Archive for the ‘Questioning’


Battling the 57% – Part2: Flanking to Win

I have written before about the statistic that is out there ‘buyers have progressed 57% through their buying process before they engage a salesperson’ – is in fact an average and that how you act before and after ‘the 57%’ is a matter of choice, not a function of averages. It really comes down to whether you engage first with the buyer, or react to their engagement with you. In this post I will set out some guidelines on how you might react ‘after the 57% point’ if you find yourself in that situation.

Let’s first consider the whole spectrum of engagement – the Sales & Marketing Continuum.

57-2-smc620

For any purchase, the customer goes through a number of phases, beginning with Awareness. At this point, they learn that you and your product exist. This is followed by Interest where they care about what you (and others) have. The next phase is the critical one. This is where they establish Preference for a given solution or supplier.

When you overlay the 57 percent point on the Sales and Marketing Continuum, you can see that it lies at the critical juncture between Interest and Preference: If they’re already 57 percent through the decision process before they engage you, there’s a high probability that they’ve already established a preference.

57-2-smc2-620

Consider what happens if  you’re late to the game. If that is the case, you’re probably chasing a sale that will be hard to win. In this case how you respond is really important. At this point your competitor is probably in the lead and has been established as the preferred supplier. You need to shift the focus of the customer’s buying criteria to a new or additional issue — one that your solution will uniquely deliver. This is called a Flanking Strategy and can reset the conditions of the sale in your favor.

57-2-flanking620

There are four things to consider:

  1. Don’t follow the rules. (Your competitor is already winning under the current rules.)
  2. You need to have internal executive support. (You’re changing the game, and someone powerful must help.)
  3. Make your move last.
  4. Don’t open the door to alternative solutions.

However you can’t just arbitrarily adopt a Flanking strategy, you must also have the right conditions in place.

  1. A flanking strategy requires that you offer a solution with unique business value informed by genuine insight about the customer’s needs.
  2. The proposed solution must also favor your unique strengths.
  3. You are devising a specific benefit or value for the customer that your competitor can’t match.

Let’s look at some examples:

In the 1990s, Oracle and Siebel dominated the CRM market. In 1999, salesforce.com entered the field. Rather than asserting, “We’ve got a better CRM,” Salesforce focused attention on a new perceived value by stating that their approach of delivering enterprise software from the cloud would yield a 10X easier deployment cycle. They didn’t sell based on CRM features. Their proposition was that Salesforce was easier to use and easier to deploy – a benefit against which the others couldn’t compete: a unique business value that the customer cared about. Over the last fifteen years Salesforce used a flanking strategy flawlessly and changed the rules in a big way.

In our own case at The TAS Group, we also adopted a flanking strategy to introduce our solutions. We examined the business of sales training, methodology and effectiveness tools: $10 billion of expenditure every year. But research showed that on average 87 percent of that training was ineffective after thirty days: $8.7 billion wasted. Clearly, traditional approaches weren’t the most effective investment for improving sales team productivity. Our solution, Dealmaker – embedded decades of sales methodology in a smart, easy-to-use software application – uniquely helps companies to operationalize their sales effectiveness initiatives – for true, sustained sales transformation. Our flanking strategy was born of this insight and helped us establish a new market category: “How do you operationalize your sales effectiveness? What do you do when the sales trainer leaves?”

While customers have an ever-increasing opportunity to research their own solution before they engage with a supplier you have an opportunity to shape the subsequent interaction by helping them to learn what you want them to know.

Feel free to download The TAS Group’s latest publication, Battling the 57%: Deconstructing the Buyer Seller Dance or for a more detailed treatment of how to add value to your customers, check out the #1 Amazon Bestseller Account Planning in Salesforce.

 

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Battling the 57% – Buyers Buy Different Things

There’s a statistic out there that buyers have, on average, progressed 57% through their buying process before they engage a salesperson. That ‘average’ piece seems to have been lost, and a commonly held-belief now is that this 57% is a fact in all cases.

How you act before and after ‘the 57%’ is a matter of choice, not a function of averages. Buyers buy different things, and sellers sell differently. You get to choose. But first, let’s explore the differences.

As we researched this topic, we spoke to many of our great customers to see what they had observed. Here’s their buyer’s point of view.

  • Xerox sells many things, including copier paper. Copier paper is a commodity. As a buyer I don’t need a lot of advice. I’m going to buy frequently and only care that the price/quality is reasonable.
  • Hewlett-Packard provides most things an IT buyer might need, including a cool laptop called the HP Envy – a little more complex than my copier paper.
  • If I wanted a temperature control system in our building, Honeywell is the place to go. It’s a more specialized purchase than a laptop.  I am probably going to need guidance and advice.
  • Harmonic sells media controller systems that manage video workflows in some of the world’s largest and most demanding video environments. That’s not something I want to buy on my own. I’ll need some consultative advice.
  • Box provides enterprise online data sharing and large-scale content management services. Buyers want to engage strategically when determining their enterprise content strategy. It’s a big commitment.
  • If you are choosing Salesforce as your CRM, it is likely to have significant impact on your business. You know it is important to get some serious advice.

As evident from these examples, there is a lot of variability in how buyers need to engage before buy, so let’s look about how you might deconstruct that.

Organizational Impact is a Driver of Buyer Engagement

If you engage early with the buyers in their buying cycle you will be more successful.  That is a core tenet of my book Account Planning in Salesforce (free extract here). Being a buyer isn’t as easy as it might seem. Understanding and articulating their own needs and then finding the best solution can be a stressful exercise.  The greater the organizational impact, the more stressful it gets.  Buyers need help.

p2

The two axes on this graph are cost and intellectual property (IP) intensity.  As they increase, so does organizational impact. Buyers then need help in establishing criteria, evaluating options and choosing a solution. The engaged salesperson can create value for their customer and gain more control of the deal.

There are also two other factors that matter: risk and frequency. Organizational risk is higher when choosing a CRM system than it is when buying copier paper. The buyer performs greater diligence and needs more guidance. Also, greater frequency translates to greater familiarity and less need for help. I buy copier paper more often than I buy a temperature control system so I know how to make the copier paper purchase on my own.

p1

In the chart here you can see in the top right quadrant, our buyer is more likely to engage the supplier early, because a business process infrastructure project is usually high cost, contains a lot of IP value and a bad decision carries significant risk.

Conversely, there is less IP value in purchasing utilities (e.g. electricity). The difference when buying office equipment is even more striking; Cost, IP and Risk are typically low and Frequency is high, so buyers are less likely to need a seller to guide them.

Here’s the thing: If your solutions don’t fit into the bottom left quadrant, your buyers likely want to engage with you (or your your competitor) much earlier in their process, and there are many things you can do to influence the outcome.

In the next post, I’ll help you understand how to respond when the buyer is in fact well along the path to developing a buying preference. In the meantime, please feel free to download our latest publication Battling the 57%: Deconstructing the Buyer Seller Dance.

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20 Facts about Sales Performance

At The TAS Group, we just recently completed a global study of sales performance.  The full report will probably be available by late April.  If you want a copy email me ddaly (at) the tasgroup (dot) com.

The statistics are pretty revealing – so I thought I would share them with you now.

  1. 33% of sales people made quota in the last reporting period

  2. Only 52% of sales people say they can access the key players for a sale

  3. 39% of sales professionals say they are not able to effectively uncover customer problems, and

  4. 35% struggle with designing customer focused solutions

  5. 59% of sales close as originally forecasted

  6. Sales forecast accuracy jumps to 76% when sales methodology is applied well

  7. When the Sales function contributes to company strategy, quota attainment is 15% higher than when Sales is not involved

  8. Quota attainment is 25% higher when Sales and Marketing are aligned, and

  9. Win Rate is 15% higher when Sales and Marketing work well together

  10. 59% of sales reps are good at opportunity qualification

  11. 32% of sales professionals do not develop competitive strategies for their opportunities

  12. When competitive positioning is part of a company’s sales strategy, revenue increases by 30%

  13. 44% of reps are able to maximize the value of a sales opportunity

  14. Only 36% can maximize the value of their key accounts

  15. Salesforce.com has the highest % of CRM users with adoption > 50%

  16. TAS has the highest % of methodology users with adoption > 50% (We are very happy about this!)

  17. When methodology is integrated with CRM sales teams are 35% more likely to achieve average quota over 75% (As you know this has been my mantra for a long time!)

  18. The #1 reason why sales methodology is not used is that only some people use it.

  19. 60% of companies use a defined sales process

  20. Companies are 33% more likely to achieve average quota over 75% if they use a sales process.

We have analyzed all the data that we gathered – and it was a lot – and some of the insights are fascinating.  We are looking forward to getting this finished and published to share.

As I mentioned above – If you want a copy email me ddaly (at) the tasgroup (dot) com.

 

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The Challenger Sale Debate – Is it missing the point?

There has been a lot a debate among the sales training / sales enablement community about The Challenger Sale from CEB’s Sales Executive Council.  Some of it has been cogent and balanced, but unfortunately a lot has been mud-slinging and poorly articulated or uninformed specious commentary that does not reflect well on the sales training industry. Most of the latter type has, probably predictably, come from those who might have good reason to be threatened by the seeming ubiquity or pervasiveness of TCS.  On the other hand, where measured arguments have been put forward, it seems that these originate more often from users, practitioners, or observers who acknowledge the value of TCS while wondering about its place in an overall sales eco-system.

I have read commentary from Linda Richardson, HRChally, Jonathan Farrington, Dave Stein, Tamara Schenk, Solution Selling, and others, and you can look at the links and judge for yourself who is engaging in productive debate, who is posturing to protect their own patch, and who is being downright unprofessional.   Methinks the latter doth protest too much!

Most of the anti-Challenger rhetoric seems to rail primarily against how the Sales Executive Council has presented Challenger to the market, and less about the substance of the TCS model, or the research behind its findings.  Many of the commentators take umbridge at SEC’s positioning of the findings as being new or noteworthy.  “There is nothing new or unique here” is a common cant.  Well, clearly that is not true: Otherwise TCS would not have captured the attention that is has, resonated as strongly with the marketplace, or evoked such a – sometimes vitriolic – response from those who feel threatened by it.

At The TAS Group, we faced similar criticism from some of the traditional sales training players when we introduced Dealmaker to the market.  We presented a view that effective adoption of methodology could only happen when supported by intelligent software and integrated into the daily workflow of the sales professional by combining the application of methodology with usage of the CRM. We were subsequently positioned by our competitors as only focused on technology, and we were questioned by the analysts as how we could maintain deep research in methodology and technology at the same time.  Well, that was six years ago, and the evidence suggests that we were not as misguided as some would have thought.   Now, although not everyone has the depth of technology resources that we do, everyone recognizes the need for software as an integral part of a sales performance system.  And, the advancements we have made in methodology during that time has served our customers very well.

I don’t think TCS is either perfect or a complete sales system, or a one-size-fits-all solution; nor do I believe that the folks at the Sales Executive Council think so either.  (By the way, I am struck by the fact that it is evident that many of those who are criticizing TCS had not spoken to the SEC before they expressed their views.)  A complete sales performance system requires everything from market planning to territory segmentation, account stratification, account management, opportunity management and sales process, all supported by skills and technology.

But TCS has a number of undeniable strengths.  It has done a better job of highlighting the need for greater sales and marketing alignment than many of its forerunners.  (I have written about that problem here, here, here, here, here, and here.)  With a level of clarity all too rarely seen in the industry, it has debunked the myth of the Relationship seller.  Where others represent it as arrogant that a sales person should bring insight, or being able to ‘teach’ the customer as being arrogant, I see it as a customer focused approach, and an acknowledgement that buyers are more informed and therefore the sales person has to prepare much more diligently.  It demands that the sales person work hard to understand their customer and the customer’s industry, and requires a level of intellectual capital that all customers should look for from their suppliers.   In my opinion, any effective sales person should be able to bring insights to her customer of what has worked elsewhere.  I think that is table stakes.

Through its membership community, SEC has an effective petri dish to test its approaches, before unleashing them on the market.  Their heritage in research is a matter of fact – not of opinion. While they still have a way to go, I would have hoped that constructive inclusion, a recognition of how TCS complements other methodologies, would have been the response, but sadly …

More importantly though, the success of Challenger – and it is unquestionably successful – points to a failure of traditional providers, particularly those who focus on sales skills.  The fact that TCS has been so quickly embraced points to a deficiency in the alternatives.  Otherwise why would there be a gap in the market for SEC?

Make no mistake.  SEC has done a remarkable job of positioning TCS in the market, and indeed is using the principles espoused by Dixon and Adamson in their book to effectively challenge the status quo.  Something is working – and the response of the detractors only validates the approach.

 

 

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Please sit still this won’t hurt a bit…I have some questions…

Guest Post: Tim Foster, Sales Director EMEA, The TAS Group

Over the first month of this year, I asked a lot of sales people and their bosses a simple question; “What is the most difficult element of selling in 2012 and what will make or break your year?”. The same two answers came up frequently:

  • I can’t get access to the decision makers
  • Customers don’t follow through on their committed actions

These are not new problems, and not ones that seasoned sales professionals like to admit to themselves. But things have come to a head. For the last five years sales people have been told to create value, not just communicate value.

We have all warned and been warned that the buyer now controls the buying cycle, and that much of it is happening without the seller present. In many cases (dare I say most?) the sales cycle has been reduced to a short interaction to validate buyer assumptions and haggle over price. Buyers are now used to this pattern and as a result have Zero Tolerance for the traditional Discovery Call.  The bar has been raised. Without doing something dramatically different you won’t get access. Even in the rare cases that you get in the door, they will perhaps smile, but you will not get them to agree do anything if you follow the old traditional approach.

No one likes to be confronted with their failure, least of all me, so let me try to explain, in a positive way what’s going on and what we need to do.

The symptom is the difficulty of gaining access and provoking action.  The underlying cause is the inability to build consensus and alignment between you and the buyer. You can only build consensus if people remember you and what you say. This means that what you say has to be something that represents true value creation for the buyer.

What you say must be an idea that the buyer has not come up themselves, and, crucially, must be something that is truly useful from their perspective and delivered in context of their current challenges, their situation and their goals. If you don’t you do that, you are merely a distraction. At the heart of this is the age-old perception problem that many in sales or “Business Development” cannot be trusted. And, without trust it is hard to have to gain the customer’s confidence. So, before the conversation starts, you have to earn the right to engage, discover and advise the customer.

At the TAS Group we are cognizant of the fact that at the end of the day, the customer’s opinion is the only opinion that matters, and to change the customer’s mind, you have to first get inside it.  We think the Trust Equation is a good framework to use to virtually place yourself on the same side of the table as the customer.

Trustworthiness = (Credibility + Reliability + Intimacy) / Self-orientation

How the Trust Equation Works:

It all starts with Credibility:

Credibility Builders include:

  • Accuracy and completeness of your story
  • The ability to grasp and even predict the customer’s key business challenges and the ability to articulate the way you have solved similar issues for others in their industry.
  • Confidently and proactively reference other customer outcomes ( avoiding the often awkward phoney war of Discovery first,  references 2nd)

Credibility Killers include:

  • Exaggeration
  • Overstating your knowledge
  • Lack of specific detail that demonstrates a lack of preparation.

Reliability is just ‘table stakes’, but a critical factor.

Reliability Builders include:

  • Delivering on what you say you will do
  • A connection between promise and action; doing things the way the customer wants them done
  • Marshalling all the required resources within your company and beyond
  • Helping the customer look good with their peers or superiors.

Reliability Killers include:

  • Missing deadlines
  • Inconsistency
  • Inability to move things forward for the benefit of the customer. They hate having the same conversation twice – or boring conversations even once.
  • Wasting their time

Intimacy shows that you are not afraid of being vulnerable:

Intimacy Builders include:

  • Courage to do the right thing
  • Leading (which might not be the safe option)
  • Candor and willingness to demonstrate emotional commitment to the customer

Intimacy Killers include:

  • Artificial behavior
  • Saying just what the customer wants to hear
  • Arrogance or belligerence.
  • Closed mind set, or fear of taking risks. (Ditch the comfort blanket of the 14 slide company overview that you like to warm up with)

Self-Orientation is critically important.  Getting this wrong destroys your efforts everywhere else:

Self-orientation Builders include :

  • Active listening rather than talking. I mean really listening to what the customer has just said and building the dialogue around that before moving onto the next point you want to make.
  • Focusing on the reality of the here and now and a genuine curiosity of the customer’s problems is essential.

Self-Orientation Killers include:

  • Being in it only for the money and your benefit
  • Always needing to be right
  • Winning at all costs with limited evidence of long term commitment.

Think about a good sale you made recently. Everything seemed right and if you were to ask the customer why they bought from you they should recognize that you made it easy (or easier) to buy from you rather than the others. Building trust and a relationship with the customer makes it easy for the customer to buy.

This approach requires a shift in mind-set as well as the learning and application of a new way of working with customers. It’s a fine balance between asserting control and getting on the other side of the table.

Not all customers will let you stay on their side of the table, and not all sales people will find that a comfortable place to sit. I urge you to try it. You just might like it and make things a little less painful for the customer.  In turn, that will make things a lot less painful for you, and will validate in the customer’s mind their decision to give you access, and strengthen their desire to follow though on their committed actions.

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The One Sales Trend that Demands Attention

Guest Post: Bruce Wedderburn, EVP Channel & Enablement, Huthwaite Inc.

As we kick off 2012 with a heightened sense of optimism after the past few years, we all hypothesize what the new year will bring to our organizations, our people and our clients.  And typical of this time of year there are no shortages of prognosticators who are allegedly spotting the trends that are going to take the sales and business world by storm.  Having read many of these predictions and having had a chance to cross reference them against what we are seeing at Huthwaite as we look into 2012, there is one trend that we feel strongly all sales organizations would be foolish to ignore.

The traditional discovery or investigating skills that have been the bedfellow of top-performing sales people for the last twenty years are being totally redefined.  That redefinition is being performed by your clients, with or without you.

The previous approach to sales quota-busting was centered on your ability to effectively diagnose the customer’s known pain, uncover their needs, and based on that discovery to then craft a targeted solution that addresses the needs as the customer articulated them to you.  Sounds right, doesn’t?  I mean, that’s the practice of the star performers, isn’t it?  They have mastered the art of asking good questions.

Maybe…

Your customers have changed their purchasing behavior to make that approach a little antiquated.  Customers have put in place strong buying systems, they are taking advantage of the availability of information on the web and social media, they’ve employed consultants, and their purchasing is more strategic, commercial-driven, transparent and professional than ever before.  That means that by the time your sales rep gets to talk with a customer, the customer may have already moved far around the buying cycle on their own.  A recent SLR report stated “on average, 57% of a purchase decision is complete before a customer contacts a supplier”.  By this time a customer is quite clear as to what their needs are, what options are available to them to meet those needs, and what price they can meet those needs for.  So a traditional discussion where a sales rep asks the customer about their needs (as understood by the customer) is of very low value.  The customer already knows their needs and the unfortunate rep is forced to play the role of solution describer and price discounter.  New customer buying behavior is driving traditional sales reps to a world where they are responding to demand, not creating demand.  They are finding customers who are already in the market vs. making customers out of those who are yet to look for a solution.

Herein lies the key to the redefined role of the sales rep in 2012 and beyond – star-performers will be applying their skills in the opposite direction.  They will increasingly create demand, not respond to demand.  That demand will be created not through providing information about products and services, and not through asking the customer questions about information the customer already knows.  It is through delivering insights to their customers in a way that creates value.  But a critical question is – how are these insights to be delivered?  Recent thinking proclaims that the best reps must “teach” customers, you must “educate customers on potential ways to change”, or deliver value by telling customers what insights are important to them.

Sounds compelling, doesn’t it?  Even seductive – but it totally misses a critical point.

We must remember that there are two rules that apply to all human communication.  These rules apply particularly to selling:

1. Customers  value what they say and their own conclusions more than what they are told. (especially what they are told by sales people)
2. Customers value what they ask for more than what is freely offered. (Especially insights that are freely offered by sales people)

These rules of communication tell us that an approach based on telling, teaching or lecturing to a customer about the insights they need to be aware of may fall on deaf or suspicious ears.  And there is factor that we must also take into consideration.  With the increased sophistication of customers in today’s market, is there a risk that a sales rep’s attempts to teach or challenge may be perceived by an experienced buyer as a little obvious and even self-serving?

The reality is that the star-performers of 2012+ in the B2B world will still be the champions of investigating.  It’s just that they are no longer only asking questions to uncover customer needs.  They are asking questions that provoke and encourage deeper thinking about unrecognized problems and unanticipated opportunities for business growth.  They are indeed educating about trends and delivering insights, but doing so by helping the customer arrive conclusions not through presentation but through discussion.

Put yourself in the buyer’s shoes and ask yourself which approach you would prefer?

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Dealmaker Index Example Report

The Dealmaker Index has been running now since early November 2011 and we have been learning a lot from all of the participants. Here is sample report so that you can see the kind of information you can get if you participate in this free study. The report comes in four parts: Summary Infographic, Executive Summary, Detailed Analysis and Personal Dealmaker Index Report. The Executive Summary and Detailed Analysis components each relate to the company Dealmaker Index score, and the Personal Dealmaker Index Report is tailored to the individual who completed the study.

Summary Infographic

Dealmaker Index - Sample Report Header

The infographic is a quick summary or dashboard of the results for each participant and their company.  On the left you can see the results for the participant’s company, starting with their Dealmaker Index overall score. In this example, the company scored well, and was graded at 77%, placing them in the High performers category.  This is an absolute score.  Below that Sample Co received 70% on the Peer Group Relative Performance scale. This means 30% of the peer group who participated in the study scored better. Immediately below that are the four sub-indices that together make up the overall Dealmaker Index score. As you may know, we measure sales velocity (i.e. the amount of revenue achieved per day) by more factors; the average deal Value, the Number of qualified opportunities, the Win Rate of those opportunities and the Sales Cycle.  The four sub-indices measured here, represents how well the participant’s company performs against the elements that determine whether they are optimizing their performance in each of these areas.

On the right hand side of the graphic are the absolute and relative personal Dealmaker Index scores for the individual who participated in the Dealmaker Index study.  Jane Smith did really well (89%), and is classified as a Dealmaker Ace.  Consequently she is at the top of her peer group.

You can participate in the Dealmaker Index Global Sales Benchmark Study yourself for free here.


Executive Summary

Based on the data provided, Sample Company has an overall Dealmaker Index of 77% which places the company in the High Performer category of participants in the Dealmaker Index study.

  • Dealmaker Value Index: 76%
  • Dealmaker Number Index: 76%
  • Dealmaker Win Rate Index: 75%
  • Dealmaker Sales Cycle Index: 80%

The level of revenue that is generated by any company in any sales period is a function of the number of deals or qualified sales opportunities that are being worked; the value of each sales opportunity; the percentage of those deals that are closed; and the inverse of the length of the sales cycle.

In the case of Sample Company, based solely on the information provided, the analysis of the attributes that contribute to the performance across each of the sub-indices provided the following insight. The initial analysis here is supplemented by detailed analysis later in the report.

Many factors influence the effectiveness of your sales organization, or the sales velocity you can achieve. If you can increase your performance in each of the metrics above the line by just 10%, i.e. grow the number of deals, the average value per deal, and the percentage close rate by 10%, and decrease the length of the sales cycle by 10%, you will increase your sales effectiveness by 48%. That’s equivalent to increasing your number of sales representatives by half, without making one additional sales hire.

Dealmaker Value Index: Value optimization doesn’t appear to be a major problem for your company. This of course means that you need to close fewer opportunities to achieve your revenue goal, and it is likely that the profitability of your deals is pretty good. Bear in mind – I’m making this assessment based on the information you provided me. Check that real differentiation is being well articulated consistently – particularly in a competitive situation. Look for avenues of expanded value offering to further optimize the return from each customer. [Minimal revenue increase potential]

Dealmaker Number Index: Based on the information you have provided, you’re better that average at finding good opportunities. Stay on it. Make sure the value you articulate is mapped to the buyer’s needs. Develop and replicate refined qualification processes. Shorten the ramp-up time for your new sales hires by incorporating – in an optimized sales process – the ‘best practices’ that are working. Look to the detailed analysis later to see areas where you might improve further. [Minimal revenue increase potential.]

Dealmaker Win Rate Index: The company would appear to have ingrained ‘closing’ behaviors, practices, and departmental interrelationships that support above average close ratios. Your company’s score – based solely on the information you provided – place you well above average for your ability to close deals. Make sure that the factors that govern this performance are further institutionalized in your company. [Minimal revenue increase potential.]

Dealmaker Sales Cycle Index: Now is the time to institutionalize the best practices you have developed to manage the length of your sales cycle. It would appear that your company’s performance in this area is quite a bit better than average. Make sure you have a living sales methodology, a buyer-centric sales process – all supported by technology to maintain your above average performance in this area – and facilitate continuous improvement. This will keep you at the top of the pyramid. [Minimal revenue increase potential.]

First Action: 5 Key Areas to Focus On: Keep, Change, or Stop

KEEP: I’m pleased to see that you have a well defined sales process. Hopefully it reflects the customer’s buying process. Our experience, and that of our customers, would suggest that having a well defined sales process, mapped to the customer’s buying process, and then executing well on the process, is a powerful accelerant to any company’s progress. Stay on it.

STOP: As the saying goes – companies don’t buy, people buy. Failing to gain access to key influencers in a deal is definitely one of the main reasons why deals are lost – and unfortunately it seems your company has some work to do here. You’ve said you’re not effective at gaining access. First, you need to identify who the real influencers are; and then consider things from their perspective. If you were in their shoes, why would you spend the time? Usually senior executives – who are often the key influencers – will only take a meeting if someone in their internal organization asks them to. The second key most likely to open the door is a referral from someone in their industry, perhaps a peer at a similar company. Unless you figure out how to gain access your win rate will definitely be sub-optimal.

KEEP: You’ve said that you are confident that your sales team is good at uncovering the customer’s business problem. That’s really good, and the alternative is not pretty. As you know, without understanding the customer’s business problem, there is no way you can know the value your offering will provide, or indeed even how to apply your solution to solving the problem. Then it becomes a feature or price battle, and that’s an abyss that, thankfully, you seem to be able to avoid.

KEEP: It’s evident from your input that you’re comfortable that the sales team is effective at differentiating against the competition. You seem to have this in hand, but is possibly worth revisiting the factors that would get in the way of this being untrue. There can be only three reasons for a sales team to fail this effectiveness test. (1) You don’t understand the Unique Business Value (See above) you provide, (2) You don’t know your competition – a grievous sin, or (3) You can’t position competitively. You have to be competent in the first two before you address the third. One more thing – I’m assuming that you understand the specific problem the customer is trying to solve (See above) because without that any effort spent on competitive differentiation is a waste of time.

KEEP: Our research suggests that sales people spend on average two and a half hours a week on sales forecasting. Yes, that’s right -150 selling minutes. And then the deals that are forecasted don’t close as forecasted. Thankfully you’re bucking the trend. That is really valuable to your company, as the alternative is one of the most damaging aspects of some sales teams’ behavior. You’re probably aware that there are evidence based sales forecast tools available, and you might be already using one. As you know you will achieve much greater sales forecast accuracy if the team follows a well defined sales process – one that is designed to map to the customer’s buying process (See above). Good work.


You can participate in the Dealmaker Index Global Sales Benchmark Study yourself for free here.


Detailed Analysis

Strategic Alignment
It’s good that you think that sales and company strategies are aligned. Selling against the corporate direction is hard, but it doesn’t seem like that is the case here. ~ It would be better if there was enough evidence for you to be clear that the sales and marketing functions worked well together. You’re saying you’re not sure about that. Sales and marketing alignment is crucial. Think of it this way: You’re supposed to be working together to beat the competition. Get everyone behind that goal with a shared purpose and common resolve. ~It’s good to see that you believe that the leadership of your company looks for strategic input from the sales organization. This is one up for the good guys. Nothing happens until someone sells something. The sales function is strategic, and so must be part of the overall strategic picture. Make sure those who need to know this, actually know this, and always consider what is going to ease the buyer (your customer) / seller (your sales organization) relationship. ~ When a company’s culture encourages support of the sales organization, it usually means that the focus is right on target. Congratulations, you’re in a good place, as it seems that the sales function is getting the support it needs. The sales team needs to hold up its end of the bargain and make sure that reciprocal respect is forthcoming.

Sales Process Analysis
I’m pleased to see that you have a well defined sales process. Hopefully it reflects the customer’s buying process. Our experience, and that of our customers, would suggest that having a well defined sales process, mapped to the customer’s buying process, and then executing well on the process, is a powerful accelerant to any company’s progress. Stay on it. ~ Read again what I said earlier regarding the importance of a well defined sales process. I’m pleased to see that you believe that your sales process is well understood and executed by the sales team? Assuming it is a well defined process – one that is mapped to your customer’s buying process – then you’re optimizing your chance of success. Well done. ~ Sometimes it is hard to get all of the company to understand that they are a critical cog in the sales machine, so I can understand why you’re uncertain about the ‘non-sales’ people’s understanding of their role in supporting the sales team’s execution of the sales process. Perhaps you might try this. Take out a piece of paper, or get to the white-board, and sketch out all of the touches a customer has with your company; this should cover how the phone gets answered when the customer calls; the product or service being used, the response time on queries; the stories in the press; your presence in the Social Universe, and so on. Then think about the steps in the sales cycle, and consider how each of these interactions might impact the execution of each step. That might help everyone understand the role they play. Understanding is usually the hardest part of this task. ~ Understanding sales process is fundamental. It’s as simple as that. The only long-term alternative is organizational pain. I’m glad that you recognize this. How can you arrive at the right destination if you don’t have a map? You’ve indicated that you think this is a Very Important competency for your company. I’d probably like to see it in the Essential category.

Sales Velocity
It is very positive that you feel good about the sales team’s ability to effectively qualify opportunities. I remember a wise experienced sales professional asking me one time why I was working on unqualified opportunities, when I could be making money. It is good that the team is focused on the latter. Continue to make sure that the definition of a qualified opportunity is clear to everyone and that the sales team has the skills, and inclination, to ask the hard qualifying questions. ~ You’re not confident that your sales close ratio is satisfactory. You need to ask yourself three questions. What is the underlying cause? What is the impact? What can you do to improve it? And then perhaps consider how you define win rate. Close ratio is one of the four main factors in the Sales Velocity Equation and a critical component of profitability. It costs real money (and of course time) to pursue each deal, and when you’re not achieving an acceptable win rate, both revenue and profitability suffer. There are really only two reasons why you ever lose a deal; (1) You shouldn’t have been in the deal in the first place – in other words you did not qualify correctly, and perhaps your offering is not suitable. See comments above on qualification. (2) This was a qualified opportunity, but you were outsold. Think about it and consider whether your sales process is truly aligned to the customer’s buying process, and whether the sales team has the right supporting tools to present the right value proposition to the customer at each stage in the buying cycle. Only then will you be able to guide the sale in the direction you need, thereby increasing your win rate. ~Being comfortable with the sales cycle duration is a very healthy indicator. You said that you think the sales cycle is about the length you think it should be. This is one of the fundamental factors in the Sales Velocity Equation, and a strong predictor of success.

You’ve been non-committal in your assessment as to whether your company is effective at maximizing the potential from your major accounts, or maybe you’re just unsure, or you don’t think it is applicable. If your major accounts are indeed ‘major’ then you can’t do this on your own, and you need corporate level buy in, and sustained commitment. Major account development takes time before it provides the return, and there is no point in trying to develop major accounts unless your company has the infrastructure, inclination and ability to apply the necessary resources to make it work.

Coaching and Getting the Basics Right
The first line sales management job is really difficult. But it is also particularly important. Managers should most of their time coaching. The answer you selected would suggest that this is the case. There is abundant research that supports the fact that sales teams who are frequently coached will dramatically over perform those who don’t receiving that kind of guidance. If the managers are spending their time chasing details of sales opportunities, there is very little value added to the sales person. Make sure that your company continues to do what it takes to make this embedded practice in your company. ~ It was Albert Einstein who said – never stop questioning. He might not have known it at the time but he was articulating one of the key commandments of the sales profession. Alongside listening and presentation skills, these are really basic skills that every salesperson should master. You’ve indicated that you’re pretty happy with this, and that is great. The good news is that if competencies begin to slip, this is one area that is pretty easy to fix. Keep up the good work. ~Efficient utilization of company resources is always important. You are in the happy position where you believe that the company efficiently allocates resources to well qualified opportunities. This means that resources are applied to the ‘most-deserving’ opportunities, and investments that you would like to see in other supporting functions, such as product development, marketing or support, are not being wasted. The sales organization should care deeply about this. ~ It is always healthy to retain an adequate focus on the basic skills. I am pleased that you view Level 1 Individual Selling Skills as Very Important. These skills are foundational. ~ Demonstrable Level 2 Selling Skills (Gaining Executive Access, Discovery, and Understanding Customer Needs etc.) are some of the most common skill deficits that lead to missed revenue. Recognizing the importance of this is crucial, and I’m pleased to see that you share this perception. Now, just be sure that your program to embed these skills is sustained.

Social Media
Whether we like it or not, social media is here to stay. Twitter, LinkedIn, Facebook, company blogs, YouTube video channels, self-service capabilities on the Internet like Dealmaker Genius and Dealmaker Index, and community sites are examples of just some of the facilities in the Social Universe being used by your customers, and your competitors – and it’s not just for consumer focused businesses. If your company is not really leveraging social media it is undoubtedly developing a competitive disadvantage for itself. Not all social channels need to be used, but to use an off-line analogy, this is where your customers are ‘hanging-out’. This is an increasingly important destination for your customers, and it’s where they are increasingly having conversations. If you’re not part of the conversation, then it is less likely that you will be the person they call when a business opportunity arises. It’s that simple.

Keeping Customers
You’re not ready to say that your customer retention rate is satisfactory, and that is a concern for me. Customer retention is an issue you must address if you’re to pursue a sustainable growth strategy, or even if you just need to achieve a healthy profit margin. Perhaps somewhat surprisingly, customer retention is not usually a result of price pressure or product features or capability. More often customers switch to an alternative supplier because they are unhappy with the service being provided. Now armed with that knowledge, what actions can you take to improve your customer retention rates? ~ You must be pleased that your company understands that effectively developing and maintaining long term customer relationships is the key to achieving an optimum renewal rate for your recurring business. You’ve said that you believe renewal rates are satisfactory. Keep effectively communicating with your customers and continue to elevate the renewal conversations to a business level, demonstrating the true benefits of renewing from a customerÆs perspective.

Competitive Differentiation
Differentiation is key. There is just so much noise out there. And clearly your company has figured it out. You said that your sales team finds it easy to differentiate your offering. While everyone else is talking about USPs or Unique Selling Proposition, your team is more likely thinking in terms of a Unique Buying Proposition, or a Unique Business Value, or they might call it a Unique Value Proposition. In any case, you’ve figured out that it should be considered from the buyer’s perspective. That works. ~ As the saying goes – companies don’t buy, people buy. Failing to gain access to key influencers in a deal is definitely one of the main reasons why deals are lost – and unfortunately it seems your company has some work to do here. You’ve said you’re not effective at gaining access. First, you need to identify who the real influencers are; and then consider things from their perspective. If you were in their shoes, why would you spend the time? Usually senior executives – who are often the key influencers – will only take a meeting if someone in their internal organization asks them to. The second key most likely to open the door is a referral from someone in their industry, perhaps a peer at a similar company. Unless you figure out how to gain access your win rate will definitely be sub-optimal. ~ You’ve said that you are confident that your sales team is good at uncovering the customer’s business problem. That’s really good, and the alternative is not pretty. As you know, without understanding the customer’s business problem, there is no way you can know the value your offering will provide, or indeed even how to apply your solution to solving the problem. Then it becomes a feature or price battle, and that’s an abyss that, thankfully, you seem to be able to avoid.

Your company clearly understands that the key to crafting solutions aligned with the customer’s need is to first understand the customer’s business problem. (See above) You’ve indicated that the sales organization is good at designing solutions. This is a very valuable asset in your company. To ensure that you maximize this advantage, you might consider using collaborative techniques with the customer to ascertain specific, and I mean very specific, features or attributes of your product/solution/offering that can be applied to solve very specific aspects of the customer’s problem. I know you would never do this, but the temptation is often to pitch your entire solution to solve the customer’s entire problem, and that approach rarely provides adequate insight for the customer as to how you bring real differential advantage. ~ It’s evident from your input that you’re comfortable that the sales team is effective at differentiating against the competition. You seem to have this in hand, but is possibly worth revisiting the factors that would get in the way of this being untrue. There can be only three reasons for a sales team to fail this effectiveness test. (1) You don’t understand the Unique Business Value (See above) you provide, (2) You don’t know your competition – a grievous sin, or (3) You can’t position competitively. You have to be competent in the first two before you address the third. One more thing – I’m assuming that you understand the specific problem the customer is trying to solve (See above) because without that any effort spent on competitive differentiation is a waste of time. ~ Harking back to an earlier comment, we know how important it is to be able to effectively describe the value that you can bring to a customer. You’re clearly comfortable enough to say that this is something that your sales team can do well. That’s not as common as you think – so, well done. Many organizations struggle with this. I’d strongly recommend that you maintain a deep focus on this. Here’s what I would suggest. Go to your CEO, Head of Product Development, or Head of Marketing, and ask them a question in two parts. Firstly – would your customers care if your company went out of business? Next – what is it about the products or service you offer that they would miss most? If the answer to the first question is no, then you’ve got a bigger problem than I can help you with here; but if it’s not, then the answer to the second question should be illuminating.

Sales Methodology & CRM
Most sales methodologies are poorly implemented, the training books gathering dust on the shelf. One of the ways to address this problem is to tightly integrate the sales methodology into your CRM System. When I say tightly integrate, I mean surfacing the methodology in context when the deal is being worked. I don’t mean just adding the fields to the CRM or adding a ‘dumb’ (read not intelligent) data entry form. The integration should be smart enough to identify for you vulnerabilities in the deal, acting like a sales coach always there to help while proactively offering suggestions. You say that your sales methodology is effectively integrated with your CRM. Does the integration provide you with all of these benefits? If not, it is a missed opportunity (pun intended). ~

You can refer to them as Key Accounts, Strategic Accounts, or Major Accounts, or whatever you want; but when a company is successful at penetrating large accounts, it is usually because they’ve followed a structured account planning methodology. Based on the level of importance you’ve assigned to this competency, you’ve clearly identified this. But, as you know, Key Account Planning and Management is not for every company, or sales person, as it requires significant resources and a certain type of business model or level of product maturity. Make sure that this is the optimum time for your company to allocate resources in this area, or if other areas should receive your focus. ~ It’s a positive statement that you’ve selected a sales methodology. I’m not going to comment here on the usage levels of the methodology in your company, as I want you to step back with me for a second and make sure that we’re setting the bar high enough. Implementing a sales methodology is not a trivial initiative. It is expensive to do and expensive to sustain. But when it is done well (an all too infrequent occurrence) it can deliver dramatic benefits. Here are a few principles to consider: Don’t think that a tactical sales training event will have a strategic impact on your business; Do give your sales team the credit that they deserve – they do want to apply sales methodology to be more successful, it’s just that in many cases in the past it’s just been too hard to do; Don’t waste your money on sales methodology/sales training unless you’re prepared to set quantifiable business results that you want to achieve; Do measure yourself against those goals; Give adequate time to consider the role that technology has to play in sustaining the effectiveness of your sales methodology. Recent developments in this area are very exciting.

As your business develops you might give some thought to the strategic nature of the CRM, and examine whether your current CRM system approach will get you to where you need to be. Consider the reason why you purchased the CRM in the first place. Less than one in five CRM installation succeed in driving revenue for the customer. When intelligent sales process, sales methodology and CRM are well integrated, significant revenue advances occur. As you probably know, there have been considerable advances in CRM capabilities in recent years – particularly in respect of integration capabilities. Make sure you are taking full advantage. ~ Now that you’ve had the CRM in place for more than five years, you’ve had the opportunity to get all of the best practices embedded, and, in terms or organizational effort, there are really no excuses for a sub-optimal implementation.

Revenue Performance Management
Our research suggests that sales people spend on average two and a half hours a week on sales forecasting. Yes, that’s right -150 selling minutes. And then the deals that are forecasted don’t close as forecasted. Thankfully you’re bucking the trend. That is really valuable to your company, as the alternative is one of the most damaging aspects of some sales teams’ behavior. You’re probably aware that there are evidence based sales forecast tools available, and you might be already using one. As you know you will achieve much greater sales forecast accuracy if the team follows a well defined sales process – one that is designed to map to the customer’s buying process (See above). Good work. ~ Congratulations on the fact that you have and use a clearly defined process for managing your sales forecast. If you don’t have a defined process, then any degree of accuracy you achieve is pure chance and down to the individuals who are the component parts of the rolled-up sales forecast. The subjectivity inherent in that approach is your enemy. It is not an approach you can trust, and it’s certainly not an approach that can scale if your business grows. Stay true to the discipline. It will serve you well.

I’m not sure I even know why I asked this question – but there were many that disagreed. It defies me to understand how a company could operate in today’s fast moving world if sales forecasting is not at the heart of the business. You strongly agreed with the statement ‘Our sales forecast is a critical component of the overall business planning’. It just has to be. ~ There are a lot of myths around pipeline management. The most dangerous one is that bigger is always better. People talk about the need for 3x, or 5x, but in reality that rarely considers sales cycle duration or funnel velocity. One of the most important attributes of a pipeline is its integrity. The opportunities in the pipeline need to be real and active. That’s the only way for the pipeline to give an accurate picture of future business. Thankfully in your case, you agreed with the statement that the sales pipeline gives an accurate picture of future business. Continue with your pipeline management practices. Continue to qualify hard and clean out dead deals.

The hardest thing to deal with in business is a surprise. There are revelations, bluebirds and bombshells, but whatever the form, any surprise usually causes business disruption. When one materializes in the form of missed revenue, or inaccurate sales guidance, then the pain can be severe. You can end up with too much inventory on the shelves, too little stock in the stores, disgruntled shareholders, or dissatisfied customers; all because your sales forecast was inaccurate. And that’s without considering the productivity impact on the sales organization referenced elsewhere in this report. Clearly you understand this, and I’m thrilled to see that you think that a competency in sales forecasting is Essential. ~ While many companies’ financial quarters force measurement in four financial quarters, few customers’ buying cycles maintain a similar rhythm. Focus on this competency is all too rare, and you should be proud that it’s getting the attention that it is at your company. Maintaining a strong pipeline is the only way to constantly have enough deals in hand to avoid a sinusoidal revenue profile. Pipeline management can be a complex endeavor, but, as you know, it merits prioritized attention, as without it you end up in what feels like an almost circadian pattern of surprises. And you know what that means.

You can participate in the Dealmaker Index Global Sales Benchmark Study yourself for free here.

Personal Dealmaker Index Report

Based on what you’ve told me, I’ve calculated you have a Personal Dealmaker Index of 89%. I’ve assessed both your approach to sales and your execution ability, and you’re in the Dealmaker Ace category.

There are a number of elements that are factored into this analysis, but clearly there are some things that I have not been able to consider. I hope that as you review the analysis you will get some ideas that will prompt action and will help you increase your sales performance and reach your full potential.

Sales Engagement
You will generally make more progress and gain more insight talking to customers than in any other activity. I’m not entirely sure you are having enough customer meetings. Step away from the computer and call someone. ~ Analyzing why you won or lost a deal is possibly the most valuable insight you can get to what you should change (or keep) about your approach to a customer. How else can you uncover such deep market insight? If you’re doing it less than half of the time – you said 25-50% – you’re missing out on more than half of the insight. That’s not my recommended approach. ~ As you know, I’ve said before that a sales process is fundamental, and I’m glad to see that you’re on the same page. If you could nudge your application of this discipline from ‘Most of the time’ to ‘All of the time’ I believe you will see a noticeable difference in your results. ~ There is conclusive evidence that a referral from a peer is one of the most effective ways to gain access to busy executives, and get the chance to explore business opportunities. If you have delivered value to one customer and built up some credibility, then you’ve earned the right to ask for a referral. You say you are asking for referrals more than half of the time. If so, you know that this is one of your most valuable sources of leads and opportunities. Try to improve on the ratio. ~ You’ve selected ‘Needs Analysis’ as the most important stage of the sales cycle, and you are absolutely correct. Well done. Unless you can figure out what the customer really wants, all of the rest of the steps are less valuable. ~ I’m glad you selected ‘Needs Analysis’ as the most difficult stage in the sales cycle. Based on my experience it is the area where most sales people fail – and then everything else falls apart. In my opinion, Needs Analysis is both the most important and the most difficult. Getting behind the customer’s business problem is a skill very few have mastered.

Personal Perspective
So, you’ve figured out that in most cases customers will only buy from you when that is a best choice for them. Usually that means you need to be able to differentiate your product from your competitor’s offering. You’ve indicated that you’re pretty effective at this. It is always good to check that you are doing the best job you can here. Perhaps you might take the time to validate your perspective with your customers or colleagues. You may well learn something. ~ In a competitive situation most sales people fail. That is a mathematical certainty. Developing a competitive strategy for an opportunity means that you consider the people involved, the problems they have and the relative strength of your solution compared to your competitors’ – all in the context of the customer’s decision criteria. Most sales people don’t craft a competitive strategy, though – based on your input – I’m pleased to see that you are an exception. Keep it up. ~ You really only have control of two things; who you meet, and what you do when you meet them. It’s clear that you appreciate this. You’ve said that you’re always clear about what you want to achieve in advance of a meeting. That’s great. You might also think about considering why you might not achieve your call objectives, and develop a ‘Plan B’.

You have indicated that your negotiation skills are well developed. Make sure that you are not just negotiating at the ‘negotiation stage’ in the sales cycle. In truth, how you position your solution right through the sales cycle sets up the negotiation landscape. ~ As you know, you need to be having business conversations with business leaders if you are to be a successful sales professional. Based on your input it would appear that you know that this means you need to understand how to read an Income Statement, understand a company’s 10K filing, and look for strengths and weaknesses in a Balance Sheet. When executives want to discuss ROI, understanding the underlying fundamentals that the financial calculations are based on is the key. Perhaps you might check your skills level with your CFO or other executives. ~ Communication with your peers enriches the fabric of your knowledge – always. I’m glad that you understand that your success is tightly linked to how well you communicate with your peers. We all need help. ~ Your job as a sales person is to deliver value to your customer. At least that is my opinion. It’s the only way I know how to maintain long term relationships and build a personal business portfolio. Sometimes that requires tough love. I take it from your answer that you’re in agreement with that. I’m pleased to see that. It underpins the integrity of the relationship.

Leveraging Infrastructure and Systems
You seem to have a healthy relationship with your CRM. It is not always fun, but effectively used it should help you to better manage your personal business. ~ There is a direct correlation between consistent usage of a (good) methodology and revenue performance. You seem to be on the right track here. ~ LinkedIn is a good source of networking insight. With the recent additional capability (following etc.) it can be a valuable resource. Your usage appears to be quite healthy. ~ Facebook has not yet penetrated the business world enough for it to deserve the same focus as LinkedIn. In my opinion, it has value in a pure social networking sense, but you need to manage the noise levels well. To get the ‘network benefit’ you probably need to participate a little more than you are currently doing I think. ~ If you’re looking for up to date information on what is happening in you marketplace, Twitter is the place to ‘hang out’. If you do nothing else except listen to the conversation it can be a truly valuable resource. You’ve recognized that, and that’s a plus. Remember the shelf life of a tweet is really short, so frequent visits are necessary.

You can participate in the Dealmaker Index Global Sales Benchmark Study yourself for free here.


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The Challenger Sale: Challenging Conventional Wisdom – Book Review

The Challenger Sale
If you read one sales book this year, The Challenger Sale should be the one.  Actually, if you don’t generally read sales books at all, you should make an exception in this case and read this one.

The Challenger Sale comes from Matthew Dixon and Brent Adamson of the Sales Executive Council, part of the Corporate Executive Board.  The hypothesis it sets out flies in the face of the conventional wisdom that suggests that complex B2B selling is all about relationships.  Instead it describes a new kind of  B2B sales winner – the Challenger – who has six specific attributes.

The Challenger …

  1. Offers the customer unique perspectives
  2. Has strong two-way communication skills
  3. Knows the individual customer’s value drivers
  4. Can identify economic drivers of the customer’s business
  5. Is comfortable discussing money, and
  6. Can pressure the customer

Now, this hypothesis is not conjured up in a vacuum.  It is based on original research with 700 sales people, followed by a global analysis of 6,000 sales professionals involved in large-scale, complex, B2B sales.  This is not trivial work, and the conclusions drawn from the data are not to be ignored. Challengers are able to teach for differentiation, tailor for resonance, and take control of the sale.

When the analysis was completed by Dixon, Adamson and their colleagues, five different types of sales reps emerged: the hard worker, the challenger, the relationship builder, the lone wolf and the reactive problem solver. The results of the analysis are striking, and some may be surprised by the main thesis, viz., When selling complex solutions the highest-performing reps were challengers and the lowest-performing reps were relationship builders.

I wrote a blog post back in August 2010 called Why Customers and Suppliers collide. It opens with the following:

You’d be forgiven for thinking that being a customer is easier than being a sales person.  All the customer’s got to do is pick a supplier, right? But when the customer makes that buying decision, the risk shifts from the supplier to the customer, and the impact on the customer of a poor buying decision is usually greater that the impact on the salesperson of a lost sale.

The core premise in that post is that the customer does not always know the best decisions to make for their own business, and it is the salesperson’s job to point the way.  The Challenger Sale gives really pragmatic advice on how to navigate that journey.

I had an opportunity to discuss the book in detail with one of the authors, Matt Dixon, and the attention to detail he exhibited, the passion shown for the topic, and the care taken in drawing conclusions, are uncommon in the sales world.  Many other publications on this matter are based on anecdote and war stories, whereas the research behind The Challenger Sale gives depth to the unassailable inferences that are clearly drawn.

As I reflected on the excellent points in this book, I looked to other references that might bring additional measurable insight to its core hypothesis.

The Impact on Quota Achievement of Designing Customer Focused Solutions

As you can see from this chart here – quota achievement can be directly correlated to the extent to which sales organizations can effectively design customer focused solutions aligned with the real needs of the customer. The source of this data is the Dealmaker Index – a free global sales benchmarking service that is free to all, where you can score your sales effectiveness. The correlation between this and the findings from the Sales Executive Council’s research is not a linear one, but it further supports the hypothesis.

The book itself is extremely well written and it is very consumable. The ideas are presented cogently, and it is replete with though-provoking and prescriptive advice.   Interestingly, the foreword of the book is written by Neil Rackham, a fact that proponents of SPIN Selling might find surprising.  In fact Rackham suggests that this is “The most important advance in selling for many years.” The challenge (pun intended) for those who wish to adopt the principles in this valuable book will be how to embed the Challenger discipline in the daily operation of the sales organization.  Perhaps there will be an app for that.

As I said at the outset, this is book well worth reading. If you’ve been focused on hiring relationship sellers, or trying to develop your own relationship skills, you will find that The Challenger Sale gives you pause for thought, and that is always a good thing.

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Do you Qualify to Sell? – Blueprint for Sales and Marketing Alignment – Part 4

This is the fourth part of this series of posts that is intended to set out the core issues that need to be addressed in each part of the buyer / seller interaction so that the complementary activities of sales and marketing can work in harmony.

Where sales and marketing are integrated, it is a beautiful thing. Focused activity becomes the norm, sales forecasts are more accurate, revenue increases, and an uncommon organizational alignment is achieved, resulting in true collaborative success.

You can find the earlier posts here:

Effective qualification, as an integral part of the sales process, is a supremely valuable tool, not just for the sales organization, but for the company overall. Remember, there are really only two reasons why you lose a sale; (1) you shouldn’t be there in the first place, i.e. this is a deal you should not win, or (2) you were outsold.  If marketing and sales are aligned the profile of the ideal target customer, as outlined in the second post in this series, then a lot of the pain associated with the first reason goes away.  You’ve targeted the customer correctly; so yes – if there is an opportunity – the sales person should have a good chance of winning it, unless he is outsold by a competitor.  But it is not all just about identifying the right customer profile.  We also need to understand whether there is really an opportunity there to win. (This is one of the Four Key Questions that is part of TAS from The TAS Group.)

Unless you have a crystal ball, you cannot forecast accurately if you don’t qualify properly. Poor qualification leads to missed numbers and surprise sales losses. If internal resources are allocated based on your pipeline, your credibility is seriously damaged, and your customers will slip down the priority list when internal resources are getting allocated.  Then neither sales nor marketing know where to spend their time.

Link precise qualification with your sales process stages and your pipeline management, and then you know what’s going on.  [If you need to create a new sales process, or optimize the one you currently use, you can create a customized sales process of your own company for free at DealmakerGenius.]

Depending on the questions you ask and the information you glean, you can determine how likely the sale is to close. Following are some questions you might consider.  Depending on how you structure the interaction between sales and marketing, whether you use inside sales or telemarketing, and how you define a qualified lead or opportunity will all help you determine whether these questions should be asked by marketing or sales.

  • Has the customer an identified project?
  • Is budget allocated?
  • Do you know the compelling event that will motivate the customer to buy?
  • Are all of the influencers identified?
  • What roles do they play?
  • Have you won this type of business before?
  • Can you win this one?
  • What’s your source of information?
  • Are there any competing projects?
  • Is there a date by which this project has to be completed?
  • Is this a competitive opportunity? What is your competitive advantage?
  • Do you fully understand the buyer’s needs?
  • Can you meet them competitively?
  • Does it matter if the project slips a few months? If so you might question whether it is worth spending the time now.
  • What’s the downside for the company if they don’t proceed with the purchase of a product such as yours?

Qualification is not an event. It’s an ongoing process. As buyers evaluate you, you must continue to qualify them. If you are a ‘value creator’ during the evaluation, you’ve earned the right to probe deeper into the opportunity. Part of the qualification process involves establishing the rules of engagement and laying the groundwork for control of the sales process. You must make sure that you question for objective and accurate answers. Ask the same question of different influencers in the account, and you will be surprised at what you learn about the perspective of each role. You need to check that you’re working on a real live opportunity.

One of the main benefits accruing from disciplined qualification is a pipeline that’s credible and a forecast you can stand over – and deliver; and this is where sales and marketing need to be totally aligned.

  • When does a target become a qualified prospect that warrants extensive sales effort? Here marketing can put in place a rigorous lead or opportunity qualification process, agreed with sales, so that the sales person is truly motivated to quickly pursue targets that marketing identifies.
  • How many qualified prospects do you need at each stage of the pipeline to meet your quota? When you know sales quota, and the rate at which deals progress through the funnel, examining the current value of each stage in the funnel can provide indicators of when a shortfall exists.
  • What is the specific evidence you need to determine whether a deal is likely to close? Marketing and sales need to work together on the verifiable outcomes in each stage of the sales process – and marketing must consider what sales tools are required to help the sales team achieve those outcomes.
  • As you are getting to that final negotiation stage, what’s the impact of poor qualification on your ability to strike a good deal? What sales and marketing efforts do you need to make sure that risk is minimized at this stage of the deal?

Recognizing that qualification is a shared function between sales and marketing tends to focus the activities that marketing undertakes beyond just throwing a lead over the fence.

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50 Ways to Love your Lever (with apologies to Paul Simon)

You may have read the previous post where I discussed the levers that impact revenue. If so, you will recall that there are really only four things you ever need to worry about.

  1. Number of qualified deals you are working on
  2. The average value of each of these opportunities
  3. Your close percentage, or the win rate
  4. The length of the sale cycle

If you take each of these in turn, your challenge is to increase the first three, and reduce the last one.

If you move each of these factors by 10%, your overall sales velocity (measured in sales revenue per day) will increase by 48%.  Of course you want the first three (number of deals, deal value and win rate) to move up by 10% and the last (sales cycle) to move down by 10%.

(If you’ve not read the post describing how one company used these levers to increase its revenue by 400%, it is worth a read to learn from that experience.)

To increase your own sales velocity, here are 50 questions you might ask yourself as you move through the sales cycle, or with apologies to Paul Simon, and his song 50 ways to leave your lover, these are 50 ways to love your lever.

  1. Is the customer in your company’s ‘sweet spot’ for your solution?
  2. Has contact been made with a buying influencer who is driving the business project?
  3. Can you confirm that your company is not locked out by a competitor?
  4. Has a specific project been identified by the customer to solve the problem?
  5. Have you agreed with the customer the specific business challenge problem(s) they need to solve?
  6. Has the customer an authorized and funded project to solve this problem?
  7. Have you evidence from the customer that this project needs to get started, or completed by a certain date?
  8. Can you confirm that you know what’s driving the project date?
  9. Where you are selling a technical solution, is the technical infrastructure in the customer’s organization compatible with your solution?
  10. Have you identified the unique value that your company can provide to the customer to solve their business challenge?
  11. Based on the information collected above, is this a real opportunity, and one that your company can win?
  12. Is this opportunity worth winning?
  13. Have you identified all of individuals at the customer who will be involved in the buying decision?
  14. Is the measurable benefit that the customer wants to achieve from their project defined and agreed with the customer?
  15. Do you know the cause of the problem that prompted the customer to act now?
  16. Do you understand the formal/informal buying process that will be undertaken by the customer?
  17. Do you understand the ranked decision criteria for each of the key buying influencers ?
  18. Are you, your product, and your company competitively well positioned relative to the alternative solutions being considered?
  19. What evidence do you have that you are well positioned?
  20. Have you developed a competitive strategy to win the business challenge business?
  21. Have you determined that the budget the customer has allocated is sufficient for your solution?
  22. Have you actively engaged with the person who owns the business results dependent on the business challenge problem? (i.e. Not just an internal service provider)
  23. Are you sure that you are not disadvantaged by a competitor being involved in setting the business challenge statement of requirements in an RFx or other format?
  24. What evidence do you have that a competitor is not in control?
  25. Is this a project your company is well positioned to service with internal resources that are available as necessary?
  26. Are you on a short-list of three or less?
  27. Is your solution a really good fit to solve the customer’s business challenge?
  28. What features of your solution can be applied to solve the specific business problem?
  29. If you were the customer, would you buy your solution from your company?
  30. What reasons can you think of that would drive the customer to buy from the competitor?
  31. Do you have evidence that you have credible internal support (a Coach, Champion, Mentor or Internal Sponsor) who is working on your behalf to recommend your solution?
  32. Have you validated with your internal support at the customer that your proposed approach and solution will be acceptable to each of the key influencers?
  33. Have you presented your solution to the each of the buying roles at the customer, by mapping your company’s capabilities to their critical needs?
  34. Can each of the key buying influencers at the customer articulate the value of your solution specifically in the context of their business?
  35. Have you outlined the Return on Investment for the customer?
  36. Have you provided third party validation (e.g. references or testimonials) for your solution and your company?
  37. Has the customer confirmed that you are the preferred supplier?
  38. Have you developed a strategy to overcome any potential reasons why your company might not win – either through a loss or a no-decision – there must be at least one!
  39. Have you reconfirmed the trigger event that is driving the project start date?
  40. Have you agreed pricing with the customer for the solution?
  41. Has the customer agreed that there is adequate budget still available?
  42. Are you engaged with legal or procurement to get master contracts, statements or work, or purchase orders approved?
  43. Have you confirmed with your company’s implementation team that this project can be implemented profitably and in line with the customer’s expectations?
  44. Has the customer allocated implementation resources to the project?
  45. Have you reconfirmed with the owner of the business problem that the solution from your company is the preferred solution?
  46. Are all terms and conditions for the business challenge project, including final prices, agreed in writing?
  47. Has an implementation plan been agreed?
  48. Are all necessary behavior change, workflow, or solution usage issues being addressed?
  49. Have you completed your account development strategy?
  50. Have you asked for a reference?

Are you asking yourself these questions and answering them honestly?

Do you have a favorite question here, or what other questions would you ask?

I’d love to hear your opinion.

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