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Hey! Your Company Just Turned Into a Supply Chain!

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 What’s the biggest business change of our time? You might say it’s the Internet. Or globalization. Or outsourcing.

But let me make a case for something else. Something that incorporates those other ideas, but puts them all in a bigger context. Something Big but Simple.

We are moving from a world of Competition to a world of Commerce.

In the old competitive world, most business was transacted within companies, as part of a hierarchically-organized management process.

In the new commercial world, those same business transactions are happening increasingly between companies—not within them—as part of a horizontally organized commercial process.

Let me break that down:

• Business is now done between, not within, companies.
• Business is now done not hierarchically, but horizontally.
• Transactions are no longer managed within firms; they are bought and sold between firms.
• The people you transact with no longer work for you—now they sell to you.

When Tata Motors recently announced the $2500 car, the interesting fact was not the cheapness of the car, but the authors of the announcement. It was the Tata supply chain, not Tata the company, who would make the car. Tata is willing to outsource even the final assembly.

Companies still compete with each other: e.g., GM vs. Toyota, Citibank and Chase, etc. But the bulk of business transactions are no longer internal, they are external, and they are not between competitors, but between suppliers and buyers—collaborators, not competitors.  It’s not that competition doesn’t exist anymore, it’s that your company isn’t in charge of your competitiveness.  Your supply chain is.  And you have to get along with your partners to share in your collective success.

Those who persist in viewing the world through competitive lenses are marginalizing themselves. It’s a relationship world. You can’t go it alone. Those who see through collaborative lenses are, paradoxically, those who will win—not those who set out to "win" by competing.

GM no longer competes in the car business—they just add the final 10–20% of the cost structure in an automotive supply chain. The real “car business” is a whole bunch of companies, inextricably linked in a commercial web. Except for those who continue to believe their suppliers and customers are their competitors. To compete is, increasingly, to lose.

Those who work together well—those who can play in the sandbox nicely with others—are those whose supply chain will win, and them along with it. Those who still think they’re competing with their suppliers and customers are those whose supply chains will lose, dragging them along with it.

Competitive advantage doesn’t determine success anymore—collaborative advantage does.

It’s the external commercial relationships that dominate the value add in the new economy, not the internal ones.

Competition isn’t dead; it’s just not where the action is. Commerce—the ability to get along with others in a supply chain—is where the action has gone.

Hey! While you were sitting in a classroom reading about competitive strategy, your company just morphed into a supply chain!

Why Laughter Might Win the Proposal

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Quick: in your sales and internal presentations, do you use too much humor? Or not enough?

Your first reaction may be, “probably not enough. Then again,” you might think, “ I’m not too great at jokes—and the last thing I want is to have some lame attempt at humor fall flat. My clients are serious about their business, and I wouldn’t want them thinking I was being cavalier about it.”

That reaction puts you square in the middle of most presenters I’ve seen. The claim that “business is serious” masks a deeper truth—what if I fail? And heaven forbid we fail.

So we take the low-risk route.

Result: pandemic boredom.

Enter author Adrian Gostick and humorist Scott Christopher, in their new book The Levity Effect  They argue that:

Some salespeople mistakenly worry…that humor dilutes their message, makes it less urgent and torpedoes credibility. Nothing could be further than the truth. Sending a message with levity demonstrates a clear understanding of the principles of effective communication. It also shows the audience you value their time enough to want to entertain and connect with them and make it worth their while.

They give the delightful counter-example of Linda Kaplan Thaler, CEO Kaplan Thaler agency, who was pitching Panasonic about a shaving product.

As the business meeting began, Kaplan Thaler and her team sat around a conference table with the executives… The Panasonic brass was expecting a formal presentation, but instead Kaplan Thaler smiled and said, “Pretend I’m one of the guys.” Then she proceeded to sing, “Shaving sucks, shaving sucks, like a Band-Aid getting stuck, why does half the human race tear the hair out of their face …”

After sitting through days of drab pitches, the executives were very quickly snorting and hooting in appreciation of the zany song.

“They loved it, and we got the business. They said, ‘You didn’t have the best strategy, but you had the most entertaining way to do it. So we figured you guys are going to be a lot of fun and more entertaining to work with.’”

Next time your firm does a win-loss analysis, include three variables on the survey:

a. Did the winner, whomever it was, have the lowest bid?
b. Did the winners rate higher on relationship, or on value?
c. Did the winner seem more fun to work with?

(Probable answers:  a. no;  b. relationship;   c. yes)
 

Are you Hard Selling or Wrong Selling?

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“Sell” is a four letter word to most customers. And, less consciously, to most sellers as well. It is not an easy thing to pursue a profession that the dictionary—which after all simply documents what people really mean by a word—pronounces as mean-spirited.

Consider these entries and examples in the dictionary definition of “sell”:

· Sell out
· Hard sell
· Cheat, hoax
· To be employed to persuade or induce others to buy
· To force or exact a price for
· To accept a price for or make a profit of (something not a proper object for such action):
· Sell down the river
· Sell (someone) a Bill of Goods

Common to all those definitions is the root reason people find ethical issues with selling—the absence of a relationship context.

If you’re Robin Crusoe on a desert island, you can be said to live in a non-ethical environment (leaving aside animal rights activists and strict vegetarians for the moment). You cannot behave unethically if there is no relationship to an Other to be violated.

There are more than a few echoes of non-relationship thinking in sales: you can find it in people who define sales as “the fine art of separating the customer from his wallet.” You can also find it in technocratic, process-driven approaches to selling; they have sucked the soul out of sales by removing the relationship component entirely and replaced it with metrics and motivational incentives.

Such approaches go well beyond garden variety “immoral” sales behavior. If I know I’m tricking you, I may feel guilty, or not—but I know enough to pretend otherwise in most situations, I know enough not to admit it to certain people—I know I’m violating a serious social norm by cheating or hustling my fellow man. I am still rooted in relationships, even if I choose to violate them.

It’s completely non-relationship based selling that is non-ethical, or unethical. Those approaches treat the customer as Robinson Crusoe might treat a coconut—perhaps essential to his existence, but with no meaning beyond the nurturance of Crusoe himself. The customer as fodder, or as poker chips.

As the late Herman Kahn of the Hudson Institute once said in typically outrageous fashion, “There’s nothing wrong with killing a million people; what’s wrong is killing them without thinking about it.” If you can stand his exegesis, the man had a point.

When selling is decoupled from human affairs, it is desensitized, sanitized, de-humanized; and it becomes an awful thing. The crucial human point of commercial contact—the sale—becomes an occasion simply for extraction of monetary value.

There is danger in over-metricizing process. There is danger in over-using terms like “human capital” which dehumanize humans. There is danger in the perversion of terms like “loyalty” and “relationships” into statistical detritus. There is danger in thinking that physicalist “explanations” like today’s neuro-noun buzzword are somehow more “real” than poetry.

There’s nothing wrong with hard sell. What’s wrong is wrong-sell, done without thinking. And selling without relationships is wrong-sell.

Great Selling by Truth Telling: A Best Buy Tale

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I was in Best Buy the other day.

The sales guy was excellent. He was open about what he knew and what he didn’t. He advised us to spend more, or to spend less, depending on what we wanted and needed in the several product lines we were exploring. He was candid. He spoke quickly and directly, in short, to-the-point sentences.

When we finished, I asked him, “You’re not on commission here, right?”

“No, not here. I’ve sold on commission before, though.”

“Which do you like better?” I asked.

“Oh, I prefer this. You can tell the truth.”

“You can tell the truth?”

“Yup. The other way, sometimes you’ve got to make the month, or bend it around for some other reason. It’s hard. Here you just tell the truth. It’s a lot easier.”

Just tell the truth–it’s a lot easier.

Let’s parse that: then evaluate it.

Why is it a lot easier?

1. There’s only one version of the truth—an infinity less to remember.
2. It’s easier to answer questions—it requires only short-term memory, not creative license.
3. It’s easier for people to tell you’re not lying.
4. People buy more from you if they feel you’re telling the truth.
5. People tell their friends; truth-telling is good marketing.

Of course, some people feel this is a sucker’s game. It’s sales right? The point isn’t to tell the truth, it’s to not get caught not telling the truth? To look like you’re telling the truth, not to actually tell it.

After all, we’re in business—right?

So let’s have a look at the numbers.

BBY Stock Chart

Here is a 5-year stock chart for Best Buy, tracked against the S&P500, and against Best Buy’s most obvious US competitor, Circuit City. (BBY is the one that ends at the top, by the way).

And sure, you can make charts look any way you want. I’m not trying to be an analyst here. I’m just saying the case is not only intuitive, but very plausibly empirical as well.

(By the way, Bear Stearns rated it underperform back in January. Goldman Sachs rates it a Buy.  Cheap shot? Maybe, but I’m just sayin’…)

Telling the truth is not stupid, wussy, or bad business. Far from it. It’s very good business. And for pretty obvious reasons.

And that’s the truth.

Trust Based Selling in the Real World Case Study Number 42

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When the Beatles sang that in the end, the love you take is equal to the love you make, they could have been singing about software development consultant Andrés Taylor.

Andrés describes himself this way:

"I am Andrés Taylor. I’m one of the founders of blueplane, a consulting firm specializing in helping software teams produce better code more reliably. I write mostly about the soft arts of team work."

He wrote some nice things about my book Trust-Based Selling. But what really grabbed my attention was his story of a recent sale.

Andrés mainly a technology person—not a sales guy at all. So it was with great trepidation that he responded to a customer’s request for a reference by putting the customer in touch with a past customer.

He got the old customer to visit the new-customer on the new customer’s premises; they got on well, and eventually Andrés got the feeling that maybe he should just leave the room. And he did. Abandoned the customer in the middle of the sales call. Didn’t do a close. Didn’t ask for the sale. Just left him with an old customer.

And of course, a happy ending ensued.

Read the post itself, it’s worth the click-through.

Here’s my take on what he did right:

  1. His decision to allow other users in tapped one of the strongest sources of trust: testimonials from others.
  2. His decision to use old-client as a case example is part of selling by doing, not selling by telling: giving a practical demo.
  3. His decision to let the old client client speak for himself—to the extent of leaving the room—visibly demonstrated:
  • his detachment from trying to control;
  • the fact that he wasn’t trying to control old-client;
  • his confidence in old-client’s probable answer;
  • his confidence in his own services’ abilities to speak for themselves through others.

 

But what really tells me that Andrés “gets it” is this statement in his post:

“My very explicit goal for every meeting I have is to listen to what they say, and try to find something that is a problem for them. If I can, I try to share some experience or knowledge with the person, that might help them with whatever they are having a problem with.”

That’s Trust-Based Selling at work. Trusting that in the not-too-long run, doing right by your customers ends up doing well for yourself.

And that’s not a Beatle song, that’s a business model.

Well, maybe both.

Real World Trust-Based Selling: Case Study 10

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A few months ago I converted from Windows to Apple. It hasn’t gotten all that much easier than the last time I did this, about ten years ago. In particular, there are some nasty complications with Outlook, Blackberries and virtual drives.

In the midst of searching bulletin boards for solutions, someone mentioned a product called Crossover, by a company called Codeweavers. It sounded like it could solve my problem.

I looked it up and fired off an email to their support email address. When your computer is misbehaving, the desire for instant gratification is great; but it was SuperBowl Sunday afternoon—not propitious timing.

So imagine my surprise when I heard back from their VP of Sales in just a few hours. Not only that, but his email was literate, specific, directly responsive to my questions, and offered valuable perspectives.

He confirmed my fears in one area, offered a direction for a solution, and took care to specifically point out his own bias and company’s interest in the matter.

Bias? I didn’t care. Here’s someone for the first time in a week who clearly understands where I’m coming from, echoes my frustration, adds detail to the symptoms and the diagnostic of what my problem is, and outlines possible solutions for me. And all this on Superbowl Sunday? Gimme more!

And he did. We exchanged a couple more emails that same day, and more the following week. He was consistently helpful, including being very open about the limitations of the solution his company could provide. He offered perspective; he also offered up some customized service that he could offer in my case.

He was unfailingly polite and focused on my needs, even at the point when I reluctantly concluded that for my very specific case, I was going to choose a different solution—for now. It wasn’t his product’s fault, he was hamstrung by a compatibility issue with RIM, Apple and Microsoft.

What did this gentleman get out of our interchange? After all, he didn’t get the sale. I asked him that question, after thanking him for his (very big) help. And here’s what he had to say:

I truly believe that a salesperson’s best attribute is his or her’s ability to connect and build meaningful relationships with each and every person he/she meets. I’d much rather be viewed by clients and prospects alike as someone committed to them and their needs then someone committed to my company and my needs.

Here’s a real-life case of living the trust-based selling principles.

How’s his business doing? I don’t know. The product looks sharp and the company industrious. But that’s not why I know I’ll seek him out again, why I’ll stay in touch to see how his product evolves. It’s because he was so helpful to me in the first place.

And in the meantime, I’ll give him some well-deserved free publicity through this blog. Interested in running popular Windows programs like Outlook on your Mac? Call Codeweavers.

That’s not a plug—that’s helping out someone because they helped me out.

And that’s how it works.

Buy With the Heart, Justify With the Brain

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People buy with the heart, and justify their decision with the brain.

I’m not the only one to make that claim (for another, try Jeffrey Gitomer).

People in “sophisticated” businesses—information technology, Wall Street, law, accounting, consulting—tend not to believe it.  They think business people make business buying decisions in a rational, deductive, linear, data-based, cost-benefits kind of a process.

These people are sellers and buyers of sophisticated sales management and sales training systems.  Their models are variations on “consult with a customer to find a need, get the customer to articulate it, package a solution, and show the customer how the solution fills the need.”

Fine, except it assumes:

a. The buyer can articulate the need
b. The buyer is willing to articulate the need.

Frequently, neither is true.  I recall (can someone help me out on this?) a study of relocations of corporate headquarters, identifying how many moved the HQ closer to the chairman’s home, vs. how many moved it further away.  Care to guess the outcome?

Educated people in powerful businesses (oil, investment banking, capital equipment) will generally tell you they make decisions based on the rational model described above.

Here is a delightful counter-example from a few years ago about an oil industry executive, making an important personal purchase decision—how to select a high-end, bespoke English tailor, courtesy of Thomas Mahon’s blog English Cut:

It’s funny how things from the past can do two things- (A) come back and haunt you, or (B) come back and help you.

Last week I measured up a new customer, who has a senior position with one of the largest and most successful oil companies in the world. He was a very charming fellow who only knew about me through reading English Cut.

He chose me not just because he felt I could give him true bespoke (which I certainly hope I can), but the deciding factor was that he is originally a Cumberland native, like myself. So that put his mind at rest. People go with who they know.

As we were discussing the final cloth choices on his two suits, we stood by the window looking out onto sunlit Savile Row and Anderson & Sheppard’s old premises. When my customer told me which line of business he was in, I remarked that when I as working at A&S I used to cut for the chairman of his company, in other words, his boss.

He than stood back in astonishment. I didn’t know if this meant he thought his boss was the best dressed man on the planet, or the worst, so I was fairly nervous there for a moment.

But then he told me the story. When he first started working with the chairman several years ago, he was in a business meeting on a private jet somewhere over the Atlantic. When my customer had finished discussing some business details, the chairman leaned over the table, took off his glasses and said, referring to his accent, “You sound just like my tailor.”

So be nice to everybody. You never know who may be talking about you.

The customer’s original “deciding factor” was the geographic origin of the tailor—a connection with his own.

The punch line, from which we conclude the tailor had a customer for life, was that the customer’s boss had also hired the tailor.

You come from my part of the world, and my boss uses you.  Sold.

Lesson 1. You won’t find that one in a standard sales process model.

Lesson 2. You can’t build that one into a standard sales process model.

Lesson 3. What you can do is what Aristotle pointed out: character is a habit.  Be nice, competent and of service to everyone—as a habit.  Then when the uncontrollable comes around, you’ve got a reference.

Selling to the Primal Instinct in All of Us

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If you’re in sales, this blogpost is for you.

If you have a toddler at home, ditto.

And if you’re a toddler parent who sells for a living, you just hit the jackpot. Listen up.

I recently wrote an article on selling called The Point of Listening is Not What You Hear, But the Listening Itself.  (Or, read the shorter, blog version).

The title pretty much says it. A lot of sales programs focus on listening for content; but unless the customer feels heard, all you’ve done is a brain-suck, and that feels invasive to the customer.

That idea won’t be new to some salespeople, or to afficionados of communications theory.  But I had no idea how firmly based it is in develomental history.

From the NYTimes Feb. 7, we have “Coping with the Caveman in the Crib.” 
 

If there is such a person as a “baby whisperer,” it is the pediatrician Dr. Harvey Karp, whose uncanny ability to quiet crying babies became the best-selling book “The Happiest Baby on the Block.”

Dr. Karp’s method [works with] fussy babies who are quickly, almost eerily soothed by a combination of tight swaddling, loud shushing and swinging, which he says mimics the sensations of the womb.

Now Dr. Karp, assistant professor of pediatrics at the University of California, Los Angeles, has turned his attention to the toddler years…A wailing baby is nothing compared with the defiant behavior and tantrums common among toddlers.

But Dr. Karp’s method of toddler communication is not for the self-conscious. It involves bringing yourself, both mentally and physically, down to a child’s level when he or she is upset. The goal is not to give in to a child’s demands, but to communicate in a child’s own language of “toddler-ese.”

This means using short phrases with lots of repetition, and reflecting the child’s emotions in your tone and facial expressions. And, most awkward, it means repeating the very words the child is using, over and over again.

For instance, a toddler throwing a tantrum over a cookie might wail, “I want it. I want it. I want cookie now.”

Often, a parent will adopt a soothing tone saying, “No, honey, you have to wait until after dinner for a cookie.”

Such a response will, almost certainly, make matters worse. “It’s loving, logical and reasonable,” notes Dr. Karp. “And it’s infuriating to a toddler. Now they have to say it over harder and louder to get you to understand.”

Dr. Karp adopts a soothing, childlike voice to demonstrate how to respond to the toddler’s cookie demands.

“You want. You want. You want cookie. You say, ‘Cookie, now. Cookie now.’ ”

It’s hard to imagine an adult talking like this in a public place. But Dr. Karp notes that this same form of “active listening” is a method adults use all the time. The goal is not simply to repeat words but to make it clear that you hear someone’s complaint.  “If you were upset and fuming mad, I might say, ‘I know. I know. I know. I get it. I’m really really sorry. I’m sorry.’ That sounds like gibberish out of context,” he says.

On his DVD, Dr. Karp demonstrates the method. Within seconds, teary-eyed toddlers calm and look at him quizzically as he repeats their concerns back at them.

“The goal is not simply to repeat words, but to make it clear that you hear someone’s complaint.”

The point of listening is not what you hear, but the act of listening itself. Or, to be more correct, the result of that act, namely the customer’s experience of being heard.

Sometimes what works on kids also works on adults.  Sometimes not.  My tummy tells me this is the former.

And it’s basic. Primal.  It’s about empathy, not about exchange of cognitive information.

Don’t listen to do a brain-suck. Listen so the customer (or your toddler) feels heard.

And to all you salesperson/parents out there—you’re welcome.  Wish I’d’a knew it!

Lying to Get the Sale

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Suzanne Lowe, at The Expertise Marketplace, has a provocative post titled I Told the Truth—and Got Hired Anyway.

Briefly, she faced two sales situations in which she knew she’d be asked the inevitable question: what experience do you have working in our business?

The truthful answer boiled down to, “none at all.”  Since we all know this is the “wrong” answer, it took a certain amount of courage for Suzanne to speak the truth, and even more courage to then avoid rushing into the silence to list the dozens of reasons why she was nonetheless the best for the job, etc.

The punch line in Suzanne’s posting was, of course, that she got the job. And she asked her readers to help explain why.

Now, what I find curious is not the fact that she got the job—but her readers’ explanations for it.

To me, the reason she got the job seemed transparently clear, almost self-evident.  She got the job because she immediately proved she was honest, transparent, truthful—and those personal characteristics in this case outweighed the importance of industry experience—as they frequently, though not always, do.

Yet to my surprise other commenters had different explanations.  Their explanations included:

• Maybe the client saw the greater relevance of her experience in other industries
• This may be the rare client who is not risk-averse
• Maybe lack of industry knowledge meant no bias, hence an open mind—ignorance here is a plus
• Maybe her integrity helped feed a broader sense of chemistry about her

My first reaction to these other reasons (I’m trying to be honest here), was one of disbelief.   It’s always shocking to me when other people don’t see things precisely the way I do.  ("How could these people not see"…."Why don’t they understand…"). 

I mean, don’t you know who I think I am?

Yet, I know some of these commenters. They are bright, experienced, knowledgeable people.

Unfortunately, this means I am denied access to my preferred, first-blush, gut-instinct explanation for why they might disagree with me, namely they’re ignorant fools. (“Damn; I have to take these opinions seriously.”)

So, I have two questions for this audience.

1. What do you make of Suzanne’s tale; why do you think her clients in each case bought her services despite her lack of industry credentials?

2. What do you make of my being shocked at the other answers? What’s your first reaction when you find out someone has a different reaction to something you felt was obvious? And what do you do about it?

Carnival of Trust for February is Up

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Carnival of TrustThe February 2008 Carnival of Trust is now online, hosted by Michelle Golden and her blog Golden Practices.

Each month, the (rotating) host selects the Top Ten trust-related blog postings from across the web during the prior month. Subject areas include Advising and Influencing, Sales and Marketing, Leadership and Management, and Strategy, Economics and Policy.

I want to say pointedly how great this Carnival thing is.  Maybe you never heard the word "carnival" applied to blogs before.  All it means is a compilation of other blogs.

But as with all things internet-related—there are compilations, and there are compilations.  If you like casually searching the web for interesting stuff, the best click you can make is onto a really good Carnival.  And here’s why this one is turning out so well.

First, we limit the posts to 10.  This is the Top 10 list, the very best of the blogosphere, for anything vaguely related to trust last month.

Second, we get great hosts.  It’s not me that picks the Top 10, it’s the fine people who bring their own special expertise—marketing, consulting, intellectual property, selling, communications—and apply that expertise to the selection.

Third, those great hosts have a Point of View.  They add zing and zest and perspective to the already-good material they’ve selected.

Think of reading the Carnival of Trust as like skimming the NYTimes Book Review, if you like that; or the category leaders in Amazon; or some kind of Google-scanning with mind-reading software that filters out everything but what is Really Great for You and You Alone (if you like trust, that is).

If you can’t tell, I’m excited about the way the Carnival of Trust has been evolving.  Do yourself a favor and pop over to the carnival, hosted by Michell Golden this month,  and treat yourself to a good quick  read.