http://blog.inc.com/sales/ Patrick Stakenas is Co-Founder, President and CEO of ForceLogix. Patrick has over 25 years of industry executive and entrepreneurial experience and has served as Senior Vice President of Sales and Operations at CCC Information Services, FileNet, and OpenText. Read full bio. en-us 2009-06-30T15:41:51-05:00 hourly 1 2000-01-01T12:00+00:00 http://blog.inc.com/sales/2009/06/the_benefits_of_sales_coaching.html Forward-looking organizations like Lenovo, Corning, Innovex, Motorola are known for being leaders in adopting effective sales processes and technology. Many of these companies are now leveraging new processes and capabilities to empower their sales management teams and to get more out of their sales people through tracking key performance indicators and coaching. Even though you may be a small company in comparison, the key to improving sales in your organization is where you focus. The focus should be on your salespeople and their performance rather than the resulting numbers. One way to assist your salespeople is to identify key members of the sales team who have the greatest propensity for coaching and create a buddy system whereby your salespeople are supporting one another and encouraging each other to meet their goals. In a recent study by the Sales Executive Council (SEC), companies were surveyed to determine the relative impact of effective coaching on A, B and C performers. The study clearly indicated coaching offers greater value when targeted specifically at the B players, or "core performers"—those who show ability but have unrealized potential. In fact, the study indicated that you can expect to see a 17% or greater improvement in productivity and revenue from your B and C players when consistently coached. Do this simple exercise, regardless of the size of your company, and you will be able to determine where to focus your coaching efforts. What percent of reps made their assigned quota? How many reps came at least within 20% of their targets? What is your turnover percentage and how many reps are new? If you are like most companies, you are likely to have 10-20% of your sales team that are in the “A” category and 10-20% that are new hires. The core 60% or so from this simple exercise is where your sales leaders need to focus their time and efforts and where you should be spending your money. Focusing on this core makes sense from several perspectives: They are most coachable and your money invested will be well spent. They represent the largest fixed investment in your sales budget. Given the law of numbers, a simple 3-5% performance improvement in the core will yield a significant overall impact. The practical goal is not so much to expect 100% “A” players, but minimize the under performers’ impact on your business and coach this core team to better results. 6027@http://blog.inc.com/sales/ 2009-06-30T15:41:51-05:00 http://blog.inc.com/sales/2009/04/can_sales_technology_help_your_1.html More companies today are leveraging technology in the area of coaching, sales management, and sales operations to drive not only selling efficiencies, but also the overall effectiveness of their sales team. Traditionally, investments in sales technology have been looked at as a necessary evil, and are often shunned by IT departments who think they can build it themselves. The reality is that it took sales guys like Tom Siebel, of Siebel Corporation, and Mark Benioff, of Salesforce.com to build true CRM systems, while IT guys were building and throwing away miles of code. Forward-looking organizations like Lenovo, Corning, Innovex, Motorola and many others are leveraging the capability and domain expertise of technology built by sales managers to empower their sales force. Many of these solutions utilize SaaS technology to build flexibility in sales management, measurement, and coaching. However, as organizations tighten their belts, resources including financial and human capital become difficult to obtain and managers must work harder than ever to ensure that their employees are focused on achieving critical objectives. The good news is that technology can be a key enabler in achieving these goals. If employees, especially sales people, are coached, and have clear objectives that are tied back to the organization’s strategy and operational plan, it’s more likely that the strategy will be achieved. In a recent study done by the Aberdeen Group, it was confirmed that this economic downturn has placed even greater pressure on the sales function. Sales leaders must increase sales effectiveness while external forces reduce the number of real opportunities and threaten top-line revenue growth. Business leaders need actionable data to align sales behavior with business objectives and rapidly adapt to changes in the market. Aligning and automating sales execution with organizational goals requires a holistic approach that includes compensation management, process optimization, and data analysis. Research reveals that traditional manual coaching and sales management processes reduce productivity for multiple functions, not only sales; finance, operations, and IT are all impacted as demand for sales information increases, in turn affecting both top and bottom line growth. Companies must keep abreast of the latest technology strictly from the standpoint of whether or not it can help you increase your business volume. Regardless of the industry, sales people must be held accountable to know the products, know the marketing message, understand the sales process, and have the skill set to use the arsenal provided by the company or institution. Face it: If you don't make sales, you're not in business. One way to use technology to your advantage in coaching and SPM is to have it accessible while the coaching session is taking place. To have the ability to coach on the spot and track what you have taught is invaluable. Being able to follow up immediately with the sales person on the objectives set and create an ongoing dialogue, will lead to more effective and more productive sales people. In the highly competitive sales industry, a key source of competitive strength is the execution skills possessed by your on-the-ground or telephone sales force. This has become more critical than ever as the economy has slowed down and workforces are shrinking. Without a system to track the ability, skill, and overall effectiveness of your sales team you will suffer consequences in today’s competitive environment. Do you have examples of how your company has utilized sales technology to optimize your bottom line? 5735@http://blog.inc.com/sales/ 2009-04-24T16:24:48-05:00 http://blog.inc.com/sales/2009/04/smoke_and_mirrors_sales_figure.html More often than not, when it comes to companies meeting their sales figures, there is a disconnect between what the CEO expects and what the vice president of sales can realistically deliver. The true challenge for the head of sales lies in how to substantiate to the CEO why the numbers were missed, or, if they were made, how they were arrived at. A recent article published on MarketingProfs.com titled “Lies, Damn Lies and Dashboards,” stated that CRM and business intelligence dashboards are often manipulated by managers and marketing execs to present a positive outcome that doesn’t necessarily promote the truth. The key to establishing a trusting relationship between sales and the boardroom is to put in place a process for determining how a representative or team is doing against expectations. This often involves using technology that can track, measure, and report on both the leading and trailing indicators of the company's sales goals. It also provides you with a system for tracking the progress of your salespeople. Done properly, senior sales leaders can deliver the truth that CEOs can and want to handle. If things are going well, the vice president should be able to explain what is driving the success of sales and why, and also how those sales will be sustained. If it is a rebuilding model, the same applies. The vice president must be able to show where the bad news is; he or she should have an explanation for what is happening with the sales trajectory, and what the plan needs to be to correct the situation. CEOs make the connection between fluff and what matters. And with sales, it can't all be smoke and mirrors. Patrick Stakenas is president and CEO ForceLogix, a Chicago-based company that builds on-demand sales performance management solutions. 4460@http://blog.inc.com/sales/ 2009-04-06T18:10:19-05:00 http://blog.inc.com/sales/2009/01/increase_sales_by_focusing_les.html Sales managers seemingly never take their eye off where they stand against quota. But what if I was to tell you that maybe it’s time to forget about quota and focus on long-term results? You may think I’m out of my mind. How can a sales organization be led without focusing on quota? If quota isn’t met, the salesperson will clearly lose his or her job. If enough salespeople don’t meet quota, then the sales manager loses his or her job. If enough sales managers miss their numbers, then the vice president of sales gets it. Right? Yes, right, but focusing only on the numbers and beating people up over them, instead of teaching, coaching, leading, or managing will only bring short-term results (if any at all). The first step toward exponential revenue growth isn’t about running after quota each month or quarter. The success of the sales organization will come from process. Build competency and skill within the team and execute with that skill until a powerful hold grabs onto the sales organization. Second nature will then drive sales effectiveness month after month after month. Typically when a new methodology is introduced into the sales organization, it’s often treated as an event or project and not immediately linked to the process by which the sales team sells. In fact, training is often viewed as a distraction or taking an eye off of the number. Yet companies spend millions of dollars on sales methodologies and training, while follow-up on these new processes is poor. Sales leadership at the top is typically not engaged. While they may claim to be supporting the approach, often they aren’t doing anything to ensure there’s a return on the effort and cost. Many sales leaders think because they have brought in CRM, put salespeople through training, and have a consultant in place to figure out which sales methodology is best, that sales will just increase. It’s this same so-called leader or change agent that CEOs have had to remove time and time again because they never actually delivered the number and spent too much money trying to do so. The fact is that these elements are necessary, but on their own they are not going to make much of a difference. They will not stick unless these elements are controllable and measurable and salespeople are held accountable for learning and following the process. Sales management is a close relationship between the sales representative and the sales manager. It should not be an exercise where each conversation only involves quota. Effective sales management requires sharing in the responsibility to understand the issues, problems, and gaps in your sales process. Start with a desired process, then coach, lead and motivate reps to follow that process. If you focus only on the number, you will not attain the number. 4194@http://blog.inc.com/sales/ 2009-01-22T12:45:26-05:00 http://blog.inc.com/sales/2008/11/turning_value_into_customer_re_1.html Although armed with a carefully crafted list of 10 “unique” benefits to customers, a supplier of sophisticated network security systems learned they had lost a million dollar contract to a competitor with almost exactly the same list of benefits, but a 10 percent lower price. Another company offering comprehensive Enterprise Resource Planning solutions emphasized their superior ability to promote operating efficiency. After losing a large sale, they were surprised to learn the customer wasn’t especially interested in efficiency. Instead, customer executives had bought into a competitor’s offer of flexible, modularized SAP solutions--a perfect fit for the firm’s strategy of growth by acquisition. By then, it was too late for the original vendor to explain that they could match and even exceed the competitor’s flexibility. These companies were both trying to “sell value” to their customers--an objective shared by nearly every business-to-business supplier. In an audience of sales professionals, we see nods when this subject comes up--“That’s exactly what I do,” they say. “I sell value.” Despite the overuse and misunderstanding of the “V” word in recent years, selling organizations have received the message: the one and only thing customers really want to know is, “What is the value to me if I buy from you?” If everyone got the message and the value strategy is in play, why aren’t customers responding? At the same time, why are sales cycle times lengthening, the number of “no decisions” increasing, and it’s tougher than ever to engage C-level executives? In some ways, the answer is deceptively simple. Too many salespeople are presenting their “value propositions” in a vacuum and lacking genuine insight into the customer’s point of view about real value. Without a consistent method for looking at the offering from the customer’s vantage point, we can be blinded by internal perceptions of what we bring to the market and unable to identify and leverage what really provides value to our customers. In reality, we aren’t converting value from “interesting” to “required.” Unfortunately, value propositions and common “value messages” are merely a statement of value capability. They are value messages based on one-size-fits-all assumptions, or that emphasize a distinction that doesn’t make a difference. After a two-year study of management practices in Europe and the United States, it’s not a surprise that James C. Anderson and his colleagues at Harvard discovered it is “exceptionally difficult to find examples of value propositions that resonate with customers.” In our Diagnostic Selling® program, we like to compare the interactions between a salesperson and a customer as similar to those between a doctor and their patient. With that in mind, if we take the prescription drug Lipitor, its “value proposition” is that it will reduce cholesterol. The critical point doctors understand, which we sometimes overlook as salespeople, is that you can only reduce cholesterol if the patient has high cholesterol. If the patient doesn’t have high cholesterol, Lipitor is of no value. Exceptional sales professionals recognize that in order to maximize value, there first must be an absence of value, and the consequences of the absence of that value needs to be significant enough to create the “Incentive to Change,” to take action. The first step in a doctor’s diagnosis is to check for the presence of symptoms of a disease. If they exist, this would indicate the patient’s health is at risk and the doctor’s intervention in the form of a prescription drug or surgery would be of value. It certainly would be an incentive to change. The same holds true for the salesperson. What are the physical symptoms of the “absence of the value” your product/service/solution is capable of providing? If your customer shows those symptoms, their business and/or personal job performance is at risk and your solution will be of value. The next step is to jointly determine the consequences. We need to determine how and by what dollar amount is this individual and this business and their respective performance measurements impacted by the absence of your solution. This will determine the true value of your solution in a tangible manner that the customer can agree with. The value proposition makes your solution capable, the existence of the symptoms makes your solution’s value relevant, and the level of the consequences will create the urgency that will make your solution required. Jeff Thull is the President and CEO of Prime Resource Group, and a leading-edge strategist and valued advisor for executive teams of major companies worldwide. 3948@http://blog.inc.com/sales/ 2008-11-07T15:44:03-05:00 http://blog.inc.com/sales/2008/10/prepare_your_sales_hires_faste_1.html Optimizing sales performance should be your most important concern. The 2007 CSO Insights report cites that to achieve sales performance optimization, one must truly understand the "levers" of sales performance and effectiveness. And the first "lever" should be getting your salespeople ramped up and on board as fast as possible -- this way they can start earning you the "green." But did you know there are levers inside the hiring and on-boarding process that must be defined as well? Here are three must-dos to turn your lost-in-the-sauce newbies into familiarized staffers: 3780@http://blog.inc.com/sales/ 2008-10-07T14:47:02-05:00 http://blog.inc.com/sales/2008/09/sales_management_coaching_will.html With the baseball season in full swing, it was no surprise to me that an article came across my desk on baseball coaching, and managing the strengths and weaknesses of players. I found it apropos that I was working on an article that stressed the importance of sales managers to coach their sales people to get better results. In baseball, the manager has many statistics; batting average against the team, on base percentage against opposing pitchers, runs batted in, etc. All of which they (the manager) use to coach and make decisions during practice and the course of the game. They understand the strengths and weaknesses of every player and coach and manage to improve their game. 3658@http://blog.inc.com/sales/ 2008-09-17T10:59:43-05:00 http://blog.inc.com/sales/2008/09/nobody_buys_a_value_propositio_1.html Value is at the heart of what every customer wants to buy. If you can't position yourself and your company as a source of value, executives will not want to talk to you. If you can't clarify what that value is to a specific executive, those executives will not take any action and most certainly won't buy. The issue of value is inescapable. Every conversation with an executive, or anyone within the customer's organization for that matter who has any power or influence, must include a conversation about value. The irony is that the more we try to differentiate ourselves by portraying our value through a value proposition, which we present to our prospects, the more we all sound the same. 3601@http://blog.inc.com/sales/ 2008-09-02T17:52:44-05:00 http://blog.inc.com/sales/2008/08/breaking_away_with_exceptional_1.html The more credibility we earn, the more exceptional our sales success will be, but it is becoming increasingly difficult to earn exceptional credibility. In my second book, The Prime Solution, I described how the requirements of our customers have steadily grown over the past decades. As customer requirements have expanded, so have the demands on sales professionals. Our ability to understand and meet those demands determines the degree of credibility that our customers will assign to us. We all know how important credibility is. When I ask seminar audiences "What is credibility?" the answers will include, our product knowledge, our brand, our history of success, our financial strength, our customer testimonials, our dedication to service, our reputation, etc. All of these are important answers and valid contributors to our credibility. The next questions I'll ask are "How do we typically convey that credibility to our potential customers? How do we get this message across to the customer?" Inevitably, the answers are, "we show them…" or "we tell them…" or "we give them a presentation." Then I ask a question that is quite sobering, "How different is your 'credibility story' from the credibility story of your next two best competitors?" The response is usually, "Not very different at all." 3456@http://blog.inc.com/sales/ 2008-08-01T14:19:35-05:00 http://blog.inc.com/sales/2008/07/how_can_your_purchasing_depart.html In the current economic climate, rising costs are affecting virtually every industry. As companies struggle to hold the line on their overall costs of goods sold, purchasing departments are under greater pressure than ever to focus on price in selecting vendors and contracting for products and services. While there may be some consideration of quality, availability, and overall value, price weighs ever more heavily in the decision process. As a result, companies are in danger of falling into the "penny wise and pound foolish" trap -- saving dollars up front, but incurring more cost down the line. Inexpensive products can offer significantly less value, regardless of immediate cost benefits. When any product is selected primarily on price, there are high risks of passing inferior performance and quality issues on to the buyer's customers, resulting in erosion of confidence in a company's brand. These and other problems can ultimately cost far more than the dollars originally saved at the time of purchase. 3337@http://blog.inc.com/sales/ 2008-07-01T06:00:01-05:00 http://blog.inc.com/sales/2008/05/dont_be_a_victim_of_commoditiz.html Understanding the three reasons for commoditization will help you provide value to your customers. Company executives and their teams are struggling with differentiating their complex business solutions in this highly competitive and complex market. Simultaneously, customers are putting a squeeze on margins by driving buying decisions down to the lowest common denominator -- price. How is this happening? Why is this trend increasing at an alarming rate? How can you hold your price and get paid for the value you create? Let's start by taking a hard look at the three driving forces of commoditization…advances in technology, difficulty connecting value to the customers' business drivers, and pressure on buyers to make decisions when the problem to be solved, and solutions offered, are not clearly understood. Companies are constantly seeking differentiation by upping the ante in technological advances; but this can be problematic if that differentiation exceeds the needs and understanding of your customers. If your customers can't comprehend or measure your value, they will respond by ignoring what could be very valuable to them and focusing on what they do understand…price, and there goes the downward spiral to commoditization. 3130@http://blog.inc.com/sales/ 2008-05-01T13:51:52-05:00 http://blog.inc.com/sales/2008/04/standing_out_in_todays_complex.html What obstacles do salespeople around the world face? The answer may surprise you. I've just completed a four week, eight country tour that included the US, Europe, Southeast Asia and the Middle East. Set aside the critical cultural nuances for a moment and you will find that sales professionals around the world are asking similar questions regarding how to become more successful in this complex and global market. 1. What are the most important skills a sales professional needs in order to succeed in today's competitive environment? There are critical components that form a foundation for learning and performance for all professionals. They are systems, skills and disciplines. A system is a set process or organized procedure that leads to a predictable result. The skill is in the individual's knowledge and ability to execute the system. Discipline is having the emotional or mental stamina, perhaps even the courage, required to achieve the highest standards of the profession. In short, these three areas represent knowing what to do, how to do it, and having the emotional strength to actually carry it out at a quality level. 3129@http://blog.inc.com/sales/ 2008-04-14T13:46:40-05:00 http://blog.inc.com/sales/2008/03/becoming_an_exceptional_resour.html When customers see you as contributing to their business's success, you're rewarded with greater loyalty. Exceptional sales professionals recognize that the traditional strategies of differentiation through product and price are not nearly as effective as building a solid base of customers who look upon the seller, their solution provider, as contributors to their business. Customers deal with many salespeople and are demanding a higher level of expertise from the individuals they choose to work more closely with. They are giving greater loyalty to those professionals who most adequately support their business objectives, those that become a source of business advantage. We refer to that unique group of professionals as P.R.I.M.E. Resources®. What does it mean to become a P.R.I.M.E. resource? 3128@http://blog.inc.com/sales/ 2008-03-24T13:42:47-05:00 http://blog.inc.com/sales/2008/01/three_keys_to_a_successful_new.html The beginning of the new year is a great time to re-evaluate what worked well last year, and what didn't, and what you'll need to do to face the challenges ahead of you. In the past year we have seen businesses undergo dramatic changes in their attempts to meet customer requirements and serve their markets more professionally and successfully. Competitive pressure is relentless, especially when it's becoming more obscure as to whom the competitor actually is and how the customer is evaluating their choices. The beginning of a new year is a great time to pause and re-evaluate what has worked well and what has not, what's evolving and what we need to do differently to meet the challenges in front of us. As you examine your own business strategy, I want to share with you the top three challenges that I have observed organizations struggling with, and give you some ideas on how to reposition yourself and win more business in 2008. 1. Customers don't fully understand their problem and what to do about it. The complexity of today's business -- advancements in technology, evolving global markets, unanticipated competition, creation of robust and more complex solutions, etc., make it nearly impossible for the customer to be expert in all areas of business and be able to recognize the best opportunities for improvement. 3127@http://blog.inc.com/sales/ 2008-01-13T13:39:53-05:00 http://blog.inc.com/sales/2007/11/set_yourself_apart.html You gain more credibility with the questions you ask than with the stories you tell. I had the pleasure of joining my partner today on a conference call with a prospective customer. This is about the fourth such call she has had with this customer. It is a substantial opportunity for us, and of course in an opportunity of this size, the customer is speaking with a group of potential suppliers. The initial group was large -- 12 great companies looking for an edge -- but it always narrows down to the preferred choice. In this case it was Prime Resource Group. Today I heard this customer say those critical words, "Quite frankly, you guys are asking a lot of questions that I haven't heard from the others. You've helped me think this through and, in fact, you have really caused me to change my thinking on my entire approach." Let me share with you one of my "Key Thoughts": You will gain more credibility through the questions you ask than the stories you tell! It's one of those simple nuggets of information that, when applied, can make a great impact on your business. 2315@http://blog.inc.com/sales/ 2007-11-17T11:31:29-05:00