Mark Jewell's Blog: Selling Energy, page 280

Freakonomics

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As a Wharton Finance graduate and a life-long entrepreneur and businessperson, I can confidently say that having a strong foundation in the principles of economics has had a significant impact on my professional success. While economics and finance have served me well, the pragmatic lessons that I've learned regarding how people make financial decisions have been even more useful. If we as sales professionals can think more like pragmatic economists than academic ones, we’ll have a better understanding of how purchasing decisions are actually made, and in turn, see an improvement in our overall sales performance.

While I don’t necessarily expect you all to have the time to take a full course in economics (or even to read an economics textbook, for that matter), there are some lessons in economics that can be easily (and enjoyably) digested in Steven D. Levitt and Stephen J. Dubner’s best-selling book, Freakonomics: A Rogue Economist Explores the Hidden Side of Everything. This book does not teach your typical economics topics (like supply and demand, monopolies, elasticity, and so forth). It does, however, provide a pragmatic view of how economic decisions are made, and teaches you how to view the world through the lens of an economist. I highly recommend picking up a copy of this book if you’re interested in expanding your “economic mind.”

(For those interested in delving even deeper, I recommend checking out Levitt and Dubner’s podcast, Freakonomics Radio.)

Here’s a summary from Amazon Books:
“Which is more dangerous, a gun or a swimming pool?
“What do schoolteachers and sumo wrestlers have in common?
“How much do parents really matter?

“These may not sound like typical questions for an economist to ask. But Steven D. Levitt is not a typical economist. He studies the riddles of everyday life—from cheating and crime to parenting and sports—and reaches conclusions that turn conventional wisdom on its head.

“Freakonomics is a groundbreaking collaboration between Levitt and Stephen J. Dubner, an award-winning author and journalist. They set out to explore the inner workings of a crack gang, the truth about real estate agents, the secrets of the Ku Klux Klan, and much more.

“Through forceful storytelling and wry insight, they show that economics is, at root, the study of incentives—how people get what they want or need, especially when other people want or need the same thing.”

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Weekly Recap, March 20, 2016 (Clone)

 
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Monday: Read Jim Collins' best-selling book Good to Great:Why Some Companies Make the Leap...And Others Don't to understand how to achieve long-tern success for your organization. 




Tuesday: Ask yourself these questions before taking your new product or service to market.




Wednesday: Continuing Tuesday's post on examples of the most important questions to ask yourself when going to market. 




Thursday: Connect the dots for your prospect by reframing the benefits of your product to fit their needs. 




Friday: How to use NOI as the metric to focus on when presenting an expense-reducing capital project to a landlord. 




Saturday: Commute to work? Read this Hubspot article on, "10 Easy Ways to Make Your Commute More Productive."

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Commute and Work

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Productivity is a lifestyle. While it’s important to be as productive as possible during the workday, you should maintain a productive mindset even when you’re away from your desk.

The average American spends 50 minutes a day commuting. That’s more than 10% of an average workday. Think about how much you could get done if you had 10% more time on your hands! Needless to say, commute time is “wasted” time if not used productively.

Of course, there are limitations to what you can do while commuting, and I would always advise against doing anything that detracts attention from driving. There are, however, dozens of tools in the marketplace that are designed to help you be (safely) productive on the go. An article published by Hubspot blog recommends a number of useful mobile apps, tips, and tricks for commuter productivity. If you’re thinking, “I could probably make more productive use of my commute time,” I would recommend you read this article and explore some of the productivity suggestions:
http://blog.hubspot.com/marketing/productivity-apps-commute

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The Higher NOI

 

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Today, we’re going to discuss the metric that you should focus on when presenting an expense-reducing capital project to a landlord.

 For most landlords, one of largest controllable operating expenses is the utility bill. Payroll for the chief engineer, porter, doorman, and so forth may make up a portion of the landlord’s controllable operating expenses; however, these costs generally pale in comparison to the utility costs.

Your task is to convince the landlord that a reduction in operating expenses for his or her building through energy savings will result in an overall increase in his or her Net Operating Income (NOI). NOI is the mother's milk to real estate investors. It's why they get up and put their pants on in the morning.

In a case like this, there are three drivers of higher Net Operating Income:

Higher rent
Lower vacancy/less tenant churn/better tenant retention or attraction
Lower landlord share of operating expenses

If you want to sell energy efficiency effectively in the commercial real estate environment, you have to explore these drivers and determine which ones might have the greatest positive effect on your prospect’s NOI.

 

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Connect the Dots for Your Prospect

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To be a truly successful sales professional, you must reframe the benefits of your product or service so they can be measured with yardsticks your customer is already using to measure their success. I’m sure most of you have heard me say this before, and I repeat it often because I believe that this concept is absolutely vital to efficiency sales success.

Today, I’d like to share a story that comes from one of our Efficiency Sales Professional™ Certificate Boot Camp graduates. This ninja (who we’ll call Sarah) started out her sales career selling anti-violence training programs to schools.

Sarah would go into each school, meet with the principal, and typically say something like, “I’m here because my mentor and I are advancing this anti-violence program that I think would greatly benefit your school.” Before too long, the conversation would advance to, “How much does it cost?” She would tell the principal the price (I believe it was somewhere around $9,000), at which point the principal would recoil and say, “Did you take a look around? I mean, we don't have enough books, we don't have enough computers…we hardly have enough money to put the chains on the doors to keep the drug dealers out during the school day. Where do you think I'm going to get $9,000 to buy your training system?”

Sarah was a sales professional and was unfazed by this concern. She would say, “Let me ask you a question: How many fistfights did you have last month?” At that point the principal would say something like, “Oh, don't even get me started.” Sarah would continue, “Well, what happens when you do have a fistfight?” The principal would respond, “We suspend the kids.” Sarah would then ask, “One kid or both kids?” The principal would say, “Both kids, since we can’t usually determine who threw the first punch.” She would then ask, “How many days do you suspend them for?” The principal would typically respond, “A minimum of three days.” Sarah would then put the last link in the chain by asking, “Is it true that the district allocates funding to your school using the formula of $40 per day for each student who shows up for school?” The principal would respond, “Yes.”

Now comes the fun part. She knows that every fistfight costs this principal 3 days x 2 kids x $40, or $240 of potential funding from the district. So she would respond, “You know, with all due respect Mr. Principal, you'll probably break even on this $9,000 investment in the first month of the fall semester, and after that you’ll able to spend all of your incremental school subsidies on more books and computers, which you and I both know you need.”

Sarah told me that using this approach afforded her a success rate better than 95% (which she deserved since she was connecting dots for her prospect and using the right yardsticks). I'm sure when she walked into the room, before she started speaking, there was no way that the principal was thinking about average school attendance subsidies or how much money he loses from the district every time he suspends two kids for three days each. He probably hadn’t even thought about quantifying and monetizing the number of fights he'd had in the school. When all that stuff is lined up, it’s easy for him to agree with Sarah that the best thing he could possibly do is buy her training system and start using the larger subsidies he’d now be receiving to improve the learning outcomes in his school.

So what’s the moral of the story? Figure out what yardsticks your prospect is using to measure his or her own success, connect the dots for your prospect, and make your product or service a no-brainer investment decision.

 

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Why? How? Where? (Part Two)

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Today, we’ll continue on with two more examples that address the following questions (again, through the lens of an HVAC sales professional selling “smart valves”):

Why should a particular prospect or group of prospects be interested in what I have to say?
How might I reframe the value so it resonates specifically at their frequency?
Where might I reach my prospects once I determine that that's the message I want to deliver?

Premier Owners (End-Users) 
Why?

Premier owners are opinion leaders. Getting them on your side is a very good strategy, especially in commercial real estate where most people are sheep (and I say that affectionately because I used to work in commercial real estate).
Premier owners typically have engineering prowess and they are the people who most appreciate technology like smart valves.
You get the benefit of scalability. Once you get a premier owner with a large portfolio to prove the effectiveness of your product at his own site, you've now got a lot of other buildings that they could extend that success into.

How?

Look for the intersection of engineering expertise and green press releases. Typically, if you have a premier owner who has been in the press a lot for sustainability and they're happy to be featured for laudatory efforts in sustainability, this would be a great case to bring to their table.
Look for premier owners who are frequently featured on green conference panels. The most vocal premier owners are the ones that you want to associate with, because if the technology doesn't work, they'll tell you; and if it does work, they'll be your canary. They’ll get the satisfaction of sharing a success story with their peers, and you’ll get the benefit of increased exposure.

Where?

Hines has a wonderful reputation for being a premier owner when it comes to mechanical engineering. In fact, Jerry Hines, their founder was a mechanical engineer before he started this global multibillion-dollar real estate operation.
Liberty Property Trust has had noteworthy accomplishments building LEED® certified, award-winning buildings, and they have a pronounced penchant for all things green, sustainable, and energy-efficient.
U.S. Green Building Council is a good watering hole for people interested in using cutting-edge technology to make the built environment better.

Capacity-Constrained Systems
Why?

Smart valves might obviate the need for new equipment.
Budget-minded prospects might appreciate the benefits of smart valves as an affordable alternative to higher-priced, harder-to-maintain efficiency solutions.

How?

You could focus on the fact that smart valves might help compensate for the reduced capacity of aging coils.
You might also focus on the reduction in cooling capacity in the wake of required refrigerant change-outs.
If your prospect is predicting an increase in cooling/heating loads, you could emphasize the fact that they would likely have more cooling capacity in the wake of installing smart valves.

Where?

Network with mechanical service contractors and data center designers – especially ones that are brought in to expand existing data centers.
Write and present a paper about how to solve the problem of increased capacity without having to add a new chiller and other costly physical plant items. That gets the word out there that this is not your first rodeo and that you have a better solution to a problem that the industry feels it faces.

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Why? How? Where? (Part One)

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When you’re going to market with a new product or service, what niches and value propositions would allow you to stack the deck in your favor? In determining an answer to this question, there are three key questions you should first ask yourself:

Why should a particular prospect or group of prospects be interested in what I have to say?
How might I reframe the value so it resonates specifically at their frequency?
Where might I reach my prospects once I determine that that's the message I want to deliver?

Continuing on with the example of the HVAC sales professional selling “smart valves,” we’ll discuss several scenarios over the course of the next two days to get the wheels spinning in your mind as to some possible answers to these questions:

Utility Programs
Why?

Utilities need the savings, and some utilities have problems finding projects that will actually generate therms savings.
They need to prove the savings to the regulators, and your smart valve solution will give them concrete data as evidence.
Some utilities are just fond of seeking new technologies so they can fulfill a market transformation goal.

How?

Propose a pilot program to prove the concept.
Instead of just having a prescriptive rebate (where they give $100 per smart valve), suggest to the utility that they do a custom pay-for-performance incentive (where you get paid only for the energy savings).
Once the pay-for-performance incentive proves itself, you can suggest migrating to a prescriptive rebate. 

Where?

You might work with third parties to find utility partners (such as rebate administrators).
You might look for state incentives on the DSIREUSA.org database.
You also might start with the utilities serving test sites if you want to do a pilot program.

Retrocommissioning Specialists
Why?

RCx specialists are sophisticated enough to understand the benefits of your technology.
They have insight into the highest value applications.

How?

Work with a retrocommissioning specialist, have them use the product, and then feature a product case study on a reference library website (such as PECI or LBNL).
Present a paper at the National Conference on Building Commissioning about how this smart valve technology could help a retrocommissioning specialist gain more control over a facility that they get hired to optimize. 

Where?

You can meet retrocommissioning specialists by hanging out at their watering holes, such as the California Commissioning Collaborative or the National Conference on Building Commissioning.

Stay tuned for more examples on this topic tomorrow…

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Going from Good to Great

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Creating a company that will continue to be successful and profitable many years down the road requires strategic long-term planning. It’s easy to get wrapped up in the present and focus only on that which will provide immediate gain; however, a great company always keeps one eye on the future and plans for sustainable growth and success in the long run.

So what factors allow a company to experience continuous, enduring success? Jim Collins, best-selling author of Good to Great: Why Some Companies Make the Leap…And Others Don’t, studied this question in depth. He examined twenty-eight companies that exhibited exceptional long-term success and crunched the data to extract the commonalities between the companies. The results are truly compelling. If you are responsible for the long-term success of your organization, I highly recommend picking up a copy of this book.

Here’s a summary from Amazon Books:

 “The Challenge:
Built to Last, the defining management study of the nineties, showed how great companies triumph over time and how long-term sustained performance can be engineered into the DNA of an enterprise from the very beginning.

 “But what about the company that is not born with great DNA? How can good companies, mediocre companies, even bad companies achieve enduring greatness?

 “The Study:
For years, this question preyed on the mind of Jim Collins. Are there companies that defy gravity and convert long-term mediocrity or worse into long-term superiority? And if so, what are the universal distinguishing characteristics that cause a company to go from good to great?

“The Standards:
Using tough benchmarks, Collins and his research team identified a set of elite companies that made the leap to great results and sustained those results for at least fifteen years. How great? After the leap, the good-to-great companies generated cumulative stock returns that beat the general stock market by an average of seven times in fifteen years, better than twice the results delivered by a composite index of the world's greatest companies, including Coca-Cola, Intel, General Electric, and Merck.

“The Comparisons:
The research team contrasted the good-to-great companies with a carefully selected set of comparison companies that failed to make the leap from good to great. What was different? Why did one set of companies become truly great performers while the other set remained only good?

“Over five years, the team analyzed the histories of all twenty-eight companies in the study. After sifting through mountains of data and thousands of pages of interviews, Collins and his crew discovered the key determinants of greatness -- why some companies make the leap and others don't.

“The Findings:
The findings of the Good to Great study will surprise many readers and shed light on virtually every area of management strategy and practice. The findings include: 

Level 5 Leaders: The research team was shocked to discover the type of leadership required to achieve greatness.
The Hedgehog Concept: (Simplicity within the Three Circles): To go from good to great requires transcending the curse of competence.
A Culture of Discipline: When you combine a culture of discipline with an ethic of entrepreneurship, you get the magical alchemy of great results.
Technology Accelerators: Good-to-great companies think differently about the role of technology.
The Flywheel and the Doom Loop: Those who launch radical change programs and wrenching restructurings will almost certainly fail to make the leap. 

“‘Some of the key concepts discerned in the study,’ comments Jim Collins, ‘fly in the face of our modern business culture and will, quite frankly, upset some people.’

“Perhaps, but who can afford to ignore these findings?”

Love one of our blogs? Feel free to use an excerpt on your own site, newsletter, blog, etc. Just be sure to send us a copy or link, and include the following at the end of the excerpt: “By Mark Jewell, Wall Street Journal best-selling author of Selling Energy: Inspiring Ideas That Get More Projects Approved! This content is excerpted from the Sales Ninja blog, Mark Jewell's daily blog on ideas and inspiration for advancing efficiency. Sign up at SellingEnergy.com.”

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Weekly Recap, March 13, 2016

 
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Monday: Read Tony Robbins' best-selling book Awaken the Giant Within to gain perspective on how to apply your values into your work. 




Tuesday: Don't just read off your presentation slides; be a storyteller. 




Wednesday: After you give your elevator pitch, make sure to visualize the outcome of your conversation. 




Thursday: Practical tips for business development. 




Friday: How to get your prospect interested in your efficiency product or service. 




Saturday: Want to create a productive work culture? Read this LifeHacker article on, "6 Key Characteristics that Make a Highly Effective Team."

Love one of our blogs? Feel free to use an excerpt on your own site, newsletter, blog, etc. Just be sure to send us a copy or link, and include the following at the end of the excerpt: “By Mark Jewell, Wall Street Journal best-selling author of Selling Energy: Inspiring Ideas That Get More Projects Approved! This content is excerpted from the Sales Ninja blog, Mark Jewell's daily blog on ideas and inspiration for advancing efficiency. Sign up at SellingEnergy.com.”

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6 Key Characteristics that Make a Highly Effective Team

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“Many of us are more capable than some of us, but none of us is as capable as all of us.” - Tom Wilson

The ability of a team to work together efficiently and effectively can have a major impact on the success of an organization. Your team may be comprised of highly skilled individuals; however, if they don’t mesh well with the rest of the team, their talents may ultimately fail to increase the overall success of the company.

In this oldie but goodie LifeHacker article, individual members of a great team feed off of one another and form strong relationships. The article proposes that there are several key characteristics to look out for when hiring new employees. These characteristics will help you determine if the individual is likely to be a good “team player.” For more on this topic, I recommend reading the full article below:
http://lifehacker.com/six-characteristics-that-make-a-highly-effective-team-1643031197

Love one of our blogs? Feel free to use an excerpt on your own site, newsletter, blog, etc. Just be sure to send us a copy or link, and include the following at the end of the excerpt: “By Mark Jewell, Wall Street Journal best-selling author of Selling Energy: Inspiring Ideas That Get More Projects Approved! This content is excerpted from the Sales Ninja blog, Mark Jewell's daily blog on ideas and inspiration for advancing efficiency. Sign up at SellingEnergy.com.”

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