Do you remember watching the lion tamer at the circus when you were a kid?

Alone he would step into a cage with several wild cats. Twice his weight, they flashed their teeth and claws. Yet when he cracked his whip, the big cats jumped on the boxes and stayed there. When the cats are on the ground, they have some control. When they are on the boxes, they must pay attention to him.

How does the lion tamer gain power over carnivores?

The answer to that question can help your salespeople tame your customers as well.

After all, humans are wild animals too.

How to Get the Cats on the Boxes
Power is ultimately very simple: What you have or can do is important to people in some way. If you make a product they need and can’t get anywhere else, you have power. As an employer, your ability to send them a paycheck, or not, gives you power.

The lion tamer caused the lions to believe they better pay attention. How?

A while back I read an interesting story about how young elephants are tied to a stake as part of their training. Squirming and straining against the rope only teaches them that it won’t come out of the ground. Years later, after they’ve grown by twenty thousand pounds, the elephants still “know” the stake won’t come out of the ground, so they don’t even try.

The lion tamer uses a similar technique. He has taught the cats that he is important to getting what they want, and avoiding what they don’t want, when he is around (wielding his whip). He has conditioned them (whips sting; do the trick and get a snack instead).

How can you apply this to your sales team’s advantage? By knowing what your prospect wants and what they are afraid of. And by conditioning them.

Dan Kennedy (www.dankennedy.com), who calls himself a “millionaire maker,” attracts all manner of small entrepreneurs to his direct response marketing workshops. He almost always begins each session by asking some of his (successful) clients to tell their story. One by one, people who look no different than you or me stand up to describe how doing what Kennedy told them to do caused their small business to double or triple in three or six months.

It does not matter that most people who buy Kennedy’s information don’t achieve those results. There is some truth to their stories, and they give Kennedy the credit. After these people finish giving their live testimonials, there is no doubt why everyone is paying for the privilege of being in the room when Kennedy is on stage. Reminding the audience of his power to (potentially) make money for them gets his “cats” on the boxes.

Next week in part 2, I’ll describe some areas where your salespeople can gain some power over their prospects.

Michael J. Webb
June 24, 2008

Do you remember watching the lion tamer at the circus when you were a kid?

Alone he would step into a cage with several wild cats. Twice his weight, they flashed their teeth and claws. Yet when he cracked his whip, the big cats jumped on the boxes and stayed there. When the cats are on the ground, they have some control. When they are on the boxes, they must pay attention to him. (more…)

Hello,

Today is my birthday, so I hope you have a great day.

Michael Webb
________________________________________________________________________________
Seven Ways to Permanently Improve Sales

Leading a company is a difficult job in the best of times. Yet executives can take common sense steps to make things easier to generate customer revenue.

Our work in a variety of industries has revealed seven ways to make the sales funnel flow faster. Taken independently, they are simply shifts in how the executive thinks about the situation. Taken together they comprise a powerful framework for winning in business.

1) Find a Starving Market
The famous direct response marketer Gary Halbert once said, "A key to success is to find a starving market whose needs you can fill."

No doubt your company’s original success was due to this. Unfortunately, rather than continuing the search for starving markets, most companies start believing their product is what makes money for them. As a result, when the market changes from, say, electron tubes to integrated circuits (or from cell phones to wireless PDAs), they are left behind.

Chances are some of your customers have been asking you for things you don’t currently provide. Ask yourself, for example:

• How often your salespeople say no to customers?
• What things your customers want, but don’t think you can (or will) offer?
• What workarounds does your customer employ as they try to achieve their ultimate goal?

Finding and filling these new needs mean changing and growing. Doing it consistently is the definition of a successful business.

2) Know Your Customer’s Journey
Once you are in the right market, chances are someone else is too. To win you must do a better job than they do. That starts with making yourself easier for customers to deal with.

Your customer goes through stages (called the Customer’s Journey) as they attempt to solve their problems. At first they may not be aware of their problem. Then they have to prioritize it, attempt to understand the causes, determine a solution, and so forth.

If you understand their journey you can decide where and when to interact with them. You can avoid aggravating them about your product when they haven’t yet realized they need it. You can build a process that helps them, builds their trust, and gives you an advantage over your competitors.

Without understanding your Customer’s Journey, you can still succeed, at random intervals. With it, you have the potential to build a more consistent money machine.

3) Establish a Systems Perspective
Many senior executives try to achieve results by optimizing marketing and selling as independent functions.

This is wrong. As evidence, consider the swarm of cancers it creates:

• Marketers work hard to generate "leads" that are not what salespeople can sell.
• Service departments see customers complain again and again about issues that product designers don’t pay attention to.
• Salespeople don’t have enough opportunities to make quota because they have to nurse existing customers or because prospecting is so time-consuming.
• Managers tire of the internal bickering and complaints. Unable to resolve the dilemmas, they resort to "just do it because I say so" policies.

Worse, the functional view has no means of correcting its errors. Why would your definition of the functions be any better than mine or someone else’s?

Whether you know it or not, the part of your company that finds, wins, and keeps customers is a system of interdependent elements. How well it works depends on how well it generates actions on the part of the customer. You make an offer; if they like it, they respond.

The goal is not to optimize the output of the marketing department or the sales department (as the functional view suggests). The goal is to optimize the movement of prospects through the stages of their journey. Ads and offers with high response and high conversion create value. Those with low response and conversion are wasteful.

For example, an engineering company raffled a widescreen TV at an industrial conference. It generated many names, but few were prospects for their services. The effort was wasteful. Likewise, proposals that get ignored are a tragedy. Features customers chronically complain about are a crime.

These feedback loops signal the need for improvements. The defining characteristic of the systems perspective is its ability to evaluate improvements according to their effect on the entire system.

4) Simplify the Steps and Write Them Down
Things get tricky when the thing you are trying to control (your customer) can’t be controlled in the first place! That’s why many salespeople resist efforts to document the sales process. Dealing with this issue correctly separates meaningful selling from wasting your effort (or the paper it is printed on).

Knowledge of the customer’s journey is pivotal for clarifying and simplifying this work. It allows you to lay out a game plan with defined roles for your players. It also provides a language for identifying variations in the quality of sales opportunities.

For example, signals such as body language, tone of voice, or something that happened when they dealt with you last year can indicate how to handle a prospect. Yes, these are judgment calls, but they are judgments of facts, of observable characteristics of a sales opportunity. Identifying them can tell you crucial things, such as:

• Whether an opportunity really exists
• The extent of the pain/value/urgency to the customer
• The extent of the potential value to your company
• The likelihood of your company winning the business

Much of the sophistication of salespeople revolves around their ability to gain insight into these factors and to use them to advantage. In my experience, salespeople love to articulate and clarify this logic. Helping them do it puts your company light years ahead of others for three reasons: 1) it elevates the consistency of salespeople’s decision making in the field, 2) it enables new salespeople to get up to speed more quickly, and 3) it serves as a surprisingly accurate forecast indicator. 

Far from a boring, pointless exercise, documenting the sales process can and should be an essential goal of every sales organization, one grounded in street-savvy facts that everyone (especially customers) must face.

5) Measure the Process by Following the Money
Measuring live deals through the stages of the customer’s journey improves the performance of your production system. Unfortunately, instead of measuring these facts, most companies substitute someone’s arbitrary estimates or "percent chance of close."

The futility of this has always mystified me, but considering the difficulties of getting good data from field salespeople, some people may consider it an option.

Why is it so hard to get data from salespeople? There are many reasons, many of which are actually true:

1. Recording data is extra work that creates no value for us (salespeople).
2. Any information we provide can (and will) be used against us.
3. What we do is art, not science, so this is a waste of time.
4. This is another example of how management just doesn’t "get it."

Rather than being designed in any systematic manner, most sales "processes" have grown helter-skelter over the years through personalities and chance. "Somehow" it generates the money the salespeople and the organization need (although few people understand exactly how). Fooling around with people’s money generates fear and mistrust.

Sales process measurement is actually a leadership problem, and not an analytical one. Doing it requires adroit and persistent effort (often with the help of outside consultants). Even the most effective interventions generate some immune reactions in any organization. In sales, if you don’t have something immediately credible, and there is nothing obvious in it for the sales department, you are going to get fried.

This is obviously worth the effort. Salespeople are like an enormous array of sensors, each with partial knowledge of what is happening. Focusing this mosaic effectively enables you to do learn things like which million dollar deals will close next quarter, which packaging tweaks will increase market share by 15%, and which promotions will pre-empt the competition.

6) Provide the Supporting Infrastructure
Normally, behaviors can only change after the systems change, the training changes, and the performance evaluations change. Often the systems, training, and performance evaluations simply need different linkages and policies rather than a major redesign.

One HVAC manufacturer saved hundreds of thousands of dollars when it realized that the infrastructure for managing coop-advertising funds was unnecessary. They freed up even more sales time, eliminating controls around price discounting, when they realized a change to the commission policy could help sales managers self-regulate.

Another company developed a better sales process, only to discover most of the salespeople were still in the dark. They had been busy booking business while the process improvement team did its thing, and thus missed the chance to grapple with the issues and concepts themselves.

Working with a skilled facilitator gave them the opportunity to grapple with the question of "what does great selling look like" in their environment. They applied the new process on some of their live sales opportunities. They devised improvements to the sales tools and proposal templates. They came out with an appreciation and enthusiasm for the new approach.

Their permanent behavior changes produced more than enough ROI for the process improvement project. Improvements to the CRM’s report formats and the ability to forecast deal closures with 90% accuracy reinforced the new sales mentality.

7) Manage Based on Facts 
Getting things done through other people bedevils managers everywhere:

• Are our salespeople prioritizing their time and their choices in the best way?
• Are our sales managers effectively coaching and guiding them for the best results?
• What do our executives need to know to take appropriate corrective actions?
• How can our senior managers gain the facts they need to determine whether problems are in the market, in the sales force, or in the product? 

A properly designed process enables managers to focus on achieving results rather than activities. It aligns everyone’s interests with the customer’s, so facts and data can actually flow throughout the organization. Most important, it enables managers to learn which of the seemingly "little problems" they are seeing are actually big problems, representing system-wide opportunities to increase margins and decrease costs.

Conclusion
Far from taking the "human element" out of sales and marketing, the right approach to the sales process engages peoples talents to observe what is real, consider the  perspectives of the customer, the salespeople, and the company, and create new opportunities to make more money.   

Michael J. Webb
June 19, 2008

Every executive I know wants easier ways to get information about what is happening in their business. Most big software applications include some kind of “Executive Dashboard” in order to meet this need.

If only the problems were solvable with software!

It’s not.

A discussion of this topic that is well worth reading was posted on April 30 by Avinash Kaushik, a blogger who works for Google: The “Action Dashboard” (An Alternative to Crappy Dashboards)
http://tinyurl.com/6ere4f.

Avinash’s point is that the analyst responsible for creating the data can make things better by presenting a context that is helpful for executives. He took a human psychology perspective in his recommendations to improve the dashboard’s effectiveness:

• Only report the three or five (at most!) metrics that define success for the whole business.
• For each metric, include:
       1) the data in trend format (ie, chart it over time),
       2) interpretation of the trends and the context,
       3) actions/steps to take, based on investigation, and
       4) impact on the company/customer.

These are very good recommendations, because they stretch the analyst, forcing him/her to learn a bit more about the business so they can present information in an appropriate context. They also make the information more useful for executives, because it is tied to issues they care about.

Additional Requirement for Good Executive Dashboard Information
If you’ve been following my writing for a while, you might guess where I will go with this: Dashboards work far better for production of goods than they do for production of sales revenue.

There is a reason for that problem, and it is entirely fixable.

A dashboard that tracks data around the flow of inventory production has a high likelihood of providing meaningful data, because people can trace everything to concrete observable events (inventory transactions). Classify the events correctly and add up the right numbers and you produce important facts.

A dashboard that tracks the flow of leads, opportunities, and deals has a much lower likelihood of providing meaningful data. That’s because people have not developed the means of tracing everything to concrete observable events. Executives need to know the returns they are getting on their marketing spend. They need to know if salespeople have enough potential deals in their pipelines to make the numbers.

This kind of information is very high level. It is the kind of information they usually can’t get, so they are used to relying on gut feeling rather than on facts. But it is information that could be generated from field data …that’s what dashboard technology is supposed to do.

Suppose the dashboard includes some measure of lead generation, since that is obviously important to ensure salespeople’s pipeline is full.

If some of the “leads” are defined as “business cards collected at a trade show,” for example, then the dashboard will present confusing information. That’s because a “package deal-”a false assumption-is getting in the way. It will show that high (or low) production of “leads” has virtually no relationship to sales revenue.

What’s the false assumption?

The idea that “business cards collected at a trade show” has something to do with putting opportunities in salespeople’s pipelines. That assumption might possibly be true (although probably not). However, until you have tested and proved it and the sales team accepts it, you don’t KNOW that it is true. Hence, the false assumption.

Consider: Has anyone in your organization taken the time to trace-to audit-the validity of the meanings of the terms in your company’s dashboard? The IT world is filled with examples of spreadsheets containing huge mistakes, retired old ladies receiving phone bills for $100,000, of so-called “web site traffic” turning out to be undigested logs of meaningless server activity.

Even a dashboard that incorporates Avinash’s suggestions will provide confusing, even misleading, “information” if the data it shows cannot be traced to hard evidence, similar to that of production inventory systems. Everyone must understand what observable characteristics cause a prospect to be classified as leads, qualified opportunities, and customers.

This is one of the key foundations of sales process improvement: Establishing observable definitions (ideally based on customer actions) for the stages of sales production. Get these perfected within your company’s culture, and the rest really is just a software problem.

Michael J. Webb
June 15, 2008

 

 

Every executive I know wants easier ways to get information about what is happening in their business. Most big software applications include some kind of “Executive Dashboard” in order to meet this need.

If only the problems were solvable with software!

It’s not.

A discussion of this topic that is well worth reading was posted on April 30 by Avinash Kaushik, a blogger who works for Google: The “Action Dashboard” (An Alternative to Crappy Dashboards)
http://tinyurl.com/6ere4f.

Avinash’s point is that the analyst responsible for creating the data can make things better by presenting a context that is helpful for executives. He took a human psychology perspective in his recommendations to improve the dashboard’s effectiveness:

• Only report the three or five (at most!) metrics that define success for the whole business.
• For each metric, include:
       1) the data in trend format (ie, chart it over time),
       2) interpretation of the trends and the context,
       3) actions/steps to take, based on investigation, and
       4) impact on the company/customer.

These are very good recommendations, because they stretch the analyst, forcing him/her to learn a bit more about the business so they can present information in an appropriate context. They also make the information more useful for executives, because it is tied to issues they care about.

Additional Requirement for Good Executive Dashboard Information
If you’ve been following my writing for a while, you might guess where I will go with this: Dashboards work far better for production of goods than they do for production of sales revenue.

There is a reason for that problem, and it is entirely fixable.

A dashboard that tracks data around the flow of inventory production has a high likelihood of providing meaningful data, because people can trace everything to concrete observable events (inventory transactions). Classify the events correctly and add up the right numbers and you produce important facts.

A dashboard that tracks the flow of leads, opportunities, and deals has a much lower likelihood of providing meaningful data. That’s because people have not developed the means of tracing everything to concrete observable events. Executives need to know the return they are getting on their marketing spend. They need to know if salespeople have enough potential deals in their pipelines to make the numbers.

This kind of information is very high level. It is the kind of information they usually can’t get, so they are used to relying on gut feeling rather than on facts. But it is information that could be generated from field data …that’s what dashboard technology is supposed to do.

Suppose the dashboard includes some measure of lead generation, since that is obviously important to ensure salespeople’s pipeline is full.

If some of the “leads” are defined as “business cards collected at a trade show,” for example, then the dashboard will present confusing information. That’s because a “package deal-”a false assumption-is getting in the way. It will show that high (or low) production of “leads” has virtually no relationship to sales revenue.

What’s the false assumption?

The idea that “business cards collected at a trade show” has something to do with putting opportunities in salespeople’s pipelines. That assumption might possibly be true (although probably not). However, until you have tested and proved it and the sales team accepts it, you don’t KNOW that it is true. Hence, the false assumption.

Consider: Has anyone in your organization taken the time to trace-to audit-the validity of the meanings of the terms in your company’s dashboard? The IT world is filled with examples of spreadsheets containing huge mistakes, retired old ladies receiving phone bills for $100,000, of so-called “web site traffic” turning out to be undigested logs of meaningless server activity.

Even a dashboard that incorporates Avinash’s suggestions will provide confusing, even misleading, “information” if the data it shows cannot be traced to hard evidence, similar to that of production inventory systems. Everyone must understand what observable characteristics cause a prospect to be classified as leads, qualified opportunities, and customers.

This is one of the key foundations of sales process improvement: Establishing observable definitions (ideally based on customer actions) for the stages of sales production. Get these perfected within your company’s culture, and the rest really is just a software problem.

Michael J. Webb
June 15, 2008

In 1992, Leslie and I traveled to China to adopt a baby girl. Among many vivid memories of that trip, one I often think about is the traffic jams.

When we completed the adoption paperwork in Suzhou, we trekked to the American Embassy in Guangzhou. Deadlines for health check-ups, visas, and meetings with embassy officials made Guangzhou traffic especially nerve-wracking. (more…)