Month: June 2014

Bad Sales Explanations

sales rep excuses

I was poking around the Internet today looking for examples of “sales rep excuses.” My purpose? To analyze these excuses in light of the more general phenomenon of bad explanations.  I hope you will stick with me on this (about 2,200 words, or <gulp> 146 average tweets).  To gain insight, we need to delve deeper into the topic of sales excuses than a typical blog article might have patience for.  But, (stretching the metaphor a little further), we are more likely to find undiscovered treasure if we make the effort to dive deeper into darker waters.

The properties of good and bad explanations are explored by physicist David Deutsch (Twitter @DavidDeutschOxf) in his 20011  book, The Beginning of Infinity; Explanations That Transform The World.  In a nutshell, progress happens when we form new explanations and drop bad ones.  That’s a solidly intuitive idea; so far so good.  But how do we identify good explanations from bad ones?  Easier than you might think:  good explanations are hard to vary without contradicting existing facts and well-established understanding.  Start fiddling with a good explanation in order to avoid identified inconsistencies and contradictions and the explanation starts falling apart. Furthermore, according to Deutsch, good explanations extend the reach of existing knowledge. I believe I’ve encountered this before under the name of universality. Universal explanations work everywhere every time.  In essence, their reach is infinite.  I’ve struggled to avoid using the term “universality” to explain the purpose underlying Salesphase. I think I like reach better. The goal of Salesphase is to complete the development of a methodology and an associated algorithm with infinite reach devoid of sales mythology and lore.  That’s a tall order, and a topic I will be exploring in this blog over the coming months.

What about bad explanations?  Deutsch, in so many words, tells us that bad explanations are unverifiable and easy to reformulate in the face of contradictory facts.  Hmmmm, that’s already starting to sound applicable to common excuses used by sales reps. Of course Deutsch, being a physicist, is primarily talking about scientific theories that survive criticism and testing; ones that also make new predictions or explain previous mysterious phenomena.  That’s okay, my argument is that sales, as a discipline, does not hold any special place in the universe.  Sales is constrained by the same laws as every other aspect of the observable universe.  So why shouldn’t we take advantage of scientific thinking?  We rarely, if ever, investigate the intersection of theoretical physics and sales, but that is exactly what Salesphase is doing: drawing on current scientific thinking to inform and modify the ancient profession of selling.  (As a side note, I do think that the statistical discipline of Six Sigma made some valiant attempts at using science to increase the “quality” of the sales process,  but, despite its great success transforming manufacturing quality, I never experienced a transformative Six Sigma implementation in the sales department.)

Okay, enough of the general science lesson, it’s time to extend the concept of bad explanations to bad sales explanations. To me, bad sales explanations are sales-related statements that are either unverifiable or easily reformulated when faced with conflicting data. Sales excuses might be testable by a boss and found to be false, but more often than not, there is some reason that a boss can’t or won’t directly test sales rep excuses.  What I’ve found in my experience is that most bosses don’t care for direct confrontation, don’t possess sufficient contradictory evidence, or don’t have the time and resources needed for validating or falsifying sales rep excuses.  In the typical real-world sales environment, sales reps can get away with excuses and live to explain themselves another day.

Now, to get into my analysis of bad sales explanations, we need a good source of sales rep excuses.  A quick Google search turns up 8 Worst Lies Sales Reps Tell The Boss by Geoffrey James (Twitter @Sales_Source).  Whether these actually are the eight worst lies, doesn’t matter.  I spent many years in sales and these examples will do very nicely.  I won’t go through all eight as I’m already pushing 700 words and I am just warming up.  So let me select four representative “sales lies” and let you read about all eight in Mr. James’ article if you like, (http://bit.ly/8saleslies).

EXCUSE 2. “I have a great memory, so I don’t need to write down what I’ve learned about a customer.”

The bane of a sales manager’s existence is the rep who won’t document his or her activities.  But, finding the right balance between documenting sales and doing sales can be difficult.  I have yet to encounter a major company CRM implementations that strikes the right balance.  The above excuse is a great example of a bad sales explanation as it explains nothing.  It neither explains good sales results nor poor ones.   It might be true or it might be false and either way sales results remain unchanged.  Here’s what I’ve found in my experience: when a veteran sales rep is kicking butt and closing sales at or above quota, no one is too worried about the quality of documentation.  When sales results are poor, the sales manager turns to enforcement of various sales policies such as CRM documentation as a solution.  The thinking is that the problem can’t be solved without knowing who the rep’s customers are and what’s going on with each deal.  Let me tell you though, from the perspective of a sales rep, your customer knowledge is your job security, and documentation can be the enemy.  If you are a sales magician, you don’t want to let too many secrets get out of your bag.  On the other hand, if you’re a sales slacker, you don’t want to make it that much easier for management to replace you.  In both cases you try to avoid detailed documentation.  Besides, filling in blanks and typing up sales calls is time consuming, boring and there are no commissions paid for the work.  I often wondered if anyone ever read or cared about my sales documentation…especially considering I mostly received phone calls from interested managers asking questions I had answered the night before at 11 pm when I was updating SAP CRM instead of sleeping.

As I consequence I’ve been developing the ideas behind SalesPhase ever since.  SalesPhase can be implemented in a way that does not make reps feel replaceable while also interactively gathering critical customer information that is usually hidden in the noise of each selling organization’s proudly semi-unique selling process.  No late-night typing required.  The faster a new technology can help gather and analyze accurate customer information without burdensome documentation of redundant and useless detail, the faster sales reps will adopt that technology, (and the faster such information can translate into booked sales).  Salesphase is developing a full set of good universal sales explanations, ones which can be verified and if proved wrong by emerging information, corrected.  Bad sales explanations will be irrelevant.  Sales reps can continue making excuses all they want, but  in so doing they will be naked and useless (the bad explanations, that is!)

EXCUSE 5. “I’ll make quota; my deals will close at end of quarter.”

This is a classic delay technique to get a pesky boss off one’s back without causing too much alarm. The lives of sales reps are very often tied to quarterly performance. A deal that closes at the beginning of a quarter is just as good as a deal that closes at the end of the quarter when it comes to calculating quarterly performance and commissions.  For a sales rep, a perfect quarter might be playing golf and lying on the beach for 2.9 months, then ringing the cash register in the final days of the quarter. (Never mind that the company does better when sales close at a steady pace thus keeping production output and cash inflow at some optimum rate.)  Sales manager performance and bonuses also tend to be tied to quarterly performance, and so nasty grams (in whatever electronic form) aimed at poorly performing sales reps might start going out after the first monthly report reveals a potential sales problem.  A quick reply that “my deals will close before the end of the quarter” will generally buy time. Unfortunately, this excuse is a text book bad sales explanation because it isn’t testable before the end of the quarter AND if the rep’s prediction turns out to be wrong, the excuse can be quickly reformulated into one of the other oft-used sales rep excuses for why deals didn’t close.  News flash:  if this excuse buys time it’s because a faulty sales pipeline or other faulty sales metric fails to predict the true likelihood of specific deals actually closing this quarter.  If a company had access to the Salesphase algorithm in the form of a CRM add-on or stand alone application, such a statement could be quickly justified or nullified.  If deals are going to close, the algorithm will back up the statement.

EXCUSE 6. “We lost that deal because our price is too high.”

It’s not too often that a customer will walk away from a done-deal thinking they paid too little for your product or service.  I tend to start from the perspective that customers will claim that any price over $0.00 is “too high”.  So, the price-too-high excuse is a solid go-to excuse with tremendous reach because it’s easy to defend in a wide variety of situations and it’s often difficult for a manager to test because the customer will almost always agree that price was a key problem. (It’s one of the easiest and most used excuses that buyers use for not buying).  Ideally, from my perspective, a customer buys because it needs a solution to a problem and my product has (rightly or wrongly) been identified within the time and resource constraints of the customer to be “the best alternative.”  Under this definition, it’s possible that a deal is lost due to high price.

Sales management, however, almost always blames the rep:  “you didn’t sell value!”  I’ve heard this many times.  I worked for years for 3M Company, which is rarely the cheapest alternative in any selling situation.  So, I know value selling inside out, and I’m sorry, but sometimes the price is just too damn high.  But, ironically, I don’t ever recall losing a deal I was negotiating based upon price.  If price (as one factor in the value equation) was going to be a problem, I made sure that deal never got to the negotiating stage. It was eliminated early on as a non-viable solution for that customer’s problem.  Too often sales reps stuff their territory pipeline with deals that are unlikely to close and then fall back on bad sales explanations such as, “The price twernt right.”

EXCUSE 7. “I haven’t called that customer but I have it scheduled for later today.”

Yes, I’ve had to pull this bad boy excuse out, or some variant, in a time of need (typically during a call from my boss or a product marketer).  Is there any sales rep that is on top of every customer call on their list?  This is more of a face-saving game played between manager and rep.  Of course, if the boss calls at 5pm it’s easy enough to reformulate this one as, “I left a voice mail and will call again tomorrow.”  Or, I’ve got an appointment tentatively scheduled with this customer on Thursday.” When I would fall back on this classic excuse, that particular customer call would graduate to the head of my high priority list so that I could get back to the requester as quickly as possible with the results of the call. This particular excuse isn’t really significant as a bad sales explanation, but it does point to an interaction with the boss that is awful deep in the details. If a boss is calling to ask such a question, my guess is the wheels are already loose and about to come off the bus. The only open questions is, who will get thrown under the bus?  The author of “The 8 Worst Sales Lies” correctly points to this as a problem of a rep not being on top of his or her stuff, so to speak. Anytime that is the case, expect a whole host of bad sales explanations to come streaming out of interactions. Salesphase doesn’t rely on interactions about schedules, sales calls, customers, etc. The data that will emerge from the application will make obvious which reps are on top of their game and which are not.

In general, I believe that a complex set of factors interacting over a long evolution of “sales methodologies” has left plenty of room for bad sales explanations to continue thriving. If they didn’t work, they would not be so universal as to be the subject of a top eight list in an Inc.com article. The fact is, bad sales explanations often have greater reach than the underlying company’s selling system.   Why? Precisely because they are untestable, and easily reformulated for use in varying situations.  Universal template excuses can be easily adapted to exploit weakness in the company selling system no matter how many times management rolls out a new set of tools or best practices.  Salesphase would take a different approach based on a set of universal good sales explanations (sales laws) that tap into hidden customer information.  Combine this with new customer data, as it is collected, and a much clearer picture of the quality of the sales pipeline emerges, including the likelihood of closing each and every deal regardless of its location in the sales pipeline.

To comment or discuss in more detail or privately, tweet or follow John Clark, @salesphase.

 

 

Advertisements

The Trouble with High Tech Sales Tools

I’ve been involved in the sales efforts of leading edge technologies for more than 20 years: ultrafast LCDs, liquid crystal holographic optics, virtual reality, digital micro displays, aerospace composites, etc. It doesn’t matter whether the company is a Silicon Valley startup or a Fortune 100 conglomerate–I see the same old types of approaches to selling. While product technologies being sold move ahead at light speed, “sales process technology” ambles forward at a more earthly pace.

You might disagree and rightly point out products from Salesforce, InsideView, comScore, and so on. However, I think of these as high-tech sales tools allowing selling organizations to do more with less. These are fantastic products, don’t get me wrong, but do they reach their full potential when the underlying sales processes have not changed all that much? I loved using Business Objects and had to beg permission from sales management to slice & dice my own data searching for hidden patterns left undetected by the canned sales reports.

I was working for 3M at the time and it was as if they’d purchased Ferraris for the sales force but detuned them into Fiestas before letting us drive into our territories. Even then it was still difficult for the sales (and marketing) people to understand and effectively use the sales technologies being adopted at the highest levels of the organization. I took part in a Six Sigma project to roll out a SAP CRM implementation. Time after time I was stymied when trying to take advantage of the power and flexibility of theses new technologies. Instead we essentially digitized the same old process that had been used in the prior system in a round-robin going all the way back to pencil and paper.

New systems were rolled out ostensibly for the benefit of the sales teams. How many times did I hear the pitch, “You guys are going to LOVE this!”? What would inevitable follow amongst my sales brethren was eye-rolling, groans, and the implicit understanding that we were soon in for a problematic implementation with a steep learning curve ending with more hours spent documenting at home for no additional pay. All this so that business unit management could roll up the information to make better predictions to senior management whose butts were on the line to the CEO whose butt was on the line to the Board of Directors and the shareholders. Did I ever hear a salesperson say, “This technology is awesome! I’m killing my quotas, getting home early for dinner with the kids, and sleeping like a baby all because of that new software management gifted us from heaven!”? No, I didn’t.

The better a sales person was, the more he or she could ignore any new system and keep selling the old fashioned way. One of the best and most senior of my sales colleagues would mumble, “Here we go again.” He’d survived 27 years of management shakeups, strategic re-orgs and new software rollouts, without being seduced by any of the changes. Ultimately, we all knew, it was “beating numbers” that made one successful, not early adoption of new technology.

That’s not to say it wasn’t possible: I used the power of SAP to organize several disorganized seller/buyer engineering teams. Derailed multimillion dollar projects needed to get back on track before going to corporate fisticuffs, e.g. expensive litigation and soured corporate relations. One project involved positioning systems for nuclear subs carrying Trident missiles, and another for anti-rotation systems for satellites needing to see terrorist nose hairs from outer space (well, more like near-earth orbit).

These were important projects that deserved the time and effort to master new software tools. But is that the typical case if you, for example, need to close a $50,000 abrasives purchase order with an aircraft repair station? Not as much. You have to close a LOT of those POs to make your number and you’re not going to do it at your desk (or in your car on a tablet).

My vision is to upgrade the sales process itself to match the software technology now available to selling organizations. I’ve spent the last ten years formulating my ideas. Now it’s time to build a team and raise some money.

Consider SalesPhase to be a catalyst that can supercharge the interaction between sellers, buyers and cool new CRM, data, and analytic tools. But first we need to go beyond the standard sales pipeline…far beyond.

Follow me on Twitter, John Clark, @SalesPhase to comment or discuss privately.

Sales Friction & Broken Symmetry

friction“SALES FRICTION” is wasted energy in the form of wasted time and resources during the process of a buyer and seller coming together to close a proposed deal. During 15 years managing complex high value long sales cycle B2B transactions, I found great advantage in finding ways to reduce sales friction. Simply stated, aligning sales efforts with the customer’s buying phases was the key to reducing friction (as happens in any physical system which gains coherence). But, how to do this consistently when starting with imperfect or zero knowledge of the customer’s buying agents and internal processes?

Due to superior knowledge of their sales process, sellers naturally select their internal sales funnel as a “sales gauge.” Unfortunately this is a poor choice of gauge if one is trying to measure the likelihood of a SPECIFIC customer making a SPECIFIC (large or complex) purchase. There are statistical correlations between a vendor’s sales stage and probability of closure, but can we do better than these correlations? Yes, we can.

Salesphase is a methodology that is independent of any particular buying or selling process. The scale and scope of the deal makes no difference. Sounds “universal?” Let’s check:  to claim a “universal solution” to any set of problems (including sales friction), it is well established historically & mathematically that such solution MUST be based on one or more underlying physical or abstract symmetries. “Symmetries” can be difficult to define, and as an aspect of Salesphase is kept securely tucked “under the hood.”  But in the context of the underlying algorithm, symmetries are groups of transformations which leave some property of a system invariant (fixed, unchanged, indistinguishable).

Finding hidden symmetries can be difficult. Customer and vendor organizations and processes often appear specialized, unique and yes, asymmetrical, when compared to one another. Why? Because symmetries can be “broken” by external forces, e.g. culture, terminology, system noise, etc. Broken symmetries, when not purposefully designed into a system, necessarily imply at least two things:

  1. There exists hidden “embedded” useful information; and
  2. Some property or characteristic of the system remains invariant despite observed “local differences.”

Salesphase exploits invariant properties of the selling/buying process to unlock hidden information critical to reducing sales friction and other sales dysfunctions. Salesphase realistically assumes a world of IMPERFECT/INCOMPLETE customer information which can be enhanced as information is learned or modified. Salesphase is a methodology leading naturally to an algorithm, and is not competitive to CRM or data analytics. Instead it is a framework for extending the value of existing tools while reducing total sales effort and increasing the accuracy of sales predictions.

Tweet or follow John Clark, @Salesphase, to discuss.