Even after having done this now for some years, grading students is still a challenge for me.  Do they get an “A”? Maybe it should be an “A-”, possibly a “B+”?  And at Tufts, giving a mark lower than a “B-”, is the academic equivalent of banishment from the campus.  Even with a math-driven formula built into the way I grade, still the awarding of grades, and especially final grades, is an anxiety producing but obviously necessary process.

Just as grading is part of the deal between professor and student, so are performance reviews between sales managers and their salespeople.  One of the key findings that we discovered 10 years ago, and have verified repeatedly in our surveys, is that highly successful salespeople rank themselves not against their quotas, not against their bosses’ requirements, but against other highly successfull salespeople.  Of course, they’re graded every day, week, month and quarter against quota, but the real standard among the “A” players is measuring themselves against one another.

Right now, make a list of your salespeople.  Okay, now grade them with “A”, “A-”, “B+”, and so on.  Be objective and bluntly honest with yourself since this exercise is for your eyes only.  And then sit down and figure out in one or two sentances for each salesperson what are you going to do with each of them during the balance of this quarter to change their grades?  

After you’ve completed the list, the realization that you will have to make is that you don’t have the time or the capabilities of working with every person on the list, so now the real task begins.  Where are you simply not going to invest time because the person is a solid “B+” or “A-” player, and the reality of your own schedule is that you simply do not have the time, and your grading is that the person is “good enough”?   Are you going to put more time into your “A” level players and make them “A+”?  Are you going to try to raise a “B” to a “B+”?   Do not pretend that you’re going to make a “C” into a “B” since it is highly unlikely that that person can do it without extraordinary time from you and most probably from others.   Better to cut your losses and replace the person…and do it quickly.  

Most sales managers incorrectly invest their time into attempting to improve the “C” players and hoping against hope that their efforts are going to be rewarded when in fact they should put their time into the variations of “B” and “A-” players and improve the overall scorecard of their group or the company.  The other management mistake is that of acknowledging that “some revenue is better than no revenue” such that you keep the “C” level performer just because they’re bringing in something.  Unfortunately, the math never works since once quotas continue to slip from “C” and “B-” performers, and then there’s a speed bump, for whatever reason, in one given month for the entire company, the drag caused by the “C” and “B-” players can put the entire month and quarter into a loss.

The management rule of thumb is to always to be in a recruiting mode such that when that next “A” opportunity presents themselves, you simply take that opportunity and remove  your lowest level performers.

A tough reality, but a necessity all the same since we all live by grades.

Good Selling !

Jack

Well, no, not really. Blocking & Tackling merely lays down the foundation of each month and every quarter, and in the world of Sales & Marketing this is best exemplified by quarterly Key Account Plans and what we call, “30-60-90″s, which are detailed action plans-all carefully laid out in Salesforce.com or whatever CRM system you’re using.
Our experience is that Blocking and Tackling is the easy part. It’s what we do and what we get paid for.

The real question that needs to be answered by senior management teams right now is what is it that gets layered on top of the approved business plan foundation that will allow the company to muscle up and position itself for much faster growth, if not in 2010, then in 2011?

Should we be looking for “The Next Big Thing” as one of our customers is currently focused? NBT strategies often connote that exciting word, “innovation” which always sounds very buzzy, and while it may be invigorating for the gang in Engineering, the NBT needs to be heavily researched, carefully planned and stringently balanced against the risk of economic reality in what will still be a year of uncertainty and super cautious customers.

Perhaps the incremental opportunity for additional leverage this year should be spent in exploring in much more detail just how we could add muscle to some of our current strategies and tactics.
Should we be expanding our sales activities to different channels other than direct? Is this the time to make a real investment into international sales, and just where is that country called, “international” anyway? What about trying to roll in an aquisition from one of our distressed competitors? If not the company, what about one of their product lines?

All good examples of muscling up beyond the business plan foundation which has been structured on Blocking & Tackling. The key to success here is for management to actually make the tough choices and not attempt to do more than one or two incremental strategies in 2010…especially in the world of Sales & Marketing.

While focus is critically important this year, so is first strategizing with the rest of the members of your team where you will make the time investments during the balance of this quarter to figure out how you will position yourself for much more accelerated growth in 2011. As a start, think about taking the management team and spending a day or day and a half off campus in March to objectively assess what you, as the senior leadership are going to do to really move the needle in the second half of this year and accelerate the business even more next year. You can use some of that time to do a sanity check against how you’re doing for the year since you will be closing in on the first quarter, but take 90% of that offsite time to analytically think through what the accelerants will be that get layered on top of the Blocking & Tackling.

Have a great day !

Picture Main Street, USA, and you have a mental image of what Main Street in Newport is. Neat, beautiful, picturesque and a perfect example of a small town community complete on one hand, with the headquarters of the Lake Sunappe Bank, the region’s leader, and also with my favorite place to have breakfast, The Main Street Bakery.

I walked down the stairs yesterday morning for my normal cup of tea and egg sandwich and, most importantly, to be able to listen to the owner, single employee, waitress, cook & bottlewasher and ask her what she thought about President Obama’s State of the Union comments.

Like most of us, she fell asleep during the speech, but the bottom line of what she, and most of my small and mid size business owners heard on Wednesday night was a wonderfully architected and highly marketed speech, which provided near zero real-life impact for their businesses.

Her comment was “I simply need a small business loan to be able to do more marketing, but there’s nothing that will come out of last night’s comments that will allow me to go the bank across the street and be able to do that.”

And all day yesterday, I heard the same reaction from business manager after business manager. “Nice marketing speech, but it does not do anything to make a difference at my business.”

In Texas, we call this type of Marketing, “Big Hat, No Cattle”, which is less a comment on politics (which is not my intent) and more of a reminder for all of us to communicate simply, to remember the Rule of Just Three Things, and to focus on the needs of our audience.

Last Friday, I hit the “send” button to post the final grades in a very intensive course where the final semester-long project counts for 50% of the overall grade. As usual, I’m not too sure who is more anxious about this process: me or the students? I am sure that it is me.

From my Tufts experience over the past three years and my ten years plus of teaching business planning and marketing at MIT, I’ve adapted this concept of final exams and brought it into the world of interviewing sales managers, and this morning is a great example of putting this into practice.

It’s my experience that too often we make decisions on hiring what is often the most critical position in the company on the basis of our traditional, old and tired interviewing processes. Hire a recruiter or not; shuffle through the resumes; do numbers of telephone interviews; invite a few finalists in and round-robin them among the senior team; do a series of follow up interviews and check references. An ok process, but it really never gets to the heart of whether this person can lead, can think, can manage or stand up to the performance pressures of the job.

There are nuances to this of course, and maybe today we source through our LinkedIn communities and perhaps I interject a personality profile assessment, but the basics of making decisions on interviewing and hiring sales managers are typically the same as the (unfortunate) results show in mediocre performance and relolving door tenure.

Think about continuing to do all of the basics, including an entirely new set of better open-ended questions that get the candidate to really think and reveal their process for problem solving, but add to the process a final exam.

This morning is a great example. The final candidates who are coming in to meet all of the senior management team and me have been reviewed, telephone screened and have met with the hiring VP. This morning they are coming in to provide 75 minute presentation on their first 100 days, their primary objectives for themselves and for the business at the end of 2010 and what their strategic achievements will be at the end of 2011.

In preparation for this morning, they’ve signed NDAs, have been given access to data files and schedules to query members of the senior team.

And, this morning is the final exam which will definitively demonstrate their presentation and communication skills, their level of strategic and tactical planning, their use of analytical data and their overall ability to sell and market their most important product-themselves.

There’s another added benefit to this process in that it enables everyone on the senior management team to participate in the hiring process which is a big win for team building in what is typically the most important decision that any company makes. The overall results, since we’ve been promoting this process have been excellent, and we have now extended it to all senior management hiring from CEO to all VPs.

If you want to share your own ideas on this process, just comment here or send me an email.

Good Selling !

Jack

The world of sports is exactly like business because (1) it is business, and (2) in both worlds, performance metrics drive everything.  Point, of all types, condition how we think and act every single day, month and quarter in our sales lives, or in the case of football , every season.  Take your choice and say the words, “Patriots”, “Celtics”, “Red Sox” or “Bruins” to any lover of sports in Boston, and in a nanosecond, there’s an immediate image that flashes somewhere in our frontal lobe of someone scoring a point, slamming the ball out of the park or a headline with a box score right beside it.  Who won; who lost?

Sports is all about winning and measuring that win with points, and Sales is exactly the same.  Actually, in every business, measuring performance is absolutely core to what one does, even in non-sales, non-sports activities.  I’ve always thought that Robert Frost said it the best when talking about the form and shape of modern poetry.  In disgust about the increasing use of free verse with no regular pattern of rhyme or meter and unlike couplets or sonnets, he wrote that “writing free verse is like playing tennis without a net” .  Simply, without form, without measurement, what’s the point?

Having no structure in poetry results in mindless dribble.  Having no structure in Sales always results in poor performance since, at the end of the day, why do the most successful salespeople consistently succeed?  In every study done for 20 years, the answer comes back the same:  “Recognition”  Exclamation point, underlined and bolded.  Actually, peer recognition is #1 and company/boss recognition is #2.   And, there’s absolutely no way to be recognized, if there’s no score, no net or a weak senior management team that does not consistently recognize performance on three  performance metrics.

What are those three metrics?  That’s up to you, but limit them to no more than three, and if you can get by with one, all the better.  When the Celtics beat the Spurs last night ago, there was only one score the counted:  Celtics-90, Spurs-83.  In the world of Sales, that one score is probably revenue.  But, depending on how you’re driving the business, you may want to have two or three other metrics which, in addition to recognized revenue, might include gross margin, ACV or Annual Contract Value, bookings, customer sign-ups if your pricing is freemium, and a host of other metrics that define one’s quota. 

And “quota” is the word.  Don’t be afraid to use and try to substitute wishy washy words like “goals” or “targets” . The word is “quota”, every professional sales organization uses it, and it’s a badge of honor.  My best students at MIT and Tufts publish and proudly talk about their GPAs and SATs, and professional salespeople do the same with their quota attainment.   By the way, our recent stats from our late September survey this year state that (not unexpectedly)  quota attainment has fallen dramatically in 2009 with the number at 63% if the company is a dominant player, 51% if the company is a startup and 53% if the company is one of many players in the market.  Discouraging, but it is what it is.    Another, “by the way”, always publish everyone’s quota attainment to plan openly to everyone in the sales, marketing and operations departments.  In fact, we like to see the stats available to anyone in the company. 

Only by measuring everyone against the numbers so that everyone else on the sales team can see exactly where they stand and measure up, will you know how many points you have on the board.

Have a Great Sales Day !.

Whatever your thoughts about upstate NY have been, get rid of them. Yes, on one hand, it does have a bit of snow and cold, but then I spend part of my life living in Vermont (that’s a picture of my pond with the fall mist rising from it on the header of this post), so who cares about a little snow? On the other hand, very committed and caring business leaders in Rochester and Buffalo, a superb economic development county government and ridiculously inexpensive wonderful housing. I would move there tomorrow, if it weren’t for the fact that my wife would then really have issues with the fact that we already live in three states.

We began working with The Entrepreneur’s Network a number of years ago, and now have graduated a couple of hundred entrepreneurs through the system. One of the best learning experiences for George and me are the personal takeaways from the attendees. Yes, we feed them through a firehose for two full days with 400 plus pages of material, case studies and a host of war stories, but on the other hand, the specific tactics and ideas that we, and the other 25 attendees, take away are where 20% of the learning process takes place.

Peter Drucker says it best: “Entrepreneurs see change as the norm and as healthy. Usually they do not bring about change themselves. But-and this defines entrepreneur and entrepreneurship-the entrepreneur always searches for change, responds to it and exploits it as an opportunity.”

For me, this quote is a great embodiment of entrepreneurship! When I left our entrepreneurs from Upstate last Friday, I felt that, even as a supposed expert in Entrepreneurship and Sales & Marketing Optimization, once again, I was leaving one of these programs with an even greater desire to immerse myself into more research, more data, more reading, and ultimately more teaching whether it’s with more Boot Camps or continuing my teaching at Tufts and MIT.

What occurs with entrepreneurs, of any age and at any stage, is that they ask open and probing questions. There’s little to no dialog of “We’ve tried that before.”, or “Let me tell you what happened back in…”. With entrepreneurs at the grass roots, it’s always about building, growing, exploring and learning. Good skills to bring to our older and more entrenched companies especially now as we’re working on our budgets and plans for 2010.

As sales execs, we’re always focused on the numbers:  bookings, revenue, margin and, more or less, how we’re measuring up to our expense budgets.   Numbers dominate our ideas and corresponding actions on any given day in the month, and as the months go by and we’re facing that end of the year quota number, pressure mounts either because we’re behind the curve and scrambling to make up, or we’re pushing for more bonus dollars.  It’s been that way forever, and, in the world of sales, it will always be about numbers, performance to plan and customer satisfaction ratings.  

So, why is that we typically do not use the math of those numbers to our advantage as our prospects get developed and they flow along the sales funnel moving from raw leads to closed orders?  It doesn’t seem to matter whether we’re sales hunters, farmers or managers, we always seem to spend 95% of our time focused on staring at the end of the funnel and hoping that enough stuff will drip out the end so that we will make our quota for that month.  My experience is that if that what’s actually taking place-we’re primarily focused on the narrow end of the funnel-most of the time we’re working on “the strategy of hope” rather than a new strategy of sales optimization. And, results this year seem to bear this out with quota attainment rates ranging from 51% for startups to 63% for dominant players.   

I know what you’re thinking. It’s been a tough year and it’s a tough economy, and budgets have been cut…and so on. At the end of the day, it is what it is which should demand that we try something different in 2010 since the economic conditions are not going to be substantively different.

The strategy and the reality of Sales Optimization, on the other hand, is all about focusing on doing all of the hard, nitty gritty work at the top end of the sales funnel of properly qualifying prospects and intimately discovering and validating thier very specific needs long before pricing is discussed and proposals are made. 

Since 1,500 sales execs responded in Q3 that increasing sales was their #1 objective (62.4%) in 2010 and that their #2 objective (51%) was increasing sales effectiveness, the requirement is out in every budget and sales planning meeting that we’ve been attending this fall for sales management to strategize more innovatively and plan their detailed quarterly battle plans more specifically than we’ve ever seen before.  

The questions that we’re hearing this budget and planning season are not about “How are you going to increase sales?”, they’re about ”How are you going to significantly move the needle?”.   In a 2010 budget world of continuing pressure on reduced expenses, the question that we need to answer over the next month or two as we’re crunching to yearend, is what are we going to do in 2010 that’s substantively different in personnel, in channels, in training and especially in our sales process that shakes up our sales organization and stops the strategy of hope and just staring at the end of the funnel?

Sales Optimization is the answer, which means totally re-engineering our sales processes, metrics, tools and training requirements.

Whatever happens in 2010 in the economic market and in defining, “The New Normal”, you can be assured that increasing the effectiveness of your sales and marketing resources will play heavily into improving your revenue and net income. For the past five or six years, ever since we started to hear the first rumbles of seismic changes shifting into the fundamental architecture of selling, we’ve been practicing “sales effectiveness” strategies and tactics within a large number of our companies. Actually, one of the first places that we tried this strategic thought process out years ago was at the Lake Sunapee Bank, a wonderfully managed community bank in New Hampshire. We came away from that experience very positive and thinking that if bankers can benefit from these ideas about process, metrics, and “The Engineering of Sales”, then all of that would resonate even more loudly within the world of tangible products and tightly defined services. And, over the last few years, that has been exactly our experience. 

With more process and science in profiling, testing, hiring and onboarding “A” level salespeople, the result has been higher revenues with better margins. With more discipline in creating step-by-step selling processes, the result has been shorter sales cycles with better win/loss ratios. With more exacting definition in who should qualify, who should hunt, who should farm and expand and who should support customers, and the result has been dramatic decreases in the cost-of-sales percentages to revenue. All good.

But, not good enough.

Actually, far from good enough, and that’s the opportunity that we believe will be one of the key success factors during 2010. Not just making the salesforce and the sales process, “more effective”, but actually “optimizing” every component in the sales process from hiring to training to organizing to incentivizing to measuring and creating customized sales processes along that path while enabling both significant reductions in sales cycle times and increases in larger orders at the same time. That’s the world of optimization that we’re now seeing unfold and being made even more meaningful by a plethora of Sales 2.0 tools coming online and creating an integrated technology convergence of easy-to-use data for the average salesperson. 

In the next couple of newsletters and a new Competitive Edge blog that will be released in two weeks, we thought that it would be helpful at this time of budget crunching and strategically thinking through how you’re going to become significantly more sales and marketing optimized in a The New Normal world, to read through a number of proven tactics that we’ve found to be very effective over the past two years. 

Sales Optimization Tactic #1 – Hiring and Testing. 

Recruit More Than You Need 

Begin With an Exact Hiring Profile 

With regard to selling skills, did you know that there are 38 ways to close an order? Considering just this one skill of closing, you should figure out the importance in your priority listing of skills in having a highly effective closer when you go to hire a salesperson. And before you simply say, “of course” about having strong closing skills, the priority of that skill would differ quite a bit if the salesperson you were hiring were to be a Hunter or if they were to be a Farmer. 

What about communication skills? Negotiation skills? Objection handling skills? Financial skills? Sales Process skills? And so on. A well done Skills listing in a sales hiring profile should easily identify 20 different skills. Your job is to not only list them, but to then prioritize them into two categories of “must haves” and “nice to haves”. 

You Can Easily Test Attributes 

Once you’ve detailed the attributes and divided them up into must haves and nice to haves, then test every serious candidate with a Predictive Index or a Caliper or a Disc test. Easy to do, not invasive like Myers Briggs, quick to execute and they provide very telling results. We personally think that PI is the best, but the other two companies are also very good, and the three of the them constitute the entire market. 

And here’s the compelling data. While only 41% of B2B salesforces test attributes, of those companies who do test, 33% registered “significant” improvement in their hiring success and another 51% registered “some” improvement. 

And finally, do not listen to anyone that will proffer their opinion that salespeople are “born not made”. One, it’s a stupid statement and harkens back to the old way of interviewing salespeople which was done by instinctive feel and gut reactions. Second, it’s simply not true and although many of our attributes as salespeople and managers are conditioned by our early childhood at home and in K-12, most attributes can be modified and all selling skills can be taught and trained. 

And teaching new skills is what this new world of sales optimization is all about. It’s new; it’s about process and metrics. It’s math and tools intensive. And, most importantly, it works. 

More in a couple of weeks on the subject of creating effective sales training followed by a post specifically focused to building a sales process. 

Hope that you enjoy the series. Just open up your email and let us know. 

PLEASE MAKE A NOTE THAT OUR MAIN OFFICE NUMBER HAS CHANGED TO: 617-292-7101. 

In actuality, most leverage in business is not only hard to do, but most of the time, we don’t execute it all that well, so although we talk a good game about creating “strategic partnerships” and “combined selling and marketing programs”, the reality is that most leveraged sales programs simply fail.

And, they fail largely because both sides do not go into the partnership with the thought of a win-win-win. Win for me. Win for you. And, most importantly, win for the partnership so that everyone makes a lot of money. No matter, how well we plan and how objectively we believe that we’re approaching the relationship, there’s a natural emotional tendency in all of us to first think: “What’s in this for me and/or for my company?”

For example, most M&A deals are done for “accretive value” or more simply “leveraged growth”. They answer the question of “How could I grow my company faster than it’s growing organically?” Because the M&A market represents billions of bucks, there’s always robust research around on results, and it clearly shows that most M&A deals fail. Whether it’s the low failure rate of 48% analyzed recently by Mercer, or it’s a high of 70% studied a couple of years ago by Mitchel/EIU, the bottom line is that managers do a lousy job of acquiring and integrating companies to gain the leverage that they originally conceived. And this occurs even when there’s a detailed integration plan marshaled by some uber-integrator who’s been put in charge. But, our experience is that the detailed integration plan tactic is merely a band aid, and it doesn’t get to the heart of the matter of why most acquisitions don’t work. The fact is that most transactions never get anywhere near their planned value because there’s an inherent, underlying sense of fear of the unknown and a lack of trust on both sides as individual managers enter into a brand new relationship.

The single basic failure point often comes down to the perception that “I don’t totally trust you or your company” in an relationship-yet-to-be which was conceived and built through spreadsheets and PowerPoints. Maybe it’s really a lack of good honest communication. Maybe, it’s my fault for not taking the time to get to understand your company, your selling processes or your objectives more completely. Maybe, if I were really honest with you, I would tell you that I simply didn’t like you. Maybe, we rushed into this too quickly, and all you were really looking for was a giant Barney Hug rather than a true economic partnership. The fact remains that leverage models only work where there’s a win-win-win, and managers on both sides have completely exhausted themselves working through the numbers, the people issues and all of the involved processes.

And this doesn’t happen just in M&A deals, which for most business managers will occur only once or twice in their careers. Think about “normal” leverage occurring when we try to extend beyond our direct sales channel model by creating indirect channels of manufacturer’s reps, distributors, dealers, VARs or agents.

Even here, in actuality, most leveraged selling relationships fail, or, at the very least, they never realize their true value of creating high customer satisfaction at a price that represents high benefit to both parties. The vision that we all have entering into these leverage models is to create an indirect channel model that provides maximum customer benefit to everyone in the chain. The reality is far less, and it comes back to the fact that in the majority of cases, at least one of the parties entered into the supposed partnership thinking only about “What’s in this for me?”

Every market is complicated with indirect sales channel models where there are critical cost and delivery factors that have been industry-driven forever. Let’s take an example of a new customer of ours, a major pet supply distributor. Solid guys, a great brand, traditional leverage sales channels and growing in a multibillion dollar market. Pet supplies have been typically sold by numbers of manufacturers to a large distributor who then, in turn, sells to a small local dealer who ultimately sells the dog crate or fish tank to you and me. Even today, the business is a well-oiled model of sales leverage with corresponding markups, commissions and fees: a nice, orderly and traditional way to sell. Having said that, these senior managers are now asking themselves how could they better optimize their sales processes and potentially look at other channels in a new world order of sharper discounts, online supplies and specialty mass merchandisers? Even with a growing revenue line, these managers are asking the right questions to not only insure the leverage that they already have, but enhance it both for themselves and their dealers.

On the other hand, what we too often hear from some managers who are thinking about using leveraged sales channels, are comments such as, “Dealers will be great since we can now get rid of our expensive salespeople”, or “We don’t have to pay the independent reps until we ship, and then we can probably delay payments for another 30 days”, or, “These new reps/dealers know everyone at the accounts that we want, and they can immediately introduce us”, or naïve comments that make us visibly cringe such as “If we can just partner with a few of the Cisco or Microsoft salespeople, they’ll bring us into all their major accounts”.

Then, not surprisingly, when leverage sales models begin falling apart, we hear comments such as “Those reps don’t do anything, and it costs us 10% just for them to open the door”. Ok, maybe a valid argument, so the real question should be “What would the cost be for a qualified lead and the length of the sales cycle time if we did not use reps and spent more in marketing? When leverage begins imploding, we also hear, “Those dealers don’t really understand all of our products, and they just sell the easy stuff”. Again, maybe a valid comment, so the question that should be asked is when was the last time that that the company held an online product training program for their indirect salespeople or created a quarterly spiff incentive to promote the more complex products?

Bottom line: Leverage always sounds appealing, but the reality is that it takes even more time to manage than organic growth or selling through direct channels. If you’re willing to do the hard work and make major investments in time and training, then you can pick up another 25-40% of revenue over the next three years, but it takes a ton of time and very concentrated focus from senior management.

There are a number of questions that should be asked if you’re thinking about using a leveraged channel, and a perfect time to ask them is right now when we’re all rethinking our sales plans for 2010. In your fall strategic and budget planning meetings, take an afternoon just to begin discussing leverage with questions such as:

1. Could a leveraged sales model really work for us? What’s the math of the cost of the sale and the resulting margin for both sides of the table? What different sales management and pricing practices would we need?

2. How do we make leverage a win-win-win? Should this be a partnership, a JV, a standard distributor deal, or what? What’s the best model and commission plan for the first year and then the third?

3. Like a marriage, creating leveraged sales is going to take a tremendous amount of work, honest discussion and counseling when things hit the first couple of speed bumps. In order to make sure that the marriage does not end up in divorce, figure out who is the most senior manager you can place in charge, and does that person have the right skills and experience, or do you need to go outside?

4. On both sides of the table, how does each partner create “Top Share of Mind”? How do we get our products to be the number one or two products in their vocabulary? What can we do to create better than normal gross profit for them?

5. Does leverage mean 10% more sales three years from now? If that’s all, going through the hassle of creating and then managing an indirect sales channel probably doesn’t make any sense. Could it be 30% plus per year, which would be a more appropriate growth objective, and, if it could, what operationally in production and in administration would need to change to support that level of growth?

6. And last, don’t limit this strategic discussion on leverage to traditional sales models of salespeople in the field, or even on the phone. What should we be planning in order to create and monetize inbound marketing channels that would give us a valuable stake in an online, no-touch channel? This is not a question that can any longer be answered by “That doesn’t apply to us”, or “Our customers are not there yet.” By the time that they are there (and they are probably there already, but you just may not know it), it’s going to be too late, and you’ll spend the next 12 months just playing catch up.

A perfect example of success here is the true partnership created by the Boston Business Journal and one of our most interesting customers, Associated Industries of Massachusetts, who two years ago began exploring how an online marketing and sales community network could benefit both of them and could enhance membership value for AIM and readership and event attendance for the BBJ. It took a while to figure out, but with a recent launch, this partnership is already leveraging revenue and other benefits for both parties.

As you now immerse yourself into the final push to December, force yourself to take some time offsite with your management team over the next month and think through what you could do to create leverage that would kick up your revenues and income by an additional 25% to 40% over the next few years.

———————-

It’s good to be back from the summer, and I look forward to hearing from you during the next couple of months. In the meantime, Good Selling!

PLEASE MAKE A NOTE THAT OUR MAIN OFFICE NUMBER HAS CHANGED TO:
617-292-7101.

Jack
Head Coach

We plan to provide our readers with a series of three or four editions of The Edge providing strategies and tactics which can be used to optimize your sales activities.

Each year, we go out and survey hundreds of B2B salespeople, and one of the more complex answers that comes back is in response to the simple question of “How many hours a week do you work?”. Having asked that question now for a number of years and cataloging thousands of responses, the average equals 58 hours a week for the most highly successful salespeople. When we take a look at the salespeople on the bottom end of the curve averaging around 38 hours, these tend to be the least productive as one would expect, but the real interesting data comes from analyzing not the number of hours, but the effectiveness of the utilization of those hours.

We’ve proven that those concepts about “traditional” selling were not only wrong, but they promoted the perception that selling was less than a science

Back in “the old days”-prior to five years ago-it used to be that the world of Sales was regarded by most people as conducting business in the same old “traditional” manner. The thought process by too many unknowing non-sales managers was that Sales was an art. That the most successful of the breed were born salespeople, and that successful selling was based on relationships and the thickness of one’s Rolodex. Over the past few years, we’ve proven that those concepts about “traditional” selling were not only wrong-even back in the day-but they promoted the perception that selling was less than a science, a measured practice and an analytical step-by-step process.

Why cold calling is a total waste of time

Today, the world of successful sales is all about “The Engineering of Sales” and not “The Art of Sales”. We were conducting one of our Sales Management Optimization Boot Camps a couple of days ago, and one of the company presidents in the room proudly announced how many cold calls a day his salespeople had to make. After he talked about his stats, I asked why he did that, and he looked at me like I had the proverbial two heads and could not understand why I had said that cold calling was a total waste of time for his salespeople. As we debated my ratios of cost/time/trigger points/close, in desperation to prove that his precious cold calling tactic was, in fact, a good thing, he blurted out, “but it toughens them up.” To which I responded, “and it wears them down and forces them to quit.”

Let’s think about 100% since at the end of the day, all I have is 100% of the time of my salespeople. Well, not really since I have some percentage, and the other percentage is owned by their spouse and family. But on my side of my 100%, I have all of that time. Well, not really because I need to think through the math.

Let’s assume that all of my salespeople are “very successful”, which from the data says that they work on average 58, let’s call it 60, hours a week, or 3012 hours a year. Pretty good? Well, not really since I need to immediately subtract 1028 hours for non-utilizable time, holidays, company (not sales) meetings, vacations (only 2 weeks figured here), and sick time (only 5 days in my calculation here). So, now I have 2092 hours or about 67% of my 100% to sell.

Well, not really, since the data shows that of the 100% of my 2092 hours, about 30% is lost to stupid tactics like forced cold calling, data entry administrative tasks, and market education which should have been provided by someone else. With 30% chopped off, my real available selling time is now down to 1464 hours (or about 50% of my original 3012 hours that I actually pay for), and now finally the real question that needs to be answered of those precious 1464 hours is how effective and optimized can I make my salespeople in order to help them close the most number of orders in as short a period of time.

Which brings us to today’s environment of “the engineering of sales” which is all about optimizing that very expensive 1464 hours. Can I make my salespeople 100% effective so that every call made within that 1464 hours results in a sale? The simple answer, of course, is no, so the question becomes what can I do as a manager that creates the most effective environment in which they can hunt new business, and expand existing business in order to close orders as quickly as possible. Are closing rates of 50% achievable? The answer is yes, and it all depends on the tactics that you employ to make your sales and marketing professionals as optimized as possible while working with them in a comfortable environment and analytics and measurement.

Over the next six weeks, we plan to provide our readers with a series of three or four editions of The Edge providing strategies and tactics which can be used to optimize your sales activities. During this time, we welcome your comments and your ideas, many of which we will turn around and publish to our 7,000 readers. The primary categories that we write about will be Process, Organizing, Hiring and Training.

We are hearing a strong requirement by senior managers to significantly boost the productivity of their salespeople

Given the economic climate, we know that by now everyone has cut their 2009 budgets to the bone, and what we’re seeing so far going into the 2010 budget planning season is an attitude of very cautionary spending. Having said that, we are also hearing a strong requirement by senior managers to significantly boost the productivity of their salespeople, maximize revenues and optimize cost-of-sale margins.

Our first edition on optimizing sales will focus on process and will be out in seven to ten days. In the meantime, I’d like you to think through the 100% math of your own salesforce and attempt to be as specific as possible about how many hours your salespeople work, how many hours are taken away by activities that you don’t have control over (including company meetings), and what the “administrative tasks” are that are currently being done by highly paid salespeople when, in fact, they could be done by someone else?

With that math exercise completed, let’s explore, over the next few weeks, a few of the more highly effective sales strategies and tactics that are being used by the most successful sales organizations. We hope that you’ll enjoy this series on what could very well be the most critical component in your business planning for 2010.

In the meantime, Good Selling! It’s looks, feels and smells like it’s going to be a great Q4

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617-292-7101.

Jack
Head Coach