Stop the Churn

I never thought I would ever write a public service announcement, but that is exactly what this post is going to become. STOP the CHURN! I aim this message at companies that are sacrificing long-term talent for short-term gain. Whether you are a newcomer to my web site or follow me with regularity, you know I mostly aim for the sales side of the audience; but not this time. I point my finger in absolute disgust at companies that are using talented workers as throw-away pawns in an effort to forge some semblance of profitability.

My routine is to regularly “stalk” websites, postings, and even job listings in order to stay abreast of changes in sales and the competition. I am seeing something I find unsettling. A trend among companies to hire hastily and hope for the best. Are they expecting exceptional talent at low-ball prices? What is the reasoning? The fiduciary responsibility of any company’s executive leadership is to the stakeholders, whether those stakeholders own part of the company or not. This responsibility is being ignored. I often use the phrase, “Churn-n-burn” when I talk of a salesperson’s desire to sell and get out quick. Well, it is apropos when it applies to those that are sacrificing bottom-line dollars to make themselves look good.

I will give you two examples I have personally observed without revealing the names of the innocent.
FIRST:
I have followed this particular company over the past 18 months and have seen advertised an opening for a account manager/sales representative listed 6 times for the same area! You do not have to have higher math skills to understand the people have only lasted three months! More likely 45-60 days since there will be some time period necessary to fill the position.

SECOND: Another company decided they would branch out from their inside-based verticalized sales model for a sales model based on territory. This is a model I embrace, so it is one I fully understand and believe in when a company’s strategy is to go to the next level of revenue. They brought in sales management to execute this strategy,  which they in turn brought in territory-based sales people. For those not familiar, this type of change takes time–a long time to see end results. So what was the outcome? Within 4 months the senior VP was let go and within 5 months the personnel he brought in was gone; some sales people with as short tenure as 45 days. Seeing a pattern here?? The second example is pretty extreme, but none the less true.

This is costing companies thousands of $$, let alone the cost in terms of brand damage. Think I’m wrong? Ask any reputable company what a revolving door of personnel does for company reputation. I wrote an article, “Hiring the Right Salesperson” where I mentioned the cost associated with hiring the wrong person. Think about how costly it is to the company in both tangible and intangible elements. Hire for the long-term. Hire and treat employees as you do your product. Use “Life Cycle Management” theory and apply it to the employees. If, as a company, you continue to go through not only sales people, but any employee you must understand your variable costs are going to be skewed. Is that the overall intent, screw with the variable costs at the right time to make the contribution margins look better? Let it be understood that this will catch-up on the backside–BIG TIME!

Show this to your company’s executives. See their reaction. Was it snuffed? I’ll let you decide.

Find this article useful, interesting? Contact Me or please leave a comment. If you have a Twitter account and found this article useful, it would be much appreciated if you would retweet this at the beginning of the article!

Happy Selling!

Ed Warner

Social Media and Sales

I wrote an article a few months back, “Selling Under the Social Media Umbrella”, in which I described more or less, the evolution that took place that brought us to where we are today. So, fast forward six months and look how much it seems to have changed.

People are coming out of the woodwork to claim instant superiority as social media gurus. It seems most are saying they can increase exposure, double sales, and increase your bottom line. Here’s a suggestion, ask for proof! I did from one such claim only to be told it was confidential information. What!? This is not to say they cannot be of some help, they can, it just some precautions. The problem with social media today is it is too raw an avenue to have “experts”. You can have some experience, but only to a point, but certainly not experts. Those proclaiming themselves as experts are grabbing from their legacy marketing experience and throwing the social media cover over your eyes. “Buyer Tread with Caution”.

Social Media takes time and a lot of commitment with the understanding that it is a continuous process; one that you just do not jump into. Social media is not for every business or industry. The smaller the organization, the least benefit it reaps. The reason is fairly simple. The amount of time involved is prohibitive. Smaller businesses simply do not have the resources. This is about the time they begin to look for help. The problem is, they are not sure what type of help they really need, they simply believe it is a quick way to help their business. Unfortunately,  they turn to and rely on the self-proclaimed “experts“.

I believe social media should be called “Commercial Media”. This avenue is best exploited by bigger industries that have a much larger ROI. Bigger industries have the stamina for the long-term. Let me stop here and explain something. Social media is not the same as social networking; either for business or pleasure. Social media is an evolving source of communication. I am not saying there is any benefit to smaller companies, rather smaller companies simply cannot expect the plethora of return an organization with a huge marketing budget can expect.

Social media is an offshoot of marketing. Like any other marketing campaign, a social media campaign’s success is in the execution. If done correctly, the impact can be huge. Done poorly, social media will be deemed a failure as a medium of information dissemination.

For the foreseeable future, social media will be a passive path for sales. It will eventually evolve into an active path, but not for some time. Social networking will be the next path for commercial business despite the muddling around of those that now view it has a fad.

Find this article useful, interesting? Contact Me or please leave a comment. If you have a Twitter account and found this article useful, it would be much appreciated if you would retweet this at the beginning of the article!

Happy Selling!

Ed Warner

The 4th Quarter and Beyond

It’s here folks, do-or-die time for those on the calendar sales cycle! Are you ready?

Right about now people up and down a sales organization’s chain are either confident or extremely worried about the approaching end of quarter (EOQ). No doubt, it has been a tough, tough year and it isn’t over yet, so don’t give up the ship just yet. There are some things you can do and some things you can’t.

Having one or more deals that seems to be stuck in the pipeline is one of the most frustrating situations a salesperson can encounter, and even more so as the year-end looms closer. One of the things you cannot do is BEGIN the selling process in hopes of getting closure by December 31. The exception to this is the transactional or commodity sale, but this isn’t guaranteed either. So What Can You Do?

Assuming you are still holding a live close, you can and must turn up the heat. But how?

    • Go back to your internal coach or advocate and ask
    • Decision maker relationships are key here; What are they waiting for? What is crucial to them?
    • Sales management can help; ASK!

Holding out could just be the company’s way of negotiating. Turn this around and re-negotiate, but before you do, make absolutely sure your tactic will make a difference.

Here is a graph I share with salespeople that explains very simply where ANY action takes place; in ANY organization. I share that with you now.  Presentation1(Click for a bigger image) Using this simple graph, you can add a tick marks and pretty accurately track the closure time of the deal.

Don’t get wrapped up in emotion and be pressured to make concessions you later regret. I am a firm believer in NO unilateral concessions. If your prospect wants to play this type of ballgame, then request something from them that has value to your company, like access to the CIO, CFO or any other officer that would benefit your company and gain a deeper business relationship.

After doing all this, the deal still may slip into the next year. It happens. Especially in this economy.

Ok you are wondering about the “Beyond” part from the article title. As I stated before, some deals are going to slip into the next quarter. Here and now is where you want to begin planning for the coming quarter even if you have no idea about your quota, territory, etc. Begin planning with the thought of moving some of your customers into the top tier of your account list. In my last article, So You Wanna Be the CEO I explain how this can be accomplished. Additionally, I have another article, 5 Tips to Practice Daily that explains the refocusing of your efforts towards the top percentage of your customer base. TPresentation2he following picture illustrates what your goal should be, achieving the top level of this pyramid. Once you reach this pinnacle, the customer sees you as golden. Word of caution; rarely is this level obtained in the eyes of the customer.

If you find this useful, Contact Me or please leave a comment. If you have a Twitter account and found this article useful, it would be much appreciated if you would retweet this at the beginning of the article!

Happy Selling!

Ed Warner

So You Wanna Be the CEO?

CEO’s have a tremendous burden in that they must not only perform, they must often outperform. They fail not for the lack of planning, strategy gazeor the lack of a long-term vision, rather because of a simply task, Execution.

Too often we (salespeople and alike) act as though our tasks and daily routines are insignificant. On the contrary, everything you do has a certain degree of separation that touches the bottom line. We fail to realize just how important our job is, regardless of the occupation. In spite of where you are in the corporate structure, treat your sales territory as though you were the CEO… Execute!

In order to execute, you still have to have a plan, but the execution must plancover the humdrum details of account management. Many a salesperson has made the mistake of believing they can do these at their leisure. and the customer will be happy! Nothing could be further from the truth. I am a relationship sell kind of person, therefore I believe in cultivating relationships for the long-term. I do not believe in the churn-n-burn mentality. If that’s your nature and it suits your job description, then more power to you. But if your goal is to keep the customer in hopes of selling to them again, there are continuous must-do’s you have to perform.

  1. Follow-up and make sure your solution did indeed perform–their pain MUST be gone
  2. Regular contact–this allows you to uncover additional pain or issues as they arise
  3. Competition Watch–contact allows you to understand their penetration, if any

So what’s your excuse?
Sounds fairly simple, so why is there such a disconnect in execution? TIME Make the time and make the call or visit. I have heard just about every excuse, but the one that stands out is: I don’t have time, I need to concentrate on this quarter’s numbers. hourglassThis excuse is the biggest reason for not doing anything; the illusions of time dwindle. You actually have more time than you realize and here is how you dispel the myth and reclaim the edge.

Account Division
In order to make sense of your time this really only works for those that do account management. Divide your customers into three groups, 1,2,3 or A,B,C. Decide on one key element that will divide them. It can be something like: yearly potential selling value, lifetime selling value or whatever makes sense for you.
Start by putting the top 20%-30% customers in the first tier, the next 50%-60% into the middle tier the rest in the last tier. Once that happens, make a contact plan for each of the tiers according to importance. Put this into your electronic calendar as a to-do!

Rule of thumb: 1st tier call monthly, 2nd tier call quarterly, and 3rd tier call every six months. What are we trying to accomplish? Relationships. It’s all about relationships. Still true today, people buy from people! All of your 1st tier customers should be your key account or best prospects. Increase ten-fold, the relationships you now have within those accounts. fightFailure to win this battle will guarantee you lose the war! This is a priority so treat it as such. Do what is necessary to cultivate the relationships

Your goal is to follow the same procedure for the next tiered accounts, but in a more restrained role. Tier 2 accounts can be thought of as the next Tier 1 accounts so starting early puts you ahead of the curve. The last tier of customers need to be jettisoned or cultivated. As a salesperson, no one likes to say goodbye to a customer, but consuming more resources than their sales potential is capable of replenishing, it is time to cut the strings.

I will leave you with this thought provoking question: Why win additional customers if you cannot keep the ones you have?

If you find this useful, Contact Me or please leave a comment. If you have a Twitter account and found this article useful, it would be much appreciated if you would retweet this at the beginning of the article!

Happy Selling!

Ed Warner

Hiring the Right Salesperson

Going through the hiring process from the candidate and the hiring manager’s point of view is not all that different. Each side should have the same objective; convince the other this is the right match. Is there a way to increase the odds for a win-win situation? This article addresses this question.

Anyone can hire and anyone can hire poorly. The key is to hire the right person the first time. Hiring the wrong person is costly for a company, but what the hiring company fails to realize is this is also highly damaging to the candidate’s reputation as well. Hiring the right sales person should not be predicated strictly on their ability to meet and exceed quota. WHAT? Yep, you read it right, that’s exactly what I wrote.

I didn’t say that trait was not important or not high on the list. Managers get myopic when they see a high performer and don’t see the bigger picture. Let me explain with this scenario. interviewYou have two candidates interviewing for the same position, and their performance at their last position employer was 80% and 140% respectfully. Which one do you hire? Managers with myopic vision hire the over-quota performer and six months later, you find this person truly is a rock star, but with one BIG drawback. He/she does not follow the rules, disrupts team continuity and has undermined your team allowing resentment to set in which is allowing total sales to drastically fall. WOW! Not the result you had in mind when you hired this cannon is it?

Given this scenario, which candidate would be the better hire? The answer is: You don’t know. Certainly this hire is producing as you had hoped, but at a very high expense to the team and company. The passed-over candidate maybe looking pretty good right about now, but then again you had no guarantee of success if you had hire them.

This brings us to the core of this article, Personality-Trait testing. I opposed these until I saw how costly a bad hire could become, and not just in revenue; they can be destructive to the entire sales team. Companies are beginning to understand the value of having a candidate tested, especially when it relates to the cost of hiring an employee that does not work out.

These type of tests are not expensive, so you could do these on your own and send one to targeted employers in a job search as they could give you a competitive edge. The caveat to doing this is if it came back showing you in a negative light, you might not want to share with a potential employer. Additionally, if it is truthful, ignoring it won’t make you a better salesperson.

Personality and trait analysis testing isn’t new, but in the present economy, they are becoming a valuable tool. analyzeI do caution companies and managers to think sensibly when analyzing the results. These are simply another tool to use in evaluating talent. If you perceive these as the deciding factor, then maybe hiring isn’t your biggest problem.

I will end with a great quote from
Casey Stengel–Finding good players is easy. Getting them to play as a team is another story.

Make sense? Let me know by commenting. It’s how we all learn!

If you find this article of value please comment. Have a Twitter account? I would be most appreciative if you would retweet this at the top of the article!

Happy Selling!

Ed Warner