreased budgets, etc –but while these changes may dissipate over time, we see a few trends that we think are here to stay:

1. More customer stakeholders involved with the deal
2. Customers pushing risk onto suppliers
3. Rise of third party consultants auditing deal agreements

What this means at the 10,000-foot level:  it is getting harder and harder to get a deal to close.  Looking closer, you can see that it’s getting harder in a very specific way that relies on the manager.

It helps to think about the path of a sale in two main stages:

• First, selling a customer on a vision
• Second, getting them to buy an offering customized to their specific needs

Think about it:  with every sale, we begin with the customer in some sort of status quo—uncomfortable as it may be, given the tough economy of late—then, through the recognition of a need, the customer agrees on a vision.   Read More »

I recently had a member ask me this …

“Tom is one of the best reps we’ve got. In the past three years, he has exceeded every target that’s been assigned to him. But recently, his performance seems to have slipped. He barely manages to hit his goal and has almost stopped going that extra mile. We’re worried we may have burnt him out!”

Now, there can be many reasons to why Tom is underperforming.  We discussed the economy and how things were only beginning to look brighter. We spoke about compensation and how that might affect performance. We even tried to speculate if everything was okay in his personal life.

But none of it seemed to quite hit the nail, till we came to his manager.  The member told me that Tom’s previous manager had resigned, and the position had since been filled laterally by a sales manager from another division. Further probing revealed that the company had heard a few disgruntled voices from his team, but hadn’t taken it up very seriously. We took a closer look at what they had heard from his direct reports:     Read More »