SPIF Tip #22: What Mark Twain Teaches About Systems Thinking in Sales
campaigns in hundreds of companies for more than 30 years, I have seen sites of sure-fire campaigns go down in flames. I offer you this quote from Mark Twain, which explains the problem perfectly:
“It ain’t what you don’t know that gets you into trouble.
It’s what you know for sure that just ain’t so.
That’s what will do you in.”
Here are some examples:
In his book, “Managing Major Sales,” Neil Rackham wrote about a case typical in sales organizations. A company with poor sales results decided to hire a new VP of Sales. The new VP discovers salespeople are making less than two sales calls per day. Company owners had assumed activity levels were much higher. In the sales VP’s own successful experience, call activity had been higher.
To the Sales VP and to the owners, “more call activity = more sales.” Who could doubt this was true?
So, the Sales VP raised the activity target to four sales calls per day. Of course the salespeople objected, so there was conflict in the firm. Emboldened by the company owners, the sales VP insisted.
As a result, they got their higher sales activity. Sales revenue results did not increase at all, however.
Surprise! Something else was actually driving sales. In his book, Rackham conjectured that in businesses with small transaction sizes higher call volumes might be correlated with higher sales. When transaction sizes are larger, however, this might not hold true.
Fast forward to a vivid experience I had with a B2B client. They sold time accounting software and had paid to configure the materials from a major sales training company into their salesforce CRM system.
The president believed this gave them a sales process. He knew there was a huge market. He also believed that more leads would = more sales. Who could doubt this was true? So he doubled down on Internet Pay-Per-Click Ads over a six month period of time. At one point spending over $800k in one month on them. And, lead volume increased by more than double.
However, new account sales did not. The company had to quickly ramp down the expenditures. That’s when he hired our firm. We helped that company make a big improvement – but only after we helped the president understand that his problem was not the quantity of leads – it was their quality.
When executives fail to think deeply enough about how their system works they fall prey to similar mistakes. They institute sales training and get frustrated when behaviors return to the status quo. They install CRM software, and continue struggling with lousy forecasts, and poor sales productivity. They realign territories, which fails to improve productivity. They implement sales contests or promotions that merely rob business from the future. I’ve seen lead generation campaigns actually decrease sales productivity, when salespeople cannot distinguish good leads from time wasters.
Even when temporary gains are achieved, they are not sustainable unless the changes you make actually create improvement.
But systems are counter-intuitive things. It is ok – actually it is much better – for executives to admit they do not know what they need to know about their selling system.
Ask yourself what assumptions your company is making about how to improve its sales results. Is there a way to test these assumptions before you commit to big investments or changes?