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Sales Strategy: Never Let Them See You Sweat?

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What’s your favorite sales movie? Glengarry Glen Ross? Wall Street? Jerry Maguire?

Here’s one that might not have made your top ten list for sales, but that may help you take a fresh look nonetheless.

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September 1961 saw the release of the classic The Hustler. Starring Paul Newman as “Fast Eddie” Felson and Jackie Gleason as Minnesota Fats (with great performances by Piper Laurie and George C. Scott), it portrays what happens when great talent meets self-destructive impulsivity.

Small-time pool hustler Felson takes on the legendary pool shark Minnesota Fats in an epic all-night duel of young talent vs. old savvy. As the game continues into the early daylight hours, they take a break. Felson, nearly exhausted, collapses sweaty and drained into a chair with yet another pack of cigarettes.

Fats, meanwhile, goes into the men’s room and emerges minutes later freshly shaved, wearing a newly laundered tux. Felson’s confidence is shattered by this show of confidence, and he goes on to lose disastrously.

Never let them see you sweat. That’s the wisdom Minnesota Fats employed, and in a game that’s intensely mental (what games aren’t?), it gave him a decisive edge. A great pool strategy, to be sure.

And a terrible sales strategy.

Unless you’re selling widgets B2C at $19.99, there are three principles that we don’t talk enough about in sales: your objective, your character, and your relationship to the customer. Never letting them see you sweat violates all three. Here’s how.

  1. Your Objective

A game of pool is a zero-sum game, pure and simple. There is a winner, and there is a loser. There is no win-win, and there is no synergy outside the game itself. Within the boundaries of the rules, psych-out strategies to beat the opposing player are fair game. And if that’s how you view sales, you’ll be seduced by Minnesota Fats’ clever stratagem.

But that also means you think of your customer as the enemy. You think your entire customer relationship is a series of one-off unrelated transactions, all win-lose, so there can be no accrued trust or synergy. You will also, quite naturally, seek out more ways to put one past your customer.

What’s the alternative? Think of your customer as your partner. Think every transaction is connected to every other transaction, past and future, in an ongoing narrative of relationship. There are economies of scale and levels of relationship, each adding more and more financial and psychic value at every step.

In this view, your objective is to help your customer, long-term. Period. All else follows.

  1. Your Character

If you believe “never let them see you sweat” is a great strategy, then you have adopted duplicity as a core value. That can be a treacherous decision.

It means you can’t be authentic. It means you can’t relax and let down your guard, lest the customer see your true motives or objectives. It means there is a limit to how much trust, information sharing and collaboration can go on between you and your customer.

Our beliefs drive our actions, and our character drives our beliefs. If you continue to hold a duplicitous perspective in all your customer relationships, you will behave duplicitously and be seen as a duplicitous person. And in a world that is increasingly online, transparent, and available to all, it’s more and more likely that duplicitous behavior will be exposed.

  1. Your Relationship

If you believe “never let them see you sweat,” then you’ll never have a rich relationship with “them” no matter who “they” might be. All human relationships are characterized by a degree of shared risk and vulnerability. There is a reason why in all cultures there is a set of rituals we go through in business before “getting down to business.” They may be as short and simple as, “How ’bout them Bulls,” and “I see you went to State also,” or they may be as complex as late night drinking bouts on successive visits, but they are there for a reason.

The reason: we do not trust people who never let us see them sweat. We interpret their guardedness as secretive, threatening, fearful, and unfriendly, masking motives about which we know nothing but which are suspect. If you don’t let me see you sweat, I conclude you’re probably hiding something, and you’re not the type I can trust. That’s no way to win a sale.

Never let them see you sweat? Au contraire. In Finland, they literally invite customers into the sauna to sweat together! Other cultures have their own approaches, but the aim is the same. Good selling means customer-focused objectives, a habit of transparency, and a commitment to relationship.

If you get those right, you won’t have to sweat in the first place.

 

 

 

 

 

 

Collaboration as a Strategy, Not a Tactic

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First, some context.

Two weeks ago I wrote an article in Businessweek.com called Wall Street Run Amok: Harvard’s to blame.  In it, I suggested  that business schools including Harvard have over-taught competition, and under-taught collaboration—a concept more appropriate to our connected times.  CNBC saw the article and interviewed me, albeit over-playing the blame-Harvard angle.

Then, last week, Harvard Business School’s Deputy Dean of Academic Affairs Karl Kester logged in to the Businessweek.com article and posted a lengthy rebuttal comment both there and on his own site.  Rather than further this discussion in our separate forums, I’d like to invite Dean Kester to continue the dialogue here, in this blog’s open comments section, along with others interested in the topic. Clearly the issue strikes a chord with many. 

Business Schools Have Taught Competitive Success as the Ultimate Goal

Whether you call it sustainable competitive advantage, maximizing shareholder wealth, or simply ‘winning,’ the dominant worldview in business today is that business is all about competition. Ask an MBA to provide an alternate worldview and you’ll get glazed looks.

It was not always thus. Only since the seventies have business schools made the adjective in “competitive strategy” so ubiquitous as to be redundant. Before that, ‘strategy’ had a decidedly more customer-focused tone to it—for example, read Peter Drucker. (I won’t rehash the argument, it’s in the businessweek.com article).

That belief system has become so entrenched that nearly any other aspect of business has become subordinated to “competitive success.” Think of any subject you like–human resources, values-based management, compensation management, employee engagement, customer satisfaction—and you will find that corporations routinely attempt to justify even the most humanitarian programs in terms of their ability to add to the bottom line. Their bottom line, that is–not that of the network, or supply chain, or their partners.

“Good ethics is good business,” they say, as if ethics demanded a currency-based justification. “Happy people lead to higher profits,” “being socially responsible is associated with higher returns on investment,” and so on.

Why must every social virtue be justified solely in terms of its ability to add to the bottom line? Why do we in business not see this  Kool Aid we have been drinking for the self-obsessing small-think it is?

This is precisely the trap into which I believe Dean Kester falls with his comments, and why this conversation needs more airing.

Collaboration as a Tactic–Yesterday’s View

Dean Kester says, in his response to me:

"Today, more than ever, business is a competitive endeavor. At the same time, management is a more collaborative endeavor. At Harvard Business School we embrace both of these truths in preparing our students to become successful leaders in business and social enterprise."

This approach–that business is about competition and management is about collaboration–is precisely the default idea in business today. It suggests that  the purpose of trust and collaboration is to help Our Team to beat Their Team; that collaboration is but a tactic in service to competitive strategy; and that collaboration should somehow be subordinated to a superordinate goal–the success of the competitor.

This is vintage Business School (not just Harvard), Jack Welch, and Corporate America ideology. 

It is an idea, I want to suggest, whose time has passed. 

Deputy Dean Kester’s above response is a perfect example of the current thinking, and in turn suggests how deeply embedded that way of thinking is. Dean Kester is hardly alone in this viewpoint.  But neither am I alone in noticing that over-dosing on the ideology of competition is starting to cause serious economic harm. Here’s where I see the new view heading.

Collaboration as a Strategy–Today’s View

Yesterday’s world—the competition-centric worldview—explicitly sees customers and suppliers as competitors, along with direct competitors.

In today’s flat, connected world, our first instinctive look at the world should not be based on the threats posed by our customers, but by the enormous opportunities available to us each if we can operate together.  In a connected, transaction-cost laden world, it is simply more economic to trust than to compete.  (See Philip Evans on a convincing presentation of the US vs. the Japanese auto industry and the power of collaboration).

What’s the alternative, you ask? Simple. Stop thinking about ‘winning,’ with its zero-sum implications and paranoid overtones.  Instead, start thinking about succeeding, something that is best achieved in concert with others, like our customers and suppliers.  We need to think more about commerce, less about competition.  The critical nexus is between sellers and buyers, not sellers and their competitors.

Trust.  Collaboration.  Success.  Cooperation.  Boundarylessness beyond the corporate walls.  Our customers are not our enemies, for heaven’s sake–they are our customers!

I am far from the first to make this point: see Is It Time to Retrain B-Schools?  Nor is this my first time: see The Horizontal Imperative from February 2007, and Collaboration is the New Competition from March 2008.

Trust and Collaboration: The New Leaders

We can’t any longer let collaboration be the handmaiden of competitive advantage—in the age of networking /globalization / outsourcing it should be a goal in itself. If collaboration in your company isn’t strategic, you’re not doing it right. It is the new Key Success Factor.

The business schools are fully capable of recovering the intellectual high ground in this area. After all, several faculty at Harvard—Heskett, Schlesinger, Sasser—along with Frederick Reichheld at Bain—are responsible for superb, highly customer-focused, original work on customer loyalty.

But the b-schools are not, as yet, institutionally leading the charge nowadays.  For now, leadership is coming from the newly emerging world of blogs and social networking—for example, from people like Chris Brogan and Julien Smith, authors of Trust Agents.  (Other key thought leaders in this area include Robert Scoble, Philip Evans of BCG, Dov Seidman of LRN, and the young-at-heart Tom Peters).

These new leaders are not just talking about social media and networks–they’re living them and driving them in real businesses.  And they are vastly more collaborative than competitive.

Let’s keep this dialogue going.  Thanks to Dean Kester for stating his case.  Now let’s talk about where we go from here.

On that note, if you’re interested in continuing the conversation about trust and collaboration with Chris Brogan and Julien Smith, as well as myself and David Maister (co-author, with Rob Galford) of The Trusted Advisor, come join all four of us at the Trust Summit to be held in New York this Friday morning (auspiciously, at the Harvard Club) at 7:30AM.

I’d love, in particular, for Dean Kester to join us, and in the interests of furthering the conversation the already nominal ticket charge is waived for him.

Click here for more information about the event and about Brogan, Smith, Maister and myself.

Click here to buy tickets for the Trust Summit event.

And bring your best collaboration skills—it’s not a tactic, it’s the whole point.
 

Faking It Doesn’t Make It

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Remember Leave it to Beaver’s Eddie Haskell? Always nice to Mrs. Cleaver—but always working an angle. The unctuous, silver-tongued slickster—devious, always in it for himself.

Haskell played the role of evil in a morality tale—the black-hat guy of the adolescent crowd. When he got his come-uppance, Good triumphed (though of course we were titillated by his escapades on the way).

What Eddie Haskell did best was to fake sincerity. He couldn’t fool us, of course; though poor Mrs. Cleaver was a reliable sucker.

Haskell was TV’s tame version of Hollywood’s innocent; the rural rube with a pure heart, dazzled by the sophisticated city slicker/ hustler—until (s)he finds, as everyone had warned, that he’s a cad, a con, a hustler.

He was faking sincerity.

An Eddie Haskell phenomenon has been coalescing in business. Business is becoming adept at mouthing sincerities about relationships—but in service to itself, not to the nominal objects of those relationships—customers, suppliers, employees.

Have we succeeded in faking sincerity so well that we have fooled ourselves?

Some examples:

1. From an article by UC Berkely Business School professor Lynn Upshaw:

Marketers need to consider a new calculus: "return on marketing integrity"—that is, a new type of "ROMI"—which can lead to stronger business performance.

Traditional return on marketing investment is calculated using gross margin generated by marketing efforts (GM), minus the marketing investment (I), divided by that investment: ROMI = (GM – I) ÷ I. The calculation for return on marketing integrity is identical, except that investment is replaced with marketing integrity.

This language comes awfully close to suggesting that integrity is a virtue insofar as and to the extent it pays off on the bottom line.

 

2. From a Wall Street client seated next to me before my after-dinner talk on being a Trusted Advisor:

“Trusted Advisor? If it gets me greater share of customer wallet, I’m all for it.”

The implication: trust is a virtue—if you can make money on it.

3. From a posting by Steve Yastrow on Tom Peters’ weblog:

In an age of interchangeable products and easily duplicated services, customer relationships have become one of the most powerful competitive advantages available to a business—one of the best ways to keep the competition away from your customers.

I doubt Yastrow intends it—but the language can be read as suggesting that relationships are justified by their ability to competitively advantage a company. (Consider a parallel: "darling, the main reason I want to marry you is you’ll give me a competitive advantage in the business world").

 

4. Steven Covey, Jr., in an interview on branding, says

trust is a hard-edged, economic driver—a learnable and measurable skill that can give your business a competitive edge.

Covey doesn’t say the sole goal of trust is to provide a competitive edge; still, why does that phraseology come so easily to us? (And not just to Covey—I’ve said much the same myself on occasion).

 

5. From a Harvard Business School Publishing email advertising a seminar titled “Authenticity: Are you Delivering what Consumers Want?”

…your company must grasp, manage, and excel at rendering authenticity. Learn how to manage customers’ perception of authenticity by…

• Recognizing how businesses "fake it”
• Appealing to the five different genres of authenticity
• Charting how to be "true to self" and what you say you are
• Crafting and implementing business strategies for rendering authenticity

What does “manage customers’ perception of authenticity” mean? Is it the same as “be authentic?” And if not—isn’t it then inauthentic?

Is authenticity best “rendered” by “crafting and implementing business strategies?” Is authenticity-as-strategy the same as authenticity-as-values?

This is not just about a clash of values—the greedy vs. the needy. It’s deeper. It’s about two world-views of business.

One—the dominant ideology of the 19th and 20th centuries—says business is a Hobbesian place. The dominant relationship is competition—everyone against everyone, including you vs. your suppliers and your customers. The goal is to win, defined as sustainable competitive advantage, and measured by shareholder return on equity.

In this worldview, the role of relationships is as means to an end—winning.

In the other worldview, business is about interdependencies, linkages, networks. The dominant relationship is commercial collaboration. Those who prosper are those who play well with others.

By this worldview, relationships aren’t means to an end—relationships are the end. Successful businesses are the consequences, outcomes, byproducts of successful relationships.

The world is dragging us toward collaboration; but our belief systems are still rooted in competition.

The result shows in our language. We know the right words to say, but we can’t help sounding like Eddie Haskell, trying to fake sincerity.

After all, if your sole goal is to win, how can “relationships” possibly be sincere?

Customer Strategy? Or Strategy vs. Customers? Part 1 of 2.

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The October 2007 issue of Harvard Business Review is out; in snailmailboxes, anyway (at HBR, no early advantage is given to electronic subscribers, unlike most other publications.)

The issue provides such a juicy entrée to business thinking that I can’t cover it with one blog posting. Look for the Part 2, next posting, which will pit Amazon against credit card companies.

But first—let’s talk business and global warming. The entire Forethought section this issue is devoted to “the climate business and the business climate.”

No fewer than 7 articles address the issue, led by the reigning king of corporate strategy, Michael Porter, co-authoring with Forest Reinhardt. Porter’s life’s work has been to cement the link between strategy and competition. It’s hard to overstate the effect his work has had, even on those who don’t know him by name. The term “sustainable competitive advantage” is, in large part, his handiwork.

After cementing that worldview in business, Porter applied it to countries, then to non-profits; and now to global warming. What, you might ask, does corporate strategy have to do with global warming?

Porter gives a quintessentially Porterian answer. First, you might be able to make money on it (what with higher energy prices, green policies, et al).

But that can be just operational. The bigger reasons for companies to think climate, says Porter, are strategic. You might be able to stake out a position in an emerging market; or prevent a competitor from doing so. Walmart’s emission reduction programs don’t just save money; they “will be strategic if [Walmart can]…reduce emissions in a way that is difficult for its smaller rivals to replicate.”

As Porter and Reinhardt put it:

While many companies may still think of global warming as a corporate social responsibility issue, business leaders need to approach it in the same hardheaded manner as any other strategic threat or opportunity.

I submit there is something profoundly wrong with this logic.

There is something wrong with business thinking when the core guiding strategic concept is the pursuit of continued competitive domination by corporate entities. When the best thinking business can bring to bear on global warming boils down to the dictum to view it like "any other strategic threat or opportunity."

In a world that is networked, globalized, outsourced and inter-dependent, the last thing we need is an old ideology centered on companies “built to last” who are all about “playing hardball” to achieve “sustainable competitive advantage.” That mode of thinking has proven itself incapable of dealing with the economic issues of "the commons" time and time again, on a less-than-global scale. Why should it prove any better when the stakes really are global?

Is that really the best we can do for a guiding set of beliefs? I think not.

I am not suggesting that companies ought to be do-gooders. Nor am I suggesting that companies ought to calculate political pressure and react according tof the relative power of broader constituencies and their enlightened self-interest (an approach responsible for “business ethics” being perceived as an oxymoron). I am not suggesting “co-opetition” as a solution.

I am suggesting we need an entirely different business ethos—a logic as powerfully and concisely stated and as deeply embedded at the heart of business as competition was when Porter wrote in the late 70s—but an ethos based on relationships, networks, synergy, inter-dependency, collaboration, customer-supplier relations, and mutuality.

Do the other 6 articles in HBR’s forethought section offer that ethos? Not really. One talks about the stakeholder pressures that will be brought to bear on companies; another about the value of transparency. All are stuck in the same root assumption: business is about the sustained competitive advantage of companies.

Elsewhere in the same HBR issue, however, there lurks a clue about a viable alternative approach.

Stay tuned to this blog for Part 2.