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Why People Are NOT Your Most Important Asset

by Michael Webb | * Comments (5)
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B2B Sales executives often believe that hiring the right people and training them well is the most important success factor in their business.

Unfortunately, believing this is a serious mistake.

Want proof? Consider:

You would probably agree there are a LOT of great people in companies like GM, Ford, and Chrysler.

Yet, Toyota, Honda, and Mazda have been kicking their asses in the market for decades.

Would you say these landed Japanese automotive companies are winning because they’ve hired the right salespeople, or because they’ve trained them better? Is it because they use Sales 2.0?

Of course not. The greatest salespeople and the best sales training in the world will not save the American car companies.

The caliber and training of a company’s people are no match for the larger forces in play here. Yet, these same forces are pressuring every business all the time, especially in today’s market.

So, why are the landed Japanese companies winning?

They are winning because they create more value. The proof is in the market’s reaction: they sell more.

Clearly, the sales process is only one component of their success.

Unfortunately, many, many talented sales leaders are trapped in corporations that view the world in ways similar to those of American automotive companies.

It is high time for B2B sales executives to stop being so myopic about their trade.

I’m not saying people and training aren’t important; they are important. But they are not the most important thing.

The most important things are as follows:

  • Find a starving market (i.e., what customers want)
  • Develop a system that finds, wins, and keeps customers (i.e., a sales process)
  • Develop and continuously improve the organization to execute that process (i.e., the people, training, machines, materials, systems, etc.)

Businesses need to grow out of the false assumption that the sales process is “what salespeople do.”

This error causes B2B organizations to get their sales process completely wrong. It is the reason salespeople only give lip service to the sales process. Salespeople know better, although they are usually unable to articulate why.

The fact is, processes that work create real value. Not only that, people follow them. In sales and marketing, the sales process is what causes customers to become:

  • aware of their problems,
  • interested in your solution,
  • convinced of your value relative to your competitors, and
  • committed to your products and services

Companies must recognize it takes more than just salespeople to do all those things, especially in today’s market.

It is irrelevant whether the customer’s actions are caused (or enabled) by copy-written ads, social networking, web pages, or the words of talented, trusted salespeople.

If something your company did got the customer to take one of those steps, it created value.

If your competitor did a better job of it, they deserve the customer instead.

If your prospects are now looking for information they need on their favorite search engine, and you insist on hiring and training more salespeople to make cold calls, that is your problem, not theirs!

Further, consider all the things your company does that cause no customer actions, such as generating tons of brochures no one reads, spending millions on branding exercises customers care less about, consuming thousands of hours on proposals that are never purchased, or asking salespeople to pull out picks and shovels to turn over more rocks in their territories looking for leads by hand.

All these are mostly waste.

It is high time that B2B sales executives stop being so myopic about their trade.

They need to learn to think of their business as a system for creating value. Value is created when customers take the steps listed above: it is called the “customer’s journey.” Every one of those steps is measurable with hard data. Data from the flow of people through their customer journey is proof you will be able to deliver revenue to your company in the future.

If is to work properly, your company’s system for getting customers to act needs to be designed. It requires the best selling savvy you can muster. It must be as automated as possible. Your salespeople need be able to implement the portions of the process that cannot be automated.

Executives who cling to old-fashioned notions about selling (hire the best people! make more sales calls! twist more arms! work harder!) are riding the Titanic to the bottom and will be looking for bail outs, just as the American automotive companies are doing today.

The quality of your people is important, but it is not the most important thing.

The most important thing is the quality of your business process.

Michael Webb
http://www.salesperformance.com

5 Responses to “Why People Are NOT Your Most Important Asset”

  1. [...] week’s blog post “Why People Are NOT Your Most Important Asset” created some strong reaction. Here is an [...]

  2. Wow Michael, it's about time someone addressed the changing sales landscape from outbound to inbound. I especially like this quote "If your prospects are now looking for information they need on their favorite search engine, and you insist on hiring and training more salespeople to make cold calls, that is your problem, not theirs!"

    I saw the writing on the wall in 2004 when fewer and fewer customers were seeking input from our "technical sales" team. They were getting all the info they needed from the web and when we showed up for a presentation they knew more about the solutions than us. No amount of prep overcomes the day to day use of a product/technology by a customer coupled with the internet.

    To find new customers today you have to make sure they find you and then offer them something that compels them to connect with you FIRST, before your competition. We came up with B2B budgetary self-service pricing as a way to capture interested leads early in the sales cycle.

    Keep up the insights.

    Dale - EchoQuote

  3. Michael says:

    Thanks Dale.

    I definitely believe this is one of the most insidious issues facing B2B companies today. Google's search engine has worked so well everyone has turned to it - and away from a traditional sources of information: salespeople!

    The customer wants to leverage the Internet in every phase of their relationship with a supplier. Most senior executives don't recognize the threat this represents:

    1) Whether you intend it or not, the Internet increases immediacy and transparency if information. People can easily learn more about you and your relationships with other customers than ever before.

    2) This exposes the fissures and weaknesses that exist when marketing, selling, and servicing are managed as separate functions with divergent priorities, rather than as interdependent work processes aimed at the same ultimate goal.

    Customers see your company as a single entity; most companies see themselves as separate independent departments. The blind spots produced internally are debilitating to the organization in the long run.

    It can be fixed by changing the management system, once senior management recognizes the problem. The management system needs to help employees distinguish value add from waste (just as good management accounting does in production manufacturing environments). Members of SPIF! receive a great deal of training and information around this.

    3) When management recognizes the kind of changes needed, the company needs to begin studying and embracing Internet marketing.

    (You can do some Internet marketing without changing the management system, but many departments will be inhibited, unable to see its value. A basic example is traditionally-oriented sales departments and distributors seeing Internet pages as a threat.)

    The the tools and techniques of Internet marketing are less risky, and far more measurable than anything that has been available in the marketing world before. And, they apply to every phase of the customer life cycle.

    Fantastic opportunities await companies who embrace these new approaches, and do it well.

    MW

  4. [Find a starving market] - Yep, that's the number one thing to do if you want to build a successful business, yet it is frequently overlooked. I'd like to know the ratio of companies which have built from that base, to those which have developed a product and then gone out to try and find someone to sell it to. They should teach this principle at school and make you pass a test on it before you can have a business licence.

  5. Michael says:

    I heard that principle attributed to famous direct marketer Gary Halbert (http://www.thegaryhalbertletter.com/). Don't know where he learned it though.

    My guess is that if a company has not been built from that base, it has just been lucky to have the right product at the right time. It would be interesting to know if any research has been done on that.

    Michael

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