Andy Paul's Blog, page 10

4 Steps To Dramatically Improve Your Sales Hiring

4 Steps To Dramatically Improve Your Sales Hiring

How would you respond to
the question: What’s your sales type?

I recently read that the
cost of a bad sales hire is 7 times (7x) the annual salary of that position.
You would think that such a stiff penalty would provide sufficient incentive
for hiring managers to do a much better job of specifying their requirements for
an open sales slot, as well as identifying and hiring the right candidates. And
yet, sales managers and CEOs repeat the same sales hiring mistakes time and
time again.

The problem usually
resides with the hiring manager, whether that is a CEO, owner, or sales
manager. While the job description for a sales opening might say all the right
things about the skills, experience, and personal qualities the candidate needs
to have, the CEO and sales manager usually have the list boiled down to a few
stereotypical qualities:

1.         Hunter

2.         Closer

3.         Outgoing

4.         Aggressive

In the January/February
2013 issue of the Harvard Business Review,
Jeff Bezos, founder and CEO of Amazon.com, was quoted as follows: “We
don’t make money when we sell things; we make money when we help people make
purchase decisions.”

To me, that statement
simply and accurately says what selling is. And from that description I can
identify 4 personal characteristics of a salesperson that help their prospects
make good purchase decisions:

1.         Curiosity

2.         Empathy

3.         Problem-solving
skills

4.         Responsiveness

Now let’s review that list of characteristics that hiring managers typically have in mind while they are looking to hire a salesperson: Hunter, Closer, Outgoing, Aggressive. Which of those qualities helps customers make purchase decisions? Any of them? Of course not.

Never Swing at the First Pitch

Using a Little Patience
at the Plate Will Improve Your Sales Hiring

Think back to your days
in Little League baseball or softball. You probably got this nugget of advice
from the baseball dads who coached your team: Never swing at the first pitch.
The idea was that you could learn something about the tendencies and capabilities
of the pitcher if you just watched the first pitch cross the plate.

On radio and TV baseball
broadcasts the color commentary guy sometimes talks about the batter in a
slightly condescending manner, describing him as “a first-pitch hitter.” The
implication is that the batter should be patient and  “work the count” until he sees a pitch that
he likes. We could argue ad nauseam about whether not swinging on a 0-0 count
is a good strategy or just recycled baseball folklore. But for better or worse,
it has become a de facto standard of play for batters in baseball.

I recommend that “never
swing at the first pitch” should be the standard you apply to hiring
salespeople as well. In my experience, hiring managers typically are not very
effective evaluators of sales talent and often take the path of least
resistance with sales candidates, using one of the following three standards
for hiring:

1: The “Love at First Sight” Standard: The hiring manager finds the process of hiring a
salesperson so unpleasant that he or she hires the first warm body that walks
through the door.

2: The “Armani Suit” Standard: The hiring manager has a formulaic Mom-and-apple-pie
list of the skills his company is looking for in a salesperson. Instead of
hiring someone with work experience directly tied to his business, he hires
generalists, slick sales professionals who dress well and present themselves
with a breezy air of self-confidence. They make him feel good about himself,
but he is later left to wonder why they don’t work out when they seem so
“qualified” on paper, and in person.

3: The “Not Good Enough for my Daughter” Standard: This hiring manager never finds a candidate that
meets his or her expectations and harbors a range of emotions, from slight
ambivalence to outright hostility to the idea of hiring a salesperson. He knows
that salespeople are a necessary evil, but is risk averse and afraid to make a
mistake by hiring someone who doesn’t produce.

The goal of your hiring efforts should be to identify and qualify (that’s right, just like selling) the best candidate for the job you need done and to integrate him or her smoothly into your sales team.

5 Steps to Find and Hire The Best Candidates for Sales

Here are 5 tips to help
you do a better job of identifying and qualifying the best candidate for your
sales team.

1. Write an accurate, honest job description.

The temptation is to
write too broad a job description, alluding to unspecified opportunities and
responsibilities, hoping to entice a higher level of talent to the company. The
reality is that you do not want to hire only
potential. You want to hire someone with product expertise, industry knowledge,
and successful sales experience.

2. Do in-depth evaluations of multiple qualified
candidates.

Wait for the pitch
across the fat part of the plate. In hiring a salesperson, this means that you
need to evaluate more than one qualified person for every job opening. It means
that no matter how much you like the first person you interview, you must do
in-depth interviews and reference checks of at least two other candidates
before you decide who to hire.

3. Have your entire management team interview candidates.

If you’re reluctant to
have the rest of your peers meet your favorite candidate, then you have a
problem. (Just like the time you hesitated to take your tattooed girlfriend or
boyfriend with the nose ring home to meet Mom.) Selling is a team sport. Hiring
should be a team sport as well. The final decision will rest with the CEO or VP
of Sales, but the company should take advantage of the “wisdom of crowds” by
having people from multiple departments interview all of the qualified
candidates. Make sure that sales candidates are interviewed by all of your
senior management team. Sales touches every part of your organization, and
everyone who works with sales should have input into the hiring of a
salesperson.

4. Test all skills and verify all résumé information.

Hiring the wrong
salesperson can be very expensive. If you test and verify skills and
experience, you’ll reduce the probability of making an error in the hiring
process. You’ll avoid the cost of interviewing yet another set of candidates,
as well as the cost of lost orders from new customers. Testing candidates’
technical/product knowledge and sales skills is absolutely essential.

5. Recruit internally

The best place to recruit new salespeople is inside your own company. If your company is in a technical field, then recruit technically capable salespeople from within your engineering and product development departments. Look for the engineers who have exhibited a special knack for customer support or the engineer that every salesperson wants to use as a technical resource on a sales call. This person is already spending a chunk of his or her time selling and is someone you should consider for sales.

Are You Hiring Backwards? Two Tips to Conduct Effective Reference Checks.

When do you check the references
for a sales candidate you want to hire? Do you wait until you have made up your
mind to hire someone? That’s what most sales hiring managers do. And it is the
wrong thing to do. References should be checked before you’ve narrowed your
choice down to one candidate.

Think about the typical
sales hiring process. You post an open position and do a preliminary screening
of candidates’ résumés. You develop a small pool of candidates and conduct
preliminary phone or video interviews. You then invite the best candidates for
in-person interviews. From those, you decide that two or three are worthy of
deeper consideration and bring them back for a series of interviews with others
in the company. At that point one candidate stands out from the rest, and you decide
to hire him or her if their references check out.

Here’s the problem with
that scenario: If you’re like most hiring managers, you check your favorite
candidate’s references only after
you’ve decided to hire him or her. Isn’t that backwards? References should
be a source of important data that are factored into the hiring decision. They
are not meant to be a validation of a decision you have already made.

Here are two concrete
steps to take to improve your reference checks:

1. Conduct Reference Checks on Your Final Three
Candidates

Take the time to
thoroughly check the references (and qualifications) of each finalist before
investing time and manpower company-wide interviews. Do this before you fall in
love with one candidate and become blinded to their potential shortcomings. Use
fact-based questioning to dig into and verify the claims on each candidate’s
résumé.

2. Sideline the Subjectivity: Ask More Fact-based
Questions of References

How can you get the most
out of reference calls? Simple. Don’t rely on questions that require opinions
for answers. References are increasingly reluctant to provide any meaningful,
subjective information by phone or in writing. Therefore you should ask questions
that have factual answers. For example, your candidate states on his résumé
that he achieved 120% of quota last year. Ask the reference to verify that
fact. Or a candidate claims that she made President’s Club for 3 years in a
row. Ask if that is correct. Use references to verify what the candidate tells
you. If you find that a candidate has lied or fudged the truth, you should
disqualify him or her.

I recently met with a VP
of Sales for a growing start-up. We talked about his hiring process. I asked
him how many people in his large and growing sales force he had hired who had
not achieved at least 100% of quota at their prior sales job? He confidently
said none. I asked if he had fact-checked the sales achievement claims on their
résumés. There was a pause. A long pause. Here was a fairly sophisticated sales
management executive who was still taking sales candidates’ performance claims
at face value.

Hiring is a risky
business in the best of circumstances. But sales is one of the few professions
where past performance can be an objective and transparent measure of a
candidate’s ability and future capabilities. Take advantage of this built-in
advantage and stop hiring backwards.

The post 4 Steps To Dramatically Improve Your Sales Hiring appeared first on Andy Paul.

Steps To Dramatically Improve Your Sales Hiring

Steps To Dramatically
Improve Your Sales Hiring

How would you respond to
the question: What’s your sales type?

I recently read that the
cost of a bad sales hire is 7 times (7x) the annual salary of that position.
You would think that such a stiff penalty would provide sufficient incentive
for hiring managers to do a much better job of specifying their requirements for
an open sales slot, as well as identifying and hiring the right candidates. And
yet, sales managers and CEOs repeat the same sales hiring mistakes time and
time again.

The problem usually
resides with the hiring manager, whether that is a CEO, owner, or sales
manager. While the job description for a sales opening might say all the right
things about the skills, experience, and personal qualities the candidate needs
to have, the CEO and sales manager usually have the list boiled down to a few
stereotypical qualities:

1.         Hunter

2.         Closer

3.         Outgoing

4.         Aggressive

In the January/February
2013 issue of the Harvard Business Review,
Jeff Bezos, founder and CEO of Amazon.com, was quoted as follows: “We
don’t make money when we sell things; we make money when we help people make
purchase decisions.”

To me, that statement
simply and accurately says what selling is. And from that description I can
identify 4 personal characteristics of a salesperson that help their prospects
make good purchase decisions:

1.         Curiosity

2.         Empathy

3.         Problem-solving
skills

4.         Responsiveness

Now let’s review that list of characteristics that hiring managers typically have in mind while they are looking to hire a salesperson: Hunter, Closer, Outgoing, Aggressive. Which of those qualities helps customers make purchase decisions? Any of them? Of course not.

Never Swing at the First Pitch

Using a Little Patience
at the Plate Will Improve Your Sales Hiring

Think back to your days
in Little League baseball or softball. You probably got this nugget of advice
from the baseball dads who coached your team: Never swing at the first pitch.
The idea was that you could learn something about the tendencies and capabilities
of the pitcher if you just watched the first pitch cross the plate.

On radio and TV baseball
broadcasts the color commentary guy sometimes talks about the batter in a
slightly condescending manner, describing him as “a first-pitch hitter.” The
implication is that the batter should be patient and  “work the count” until he sees a pitch that
he likes. We could argue ad nauseam about whether not swinging on a 0-0 count
is a good strategy or just recycled baseball folklore. But for better or worse,
it has become a de facto standard of play for batters in baseball.

I recommend that “never
swing at the first pitch” should be the standard you apply to hiring
salespeople as well. In my experience, hiring managers typically are not very
effective evaluators of sales talent and often take the path of least
resistance with sales candidates, using one of the following three standards
for hiring:

1: The “Love at First Sight” Standard: The hiring manager finds the process of hiring a
salesperson so unpleasant that he or she hires the first warm body that walks
through the door.

2: The “Armani Suit” Standard: The hiring manager has a formulaic Mom-and-apple-pie
list of the skills his company is looking for in a salesperson. Instead of
hiring someone with work experience directly tied to his business, he hires
generalists, slick sales professionals who dress well and present themselves
with a breezy air of self-confidence. They make him feel good about himself,
but he is later left to wonder why they don’t work out when they seem so
“qualified” on paper, and in person.

3: The “Not Good Enough for my Daughter” Standard: This hiring manager never finds a candidate that
meets his or her expectations and harbors a range of emotions, from slight
ambivalence to outright hostility to the idea of hiring a salesperson. He knows
that salespeople are a necessary evil, but is risk averse and afraid to make a
mistake by hiring someone who doesn’t produce.

The goal of your hiring efforts should be to identify and qualify (that’s right, just like selling) the best candidate for the job you need done and to integrate him or her smoothly into your sales team.

5 Steps to Find and Hire The Best Candidates for Sales

Here are 5 tips to help
you do a better job of identifying and qualifying the best candidate for your
sales team.

1. Write an accurate, honest job description.

The temptation is to
write too broad a job description, alluding to unspecified opportunities and
responsibilities, hoping to entice a higher level of talent to the company. The
reality is that you do not want to hire only
potential. You want to hire someone with product expertise, industry knowledge,
and successful sales experience.

2. Do in-depth evaluations of multiple qualified
candidates.

Wait for the pitch
across the fat part of the plate. In hiring a salesperson, this means that you
need to evaluate more than one qualified person for every job opening. It means
that no matter how much you like the first person you interview, you must do
in-depth interviews and reference checks of at least two other candidates
before you decide who to hire.

3. Have your entire management team interview candidates.

If you’re reluctant to
have the rest of your peers meet your favorite candidate, then you have a
problem. (Just like the time you hesitated to take your tattooed girlfriend or
boyfriend with the nose ring home to meet Mom.) Selling is a team sport. Hiring
should be a team sport as well. The final decision will rest with the CEO or VP
of Sales, but the company should take advantage of the “wisdom of crowds” by
having people from multiple departments interview all of the qualified
candidates. Make sure that sales candidates are interviewed by all of your
senior management team. Sales touches every part of your organization, and
everyone who works with sales should have input into the hiring of a
salesperson.

4. Test all skills and verify all résumé information.

Hiring the wrong
salesperson can be very expensive. If you test and verify skills and
experience, you’ll reduce the probability of making an error in the hiring
process. You’ll avoid the cost of interviewing yet another set of candidates,
as well as the cost of lost orders from new customers. Testing candidates’
technical/product knowledge and sales skills is absolutely essential.

5. Recruit internally

The best place to recruit new salespeople is inside your own company. If your company is in a technical field, then recruit technically capable salespeople from within your engineering and product development departments. Look for the engineers who have exhibited a special knack for customer support or the engineer that every salesperson wants to use as a technical resource on a sales call. This person is already spending a chunk of his or her time selling and is someone you should consider for sales.

Are You Hiring Backwards? Two Tips to Conduct Effective Reference Checks.

When do you check the references
for a sales candidate you want to hire? Do you wait until you have made up your
mind to hire someone? That’s what most sales hiring managers do. And it is the
wrong thing to do. References should be checked before you’ve narrowed your
choice down to one candidate.

Think about the typical
sales hiring process. You post an open position and do a preliminary screening
of candidates’ résumés. You develop a small pool of candidates and conduct
preliminary phone or video interviews. You then invite the best candidates for
in-person interviews. From those, you decide that two or three are worthy of
deeper consideration and bring them back for a series of interviews with others
in the company. At that point one candidate stands out from the rest, and you decide
to hire him or her if their references check out.

Here’s the problem with
that scenario: If you’re like most hiring managers, you check your favorite
candidate’s references only after
you’ve decided to hire him or her. Isn’t that backwards? References should
be a source of important data that are factored into the hiring decision. They
are not meant to be a validation of a decision you have already made.

Here are two concrete
steps to take to improve your reference checks:

1. Conduct Reference Checks on Your Final Three
Candidates

Take the time to
thoroughly check the references (and qualifications) of each finalist before
investing time and manpower company-wide interviews. Do this before you fall in
love with one candidate and become blinded to their potential shortcomings. Use
fact-based questioning to dig into and verify the claims on each candidate’s
résumé.

2. Sideline the Subjectivity: Ask More Fact-based
Questions of References

How can you get the most
out of reference calls? Simple. Don’t rely on questions that require opinions
for answers. References are increasingly reluctant to provide any meaningful,
subjective information by phone or in writing. Therefore you should ask questions
that have factual answers. For example, your candidate states on his résumé
that he achieved 120% of quota last year. Ask the reference to verify that
fact. Or a candidate claims that she made President’s Club for 3 years in a
row. Ask if that is correct. Use references to verify what the candidate tells
you. If you find that a candidate has lied or fudged the truth, you should
disqualify him or her.

I recently met with a VP
of Sales for a growing start-up. We talked about his hiring process. I asked
him how many people in his large and growing sales force he had hired who had
not achieved at least 100% of quota at their prior sales job? He confidently
said none. I asked if he had fact-checked the sales achievement claims on their
résumés. There was a pause. A long pause. Here was a fairly sophisticated sales
management executive who was still taking sales candidates’ performance claims
at face value.

Hiring is a risky
business in the best of circumstances. But sales is one of the few professions
where past performance can be an objective and transparent measure of a
candidate’s ability and future capabilities. Take advantage of this built-in
advantage and stop hiring backwards.

The post Steps To Dramatically Improve Your Sales Hiring appeared first on Andy Paul.

3 Steps to Building Lasting Customer Relationships

Relationships with Customers Are Like My Relationship with Riley, My Golden Retriever

Like any good golden retriever, my buddy Riley
is serenely uncomplicated and ecumenical with his affections. He loves anybody
who plies him with kibble twice a day, patiently tosses him his ball, consents
to be dragged along on the high-speed outings we still call walks, and tells
him what a good boy he is.

The truth of the matter is that Riley doesn’t
really care who feeds and walks him. Anyone that makes him happy by taking care
of his basic requirements earns his affection. That is all your customers want
as well.

Relationships
are about “needs and deeds”

Customers have needs. And their relationship
with you is determined by how well you meet and exceed those needs with your
deeds.

Like our canine companions, customers have
developed a simple Hierarchy of Needs: Give me timely, complete, and accurate
information to make an informed purchase decision; live up to your promises and
deliver on your commitments; and, at the top, support me without condition.

Just like Riley, customers really don’t care
who meets their needs. It could be you. Or it could be the sales rep from your
primary competitor. Customers may “like” you, but they don’t care
about you. Customers only care about what you have done, and can do, for them.

Do you remember when you left your beloved dog
to go off to college or moved away from home? You knew your dog loved you,
absolutely loved you, loved you completely, until the car taking you to the
airport disappeared around the corner. At which point Fido largely forgot about
you and bonded with the new person supplying the kibble and the walks. Your
customers are the same way. If you aren’t there to meet their needs, customers
will quickly forget that you exist.

Key Takeaway: Products are interchangeable. Sellers are interchangeable.

3 Tips for Building “Needs and Deeds” Relationships with Your Customers

1. Treat your
prospects and customers as you would wish to be treated.

Ask yourself this question: If you were a
customer of your own company, what would you expect the customer experience to
be? How would you wish to be treated by your own sales and support people? Your
answers should reflect the minimum standard of care that you provide to your
own prospects and customers. Meeting this standard is easy at first but
demanding to continue. It starts with a CEO and senior management committing to
making the customer their top priority.

One of my CEO clients was a very demanding
consumer. That was his right. But it was often stressful to dine out with him
because he demanded perfection in the food and service and was not bashful
about sending dishes back to the kitchen. Yet when it came to his own
customers, he was defensive about his products and adopted a minimalist
approach to customer service, making it a challenge for customers to get the
support they needed. It took a long time to help him recognize and acknowledge
the inconsistency between the service he expected when he purchased a product
and the way he treated his own customers. Only then did he start earning the
repeat business he needed to build his business.

2. Delight your
customers with your commitment to customer service.

Commit to being completely responsive to your
customers’ requirements for support, both in the pre-sale period and post-sale.
The first step to take internally is to eliminate the distinction in your
company between pre-sale and post-sale support. All support interactions
influence a customer’s decision to purchase from you again. Therefore, all
post-sale activities should be considered to be pre-sale activities on your
next order with that customer. As soon as a customer gives you an order, all of
your support should be directed toward (a) having a satisfied customer who will
order from you again, and (b) receiving a great referral to another potential
customer. Those outcomes mean that you’ve built a solid relationship with your
customer. And isn’t that the best motivation for providing great support?

Another of my clients had a simple escalation
procedure in place for all calls into sales and support. All calls were to be
answered by a live person. If the front-line sales or service tech was not
available, the call was bumped to a manager. If the manager was busy, the call
was routed to a VP and then up to the CEO. The CEO routinely answered calls
from customers. He never identified himself by anything but his first name to
customers when he helped them. Imagine how powerful it was for customers to
learn later that the CEO had so humbly helped them without drawing attention to
himself.

3. Demonstrate
your appreciation for the opportunity to serve your customers.

With Riley this is as easy as scratching his
back and telling him “Good boy.” Customers may not welcome the
physical contact, but they always like to hear that you appreciate the
opportunity to win their business.

You’ll notice I didn’t say that customers like
to hear that you appreciate their business. I’m sure they do. But I learned a
lesson a long time ago from a customer that what they really want to hear is
that you are going to work hard every day to continue to earn the right to win
their business. Demonstrate by your words and deeds that there is no danger of
you becoming complacent and taking the customer for granted.

Key Takeaway: Customers have needs, and how you meet those needs through your deeds is the core of your relationship.

The Calculus of Trust: Proactively Manage Expectations to Start a Customer Relationship

After they close an order with a customer,
salespeople routinely dig a hole and throw themselves into it. Here’s how it
plays out. You receive an order from a new customer, ACME Technologies, and
your instinct is to quickly move on to the next prospect before Larry, your new
customer at ACME,  calls and asks a
question that you are afraid of answering out of fear that it will cause him to
change his mind.

The problem here is that even though you have
an order, you haven’t finished the job of selling the customer. Your selling
process doesn’t stop when you receive an order. There is one more very
important step to take. One that can make the difference between having a
“one-and-done” customer and a long-term relationship with a loyal,
profitable customer.

The most important sales call you should make
during the course of a sale is the first call you make to Larry after your receive ACME’s order.

Why?

Zero-Time Sales
calculus

Let’s first examine a couple immutable rules of
what I call Zero-Time Sales Calculus.

Sales calculus
rule #1: Your customer’s
expectations for your product or service grow exponentially in proportion to
the number of sellers that they talked to. This rule is pretty
easy to understand. In competitive sales situations, the customer has been
promised so many features, advantages, and benefits by so many different
sellers that within 24 hours of making their decision, they have a hard time
remembering which seller promised what. Instead, they have combined the best of
what they heard from you and your competitors and inflated it into a big
fragile balloon of unreasonable expectations that is just waiting to pop.

Sales calculus
rule #2: For every one degree of
positive expectation on the part of the customer there are two degrees of
letdown when the realities of the features and functions you deliver don’t
precisely align with their overinflated expectations. Having an
unhappy customer who believes that you overpromised and underdelivered, even
though you supplied just what they ordered, is not the ideal way to embark on a
long-term relationship.

I see this happen with salespeople and
customers all the time. Fortunately, it is easily, and completely, avoidable.

Your task:
align the customer’s expectations with your commitments

Here is what you should do immediately after
you receive and accept an order from ACME Tech, your new customer:

1. Call or visit Larry, the decision-maker
and/or the functional decision-maker who is responsible for implementing,
managing, or otherwise using your product or service.

2. Using the customer record from your CRM
system (call notes, email correspondence, quotes, and proposals) take Larry
step-by-step back through the buying process.

3. Highlight the key requirements ACME
specified for the product they were buying and review the commitments you made
regarding how your product or service would meet or exceed those requirements.

4. Review your final proposal with Larry to make
sure he precisely understands the products and features you contracted to
deliver.

The primary objectives of this important sales
call are to:

(a) reinforce in Larry’s mind his stated
requirements and how you promised to meet them;

(b) refresh his memory about the specifics of
what ACME ordered and why;

(c) clarify exactly what you are going to
deliver and when.

Key Takeaway: Managing
customers’ expectations is important in building a relationship.

(c) clarify exactly what you are going to deliver and when. Key Takeaway: Managing customers’ expectations is important in building a relationship.

Don’t Give In
to Your Fears

The prevailing philosophy in many sales
organizations is that the absolute last thing you should do, as a salesperson,
is call the customer immediately after you receive their order. Many sales
managers and salespeople remain hostage to the irrational notion that you risk
triggering a cancellation if you talk to the customer too soon after they have
given you an order. I have seen both sales managers and salespeople who believe
that even though the customer has just given them the order, they only did so
reluctantly. Thus they are afraid that if they speak with the customer before
the order is shipped the customer will give in to some monstrous case of
buyer’s remorse and ask to cancel the order. I guess that could happen. But in
more than 30 years of selling, I have never seen that happen even once.

Make the call
today

The most important sales call you make will be
the first call you make to your new customer after they give you an order. It
is also the first sales call you will make for the next order you earn from
this customer.

The post 3 Steps to Building Lasting Customer Relationships appeared first on Andy Paul.

Get Rid of Quota

Is it time to stop relying on quota achievement as a measure of sales productivity?

Annual research findings from CSO Insights have documented a steady year over year erosion in the percentage of B2B sales reps that attain quota. If less than 50% of sales reps are hitting quota, does it still have any value as a measure of productivity?

Goodhart’s Law

In 1975 Charles Goodhart, a British economist, stated the following: “Any observed statistical regularity will tend to collapse once pressure is placed upon it for control purposes.”

Of course, you say, that is obvious…

Goodhart’s formulation has been proven out over the years and has become known as Goodhart’s Law.

In plain English, it says that “When a measure becomes a target, it ceases to be a good measure.”*

The negative impact of Goodhart’s Law was concisely summarized by William Koehrsen, a data scientist writing in Towards Data Science: “When we set one specific goal, people will tend to optimize for that objective regardless of the consequences.”

In sales we give sales reps that one specific target: quota. We reinforce the importance of that one specific target with incentive-based pay that is earned on the basis of achieving it. Then we measure them on achieving the target. And we wonder why so few reps are achieving their number.

As Koehrsen observed, people shape their activities to achieve the target, regardless of the consequences. Let’s take one example. Reps are encouraged to have in their pipelines a sufficient quantity of qualified opportunities that total up to a designated multiple of their monthly target.

On the face of it, that makes sense. We rarely close 100% of our prospects so having a pool of opportunities that is greater than your monthly target is prudent.

The problem is that managers are demanding greater pipeline “coverage.” 4X or 5X the monthly target is pretty typical. Some companies are requiring reps have 7X or greater coverage. And, this is when Goodhart’s Law starts kicking in.

When Standards Slip

In order to generate enough “opportunities” to cover their pipeline reps have to do “more” of everything. However, doing more means that they’re pressed for time. So, in order to do more, quality and standards inevitably slip.

Outreach becomes less personalized. Discovery becomes superficial. Qualification no longer winnows the pipeline. Instead inadequate qualification becomes an invitation to expand it.

The result is a greater quantity of poorly qualified prospects in your pipeline which leads to low close rates, high “no decision” rates, longer sales cycles and, inevitably, a smaller fraction of reps hitting quota.

I find it somewhat ironic that at a time we tout the value of the modern sales process, overall sales performance is likely being hampered by its reliance on the anachronism that is quota.

What could be an effective alternative to quota as a measure of sales performance? Personally, I think that a balanced scorecard approach, that looked at and incorporated multiple measures, would be a better approach to aligning sales performance to desired outcomes. I’ll be writing more about this in coming weeks.

In the meantime, I’m interested to hear what you think about this topic. Do you think that there’s a better way to measure sales performance than quota? If you’re a member click below to hop into the The Sales House Slack community and let’s discuss! If not, visit TheSalesHouse.com to learn more.

*(Thanks to British anthropologist Marilyn Strathern for the plain English re-stating of Goodhart’s Law.)

The post Get Rid of Quota appeared first on Andy Paul.

Products Don’t Win Deals – You Do

Buyers choose to do business with you. Not your product.

Your product is nice. I’m sure. However, your product doesn’t win orders. You do.

I realize that this doesn’t come as revealed wisdom for most of you. The whole idea of customers “buying you” has been around forever.

However, increasingly I see B2B sellers lured by the false promise of a future in which AI-driven sales tech and data-driven processes will dramatically decrease the need to actually interact with their buyers.

(I find it kind of ironic that many sales people don’t particularly like interacting with people. It calls to mind a Peanuts cartoon strip from my childhood. In it Linus shouts out “I love Mankind. It’s people I can’t stand.”)

I believe sellers should consider instead the very real possibility that the future of complex B2B sales will unfold in just the opposite fashion.

Just like today, future buyers will have an important decision to make. One that will affect their companies and very possibly their careers. They can rely on an algorithm to advise them what to do. Or, they can talk to a human seller to provide their advice.

There’s already research that shows people are loathe to solely rely on machines to make crucial decisions for them. They prefer their final decisions to be influenced by a trusted advisor’s human judgment.

So, what does this mean for sellers? It means you have to get even better at the human aspects of selling. In particular, building trust-based relationships with buyers.

The key is trust.

In a recent article in The New York Times, Leigh Tost, an associate professor of management and organization at the University of Southern California Marshall School of Business was quoted as saying, “To take advice from someone is to agree to be influenced by them.”

So, in earning their trust, what the buyer did is give you, the human seller, the power to influence them with your ideas.

That trust doesn’t materialize out of thin air. You have to establish a sense of connection with the buyer as a person. They have to believe that they are sensitive to your concerns, have viable answers to their questions and can help them achieve their desired outcomes with your product.

Geoffrey Colvin, in his book Humans Are Underrated, writes that in the coming decades those professionals that are more likely to experience success will be those who are more “intensely human.”

For sellers that means developing your human selling skills to ensure that you become less robotic in how you communicate with your buyers. Not more.

Andy

P.S. Go here to order your Sales Growth Planner and get ready for 2020!

The post Products Don’t Win Deals – You Do appeared first on Andy Paul.

Products Don’t Win Deals. You Do.

Buyers choose to do business with you. Not your product.

Your product is nice. I’m sure. However, your product doesn’t win orders. You do.

I realize that this doesn’t come as revealed wisdom for most of you. The whole idea of customers “buying you” has been around forever.

However, increasingly I see B2B sellers lured by the false promise of a future in which AI-driven sales tech and data-driven processes will dramatically decrease the need to actually interact with their buyers.

(I find it kind of ironic that many sales people don’t particularly like interacting with people. It calls to mind a Peanuts cartoon strip from my childhood. In it Linus shouts out “I love Mankind. It’s people I can’t stand.”)

I believe sellers should consider instead the very real possibility that the future of complex B2B sales will unfold in just the opposite fashion.

Just like today, future buyers will have an important decision to make. One that will affect their companies and very possibly their careers. They can rely on an algorithm to advise them what to do. Or, they can talk to a human seller to provide their advice.

There’s already research that shows people are loathe to solely rely on machines to make crucial decisions for them. They prefer their final decisions to be influenced by a trusted advisor’s human judgment.

So, what does this mean for sellers? It means you have to get even better at the human aspects of selling. In particular, building trust-based relationships with buyers.

The key is trust.

In a recent article in The New York Times, Leigh Tost, an associate professor of management and organization at the University of Southern California Marshall School of Business was quoted as saying, “To take advice from someone is to agree to be influenced by them.”

So, in earning their trust, what the buyer did is give you, the human seller, the power to influence them with your ideas.

That trust doesn’t materialize out of thin air. You have to establish a sense of connection with the buyer as a person. They have to believe that they are sensitive to your concerns, have viable answers to their questions and can help them achieve their desired outcomes with your product.

Geoffrey Colvin, in his book Humans Are Underrated, writes that in the coming decades those professionals that are more likely to experience success will be those who are more “intensely human.”

For sellers that means developing your human selling skills to ensure that you become less robotic in how you communicate with your buyers. Not more.

Andy

P.S. Go here to order your Sales Growth Planner and get ready for 2020!

The post Products Don’t Win Deals. You Do. appeared first on Andy Paul.

732: Do Your Customers Love You? w/ Steve Farber

Steve Farber, author of Love is Just Damn Good Business: Do What You Love in the Service of People Who Love What You Do, joins me on this episode of #Accelerate!

KEY TAKEAWAYS



People who are great at what they do love their company, team, and customers. Steve explains the impact of translating love into action in your work.Do soft skills make you nervous? Can love be quantified? Steve talks about the net promoter score and employee engagement as examples of love metrics. If you can’t measure something, is it still worthwhile to do?What is the measure of a relationship? If you’re not hitting your numbers, that is a measure of failed relationships. The highest-performing salespeople have great relationships. Selling is all about relationships.Steve shares a case study of a top salesperson who asked herself if her customers loved her. She went on a campaign to gain their love by serving them in a way that showed her love for them. Listen in for her results!How do you develop love? Steve discusses relationships in transactional and complex sales roles. We always want the customer to love our brand, product, and service. Steve tells how to sustain those customer conditions.Can you simultaneously want to serve the customer and close the deal? Steve gives a hypothetical example of a salesperson motivated only by money. Will they be loyal?A sales manager who loves their team will hold their team’s feet to the fire when they are living below potential. Love has high expectations. Love has a low tolerance for negativity. Love is good business!What about employee development? Andy and Steve explore the impetus for improvement. Steve breaks down what he means by doing ‘what you love in the service of people who love what you do.’ It starts with you.How do you find what you love? Steve devotes a section of his book to that question. Don’t wait around for it to dawn on you. Search for it. First, ask, “What do I love about the work that I’m doing now?”Steve talks about his development as a musician and then going into business. He started as a broker and then founded a brokerage. He explains why he was miserable in it, and what he looked for, next.Discover your purpose and apply it to your work. Andy talks about sampling careers before settling on your chosen career path.Steve shares a story for  the first time of his son’s motivation for education and where it took him.

The post 732: Do Your Customers Love You? w/ Steve Farber appeared first on Andy Paul.

731: Why You Should Flip the Sales Script w/ Oren Klaff

Oren Klaff, Managing Director of Intersection Capital and bestselling author of Pitch Anything: An Innovative Method for Presenting, Persuading, and Winning the Deal and Flip the Script: Getting People to Think Your Idea is Their Idea, joins me on this episode of #Accelerate!

KEY TAKEAWAYS



Buyers have become increasingly empowered in the years since Oren wrote Pitch Anything. Now, buyers receive your proposal and then can search everywhere online to find the lowest price.Buying options reduce conversion rates and take the margin out of selling. That’s why Oren wrote Flip the Script. When the buyer chases you, you close sales deals.Andy and Oren discuss maximizers and satisficers. Anyone who asks you for a proposal plans to ask you for a discount when they compare proposals.Oren finds from his consulting that when buyers are motivated and decide to work with you, that decision is resilient throughout negotiations and distance. But when buyers have many objections, you don’t close deals.Objections come from two reasons: 1. Your status as a salesperson isn’t high enough; 2. You’re not perceived as an expert. Status measures your trustworthiness and credibility. Expertise provides certainty for the buyer.When the buyer assigns you trust and certainty, they want you to do business with them.Oren says the basis of feeling like or being an insider wins deals. It involves being able to talk to someone in their language about their business. People are skeptical of outsiders and their promises.Inception (with credit to the movie) refers to the writing a storyline to ensure that the audience deduces the solution before the characters do. That aha moment makes you feel good. Oren applies that to selling.Oren discounts decision-making theories. Oren does not recommend storytelling in spite of the storytelling culture in which he was raised. Storytelling is too hard for most people to use effectively.Oren explains the Flash Roll. Give the buyer details about your business, their problem, and the probable solution, in their technical language, told quickly, in under 30 seconds, as if you have delivered the solution 1,000 times.Andy recommends listeners to get Oren’s book, FLIP THE SCRIPT.Most of Oren’s customers are respected, technical people of high status who are not interested in cheesy tactics and don’t want to sell. The book shows you how to get your buyer to want and need to buy from you.

The post 731: Why You Should Flip the Sales Script w/ Oren Klaff appeared first on Andy Paul.

How To Be Patient To Be Pushy

Everyone feels the constant push-pull in sales.

You want to make the big deal happen. However, the buyer isn’t yours to control.

You want to push. You have to be patient.

Pushy? Patient? You gotta be both.

Being pushy is the ability to create forward momentum in a deal.

To be pushy is to identify opportunities to deliver needed value and win commitments to next steps in exchange.

The problem for many sellers is that forward momentum on every deal ebbs and flows.

Sellers grow impatient in the absence of movement.

Impatience encourages bad sales behaviors. Like lobbing time-wasting, valueless “check-in” calls into the buyer…

This is why patience is the partner of pushy.

Being patient is the ability to correctly read a sales situation and resist taking actions that might make you feel better…but do nothing to help the buyer make their purchase decision.

The temptation for most sellers is to push without momentum. Because that’s what you’ve been trained to do.

Since pushing without momentum works about as well pushing a wet noodle uphill with your nose, you need to learn some patience.

Yes, patience is a learned skill. It’s not a “set and forget” part of your personality.

Try this approach to make patience a habit: reframe how you think about the situation you’re in with a buyer to connect it to your larger story.

Psychologists call this cognitive reappraisal.

For instance, imagine you’re trying to land an anchor customer in an important new market segment.

Your frustration is triggered by the buyer’s lack of response to your emails since your last call (which you think went really, really well.)

Your emotional impulse is to hit up the buyer with a check-in call (or three.) None of which would be well-received or have any value to the buyer.

Instead of acting on your frustration, pause and acknowledge your larger story, which is the value this buyer will have as a reference account to help open the doors into many new customers in this new market segment.

Then choose what to do. Risk a rash action with unforeseen consequences. Or, stay patient until you have identified the next opportunity to deliver needed value and win the buyer’s commitment to next steps that move the deal forward.

The post How To Be Patient To Be Pushy appeared first on Andy Paul.

How to be patient to be pushy

Everyone feels the constant push-pull in sales.

You want to make the big deal happen. However, the buyer isn’t yours to control.

You want to push. You have to be patient.

Pushy? Patient? You gotta be both.

Being pushy is the ability to create forward momentum in a deal.

To be pushy is to identify opportunities to deliver needed value and win commitments to next steps in exchange.

The problem for many sellers is that forward momentum on every deal ebbs and flows.

Sellers grow impatient in the absence of movement.

Impatience encourages bad sales behaviors. Like lobbing time-wasting, valueless “check-in” calls into the buyer…

This is why patience is the partner of pushy.

Being patient is the ability to correctly read a sales situation and resist taking actions that might make you feel better…but do nothing to help the buyer make their purchase decision.

The temptation for most sellers is to push without momentum. Because that’s what you’ve been trained to do.

Since pushing without momentum works about as well pushing a wet noodle uphill with your nose, you need to learn some patience.

Yes, patience is a learned skill. It’s not a “set and forget” part of your personality.

Try this approach to make patience a habit: reframe how you think about the situation you’re in with a buyer to connect it to your larger story.

Psychologists call this cognitive reappraisal.

For instance, imagine you’re trying to land an anchor customer in an important new market segment.

Your frustration is triggered by the buyer’s lack of response to your emails since your last call (which you think went really, really well.)

Your emotional impulse is to hit up the buyer with a check-in call (or three.) None of which would be well-received or have any value to the buyer.

Instead of acting on your frustration, pause and acknowledge your larger story, which is the value this buyer will have as a reference account to help open the doors into many new customers in this new market segment.

Then choose what to do. Risk a rash action with unforeseen consequences. Or, stay patient until you have identified the next opportunity to deliver needed value and win the buyer’s commitment to next steps that move the deal forward.

The post How to be patient to be pushy appeared first on Andy Paul.