Thursday, May 11, 2006

Sales force Challenges : Knowledge Index

This blog exposes sales managers to the various challenges in sales force management . For managers who want detail information about any particular area there is a list of reference books & articles too .

To join the debate & increase your knowledge Index
click below on your area of interest .

  1. Sales Force Challenges Analysis :
    • SFC Analysis always starts with the basics . Understanding SFC is all about asking the right questions :
      Where are we , Where we want to go & How do we go there . ???
  2. Environment Forced Challenges
    • As product responses become increasingly quicker with improved manufacturing and R&D systems, it's the quality of sales forces that holds the key for many companies, Smith, Global Practice Leader at The Gallup Organization says ....
  3. Sales Effectiveness Challenge ( CRM forced challenges )
    • The three components - sales, marketing, and support - are questioned deeply into surfacing the specific challenges companies are dealing with, and then with the problems clearly defined, benchmark how companies are successfully dealing with these issues.
  4. Challenges in implementing best practices
    • Sales managers often think of best practices in terms of skills and knowledge that separate star performers from average performers. What do the stars do that gives them an advantage?
  5. The Sales Knowledge Challenge
    • The Sales Knowledge Challenge is a training needs assessment which measures an individual’s knowledge of sales......
Main Page : Sales Knowledge Bank
    • A Sales Manager Knowledge blog that exposes new sales managers to the challenges in the sales force management

Thursday, March 16, 2006

The Sales Knowledge Challenge

The Sales Knowledge Challenge is a training needs assessment which measures an individual’s knowledge of sales in the following seven areas:

  • Attitude - The Sales Personality
  • Time Management
  • Finding the Suspect/Prospect
  • Determining Needs and Developing Rapport
  • The Sales Presentation
  • Handling Objections
  • Closing the Sale

An important feature of the report is that it measures an individual's knowledge of the sales process. The report then provides positive feedback regarding the mastery of each section and provides recommendations for books that are specifically selected to target any areas of weakness concerning that part of the sales process.

This online training needs assessment takes approximately 30 to 45 minutes to complete. The Internet based assessment program is fast, easy and efficient. Call us at 985-651-2819 and we will be happy to give you a quick online tour of the Internet testing program.

Sample of the Sales Knowledge Report

Friday, March 03, 2006

Challenges to Implementing Best Practices in Sales Effectiveness

Limited Perspective

Sales managers often think of best practices in terms of skills and knowledge that separate star performers from average performers. What do the stars do that gives them an advantage?

This narrow approach to implementing best practices tends to focus specifically on the sales training function – if skills and knowledge are the problem, then more or better training is a logical way to fill the gap. In our experience, however, many of the challenges to best practices lie outside the domain of knowledge, skills, and training.

The marketing, hiring, and IT functions also play critical roles in identifying and sustaining best practice improvement. Firms with a “skills and knowledge” perspective focused only on the rep may never even identify (let alone rectify) their best practice deficiencies. That's why a cross-functional approach is critical.

Consider two examples from our recent experience.

  • First line sales managers complain that reps don't use the call reporting system effectively because they lack basic computer skills.

Is this a problem training can fix? Perhaps. But a better solution may lie in the hiring process: adding computer literacy to the hiring profile could significantly improve call reporting usage without increasing training costs.

  • Marketing complains that a new sales force does a poor job executing marketing's many programs for a product in a competitive therapeutic class.

Field observation confirms that reps have a poor understanding of the purpose of and target audience for these programs. High performing reps are executing only one or two of the marketing programs. More program training is an option – but the real problem is the sales force's inexperience. This is an instance in which marketing needs to collaborate with sales to design fewer, simpler programs that can be more effectively implemented given the experience and abilities of the current sales force.

Obviously, pulling together an effective cross-functional best practices team can be difficult. Yet trying to identify and replicate best practices exclusively within the "sales silo" often yields only incremental improvements. By adopting a broader perspective on best practice and inviting the involvement of key sales support functions, you improve the likelihood of significant sales increases.

Next, let's review typical barriers to best practice implementation and how your organization can overcome them.

Weak Sponsorship and Facilitation

Appropriate sponsorship is critical to the success of any cross-functional activity. In addition, to ensure that marketing, sales, sales training, sales operations, and IT work together effectively, the best practice sponsor must have high-level authority within the organization.

The difficulty is that cross-functional teams are often comprised of "part-timers" -- people who work on the team in addition to their regular responsibilities. While this model can work in the early stages of diagnosing problems and identifying solutions, it rarely works well in the implementation phases.

Here's why: Team leaders are empowered to convene meetings, but lack the authority to direct real change. As the novelty of the best practices process wears thin, team members increasingly focus on their "regular jobs." This "refocusing" not only impacts implementation -- it limits the team's ability to identify new opportunities to improve as the sales force and markets evolve. To succeed, therefore, firms must designate a permanent best practices "owner" who is evaluated and compensated in part or whole based on best practice implementation.

Weak Facilitation is another common weak spot for best practice teams. Because the team leader is often a “part-timer” drawn from an area that may be viewed as a competitor or adversary by team members from other functions, team discussions can easily become bogged down in inter-office wrangling.

That's why it is important that all participants view their team leaders as neutral parties and honest brokers without their own agenda. This kind of atmosphere can be achieved by selecting a leader with facilitation experience from a different business unit or division, or by using an outside consultant.

Structural Barriers

Many firms have unintentionally erected huge barriers to best practice identification and implementation.

Compensation is a typical barrier. Incentive plans that rely on stack rankings – requiring reps to compete against their colleagues for pay or recognition – encourage reps to develop “proprietary” knowledge, skills, and relationships. When we see a rep excel in a particular sales activity, we often ask whether the rep has shared their knowledge or ability with other reps in the organization. Frequently, the answer is a decided “no." Reps who compete against their colleagues are typically reluctant to help them increase their sales or performance.

Budgeting is another area through which firms often inhibit best practice implementation. In many cases, firms allocate resources to geographies based on past resource levels. This can provide a powerful incentive to spend all budget resources and a disincentive to control costs where appropriate.

Poor Communication and Coaching

Ultimately, many best practice dissemination efforts fail in the implementation stage. Standards, communication and coaching reinforcement are critical elements of a successful best practices program.

Many best practice teams believe that identifying and communicating best practices are sufficient to drive change. For a minority of employees, this may be true. For most, however, setting new expectations and reinforcing new behaviors through regular coaching is also required.

While building consensus for specific best practice expectations may be difficult and time consuming, it is an essential activity. Some best practices involve one-time events, such as modifying the hiring profile or changing the format of sales activity reports used by reps. Such changes, once implemented, may be easily executed with consistency. Other changes – such as those involving call planning or execution or ongoing interaction between two or more functions – may require the best practices team to set expectations and generate buy-in of key participants.

For example, a best practice expectation might be for marketing to conduct focus groups of reps and first-line managers at various stages of marketing program development to obtain feedback on implementation feasibility. Disagreements among team members about these specific expectations may be difficult to resolve but are critical to impacting sales results.

Once expectations are established, they must be effectively communicated. In our experience, management almost always overestimates the quality and quantity of information that is retained by the field. Reps today are bombarded with more information than ever before, and many struggle to manage it effectively.

In communicating new expectations, it is critical to demonstrate to those affected the urgency for making change and how new activities will personally benefit them – usually through increased sales and increased incentive compensation. If they do not share this sense of urgency and understanding of personal impact, most reps will not change their activity. Good firms “pilot” their communications with a select group to test for effectiveness and impact on understanding.

Finally, most best practices require sustained coaching and reinforcement. When new expectations are placed on the field force, it is absolutely critical to obtain buy-in from first-line managers. A best practices process flawlessly executed up to this point of rollout will almost certainly fail if subsequently the firm fails to gain the cooperation and advocacy of first-line management. For this reason, any best practices team should include at least a few first-line sales managers.

Sustaining best practice improvement is a difficult but valuable process. Although some best practice work is conducted in virtually all sales forces, it tends to be sporadic and localized. Most of the potential benefit remains untapped. Unlike other processes that involve competitive or third party information, the best practices process can generate significant sales improvement simply by leveraging information that is already present in the organization.

In the end, the key to success is meeting the challenges outlined above: maintaining a proper perspective, managing sponsorships and facilitation, removing structural impediments, and effective communication and coaching . Firms that master these continuous best practice improvement tasks develop an important and sustainable advantage over the competition.

Sunday, January 22, 2006

The Sales Effectiveness Challenge - Are We Solving the Right Problem?

The Results Are In

On the plus side, companies that successfully implemented CRM initiatives reported excellent results.

Clairol increased their revenues per sales representative by 50%. Pitney Bowes reduced their sales order processing errors by 41%. Great-West increased their new customer acquisition rate by nearly 35%. Compaq's call center project yielded a 20% increase in customer satisfaction ratings. McGraw Hill's Construction Information Group reduced their new rep ramp-up time by 80%. Cisco is doing $8 billion of their $11 billion in annual sales via the Internet. Based on these successes, the interest and sense of urgency surrounding CRM projects is greater than ever.

But while the rush towards CRM continues to gain momentum, all that glitters is not gold. Consider the following. Of the fully implemented projects recently reviewed, only 30.7% reported achieving significant improvements. Of the remaining initiatives, 37.6% reported achieving only minor improvements in performance and 31.7% stated that there was no noticeable improvement at all (see Figure 1.0).

Granted, this is a significant improvement from the 60% to 80% failure rates reported by organizations undertaking CRM initiatives a few years ago. But what accounts for this disparity in results? In reviewing the projects that achieved significant results, one of the common factors was that these companies universally could articulate the specific problem they were attempting to solve.


This was typically not the case with the other initiatives. In many of the projects that failed to achieve their potential, when reviewing how they approached the initiative in retrospect, the project teams reported that they put the cart before the horse. Instead of determining what their sales, marketing and support problems were and then looking for solutions, all too often these organizations jumped on the solutions bandwagon first. They selected a solution and then went in search of any problems it might solve for their company.

For example, some companies equate Customer Relationship Management systems with Opportunity Management systems and therefore acquire one of these systems without first understanding their business problems. An Opportunity Management System tracks all sales and support opportunities within an organization, including who is involved on customer and vendor sides and everything that has transpired. While an Opportunity Management System is a very useful system, it is only part of a Customer Relationship Management application suite and is not the answer to every problem. In considering the above successes, only Great-West's project was based on an Opportunity Management System. Clairol utilized an Interactive Selling System, Compaq was a broader call-center initiative, Pitney Bowes started with a configurator, Cisco had internally developed an e-commerce system, and McGraw Hill's project was primarily based on process innovations, not technology.

What are the Customer Relationship problems we are facing today? In order to answer this question Insight Technology Group has begun a new multi-phase research effort. We elected to take each of the three components - sales, marketing, and support - and attempt to delve more deeply into surfacing the specific challenges companies are dealing with, and then with the problems clearly defined, benchmark how companies are successfully dealing with these issues.

The results of this research will be presented in a series of reports. The CSO Challenge Series will focus on the insights we gained into the problems firms are facing in each of these three areas and the factors that are contributing to these issues.


The Sales Effectiveness Challenge

As part of our annual State of the Customer Relationship Management Marketplace surveys we always ask companies to identify the key business drivers behind their CRM efforts. In our 1999 study, the need to increase sales effectiveness was again the top priority for these projects, mentioned by 62% of the firms surveyed. This answer suggests the follow-on question, "In what areas do you feel you are ineffective?"

That became the primary focus for this phase of the research, to more clearly define the specific parts of our sales operations that need to be improved. We solicited the support of 150 firms to help answer this question. From this group we were able to get complete data from 122 organizations.






Figure 2


The following is a summary of the sales effectiveness challenges these firms reported facing. We believe the issues that are about to be raised have broad applicability. We encourage you to use this information as the basis for a brainstorming session into identifying and prioritizing the specific problems that your sales force faces.


How Do We Spend Our Time?

The first issue we explored was where sales people spend their time. The perfect answer for many CSOs would be that our people spend 100% of their time selling. That, however, is not the case - as can be seen in Figure 2.0. The firms we surveyed reported that on average their sales people spend less than half of their time selling.

Further questioning on this topic surfaced three interesting trends. The first was that while many organizations tightened their belts in the mid-1990s, causing them to decrease their sales support staffs, the administrative requirements placed on sales did not decrease accordingly. If anything, many sales executives reported a higher reporting burden than ever before being placed on their sales teams by other parts of the company. That responsibility is now often falling on the sales representatives themselves, keeping them from selling.


The second trend was an increase in time sales people have to invest servicing accounts. As collapsing product life cycles allow competitors to more easily achieve parity in their product offerings, sales representatives are finding that they have to turn to service as a competitive edge. This is requiring them to spend an increasing portion of their time tracking down customer questions on any number of issues. This also is reducing selling time.

Finally, a third item worth noting is that these firms reported that their sales people spent 1.3% of their time in training. Many firms stated that they would like to do more, but the cost of doing training has become cost prohibitive when you added up travel time, instructor time and time out of the field.





Figure 3

Let's briefly review what each of these challenges represents.


Share Best Practices

The value of sharing of best practices - sales strategies, qualification techniques, objection handling, presentations, letters, proposals, etc., was understood by most firms, but few reported doing this effectively and consistently. In the vast majority of the cases sharing ideas was done very informally if it was done at all, leaving a major corporate asset under-utilized.


Support Channel Partners

Many companies reported that they intended to increase their utilization of channel partners to drive business in the future, and were finding that the policies, procedures, and tools they provided their own sales representatives did not always work effectively when used by the channel. They reported the need to greatly simplify their operations if they were going to gain mind share from the channel reps to aggressively sell their products or services.


Ramp Up New Reps

As product lines are becoming broader, and individual offerings are often more complex, getting new reps up to speed quickly is becoming a greater challenge. Figure 4.0 outlines the time frames required to get a new sales person up to a base level of performance. It is worth noting that many firms stated that to get to full productivity often took one to two years.




Figure 4

Generate Leads

Many sales people, to meet their revenue goals, have to generate leads on their own, independent of corporate marketing programs. Targeting potential prospects and then developing and implementing local direct marketing programs is time consuming and hard to do. Also, marketing additional offerings to existing accounts was also cited as a challenge, as easily getting information on what products or services a client already had was often difficult.


Easily Access Information

Few firms reported lack of information as an issue. The issue was getting the right information to the right person at the right time. Two sets of problems emerged here. Either the reps were being bombarded by too much information - a never-ending flow of new product announcements, price changes, competitive bulletins, etc. - making it a monumental task to try to stay current. Or the information they needed to sell to and service customers existed somewhere in the company, and they had to spend a significant amount of time trying to find out who had it. In both cases the need to more effectively manage the flow of information was seen as a major requirement for improving sales effectiveness.


Communicate - Enterprise Wide

Sales representatives often need support from other functional areas such as finance, manufacturing, distribution, R&D, etc. in order to close a deal. Communicating effectively with those departments was seen as difficult today, and for many companies was becoming even more so. One of the major trends, reported by 81% of the firms surveyed, was the move towards the virtual sales force - having reps work out of home offices, customer sites, or executive suites to be closer to the client and/or reduce costs. As the percentage of the total sales force working remotely increases, the challenge of working collaboratively can also be expected to increase.


Introduce New Products

As product life cycles collapse, the rate of new product introductions is hitting an all time high for many companies. This is placing a huge burden on sales managers and sales reps to find the time to continually get up to speed on these new offerings and take the new messages to the marketplace, while continuing to manage opportunities already in the pipeline.




Figure 5

Accurately

Forecasting is all too often more magic than science, and for many firms it is black magic at that. Consider the ratings the firms we surveyed reported regarding the accuracy of their forecasts as seen in Figure 5.0. Since many companies make key business decisions based on their forecasts (resource allocations, manufacturing schedules, raw material parts orders, etc.) inaccuracies in forecasting is causing enterprise-wide effectiveness problems.


Qualify Prospects

Determining which product or service offering best fits the needs of a prospect, if any do at all, is becoming a serious challenge. Sales representatives are expected to become experts on all aspects of the product line, especially since many firms are reducing their sales support staffs, and many organizations report that this is unrealistic.


Communicate - Sales Management

A second communications challenge appears to be allowing sales representatives to easily communicate all the things they are working on with management, and vice versa. One interesting trend we noted was the increase from past years in the ratio of sales reps to sales managers. The average across all companies surveyed was 9.1 reps to 1 manager, with one company on the extreme side reporting that their ratio was 24:1. These high numbers are making it harder for sales representatives to get the coaching and counseling they need.


Service Accounts

The value of doing a great job servicing existing clients so you can sell them more in the future is clear to all firms, how to do it consistently is not. Many firms reported lacking the bandwidth and mechanisms to have sales representatives do the necessary account development work to build true customer loyalty.


Generate Proposals & Configure/Submit Orders

These are two inter-related problems experienced by many sales forces: the complexity of the orders themselves, and the number of sign-offs required to approve non-standard deals, are making sales representatives ineffective and inefficient at completing these two critical tasks.

What is the net impact of these effectiveness challenges? The CSOs we talked to cited four negative outcomes:


• Margins are eroding as sales representatives have less time and knowledge to do a comprehensive job of consultative selling.

• Sell cycles are lengthening as we introduce unnecessary delays into the sales process resulting in sales people having to spend more time tracking down others to help them complete tasks such as needs analysis, configuration, and proposal sign-off.

• Competitive loss and no-decision rates are increasing due to our ineffectiveness at presenting the full value of our offerings and injecting a sense of urgency into the decision process.

• Customer loyalty is declining as we fail to have the time required to build true business partnerships with our clients.


Sales Effectiveness Inhibitors

Our final series of questions revolved around asking for input on what CSOs saw as the major factors inhibiting the effectiveness of their organizations. Again, we asked the survey participants to rate a number of factors using a 1 to 5 scale, with 5 being a significant impact on effectiveness, and 1 being no impact at all. Figure 6.0 overviews the most commonly cited inhibitors.


Inconsistent Sales Process

Either firms reported that they did not have a clearly defined process that was understood across the organization, or they had a process, but no way to see if it was being consistently implemented or not. This was a concern to many CSOs, as the margins are just not there to have each sales representative going out and doing their own thing. This problem is being further compounded by the increase rate of mergers, where multiple sales forces are being thrown together. Many sales executives stated the desire, or fundamental business need, to be able to take more control over the sales process if they were going to achieve business goals going forward.


Inadequate Sales Tools

More often than not it was not the lack of sales tools that was the problem, but rather that the sales tools they had didn't solve the problems they faced. For example, some firms reported starting their CRM automation projects by implementing an opportunity management system, only to later determine that another tool - configurator, marketing encyclopedia, knowledge management system - would have been more useful to their sales force.


Sales Expert Access

The complexity and breadth of product lines is making it unrealistic to expect sales people to know everything about every product. But the economics of having enough sales support experts in place to support the sales force can be cost prohibitive. A balance though needs to be reached, because without access to the product and business knowledge these experts have, win rates will continue to erode.


Inadequate Sales & Product Training

The rate of change in the marketplace is increasing the need for training on products, prospect's industries, competitors, and the like, but CSOs are having a difficult task seeing that this knowledge transfer is accomplished. While wanting to do more training, they can often not justify it against the short-term impact it may have on performance.


Summary

Clearly we are seeing the sales landscape changing dramatically and with it we are finding that the strategies and tactics that served us well in the 1970s and 1980s and even early ?90s don?t always work any longer. Product complexity, customer demands, and competitive pressures are all driving the demand to reinvent the way we sell to and service customers, or else face Corporate Darwinism.

Fortunately, we are seeing new solutions enter the sales marketplace. New business paradigms, innovative processes, next generation sales tools are all proving that we can have a significant impact on increasing the effectiveness of our sales operations. Companies are dramatically improving their ability to ramp up new reps, support channel partners, communicate more effectively, eliminate order delays and errors, and more. As a result, they are finding they can more effectively use CRM innovations to improve customer loyalty and thereby increase revenues and margins.

Significant improvements in customer relationships can and are being accomplished. But before you start to seriously consider implementing any CRM solution, be it people process, or technology related, invest the time to thoroughly understand your organization?s specific challenges and get a solution that fits you exactly.

First examine your corporate goals. Next determine what aspects of your sales performance need to be improved to meet those objectives. Finally, drill down and understand what is causing you to be ineffective in areas of your sales operations.

Surface your pains. Is sales turnover costing you a fortune in lost revenue because you take between six and 12 months to get a new sales representative productive in the territory? Are your channel partners selling alternative products because you make it difficult for them to sell yours? Are your new product introductions achieving a fraction of their potential because the majority of the sales force is shying away from introducing them to customers due to feeling inadequately trained or supported to professionally sell them? What problem should you focus on? You will know that you clearly understand the sales effectiveness challenges you face when you can translate into hard dollars the ROI that remedying that problem will generate.

Saturday, January 14, 2006

Sales Force Challenges Analysis

SFC Analysis always starts with the basics . Understanding SFC is all about asking the right questions :
Where are we , Where we want to go & How do we go there . ???

The following are some sample questions . Make your own list pertaining to your environment & try answering them . You will have action plan for this quarter & the year . If you need any help write a comment to this article with your email address . We will help you come out with Right Action Plan





External-Customer Issues :
  • Is your customer buying process changing ??
  • Are your Customers consolidating.
  • Are your Customers getting more sophisticated & knowledgeable
  • Are your Customers buying globally or looking for one global vendor
  • How do I change my selling process and sales force organization to accommodate the above changes?
  • Are transactional and consultative market segments are emerging.
  • Should I go direct? Should I go indirect?
  • If indirect then how can my sales force support my channel partners?

External-Environmental Issues
  • The economy is growing rapidly - how do I manage the growth?
  • We may be in a recession - what do I do with my sales force?
  • How do I incorporate the Internet into my Go-to-Market Strategy?
  • How is technology changing the way that I need to sell?
  • The unemployment rate is high - how do I upgrade my sales force?
  • The unemployment rate is down - how do I attract and retain good people.
  • Our industry is getting deregulated - how do I adapt my selling organization?

External-Competitive Issues
  • How do I use our sales force for competitive advantage?
  • How do I restructure in the face of global competitors?
  • Our competitors are more customer focused - what do I do?
  • Am I losing my sales staff to competition - How should I protect my data , Retain experience ??

Internal-Strategy Shifts
  • How do I create a sales force?
  • How do I effectively integrate selling organizations after a merger, acquisition or alliance?
  • How do I change my sales force to successfully launch a new product or enter a new market?
  • How do we move from a product focus to a customer focus?
  • How do I adapt my selling organization to a new selling motion?
  • What should our service offering be?
  • Do we need to redefine our selling proposition?
  • How do I implement change without sacrificing revenue and profitability?

Internal-Performance Enhancement
  • How do I measure sales force performance?
  • How do I create the best sales force in the industry?
  • How do I ensure that I can make the sales goal?
  • How do I lower my cost of sales? How do I get more sales for less cost?
  • How can I motivate our salespeople and sales managers?
  • How can I increase the quality of our salespeople and sales managers?
  • Half of our people are using an outmoded selling model - what should I do?
  • How do we get everyone aligned behind the sales strategy?
  • What is the right size and structure for my sales force?
  • Who should we call on? How frequently?
  • How should we manage strategic accounts?
  • How much should I pay my salespeople? What is the role of incentives?
  • What is the best training program?
  • How can I get sales and marketing to cooperate?
  • How can I use technology effectively?
  • How can I establish territory potential?
  • How do I reduce turnover?
  • How do I create a high-performance sales force culture?
Read More .....

Wednesday, December 14, 2005

Environment Forced Challenges ...

Smith, Global Practice Leader at The Gallup Organization, was in India recently for a series of speeches on `How to build a world-class sales force.' As product responses become increasingly quicker what with improved manufacturing and R&D systems, it's the quality of sales forces that holds the key for many companies, he says. In this part of the interview, Smith talks about the different sales talents required across industries and countries, as also the impact of technology.

Do you think certain industries require a certain kind of sales people?

Let's take the aspect of building relationships with people. In some industries, you may be calling on a customer who buys millions and millions of dollars from you and has the potential to be a customer for years and years. For that customer, I have got to be able to develop a long-lasting relationship, which is going to stand the test of time. In other sales industries, I may see the customers only once — I may see them only for 30 minutes, it's more important in that setting for me to have a theme of talent that helps me build relationships instantaneously with people. Those are two different, very different, ways of going about it. In many cases, people who build instantaneous relationships are as good over the long haul too, but they would much rather meet a new person every 10 or 20 minutes.

Any examples that you could think of?

One of the companies that we work with is called the Marriott Vacation Club. They sell timeshares. And they are probably better at it then anybody else in the world, and they have a great product. Their sale works this way: they bring prospects down to their property for a week, they have a nice team, and then they come in and meet the salesperson. That salesperson has 20 minutes with them, and would probably never see that person again. Let's contrast that, going back to that medical device company I mentioned earlier. I am now a medical device salesperson, and I am calling on the same orthopaedic surgeon for the next 10 years.

So, those examples are very, very real. In some cases, quite frankly, a sales force is selling pretty much the same solution to every customer. I may be asking them individual questions, but in fact when I reach for my bag, all I have got is this to sell. Other companies, it depends much, much more on tailoring a specific need to a client. Really figuring out what is going to make sense for them. The capability of being able to listen to what a customer wants and make sure that I am crafting what they want, in response — in some sales roles is critical; in other sales roles, it's not nearly as critical. It's more important to understand what we have to sell.

It's kind of like sports. There's such a thing as a good athlete. But a good cricket player need not automatically be a good rugby player. And it is important for an athlete to find the right sport, and, in some cases, even the right position on the team to play best. Same thing is true in sales. You may be a very talented salesperson, but it's important for you to find a sales role where you get to use those talents to the maximum. What we found is that the idea that a good salesperson can sell anything is a myth.

Do you see any difference in the sales personnel in the various countries, or in the way they sell?

I believe that the cultural difference that many countries think they have are more exaggerated than they really are. In other words, the characteristics that happen to make a really good salesperson within an industry in the US, also characterise what a good salesperson is in Japan or in South America. It's true that in some cultures it is harder to pick out some characteristics. For example, the characteristic of not taking no for an answer. In some cultures, it's okay to argue with the customer or to be more aggressive. In other cultures, the salesperson may be more reluctant to do that. But internally we find that same characteristic: the willingness to ask, the willingness to push. Outward manifestations might be different.

How about differences in training, perceptions and the way they think?

I think more of what we have found is misconceptions about how sales people actually get their job done. If you go to South America, what you would hear from sales managers is this: It's all about relationships here. If you know the customer, you don't need to sell anything. When we look beneath the surface, however, we find that there are lots of sales people who have good relationships with the customers but still don't sell anything. And actually, what's more important is not just getting to see the customer and getting him to like it but getting him to say `yes.' In some cases, people place so much value on the relationship, they don't even want to risk it by asking the customer. And sometimes, it takes a little while to get a management team that has been thinking that way for long to say: `Hey! Relationships are important. But it's not all about relationships.' So, some myths are more common in one country than another country.

Relationships are important. But what's the role of technology in helping salespeople win over customers?

Not one of us would want to be caught without a mobile phone, or PDA or e-mail. But as these tools have been introduced, customers' expectations have shot way up about getting back to them. Before, if your customer called you and you called back three days later, that was okay. Now, we live in a 24x7 world: you send me an e-mail, and you expect me to answer back. Although it's very advantageous, it has also placed us all in a much more hyper-competitive environment. Those tools are helpful, but your competitors have the same tools too. And they certainly don't replace that one-on-one or face-to-face contact with the customer.


Mobile phones have undergone a change in the way they have been marketed over the years. The retail model now rules.

Sometimes, they get in the way. If we measured average customer engagement in the banking industry 10 years ago, it was close to about 10 per cent. Now, it's under three per cent. Because, instead of going in and talking to a teller, you go and talk to an ATM machine. Very convenient! But no one wants to refer you to an ATM machine: `Had a great time with that machine! You'll love it, go ahead!" It's convenient, but it doesn't do much in terms of creating customer engagement. So, one of the challenges companies have is keeping that contact alive in an environment where we are seeing less of it.

But giving in to the pressures of cost-cutting and notions of efficiency, they seem to be moving away from this concept. How badly will it hurt the industries?

Several years ago in the US, there was a lot of talk about changing the healthcare system, and attacking the costs of healthcare. In response to just the threat of that, many pharmaceutical companies cut way back on their sales forces — they used to spend a lot of money on them. Very quickly, the companies that did that lost share. They had to re-scramble. And they realised very quickly that even though, on the one hand, there may be cost-pressures to do something, by succumbing to those, you are actually committing suicide. No company has ever hired a sales force because they want one. They have one because they have to have it. Every industry is slightly different, but after 10 years in the banking industry, we are seeing lots of banks now enhance the number of private bankers they have, culling out the customers they want to develop relationships with.

It's a constantly changing environment. Thirty years ago, the way you sold vacuum cleaners in the US was door-to-door. There are no more, or very few, door-to-door sales people. The way you sold encyclopaedias was door-to-door. Now, for a few hundred dollars I can buy an encyclopaedia on CD-ROM. It's much better, quicker and even cheaper. So, you don't have many encyclopaedia salesmen now. So, some industries change when it's really not practical to have a sales force. But many other industries pop up that really depend on a sales force. For every industry that doesn't need a sales force there are two others that take its place. A lot of this has to do with just the pace of change. When cellphones were first introduced, there were really active, high-paid sales people going around. Now it's almost like a retail kiosk (model).

You have met a lot of sales people over the years. What's their perception of the profession?

If you went to a third-grade class and asked `what do you want to be when you grow up?' the answers would be `doctor,' `lawyer,' `nurse,' or fireman. Nobody says `I am going to be a salesman.' Or very few people. It's interesting because it's not one of things many of us think about doing until actually in the process of having to look for a job. And that hasn't changed much. Even lots of people going to school would think about going into marketing, but not sales. A lot of people who complete their MBA — very ambitious people — end up working for the major stock brokerage houses as stockbrokers or investment bankers. And those are just fancy words for sales people. It's a career in which many people end up by accident. And that's one of the problems. Because we might have accidentally ended up in very wrong sales roles.

How do you see the inter-relationship between sales and the broader marketing role?

Normally, when we think about broader marketing, we think about consumer products. But about 70 per cent of the gross domestic product for any country is business-to-business transactions. Very few of those kinds of companies can rely on television or print advertising because they have a much more targeted market class. Most of those have to rely very largely on the quality of its sales force. And for companies like that, their sales force is actually 80 per cent of their marketing. In consumer goods, sure, there's a bigger role for advertising in terms of creating customer demand. But even those cases usually rely on a sales force to make sure that the distribution channels are mapped and the product is properly positioned in the stores. While it changes from company to company, for many companies sales is the principal marketing activity.

And will it remain so?

I think so.

What are the future projects you would like to work on?

The reception to Discover you Sales Strengths has been really good. People are already asking us about a similar book for sales managers. And the other area in which I am really interested in, personally, is making the concepts about customer engagement much more well-known. People who draw up marketing plans need to pay much more attention to customer engagement score than market share. Your market share may go up for a couple of years because you have got a great product and your competitors don't. But if your customer engagement scores are not going up, that's business you are going to lose very quickly.

The likely success of any marketing or sales plan, in many cases, hinges on how strong your customer engagement scores are. If you don't have a clear picture of what that looks like, you can and will spend a lot of time on plans that will not pay off for you. I personally believe there's an important educational role to help people see just how important that bit of data is. Even when you are acquiring companies, you can use this data to know if you are getting what you are paying for.

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