The Role of Sales? Create Value One Conversation At A Time

Today is the Chicago Cubs home opener at Wrigley field. Now, I have to confess that I am not much of a baseball fan but I do love my neighborhood Cubbies and look forward to a summer afternoon watching the team inside ‘the friendly confines’.  So what does all this have to do with sales and customer relationships?

Years ago, I watched Sammy Sosa when he was playing for the Cubs.  Sorry to say it was a big disappointment.  Whenever I was in the ball park, he struck out. Where were all the storied home runs that were making all the headlines?  And so I learned one of the lessons of baseball: if you are swinging for the fences, either you will hit it big, or you strike out.

Those of us who work with customers should remember this as a cautionary tale.

The role of the sales force is to CREATE value for customers, not just communicate potential value of the product or service being sold.

At the low-end of the spectrum, “product selling’, the sales force should be working to take cost out of the buying process for customers.  At the top end of the spectrum, as a “trusted adviser’, the sales team is creating exceptional value through a consultative solution selling approach.

Now back to baseball.  Richard Roeper, looking ahead to the 2010 baseball season, wrote recently in the Chicago Sun-Times, “there’s an increased emphasis on defense, speed, fundamentals and smart baseball, as opposed to just relying on behemoths to hit three-run homers…”

You can add a lot of value in baseball by being able to go out week after week and hit base hits, and executing on the fundamentals.

In sales, you can add a lot of value by listening to your customers and prospects, by doing the little things that add value, build relationships and doing it repeatedly day after day.

In either case, you may not get a lot of glory, or a lot of headlines but at the end of day, you will add more value by executing on the fundamentals day after day. It is a long season after all.  Will you be able to execute after the All-Star break as well as you did before?

Customer relationships are built one conversation at a time.  Loyalty is built when trust is rewarded by good service consistently executed. Sales do not have to come from big audacious efforts to hit a home run, but come more often from consistently hitting base hits.

Play Ball!

Three Cheers For Simple CRM Systems!

I recently caught up with the CEO of a growing company that I had advised for about a year to see how they were doing. I was absolutely thrilled to hear that they had implemented Pipeline Deals (www.pipelinedeals.com), a simple CRM software application.  I was thrilled for two reasons.  First, when I checked out Pipeline Deals online it was obvious that simplicity and not over building the software are key goals of the company.  Second, I was thrilled with the initial feedback,  “It works well and everyone has adopted it. The excel sheet is gone!”

When we worked together they were still using spreadsheets to track their pipeline and forecast revenue for each month.  It worked for them then but we had many discussions about what would come next as they were rapidly growing beyond the capacity of a spreadsheet to manage their businesses. So many companies in this situation, over buy and over estimate what they need, what they will implement, and how complex their business will become.  To see this company choose a CRM tool, that fills their needs without adding too many bells and whistles is just fantastic.  I have said it before, and I will probably get on this horse again someday, but simplicity is such a key to success anytime you are working with customer management (CRM) systems especially when the field sales team is involved.

The second reason for my little jump for joy was to hear that it was working well and everyone has adopted it. Those who have been close to similar project know that this is no small feat.  The fact that the CEO is deeply involved in the sales process and took the lead with the tool deserves a lot of credit.  But that is also the lesson for the rest of us.  These tools take ongoing leadership and commitment from the very top.  This adoption and early success also sets up the company for more success down the road. Success builds success.  With this project they have begun to build a culture that expects changes to stick.  They will pay attention to the next initiative, because there is a history of projects being rolled out and transforming the business for the better. This is such a contrast to the culture I have seen in companies that expects failed projects and as a result learn to duck and wait for the ‘fad’ to pass so they can go back to business as usual.

If you have a choice between two CRM tools – one that has lots of bells and whistles, and one that is simpler – choose the simple CRM solution.  You will add more value to your business by doing a few things well in a simple system, than by failing to get adoption of a more elaborate CRM solution.

Now, go grow your business!

Sales Management Science or Art? Maturing Your Sales Organization

Organizations go through phases, oscillating between a “Creative Phase” and then a “Maintenance Phase”. Do sales managers face the same challenge of balancing the art and science, or creativity and maintenance?

All companies get their start in the creative juices of the entrepreneurial endeavor.  By definition they are born with the genesis of a new idea, a new way of serving a need, a new way of solving a problem.  These organizations place a premium on creativity to find ways to compete against larger companies with more resources.

As these great Creative organizations grow, quality issues, and service level issues start to crop up. Owners and managers, span of control is stretched and the seeds are planted for a “Control Crisis”. The question of how to channel all of the creative energy in the same direction, and how to maintain quality standards become more and more urgent.  If you don’t address this Control Crisis, you’ll lose control of the business and performance, profitability will suffer.

But on the other hand, if you can successfully address this crisis, you can regain control and navigate your company into the Maintenance Phase. Maintenance doesn’t sound very glamorous but it is a part of the natural maturing process for a company and brings with it many great benefits.

You have fewer ‘fires to fight’ in the course of operating the business.  Procedures provide guidance to set expectations and inform how work is to be completed and issues resolved.  You can deliver higher quality of service more consistently. Operating costs go down.

Unfortunately, the seeds are also now planted for a ‘stagnation crisis’. Stagnation crisis comes from external forces, the market shifts and the company in its effort to maintain order and control operations, has lost its ability to adapt.

To continue, you needs to evolve again from the Maintenance Phase to the re-Creative Phase.  And so the pendulum will continue to swing in a healthy company, always trying to balance between maintenance and order, and creativity.

Sales organizations also need to evolve and mature from their creative beginnings if they are to become high performing organizations.  Evolving out of the creative phase, allows sales organizations to be more consistent in delivering results, to share best practices with each other and have these practices followed.

Where is your sales team on the pendulum swing between creative and maintenance?  What are you doing to find the right balance?

Customer Experience: How To Close the Gap & Deliver

I heard a stunning statistic the other day:

80% of companies believe they are delivering a “Superior Customer Experience”; at the same time, only 8% of customers think they are receiving a “Superior Customer Experience”

How can a gap that big exist between what companies perceive and what their customers perceive? Perhaps more importantly, how does a company close that gap and make sure that they are on the same page as their customers?

Talk to Your Customers. This sounds easy and it should be, but are you doing it?  You need to!  What are you afraid of?  If they have positive feedback, you will feel great.  If they have some negative feedback it is better to know because then you can do something about it.  Remember that most of us prefer to avoid conflict so pay attention to how you ask for feedback.  Avoid questions that allow for simple yes or no answers.

Institute Practices that Encourage “Continuous Listening”. Identify the individuals and groups in your organization that have interactions with customers and find ways that you can incorporate a process for feedback and co-collaboration in the work that you do.  Incorporate a question or two into the call script used by the customer service group.  Build responsibility for gathering feedback and following up into your sales process.

Consider Other Interactions and Experiences That are Creating Customer Expectations. None of us live in isolation. Our experiences in our personal lives influence our expectations in our business lives. When designing and thinking about the business customer experience, think about the kinds of consumer experiences our target is having.  Have they been into an Apple store to shop for an iPhone or iPod?  Have they talked to a customer service agent to resolve a problem, when that agent was able to see all the case history? How does your company match-up to these experiences?

There is more great discussion on this topic at the Vovici blog. In this brief article Jeff Henning points out five different places in organizations where there can be a breakdown that contributes to the gap in the delivering quality service.

How does your organization stack up in delivering a quality customer experience?  What lessons have you learned about what it takes to deliver on your promise to customers?

“Net Promoter Score”

Do Your Customers Understand You?

Do your customers understand you?  This seems like such a basic question.  Surely we are all speaking the same language – or are we?

I read a questions posted on the internet (LinkedIn specifically) this week that caused me to pause and consider this with more thoughtfulness than I have in a while. Here is the question:

“Given the evolving social media influence on business communications, should there be a distinction between a priori and a posteriori in determining what to communicate? Does one have more implicit externalities than the other? What externalities would you consider?”

I would like to think that I am well educated, and have stayed pretty current with trends in social media and how companies are using it but I confess this question is meaningless to me. Several individuals did post answers to this question so perhaps it is just that I am not the intended audience. (The answers didn’t make much more sense to me than the question.)

My intent here is not to beat up the individual who posted this question, but to highlight how easy it is to disconnect from your intended audience. It is so easy to get into the jargon of our companies, our technology and when we do, we start spewing words and dribble that mean nothing to anybody else. I am as guilty of this as anybody else. My family has listened to me around the dinner table and begged me to speak English.  Somehow, my protests that I was speaking English and using perfectly good words, didn’t help.

I was discussing the recent book, “The Presentation Secrets of Steve Jobs” by Carmine Gallo with a colleague yesterday. One of the characteristics of Steve Jobs’ style is his use of relatively short words. Steve’s goal when making a presentation and the goal of every sales rep and sales leader is to communicate and persuade. Job number one is to make sure that we are understood before we can worry about persuading.

As we become more and more of a multicultural business community, making sure that we are understood will need to be a conscious effort.  More and more individuals here in the United States speak a second language, or speak English as their second language.  Even if everybody is comfortable communicating in English, the reference points from which we enter a conversation and absorb information are likely to be different.

Maybe it is time for all of us to clean house, simplify and clarify our communication.

CRM: 85% Don’t Pick The Right Tools

“As many as 85% of companies that buy CRM software to automate sales efforts don’t pick the right tools because they fail to define business objectives or develop processes for meeting objectives.”

So says Gartner analyst Robert DeSisto.  Assuming his numbers are even directionally correct, this is a pretty tragic state of affairs. How do companies get into this pickle?  Or more importantly how do you keep your company out of this 85%? Mr. DeSisto is spot on when he identifies the cause to be in defining business objectives and a process to meet those objectives.

I’ll talk some more about objectives in a moment but I think it is also important to define CRM and to define what CRM means to your company, not just what it means to whichever vendor you happen to be talking to.  There are many ways to skin this cat but let me share a very simple classification of CRM that will help to align different perspectives within your organization.

CRM as Marketing Automation

Within this ‘branch’ of the CRM family, the tools are used to create, manage and automate marketing campaigns.  Marketing departments use these tools to target different audiences with different campaigns, to develop customized responses based on how the recipient responds and even test different messages. Many companies are now learning how to nurture leads until they are sales ready using different marketing automation tools.

CRM as Sales Force Automation

This second ‘branch’ of the CRM family is all about enabling the sales team to help them be more effective in the work that they do.  Workflow can be embedded in the system to guide and keep track of follow-up activities, track opportunities through the pipeline, and provide more customer, product, market and competitive information to sales reps where they need it.

CRM to enable the Call Center/Customer Service

The third ‘branch’ of CRM enables customer service reps within a call center (or in the field) to have a more complete view of all the different customer activities that have taken place.  Cases and trouble tickets make it possible for different customer service agents to work seamlessly on the same issues.

CRM as a Customer Analytics Tool

What usually gets management the most excited about CRM is the potential to have insight and metrics about who their customers are, what products they are buying, what the forecast is, what the sales cycle is, etc.  The danger here, is that none of this information is available if the CRM tool is not being successfully used in its capacity to support marketing, sales or customer service.

So, what exactly does CRM mean to your organization? What are your objectives? Your reasons of looking at CRM?  And my humble suggestion, find these answers before you start talking to vendors.

Does Social Media Help B2B Sales?

I spent a large part of my day yesterday preparing for a talk that I am giving tonight to the International Network of Boutique Law Firms (INBLF).  I am looking forward to it in large part because lawyers are a fairly conservative bunch and one of the things that I will be discussing is how they can and should use social media in their marketing and business development efforts. There is a tremendous opportunity for mid-size companies, like boutique law firms, and those in B2B sales to leverage social media.

Social Media improves your “findability”

There are some amazing statistics on how much executives are using search engines and the internet.  Tools such as a strong website, a LinkedIn profile – or better yet – profiles for all your employees, can help your company have a presence where your target clients are looking for information.  Digital or social media can help you address the first challenge in generating new business – making people aware of you.

Social Media (especially LinkedIn) exposes connections

There is an article at destinationCRM.com, “New Social Media Not Helping Sales”, written a year ago which argues that Social Media is more of a distraction than a help to most sales teams.  I agree with many of the points made in the article but disagree with the conclusion (at least as it is expressed in the headline).  Agreed, being online is no substitute to offline skills in building relationships and there certainly is no ‘silver bullet’. However, LinkedIn can be invaluable to showing you where some of those key relationships and connections are.  I’ve used LinkedIn recently to find individuals within companies that I am targeting and without the insight provided by LinkedIn I would have had no idea who to ask for a reference or introduction.

Social Media helps manage your reputation and credibility

Social media, and again I am probably talking mostly about LinkedIn, also gives you another great way to manage your reputation and credibility.  With the profiles, Answers, company pages, relationships and groups, there are any number of ways to share the great work that you do and do it in a way that you control.

But don’t take my word for it… measure it.  As with so many other activities and efforts that can be undertaken to improve the effectiveness of your sales team, measure the value you are getting out of social media.  It is the only way that you can manage it.  Find out who on your team is using it successfully.  Find out what aspects of social media are helping your team and what aspects are sucking up energy and creating a distraction.

In this day and age and with things changing so quickly, it is time to figure out how Social or digital marketing fits into the sales and business development process.  In October, LinkedIn announced that they had passed 55 million users, and had added the last million users in 12 days.  In a world changing that fast, how long are you going to wait to learn how to use it to your advantage? Figure it out, and don’t “throw the baby out with the bath water”.

Forecasting – Finding a Better Way

The new year is off and running and for most sales organizations that means that they are chasing a new target. After struggling through 2009 this probably also means that everybody from the sales reps to senior executives are pouring over their forecasts and asking that fundamental question, “Do I have confidence in these numbers?” I thought I would take a few minutes today to share some thoughts about forecasting and what is or is not included in those numbers.

I wish I could provide a simple golden answer as to how to do forecasting.  I’ve seen lots of approaches taken by my clients, and most have some good logic behind them. Lets start with a couple of questions?

• Why are you generating a forecast? Do you need to estimate quarterly earnings to the street? build operational plans? need to track the performance of your sales team? or all of these? Why you are completing a forecast and what you need to be able to do with the information has a big impact on how you approach the process.
• How long is your sales cycle? Recognize that if you have a short sales cycle, under 30 days for example, you are forecasting in an environment that is very different than if your sales cycle is, say, 90 days or longer.
• What data are you capturing in your CRM (customer relationship management) or SFA (sales force automation) system?  If you have a CRM system, there may be an opportunity to “give something back” to the sales team by automating more of the forecasting process and minimize the effort that the sales reps need to make.

A discussion about forecasting could go on for days.  I won’t.  Let me instead suggest a couple of different ways of generating a projection.  I leave it to you the reader to consider how you might merge each of these approaches to your own company.

Sales Roll-up Forecast

Almost every sales team does some version of the rolled-up forecast.  Sales reps submit their forecast to managers, often with some reference to what they will ‘commit’ to as well as what ‘upside’ potential exists. At each level, there is another level of scrutiny, and a similar evaluation until the total forecast reaches the executive team.  Often a necessary process but filled with emotion and optimism or conservative caution.  There is a lot of art in this process.

Historical Trend Forecast

This is the simplest approach for most businesses but is also probably the one that offers the least insight into current market conditions and your team’s performance.  As the name suggests, you generate a forecast by looking at historical trends for what ever period you are forecasting.  For example, how does this period compare to other periods during the history of your company.  “4th quarter is always 40% of our business.” “The second month of our quarter is always 25% of the quarter.”  With these references, you can project the next period.

Automated CRM Forecast

I have seen this done less but it can be very successful.  One of my clients regularly had their CRM analyst develop a forecast independent of the sales team’s rolled-up forecast. The analyst consistently generated a more accurate forecast than the sales team without any knowledge of what was happening out in the field.  Generating a forecast this way didn’t provide an opportunity for inspection and dialogue within the sales team, but when it came to projecting revenue to stakeholders, this was the way to go.

How do you approach forecasting?  What are your biggest challenges?

Sales Effectiveness – Lead Generation

I saw some recent study results which suggests that lead generation is a top priority for sales organizations in 2010.  Given the state of the U.S. economy this is hardly a surprise.  As the saying goes, “A rising tide lifts all boats”, and well, a sinking tide, shows you were the rocks are.  I’m sure a lot of companies are discovering that they are not as good at lead generation as they thought they were.  Here are some thoughts on what a successful lead generation effort might look like pulled from experience at multiple companies as well as reading others thoughts on the subject.

1.  Process development and sales collaboration are  necessary first step.

Whatever you are planning to do to generate leads for your sales team, an understanding of the process is critical to success.  The last thing you want, as you invest more in developing leads, is to have a process that breaks down in the middle.  Without a process you are apt to drop leads somewhere in the middle and reduce the impact of your efforts.  Make sure that the entire sales team is engaged and involved. If the sales team isn’t on board with how leads are being generated and qualified, they are much less likely to follow-up on the leads they are given.  Then we are back to the problem of leads falling through the cracks.

2. Augment leads with as much additional data as possible

As leads are generated, marketing and sales should work together to determine what additional supplementary data can be provided about the lead that will help the sales reps to qualify the lead as quickly as possible.  The more supplementary data can be provided the higher the conversion rate is likely to be.  Not surprisingly, this again needs to be a collaborative effort between sales and marketing to balance the value of different types of information with the relative cost and difficulty of gathering that information.  Consider including data like: contact details, customer information, relationship history, marketing or industry analysis.

3. Understand and develop an approach for lead nurturing

Lead nurturing is the concept that not all leads generated by marketing are “ripe” to be handed off to sales. It is a concept that is being discussed more as companies use the technology available to them today for different lead generation tactics. This may include email campaigns, direct marketing, websites, webinars and white papers.  Not every contact who expresses interest in a webinar is ready or wants to talk to a sales reps.  Lead nurturing provides a way to cultivate the relationship and foster the lead until it is ready to be handed over to the sales team. By having a process for lead nurturing, you will improve the quality of leads being handed over to sales, AND be developing a future lead.  Now isn’t that beautiful.

There is a lot of hard work to be done in the months ahead while the economy continues to languish.  Strong lead generations practices will serve companies well now and in the future.

What is your digital age? What is the digital age of your customer?

I did some research this week on differences and similarities of how people are using technology and more specifically social media. I thought I would share some of this data with you today.  Some of it is sort of obvious and intuitive, and some of it starts to shed a little light in to the different habits that people have.

Wells Fargo completed a survey which I thought provided some good insights.  Their survey digs a little deeper than many to uncover different levels of understanding and comfort with technology.  Based on this information they categorized people as “digital novices”, digital teens”, or “digital adults”. What is the digital age of your customers?

• 92% of people have a cell phone, only 22% use an internet-based phone service like Skype
• 80% of respondents pay bills online, only 38% manage a 401K or IRA online
• Perhaps most interesting… the most ‘adult’ group of the survey was thirty-somethings, not twenty-somethings (who are more focused on entertainment)

For those of us in the B2B sales world these insights from Forbes may be on interest:

• 64% of C-level execs conduct 6 or more searches per day to locate business information.
• Sources of information that the C-Suite finds valuable:
  • Internet = 92%
  • At work contacts = 87%
  • Personal networks 73%
  • Newspapers 54%
  • Magazines 57%

Slack Barshinger did a study commissioned by Google which found among other things.

• 77% of small business owners use search engines to find business suppliers
• 80% find search engines to be the most effective tool for finding suppliers

And finally, LinkedIn passed the 55 million user mark in October 2009.  It took them 477 days to get their first 1 million users and only 12 days to get a million users this past October. At that pace they should be well past 60 m users by now.

Okay, so these are some interesting statistics but so what?  I wish I knew.  Social media marketing and digital marketing are all the rage, and rightly so.  People are changing how they use technology and how they gather information so how companies communicate their marketing message better change too.  What I am not hearing a lot of discussion about though is how all these changes in the online word is impacting the way things are done in the offline world – i.e. the world of sales. How is (how will) the C-Suite using online tools to manage their personal and professional contacts? How does that impact the buying and decision making process and therefore by extension the sales process?