Knowing your business

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Knowing your business

March 10, 2011 in Business Acumen, Communication, Procurement, Sales Relationships, Sales Research, Sales Skills, Sales Training

‘Knowing your business’ was voted as the Number 3 Sales Trends for 2011. With business becoming more complex it should come as no surprise that clients want to work with business people who can sell, think about possibilities and create a work partnership with their businesses. However, our studies with hundreds of sales professionals and middle management sales leaders reveal that the level of business knowledge and commercial acumen is poor or non-existent in many cases. Often trained on product but not on business practices, many sales teams are falling short in delivering value to their clients.

More and more is being asked of sales people and sales managers when it comes to business knowledge and commercial acumen. Gone are the days of just being a product expert. Sales people need to be competent business people too. Being able to understand strategy; how businesses, markets, and communities function; and where we, our products, services and business works in concert with our clients should be on our agenda in 2011. Today, clients expect to communicate and deal with a real professional who knows how business functions. They want to have business discussions not product discussions.

Our studies reveal that there is little if any discussion about the big picture or business strategy, or innovation or supplier integration. At best, supply and distribution are on the agenda along with product. A surprising finding was the low level of business knowledge and commercial acumen with sales managers in the technical product sectors – very focused on product quality, distribution and service they are not working at the required level to make business decisions and work strategically with clients.

What does business or commercial acumen consist of?

Using the Barrett’s Sales Competency Dictionary, here are some definitions of business competencies relevant to sales people:

Business Acumen: Demonstrates an understanding of how business works; understands the business’ commercial drivers and makes commercially sound decisions.

Financial Awareness: Develops strategies in order to optimise the potential profitability of sales and to measure the financial value of the customer-organisation relationship.

Market and Industry: Keeps up to date with relevant business, technical and professional knowledge and uses this information to understand market trends, customer needs and buying patterns.

Rosenbaum’s 2001 research into elite sales performers reveals that they are focused on the business of business as a key part of their sales strategies. Here are the key competencies they display that other less effective sale people do not:

Listen beyond the obvious product needs
- Presses for more information to identify the business issues underlying the customer’s needs
- Creatively draws on the full resources of the firm / business
- Introduces customers to other suppliers and potentially valuable support resources
Orchestrating internal resources
- Treats company resources with the same degree of importance and creativity as their prospects
- Invests time building collaborative, customer focused relationships inside their organisation
Aligning customer and supplier strategic objectives
- Looks to further the interests of their customers’ firms as well as their own
- Keeps current on developments that affect customers’ business strategies including emerging trends and customers’ competitors
- Welcomes opportunities to customise products or services and has a long-term perspective on the way they do business with customers
Establish a vision of a committed customer relationship
- Expands the customer’s understanding of what a business relationship can be
- Builds a flexible relationship that is responsive to marketplace changes
- Communicates achievable objectives for the relationship while challenging the creativity of both organisations
Understanding the financial impact of decisions
- Adept at understanding the financial impact of decisions
- Uses internal resources in ways that are appropriate to the potential profitability of serving individual customers
- Looks for ways to contribute to customers’ profitability

So what’s the solution?

How do we ensure that this competency is alive, well and fit in the sales force? Should everyone have an MBA? The answer is ‘No’. Without some domain expertise, MBA’s do not make you a great operator either. It’s about combining experience, thinking and creativity with theory. Getting real life hands on experience allows you to see how the real world operates. An interesting article on Radio National highlights the problem of having an MBA without real life experience and the serious issues this has created in business: MBA – Mot Bloody Awful

The answer lies is giving our sales people access to information or introductory training on the fundamentals in business, and the opportunity to review true-to-life case studies about how their business integrates with customers’ businesses is a good start. Including sales people in strategy development and business planning is also useful. Our ’5 Step Sales Planning Process’ that is part of our sales training and Go-to-market training sessions have also proven to be a big hit with sales teams. It allows them to develop their own sales strategies and do the thinking and analysis on their business and that of their customers and markets.

Having business and commercial acumen is also becoming a prerequisite for Human Resources and Procurement professionals. We all need to know how businesses work and function. The warning is if we continue to lead with product, we and our sales teams will be left behind in 2011. Like anything, it’s about blending theory with practice. Making sure our sales people can understand businesses’ commercial drivers and make commercially sound decisions in line with ours and our clients’ business strategies is key in 2011.

Remember that everybody lives by selling something.
Author: Sue Barrett, MD of barrett.com.au a Sales Training firm.

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Transitioning from the old sales paradigm to the new world of social sales

February 2, 2011 in Communication, Sales Relationships, Sales Skills, Sales Talent, Self Development, Social Media, Social Sales, Strategy

When I began my career as a professional sales person in the early 1980’s we were trained in product and client communication skills focusing on handling objections. We were given business cards, product brochures, a geographic territory of clients to manage and grow, and a car to get around in. We did not have mobile phones, let alone smart phones / tablets, laptops, or CRM’s. There was very little coaching and we were expected to make sales and make it work.

For a while there, let’s say 20+ years, it seemed like business as usual as many companies still clung to the Product Paradigm of Selling – ‘show up and throw up information’, however there were fundamental shifts of seismic proportions happening around us even back in the late 80’s and early 90’s. The transition from product to solution selling was one significant shift, however, this was just a pit stop on the way to the far more complex selling world we find ourselves in today.

28 years on the sales terrain is a very different proposition – the new world of social media, social selling, the importance of collaboration and the centrality of the customer – we are truly entering a customer focused world.

Product and Solutions (the aggregation of products) no longer offers the competitive edge in the sales process, the shift in value, beyond product and product solutions, lies in ideas, creativity, collaboration, interconnectedness and innovation and means that the types of conversations we have with customers, suppliers, referral partners and the like is at the centre of effective selling and business relationships.
And buyers are way ahead of most sales people. The conversations they are having about their suppliers, research they do before they buy, the journeys they take to purchase without any sales person’s involvement are important to watch and pay attention to. And that’s not all – we need to pay attention to what they do and say after the sale, how they talk about us, their points of view, the influence they have over others ideas and opinions and the circle just keeps getting wider. But are sales people and businesses keeping up.

According to Brian Fetherstonhaugh, Chairman and CEO of OgilvyOne Worldwide, Social media is having an enormous impact on buyer behaviour. OgilvyOne’s survey of a 1,000 sales professionals in US, UK, Brazil and China reported that 49% of sellers see social media as important to their success and amongst the most successful sales people, over two thirds believe social media is integral to their success. However most companies are not adapting fast enough. They are not providing training in how to effectively use social media to sell and nearly half the sales professionals surveyed believe their companies are afraid of letting employees use social media.

Only 9% of US sales people say their companies train or educate them in social media while in contrast 25% of sales people surveyed in Brazil said they received training and education in social media.
This rapid change is unprecedented. With the rapid rise of social media, the focus on innovation, value beyond product and the increasingly complexity of business networks and communities, I have found myself looking back and looking forward working out what I need to leave behind and what I need to take with me into the future.

For those sales professionals who started their careers in the last 5-10 years this article may not mean much to you, however for those of us who have longer careers in selling we are faced with significant change.

What have found to remain true and I can carry forward from my early days in selling are the following:

Keep Prospecting – it is vital to make contact and keep in contact with customers, prospects, influencers, suppliers, partners, etc.
Review and Strategic Action– always review where your market, customers and competitors are and check for signs of change so you can adapt and take strategic action. Most people would call this planning but with change happening so rapidly it’s more like review and strategic action is a constant daily occurrence
Prioritisation – even more so now than ever before is the important skill of prioritisation. There is so much information: emails, special interest groups, new innovations and the like to keep on top it can be overwhelming without some form of prioritisation skills
Questioning and listening – always a main stay in any person’s, especially a sales person’s tool box. The listening acuity we now need means we need to pay more attention to the details of our clients’ conversations, needs and priorities while keeping a keen ear and eye on the broader landscape. Asking the right questions is critical.
Problem Solving and Prevention, Creativity and Innovation – again the idea that product was king is now dead; one of the key skills is to prevent and where necessary solve problem for people, but that is only part of the game now – we now need to generate ideas and create opportunities, imagination and innovation now stand tall.
Adapting to different Communication styles – with global reach comes the need to interact with a wide variety for people and adapt to difference, not difficulty
Manners and courtesy – despite what people may say about the current state of the world, manners and courtesy are the glue that hold our relationships together. No matter what we call it, courtesy and manners are NOT trivial. Here is how Edmund Burke (1729-1797) described it: “Manners are of more importance than laws. Manners are what vex or soothe, corrupt or purify, exalt or debase, barbarize or refine us, by a constant, steady, uniform, insensible operation, like that of the air we breathe in.”

So what do I have had to integrate from the new, so far:

Digital communication, destinations and New Listening Skills. The need to look out for the digital footprints of buyers as they trawl the digital world. Mapping buyers journeys before they talk to sales people and setting up the right forums, websites, blogs, connections, opinions, etc. for them to connect to before we even speak as human beings is critical.
Interacting with special interest groups on the internet – looking to exchange ideas rather selling or blatant self promotion.
Selling is a Team Sport – marketing, sales, and customers are all in it together
Prospecting online – the shift from lists, Yellow Pages, etc to avenues such as Linkedin where a rich vein of data, contacts, prospects are available to be researched and connected to.

Much has change in the world of selling and more changes are afoot. I’m holding on as best I can, trying to get my balance as I transition from the old paradigm of selling to the new world of social sales. So watch this space.

Remember everybody lives by selling something.

Author: Sue Barrett, www.barrett.com.au

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The Yin Yang of Selling

December 9, 2010 in Sales Assessments, Sales Leadership, Sales Relationships, Sales Skills, Sales Talent, Value Creation

In the 20th century the emphasis on B2B selling had a distinct aggressive ring to it. So much so, that you could walk down the halls of many businesses and think that you were involved in big game hunting. Many of these teams saw selling as an extreme sport, or more precisely, Big Game Fishing or Hunting.

Customers were ‘Targets’.
Getting a sale was referred to as ‘the Kill’.
Customers were regarded as objects to be possessed or trophies to be placed in their cabinet; to be shown off and admired (perversely so) like stuffed animal heads on the wall.

Little regard was really paid to building genuine relationships and developing real value. It was in essences an ‘us’ versus ‘them’ approach. And if you tried to develop deeper relationships it was seen as wimpy and soft. For instance, I can recall hearing of the death of one of my long standing clients, who died tragically in a plane crash when I was working as a recruiter many years ago. Upon hearing the news I found myself crying quietly at my desk at the loss of this lovely man. A few minutes later one of our senior managers found me and asked me why I was crying, and when I told him why, he just said “get over it, it’s only a client”. Extreme I know, however I have overheard many sales people speak about their clients in disparaging and disrespectful ways with little regard for the value of genuine relationships built on trust and transparency.

So why title this post as the Yin Yang of Selling? Yin Yang are complementary opposites that interact within a greater whole, as part of a dynamic system. Everything has both yin and yang aspects, but either of these aspects may manifest more strongly in particular objects, and may ebb or flow over time. There is a perception (especially in the West) that yin and yang correspond to good and evil (not respectively). However, Taoist philosophy generally discounts good/bad distinctions and other dichotomous moral judgments, in preference to the idea of balance.

I propose that the profession of selling has been out of balance for some time and to its detriment. If we look at how selling has been evolving over the last 50 years, we can see a distinct shift occurring from the aggressive one sided approach where conquest was king (too much yang) to a more delicate balance between the masculine and feminine aspects of yin yang.

It cannot be denied that selling requires yang – a proactive, focused, go-out-into-the-world and find opportunity approach (prospecting) however, selling must now be balanced with the ability to genuinely listen and respond to the subtleties of more complex relationships which involves patience, nurturing, and dealing with ambiguity which is yin. Think of the types of conversations you now need to have with your prospective customers where listening, questioning, resolving problems, collaboration, empathy and understanding are encouraged.

This is not just a fantasy. In reviewing the latest research on elite sale performers, gender differences in sales capabilities were found; women rated significantly higher than men on 5 of the 7 emerging competencies which gave them a distinct advantage in selling. Some of these capabilities included:

listening beyond the product needs;
engaging in self appraisal and continuous learning;
orchestrating internal resources;
aligning customer/supplier strategic objectives; and
establishing a vision of a committed customer.

These capabilities are in the realm of yin. May I suggest that we encourage more yin yang to assist us on our sales journey and encourage more success! To find out how you can achieve this in your team or career, have a look at the sales training that we provide for sales people, sales teams and sales leaders.

Remember everybody lives by selling something.

Author: Sue Barrett, www.barrett.com.au

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Price is what you pay. Value is what you get.

October 27, 2010 in Ethics & Values, Procurement, Sales Skills, Value Creation

I recently had the pleasure of attending and speaking at the 6th CIPS Australasia Annual Conference for the procurement profession. It was my third invitation to speak at a CIPSA event in my capacity as a professional representing the sales profession. The theme for this conference was ‘Managing Volatility’. A key message I gleaned from the conference was Value Management rather than the narrow band width of Cost Management.

Don’t get me wrong, the Procurement Profession is still interested in cost, however, there was a distinct awareness about ‘cheap being a false economy’. While it was important that it look to secure supply, and at the same time reduce total supply cost, it was not after ‘cheap’.

At the ‘Pricing Insight’ session, one of the many sessions I attended over the two days, the famous Warren Buffett quote: “Price is what you pay … Value is what you get.” defined the issue.

Many of the procurement professionals in the ‘Pricing Insight’ session commented on the stupid pricing games played by sales people and their companies. They still found that too many sales people were product fixated rather than business oriented, and defaulted to unnecessary price wars at the expense of developing real value propositions. When something was offered up as very cheap, the procurement professionals were concerned about the guarantee of supply and quality of the offering. They did not want to buy ‘cheap’.

Contrary to the popular myth that all procurement people want to negotiate down to the lowest price, the procurement profession is far more sophisticated than most sales people give them credit for. The sales profession is doing itself a disservice if it pitches the ‘Us versus Them’ scenario when it comes to dealing with procurement.

The procurement profession is learning its lessons too. We cannot deny that there has been a climate in the past of procurement focusing on cost management only, and maybe some lingering effects still exist in some industries. However, they are learning that supply and demand are inextricably linked and not managing these issues well can cause greater costs and harm to their organisations and industries.

Take for example the European auto manufacturing industry. Prof Dr Nicolas Reinecke, a world expert on Procurement, cited how recently the major European car manufacturers had to bail out the world’s largest manufacturer of bumper bars to the tune of $100M because a climate of reducing prices by 1-2% every year finally sent the business into bankruptcy. What that auto industry had to learn was that they nearly killed off the only major quality supplier by being short sighted and self centred, as their own cost management behaviours had made it near impossible for other equivalent auto suppliers to exist. Bailing out this bumper bar business cost the industry much more than if they had have worked in a sustainable partnership model that allowed all parties to continue trading in a healthy manner.

David Noble, Chief Executive of CIPS worldwide, says that the volatile environment is the new norm and being near sighted about cost management only will harm everyone. The key differentiator, he states, is the Supply Chain as it touches all corners of the organisation and is the face of the enterprise. He commented that Value Add is increasingly generated external to the enterprise and that strong supply chains need to be fast, flexible and robust with the ability to control risk and environment.

The Supply Chain efficiency is increasingly seen as the key differentiator in business with the majority of value add in an enterprise coming from outside the organisation’s boundaries.

Sixty percent of major corporations now have Procurement and Supply at the top table with the world globalisation, recessions and environment all sitting squarely in the procurement space. David states that, the spotlight is on their profession and volatility is at the heart of supply chain management. Controlling volatility and managing value gives an organisation a huge competitive edge.

We are witnessing a quickening in the development, thinking and sophistication of the Procurement Profession – they are definitely on the front foot. They realise that they do not have to make negotiation a part of every sale – it is not about being adversarial for the sake of it.

The Procurement Profession has access to more information than ever before. Most clients know what they are after even if they don’t know how to articulate it. Today, clients expect to communicate and deal with a real professional who knows their own business and how they can best serve their clients’ needs with creative solutions and fresh ideas.

They don’t expect to be coerced, bullied, tricked or intimidated into buying. They don’t expect to be treated like an idiot by sales people who just talk at them and flash brochures or product sheets. Nor do they necessarily want to make ‘friends’ with sales people.

Clients, especially the procurement profession, are now after ‘business people’ who can sell, think about possibility and take information to the imagination phase. They are looking for partners to help them map a pathway forward into the future.

As a sales profession, we need to be keeping pace with the procurement profession and rather than working against procurement we need to work with them in a spirit of cooperation where we can manage value together.

Remember everybody lives by selling something.

Author: Sue Barrett, www.barrett.com.au

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The real $ value of role playing

October 14, 2010 in Sales Skills, Sales Training

Tell almost any sales person they are going to participate in role plays as part of their sales training and you will hear a collective groan. In short most sales people hate role playing. It is often seen as a form of potential embarrassment, or something stilted and false. Many people feel self conscious and don’t want to look ‘bad’ in front of their peers. It doesn’t help either that over 90% of all sales people follow no logical processes when selling, so when it comes to role playing they don’t know what to work on.

When role playing is brought to bear in a sales training program it doesn’t help if role playing is treated as a token gesture and is irrelevant to the real life situations faced by the sales people. Many role plays are generic and not pitched towards specific skills or behaviours nor are they properly monitored to provide genuine feedback on performance, suggestions and insights. This means that role plays are viewed as a waste of time. And they are if they are not built or delivered properly.

Given the right kind of structure and environment, the real truth is that most sales people would really benefit from regular role playing and in turn their businesses and customers would be better off too. We cannot under value the importance of role playing and rehearsal to improve and enhance our performance. When used properly role plays and rehearsal can really hone the skills, knowledge and mindset of our sales people. Linked to clear processes and behavioural performance standards we can create an environment of conscious and conscientious practice where sales teams are willing to practice and refine their skills and talents.

At Barrett we make sure all role plays are specific to our clients’ business and their client situations. We make sure that the role plays are broken down into steps which can be applied and practiced. We make sure there is a check list an ‘observer’ can use to monitor and provide specific feedback on the performance of the sales person. We make sure there is an opportunity to receive clear and unambiguous feedback on performance. We make sure it is safe for people to practice and make mistakes without fear of retribution. In short, we make sure role playing and rehearsal is practical, useful and insightful allowing people to adjust their behaviours and mindset to create better and better performance standards. However, the challenge is to make this a regular activity in sales teams.

In all sporting environments ongoing training incorporates, at regular intervals, ‘race practice’. Race practice is where you simulate the environment and actions you are likely to face when at the real event. Race practice is a regular feature of any athletes’ life. I can recall in my competitive swimming days that our squad would practice race starts, turns, relay changeovers as well as rehearse our speciality events racing against each other to develop a sense of what it would feel like when we were to perform at the real events. This happened at least once a week. This practice or role playing was invaluable to our sporting skills and especially our confidence. The physical actions and emotions we would experience at the real events were simulated in practice. We learnt not just how to swim well but how to handle the pressure of performing.

Like competing athletes sales people often need to perform under pressure. Therefore we must practice to learn how to perform under pressure. Role playing is an ideal format for building your skills and strengths in sales and working out how you handle yourself under pressure. Done constructively and with the clear intention of building people’s capabilities, role playing can be a challenging, exciting, fun and great learning experience for all.

Sadly, however, it’s estimated that only between 15 – 20% of sales teams actually practice role playing throughout their sales year.

Role playing needs to be valued as a business tool, a peak performance business tool that helps people reach higher and higher standards. Role playing or rehearsal helps us:

1. Be prepared to handle a variety of different scenarios

Different types of clients i.e. from industries, large to small; high value clients, etc.
Clients with different types of communication styles, values, desires, motives, needs, wants, goals, etc.
Dealing with multiple contacts inside an organisation – i.e. CEO, COO, Procurement, CFO, HR, etc. Our sales people need to know how to adjust their language and position with these key stake holders.

2. Handling challenging situations

Anticipating tricky situations i.e. client complaints, accommodating extra people in a meeting, other agendas competing with your suggestions, etc.
Thinking on your feet when dealing with difficult or different issues i.e. hostile clients, issues outside of your control, etc.
Handling objections or dealing with misunderstandings.
Presenting different solutions and making yourself understood.

3. Presenting or pitching for business

Making client presentations or pitching for new business with major accounts or new prospects.

Good sales practices include processes and steps to follow. They can be taught and learned. Role playing allows us to practice in safe environments and identify where we need to pay more attention to ensure better performance. Role playing and rehearsal also allows us to make sure our effective skills and capabilities don’t’ ‘go to seed’ and keep us fresh and alert.

You’re never too old or too experienced to learn. The other week when our new Director of Sales, John Garrido and I were out on a client meeting, John was able to give me feedback on my sales performance. It was refreshing to be able to have someone observe me and make suggestions on how I could be better. It is very hard to observe your own performance. We need people to observe us, see how we are performing and give constructive feedback.

Good sales teams look out for each other. They plan ahead, they account for various contingencies and they actually practice how to deal with them. They do not leave their deals or sales careers to chance.

Let’s bring back effective role playing and rehearsal and ensure our talents and capabilities are able to flourish and shine.

Remember everybody lives by selling something.

Author: Sue Barrett, www.barrett.com.au

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