Customers expect you to deliver a consistent and seamless experience that flows from marketing through sales to ongoing customer service. Your business has to engage on their terms, understanding needs, exceeding expectations and rewarding loyalty.
Customer behaviour has changed and buying cycles are getting longer. You need to improve visibility across your business and put metrics in place to accurately track performance. Doing what you’ve always done isn’t going to get the job done.
What is next depends on you. If you put in the effort and focus you will become a better salesperson. A good professional salesperson is always employable. You need to be flexible, adaptable and open to change; I have sold six different types of products and solutions in my thirty one years of selling even though I have always remained in the High Tech sector. A good professional salesperson can either stay employed in sales for his entire career or can take his career into related areas. I chose the path of Sales / Sales Manager / Sales Director / Regional VP / Business Owner. You can envisage your own path, the only certainty is that your sales knowledge will be useful whatever choices you make because at their core they make you a better communicator and more realistic; truly transferable skills.
I wish all my readers the best.
Good luck with your career and let me know how it goes by dropping me an email at Clive.Smith@crmnow.asia.
My personal agenda is that I will follow up this book with books on:-
- Sales Management
- Personal Productivity
If you get value from this book, look for my next one due end of Q1 2011.
The first resource you should look at is your company. It is in the company’s interest to develop your productivity as fast as possible and sales training has to be a part of that. As a minimum you should expect one training course that gives you professional development once a year. A new sales professional should expect an induction and introduction to selling course. A more experienced professional should expect an advanced course (SPIN, Needs Based or Solution Selling, Major Account Development) again at least once a year.
Another easily available resource is your local bookshop or library. The topics of interest are to be found in Self Help, Motivational, and Business as well as Sales Training. I have often found that books are not good value in terms of ideas per book. This is particularly true of business books which tend to pad out a few ideas with hundred of pages of examples or stories or quotations that illustrate the idea in action. I sincerely hope you feel that this eBook is good value in terms of ideas per page!
Nowadays the best resource available to anybody is the Internet. If you enter as a Google search term any of the chapter or section titles you will get thousands of hits. One of the reasons I structured this book this way is that you can get specific help reasonably easily, but I have never seen a book that provides a framework for future research. What I hope this eBook does is give you an end to end understanding of what it takes to Develop Yourself As a Sales Professional. You can deep dive on topics as you need, or as you become interested.
For You – Effectiveness
There is one area that is of key importance to a salesperson that I have not addressed in this eBook and that is self organization and personal productivity.
I cannot stress enough that all the professional skills in the world will fail if you cannot execute at the level of turning up on time, being prepared, having done your assignment (prepare proposal / presentation).
If this eBook is well received I will write a companion book with the working title of “Effectiveness for Salespeople”. In the mean time – look through the Self Help shelves of your local bookshop.
The basics are simple:
Have a Purpose
Have a reason that you are doing this. For most people this starts out as a survival issue, I need a job to pay the rent and support myself, but in the long run you need to get higher up the Maslow’s Hierarchy of Needs.
Once most people have risen above the survival layer, the most powerful motivators are becoming first competent and then good at their chosen career path. Wherever you are today, you need to realize that unless you can get to a point where your progress as a sales professional raises your self esteem within some twelve months of starting out as a salesperson, you should review whether you are doing something that you should spend the rest of your working career doing. For most people the next level of motivation is to have control over their work, rather than being controlled by their work. The assembly line worker is a slave to the line. He has to perform the task he is assigned as often as the line requires for as long as he is on the line. The salesman, once he has achieved a level of competence is far more independent. He should be out of the office frequently (I have never managed to persuade 8-10 customers per week to come to my office; you have to go to his.) Further a salesperson is fundamentally judged on what he delivers, not his activity. If you are 120% of annual quota and it is a nice day, go play golf. As a sales manager I never objected.
Have a Plan
Set yourself clear, quantifiable objectives and give yourself a deadline. It may initially be “make a minimum of eight face to face every week in February” or later it may be “save a million dollars from saving and investment over the next five years”. I do not mean “get better, some time soon”. String several objectives together that are clear, quantifiable and timebound and you have a plan. Write the plan down. Read it every week (or day). There was a long term study of Harvard Business School Graduates that tried to identify success drivers. The only thing that correlated with life success was that the successful graduates had a written plan. Keeping your commitments to yourself also builds confidence and self esteem, themselves contributors to your success.
Have a Lifestyle that allows you to be Productive
I am sorry if this advice is new information to you, but being a sales professional is too competitive and too challenging for you to spend all night on sex, and drugs, and rock and roll. The young and the strong may be able to fit one or two days of this at the weekend, but I have rarely seen a great salesman who did not consistently put in 9 hours a day, and nine hours that overlapped with the 9 To 5 hours that executives work. The high impact work that a salesperson does, meetings and presentations, are done face to face and you have to look healthy and full of energy.
Plan Your Time on a Weekly Basis
Depending on your role & responsibilities (new business, major account management) and the size of your territory the time allocation may vary, but you can assume that you need:-
- Business Development time – 20%
- Opportunity Management Time – 40% (meetings / proposal and correspondence)
- Administration & Review Time with Manager – 20%
- Reactive Time – “Events” will happen you need time allocated to deal with them
So which day (or which two half days) will you set aside to do your telephone calls; when are you going to write that proposal; when will you do the 8-10 calls a week with customers?
If you do not plan your week it will just pass and none of your objectives will be achieved.
Set Yourself Performance Targets
Service Level Agreements – make sure you set yourself standards to live up to. All emails read within 24 hours. All phone calls returned within two hours. Work them out for yourself and ask your customers if your responsiveness is good / average / bad compared to your competitors and adjust to the feedback you receive. I personally find it unacceptable to go home Friday with a major piece of work not done. I would much rather work until 10:00pm on Wednesday or Thursday than go home on Friday with work hanging over me. (I have a poor track record of working at the weekend). Get to know your work patterns (like you cannot work at the weekends and can work late week days) and adjust your workplan accordingly.
You may have heard of the Boston Box. The Boston Group of Management Consultants created a grid with four boxes where the two axes are Products and Customers as below:
They make the point that it is low risk / high rate of success to sell Existing Products to Existing Customers; and that it is high risk / low rate of success to sell New Products to New Customers. For this they probably got paid a lot of money, and people think salespeople are tricky!
From my personal experience, I can tell you that most of the very large deals that I have sold were Account Development deals, selling Repeat business ie selling existing products to existing customers. Why?
Whether the first sale into a major account is consciously defined as a trial or not; it very often serves as a trial of both the product and the company as a vendor. Most products have a wider opportunity for use than the initial sale. There will be direct competitor products being used, or alternative solutions that have overlapping utilization. The best example of this is any enterprise infrastructure such as computer software, I will use database as an example. Unless the numbers have changed since I was involved in the database market, a major customer account would have on average seven databases deployed within the enterprise. After your initial sale you should look at how much market share you can take of the total account market. You can be sure that as soon as you win the first deal, your competitors will be focused on winning back the market share they have lost to you.
From the customers perspective as soon as you have sold to them they begin to learn about your product as a solution and your company as a vendor. At some point the customer will look at consolidation and standardization on as few products and vendors as possible. If we consider the questions that a customer asks himself after a sale and implementation:
“Does it do the job?” – after a few months he knows exactly what the capabilities of your product are.
“Are they a good company to do business with?” – no more pre-sales dating; they are aware of what it is like to be married to your company, they understand your service ethic and capabilities.
“Does this make economic sense in the long term?” – New question – it is in this area that the customer will find the motivation to standardize. As long as at least one product has the capability and one vendor provides acceptable service (and both attributes of their experience of your company appear to scale to enterprise use) in time the customer will start thinking about the costs involved in having more than one vendor for similar capabilities. The costs that are not always apparent to vendors are in the area of maintaining more than one skill set and in the operational costs related to complexity. Further you can encourage this “economic” thinking by indicating that discounts are related to volume of purchase.
You have to look at the competitor installed base as your best opportunity for new business (albeit in an existing account) and give the opportunity the attention it deserves. Call on executives in the divisions that use your competitor products; spread the news (if it is good) about the success of your products deployment within the company; uncover the costs of having diverse solutions, take senior executives to lunch; make a “straw man” proposal to show the benefits of standardized infrastructure. The truth is that most companies sell once and then the salesman moves on and the only “relationship” the customer has is with the customer hotline.
I have worked with tools that help you quantify the “market size” and “market share” within an overall Account Planning process, but I do not intend to share those in this book for two reasons, these tools more properly belong to a Major Account Process that is company driven rather than salesperson driven, and really a lot of this is common sense application of the same techniques in the business development and opportunity management stages above. The beating the competitor tools are of particular use in account development.
The motivation will be that the size of the deals and their hit rate (probability that you will close them) are significantly better than in new business deals. In one of the companies I worked for the average new business deal was approximately US$100k and the hit rate across all the salepeople’s new business opportunity funnel was between 3:1 and 4:1.
The account development deals in the same company averaged US$2 million for enterprise deployment and the hit rate was consistently between 2:1 and 1:1.
So from a salesperson’s perspective you had twice as much chance of getting a twenty times larger deal; a compelling reason to look after your accounts, yes?
Twenty percent discount may be more than your company will accept (or they may bite your hand off to get the deal) but what you are really doing by summarizing is you are using principle number two:
Limit the Scope of Negotiation as Much as Possible
It becomes more and more difficult to judge whether you are truly trading value, the more aspects of commercial terms you allow to become subject to negotiation. To return to principle one, the usual reply is “No we have other points we need to negotiate” which brings us to principle three,
Do Not Negotiate one Point Then Another; Always Get The Entire Wish List Out on the Table
This principle reinforces point 2) as you can see the full extend of their demands and you can start working out your response. Remember saying, no, this is not negotiable is a valid response. In a complex negotiation it is appropriate at this point to ask for time to consult with your management and prepare a response. Occasionally some more pompous procurement guys will start asking whether you have authority to make a deal, and whether someone else who is empowered should meet with him. Usually a polite reminder that he has had several days to prepare his list and you cannot be expected to reply immediately without time to consult will shut him up. I have often been tempted to ask them whether they are empowered to negotiate a 20% rise in the offer price without reference to his management, but on balance procurement people are difficult enough without annoying them. (Though if you are really sure about your position with the customer’s end users and the procurement guy has over-reached himself, having an argument that leads to a breakdown of negotiation is an option to be considered. I have only had the guts to take this line a couple of times and sometimes it has won, sometimes the deal was lost.)
Always Know Your Walk Away Point
While we are talking about guts, principle four is “Always Know Your Walk Away Point”. One of the ways this is sometimes expressed is “Win-Win or No Deal”. Which raises a couple of interesting points: I nearly always state in the first negotiating meeting that I am happy to work towards a “Win-Win” outcome and am not prepared to accept win-loss. Usually met with a cynical smile and taken as a challenge, it has the purpose of announcing your intend to take an ethical approach (hence the cynicism); it implies that you have a bottom line after which you will walk away (DO NOT tell him what your bottom line is if he asks, you may do better than your bottom line but ONLY if you do not disclose it); and it reinforces something that is important in all aspects of selling, but of particular importance in negotiation, say what you mean, and do what you say. I cannot over-emphasise the importance of this behaviour (in all meetings with clients and) in negotiation. Once the procurement guy catches you in a position where you are on the back foot with a previous statement or offer you cannot deliver, he will push you and push you and push you.
Your Role is to be the Broker of the Agreement
In all this it is easy to end up in an adversarial mindset with the procurement but the final principle is “Your Role is to be the Broker of the Agreement”. You have interests at stake (commission, future terms of trade) but nothing compared to your company and the customer. If you can keep this mindset and work on the issues, review the list, identify the non-negotiable issues; identify the value trades; summarise a win-win agreement and sell it to both parties. You need to sincerely believe and sell it to your company as a good deal, and you need to have the agreement of the customers negotiating team that it is acceptable.
If these are the principles of negotiation the principles of Closing are easier. It boils down to asking for the order. The only preparation I make for Closing is to prepare 4 or 5 different ways of asking the question, as often asking for the order flushes out an objection or a final negotiation point, so to avoid repeating yourself you need more than one form of words. For example the conversation may go:
“I have prepared the appropriate paperwork, can we execute it now?”
“I need to get final approval from the Steering Committee.”
“So we should meet to sign the paperwork on Wednesday afternoon after the Steering Committee”. Just use different words, to avoid exhibiting obsessional behaviour or anxiety; “execute” in sentence one, “sign” in sentence two.
If you prepare for the little things that you can prepare for you can focus on the big issues.
The first principle is:
Never Concede, Always Trade Value
If the procurement guy asks for 20% discount, ask him what he will give in return, if he answers the deal, then close him and summarise back to him.
“Are you saying that if we concede 20% discount there will be no other issues and we can proceed immediately to signing these terms and conditions?”
There are libraries full of books on negotiation and closing techniques but the truth is that there is a direct correlation between the quality of the work you do in Selling the Opportunity and the ease of closing the deal. In simple terms if you have won the evaluation and the customer wants to do business with you, they will not allow the Procurement Manager to drive you away with outrageous demands.
While we are discussing Closing and Negotiations together they are very different and often mutually exclusive. What I mean by closing is “asking for the order” so almost by definition it does not happen in a formal negotiation. If you are in final presentation meeting you should always “ask for the order”. If you have done a good job in the business development and opportunity management phases you have earned the right to ask and asking always makes the status and next steps of the process clearer as the answer is always “Yes”, “No”, or “we need to do/clarify/meet with ….”. In a formal negotiation process usually the closing question is almost always some form of “So have we reached agreement?”
Only if you define Closing as every event between being “selected” by the customer and receiving the signed contracts are the two skills related as you will use both techniques in this period.
Let’s talk about Negotiation first. The strongest position in a negotiation is the position that nothing is negotiable. The overwhelming majority of consumer transactions are non-negotiable. You do not get the chance to stop at the check out of your supermarket and discuss price or legal terms and condition. More than a polite enquiry on the Returns Policy is clearly not tolerated in these transactions.
Some suppliers in the commercial world have had some success in holding to standard offerings, Microsoft is a good example, but with most corporate transactions (with Government deals being an excellent example) the negotiation phase can be as long as the evaluation phase. Once you are into negotiation one of your guiding principles is to limit the areas that you will negotiate about. Some basic ground rules will make this a little clearer.
First guideline – do not negotiate legal terms and conditions without professional help. Do you understand the difference between “best endeavours” and “commercial best endeavours”, no, the difference can be your company staying in business or going bankrupt. Try to tell the customer that legal terms and conditions are not negotiable. If they make it clear that this is a deal breaker, and only if it is a deal breaker, ask the customer to give you a “specific statement” (do not encourage them by calling it a “list” call it a “statement”) on the legal terms that they object to. You can judge how much trouble you are in by the nature of the reply. In order of magnitude of the trouble you are in, the responses could be:-
- We only do business on our standard procurement contract.
- A long List of clearly legal issues
- A (shorter?) list where there are some legal issues, and some issues that are really opportunities for clarification or explanation
Briefly, the appropriate response to 1) and 2) is to flag the situation up to Management and request legal support. The appropriate response to 3) is to clear up the opportunities for clarification and ask if the remaining issues (legal) are really something that they need to pursue.
The salesperson’s role in legal negotiations is to sell the terms and conditions earlier in the process, to reduce the time required to reach final agreement. Enclose copies of your standard terms and conditions with any proposal, so that the customer can pass them through for legal review. Reserve the time of the company advocate and attend the meetings or conference calls. Your only stake in the outcome is that if it is a major account the terms and conditions agreed should be acceptable for your company for the transaction being negotiated and all future transactions, as you will surely not be able to improve on them later.
The salesman has a much more important role in commercial terms negotiations. Usually the salesman is expected to be the chief negotiator, and I for one always wanted that role. You may be able to delegate this role upwards as again, as with legal terms, it will be the company’s decision whether to accept the negotiated terms or walk away, but I have always felt a sense of ownership in my deals. The salesperson also brings important resources to the negotiating table. The procurement manager may have more experience in the process of asking for discounts, but the salesperson has attended every meeting during the business development phase and knows why the customer needs the solution, what the value of the solution is, and why his solution was selected. I have often talked about these issues in negotiations, they are important ways of making the procurement guy understand that you understand the value of your negotiating position and will not be pushed further than a certain point.
In my view there is a lifetime of learning in negotiation but if you keep five principles in mind while you gain experience you won’t make too many mistakes.
The relationship battleground is different from the Emotional and Political battlefields. What this is about is the quality of relationship that you as an individual has with one or more of the executives in the evaluation process.
What is important is that it is differentiated. Some customers are just very social or very venal. If you offer them a night out on the beer, or dinner at a good restaurant or a trip to the local striptease club, they will say yes. The question you have to ask is “do they also say yes if asked by the competition?”. Moving away from the question of strip clubs let me give you some examples of when Relationships have been differentiated. In a new business deal recently with a telecoms company I was a little late onto the deal and yet I had a very good relationship with the key technical evaluator.
I met with him and his behaviour was very different from normal in the meeting. For several days I could not get through to him and then he called me up and asked to meet for a beer. What he told me was that he had already made up his mind months ago that he was going to buy from the competitor, and that as soon as he realized I was on the deal he rushed through his recommendation, and the contracts were awarded to my competitor because he did not want me to waste my time! Not exactly the outcome I was looking for, but an analysis of the relationship battlefield would show that I had indeed a winning position in the relationship battlefield; I had just lost on all the other battlefields! Unlike in this example, having a good relationship with one or more executives is a very good indicator of a successful outcome. I have been coached by friends when my sales messages have been off target, I have been told who the most important executives to see are, and what the “real” agenda is.
The best kind of relationship with a customer is based on trust and respect of your competence (not on your ability to perform in a Karaoke parlor). This can be the most important battlefield if you are the incumbent in a major account. If you have provided good service over several years, you will be given every help to win the evaluation.