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Books We Trust: Interview with Frank Cespedes, author of Aligning Strategy and Sales: The Choices, Systems, and Behaviors that Drive Effective Selling (Harvard Business Review Press)

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Aligning Strategies & SalesThis week sees the publication of a new book I want to bring to your attention. It’s by Frank Cespedes, a professor at Harvard Business School, and an old friend from our mutual consulting days. The book is called Aligning Strategy and Sales, and it might have been called “The Massive Business Gap Sitting Right Before Your Eyes.” To use an overly simple athletic metaphor, the handoff from strategy to sales is the source of a great deal of lost value.

I hesitate to call it a revolutionary book – but you haven’t seen anything like it. It’s very important. Especially for those of you in sales, I recommend it.

Meanwhile, here’s Frank.

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CG: What brought you to this topic of aligning strategy and sales?

FC: My academic research always focused on go-to-market elements, including channels and sales management. Then, when I left academia and ran a business for 12 years, I had to meet payroll and sell. Then, after getting lucky in business and returning to academia, I taught Strategy for a few years. Despite decades of attention to planning, there is remarkably little research about how to link strategy with the nitty-gritty of field execution, especially sales efforts. If the gods of strategy even mention sales, it’s typically advice from a fortune cookie: get incentives right, or work as a team, or re-organize. In other words, do good and avoid evil.

CG: That sounds about par for the course.

FC: Conversely, there’s a vast literature about selling. Much is anecdotal, but some—Neil Rackham’s work is still the best, in my opinion—is grounded in good research. However, this advice is misleading in a different way: the consultants and trainers who make their living this way tend to promote the universal applicability of a particular selling methodology (again, Neil is an exception), and they treat sales in isolation from strategy. The result is that much sales training has a perverse effect: people work harder but not necessarily smarter. Selling, no matter how clever and creative, can’t generate sustained returns if it’s not linked to good strategy. That may sound obvious, but it’s not been discussed actionably.

CG: Let me get this straight: you’re saying there’s a big fat chasm of under-performance in business because strategy and sales don’t align? Just how big a deal are we talking about?

FC: None of this would matter much if de facto alignment were the norm. But it’s not. The research results are cited in my book and, as they say, they speak volumes. Studies find that few strategies—some research indicates less than 10%–are executed successfully and that, on average, firms deliver only 50-60% of the financial performance that their strategies and sales forecasts promise. That’s a lot of wasted money and effort. Ever wonder why I-Bankers and other capital-market analysts tend to be a cynical bunch? Companies regularly over-promise and under-deliver in their espoused strategic goals and sales forecasts.

CG: So, why does this happen?

One reason is that the strategic planning process in firms generates a disconnect with the requirements of sales decision making. About two-thirds of companies treat strategic planning as a periodic event, typically as part of the annual capital-budgeting process. Companies tend to do plans by business unit or P&L unit, even when sales sells across those units. The average corporate planning process takes an estimated 4-5 months per year. While this is going on, the market does what the market will do, and sales must respond issue by issue and account by account. In other words, even if the output of planning is a great strategy (clearly, a big if), the process itself often makes it irrelevant to sales executives.

CG: OK, I get the time disconnect. Give us a simple real world example of how all this can go wrong?

FC: Here’s an example I discuss in more detail in the book. It’s unfortunately representative. For many years, a company I’ll call Document Security Management (DSM) had a great business in retrieving, shredding and/or securely storing organizations’ documents. Executives and their assistants loved its one-stop-shop value proposition, and DSM’s sales force cultivated good relationships with them. DSM provided a complete service and their customers could then dedicate their high-paid lawyers and other professionals to better uses. By the early 2000s, however, cheaper digital storage technology, especially the cloud, changed the market. DSM’s CEO was determined not to be fatally “disrupted” by an emerging technology, and DSM introduced its own cloud-based storage and directed the sales force to bundle it with traditional services.

The results were awful. Many of the salespeople lacked the technical knowledge to work with clients’ IT departments. Pricing was a problem, because the physical and digital services had very different cost structures. And in spite of repeated training efforts, reps often sold only the lower-priced digital service, not the bundle. Contract renewals for traditional services fell sharply, as did profits. So DSM modified its sales compensation plan, but then digital sales declined and emerging competitors established strong footholds with multiyear contracts, effectively locking DSM out of accounts as storage increasingly migrated to the cloud. Ultimately, DSM spun off its digital unit and remains a much smaller company.

What’s the problem here? Surely, you can’t disagree with the basic strategic intent. Anyone who has absorbed the lessons of Clay Christensen’s work on disruptive innovation would find it hard to argue that DSM should not have responded to emerging market reality. That’s a recipe for becoming yet another case study about market myopia. The ultimate problem was senior leaders embarking on a strategy without considering the field realities facing the people key to executing that strategy at customers. And this occurs, very often, in many situations: M&A situations where the investment thesis rests on cross-selling or packaged solution bundles, entering a new segment with different buying processes, introducing a new product, scaling a business beyond early adopters, or dealing with new entrants.

Many senior executives, years removed from actual customer contact, are often blithely unaware of the embedded strategic commitments that sales activities daily represent. For example, executives can worry prudently and diligently all they want about disruptive innovators; you need a sales force aligned with strategy to do something about it. Otherwise, all you’re doing is worrying in a currently respectable manner.

CG: Wow. So, where do these disconnects happen? The subtitle of your book is “The Choices, Systems, and Behaviors that Drive Effective Selling.” What are they?

FC: The basic idea is this: In any business, value is created or destroyed in the marketplace with customers, not in planning meetings or training seminars. The market includes the industry you compete in, the customer segments where you choose to play, and the buying processes at customers that you sell and service. Those factors should inform strategy and required sales tasks—what salespeople must be good at to deliver and extract value and so implement your strategy effectively.

Then, the issue is aligning selling behaviors with those tasks. Managers basically have three levers to do that. People: who your salespeople are, what they know, how you hire and develop their skills so they can execute your strategy’s tasks, not those of a generic selling methodology or what they learned at another firm with a different strategy. Control Systems: performance management practices, including sales compensation and the metrics used to measure effectiveness. Sales Environment: the company context in which sales initiatives get developed and executed, how communication works (or not) across organizational boundaries, and how sales managers (not just reps) are selected and developed.

Ultimately, selling effectiveness is an outcome of these factors, not only the result of heroic efforts in the field. And this has very practical implications. If you’re a sales manager, this way of thinking may change how you select and use available selling resources, how you develop your people, and how you look at your own career and development needs. And if you’re a CEO, strategist, or Board member evaluating sales numbers, it can help you to avoid being a sucker for glib generalizations about selling–and, believe me, as someone who works with PE firms and has served on Boards, it happens.

CG: Can you say more about that? It seems that we hear daily about how social media and online technologies are “disintermediating” sales forces and transforming how companies sell.

FC: Yes, based on the business press, you could easily assume that proficiency with social media or digital marketing now determines business success. But consider the basics: US companies spend, annually, more than 3X on sales forces than they spend on all media advertising, 20X more than the total spent on digital marketing, and more than 100X what they currently spend on social media ads. Whenever I see those numbers, I always think about Mark Twain’s comment: “If you’re gonna’ put a lot of eggs in one basket, then keep your eye on that basket!”

CG: But what about all the claims of the Death of the Salesman? Just four years ago this was a big headline in the sales industry.

FC: It’s simply not true that sales forces are being replaced by ecommerce, social media, or other elements of the internet. According to US Bureau of Labor Statistics, the number of people in sales occupations in 2012 was virtually the same as in 1992—before the rise of the internet. And this almost certainly understates the real numbers: as you know, business developers in many firms, especially professional services firms, are called Associates, Partners, Vice Presidents or Managing Directors, not placed in a “sales” category for reporting purposes.

In fact, if you peek behind the server farms of online firms themselves, you find face-to-face and inside sales organizations as the engine of profitable growth. At Groupon, over 45% of employees are in sales; at Google, it’s about 50%; and at Facebook, the sales force’s ability to translate “likes” into advertisers will make or break that company’s valuation going forward.

The internet is realigning sales tasks. For example, relatively few cars are actually bought online. But about 90% of Americans research the purchase via Edmunds.com or other online source before going to a dealer. The average car shopper now spends more than 11 hours online and only 3.5 hours in trips to dealerships. But this makes selling more important, not less, because it puts more pressure on the sales person’s value-added during the shorter sales experience. Smartphones, online reviews, social media blogs—all these tools are having a similar effect across many buying/selling situations.

But, perhaps focused on technology or the media buzz, many execs ignore the implications for sales tasks and the links between Sales and other parts of their companies that deal with customers before and after actual selling takes place. Don’t believe the hype: salespeople, and the customer trust they do or don’t generate, are not becoming obsolete. With Paul Nunes of Accenture, I wrote an HBR article over a decade ago—at the height of another hype cycle when most commentary was predicting (in fact, assuming) disintermediation of sales forces. The article attracted a lot of attention, most of it very negative. We were labeled as reactionaries, oblivious to ‘disruptive innovation,’ and so on. But look at empirical reality years later: they were wrong, and we were right.

CG: What’s the biggest, over-arching problem or issue you see in the field of selling?

FC: Selling is probably the most contextually-determined set of skills in a company: what works there does not necessarily work here. There’s now a century of research about salespeople. Sales talent comes in all shapes and sizes, because selling jobs vary hugely in the kind of product or service sold, price points, the customers a rep is responsible for, the numbers and types of people contacted during sales calls, the relative importance of technical knowledge, and so on—in other words, selling effectiveness depends on the particular sales task. You wrote an excellent piece about this last year (“Half of What You’ve Learned about Sales is Wrong,” TrustMatters, April 15, 2013), and I agree with you: one size doesn’t fit all.

Yet, sweeping generalizations and outright stereotypes about “sales personalities” and the alleged core “traits” of effective salespeople still dominate the field. Why? The novelist Saul Bellow liked to explain the difference between ignorance and indifference this way: “I don’t know and I don’t care.” Many executives and sales managers don’t know about this research. In fact, as others have pointed out, many sales managers have a classic cloning bias: they hire in their own image. And many trainers and consultants just don’t care: they have a hammer, and everything looks like a nail.

In my experience, these generalizations are destructive and not just abstractions. They encourage quick-fix approaches that substitute for more fundamental sales and strategy issues confronting firms. Those approaches may be quick but rarely a fix. The stereotypes also blind managers to the interactions between strategy, sales tasks, and selling requirements that they are, presumably, paid to manage.

CG: OK, time for some key takeaways about aligning strategy and sales. Let’s focus first on the Strategy side.

FC: I don’t think I’m saying anything truly original about effective strategy formulation. But I don’t apologize for emphasizing the fundamentals because, for various reasons, executives and sales people tend to forget them. Many companies confuse strategy with things like purpose, vision, or values. That’s bad news for your firm and your career. It’s the responsibility of those crafting strategy to insist on those distinctions. Any organization’s strategy, purpose or vision cannot be independent of how the world changes. If you simply cling to those abstractions, you’re just stubborn, not principled, or you may believe your aspiration is just too big to fail; it’s not.

Then, you must communicate what your strategy means for market priorities, who are and are not your customers, and the implications for sales tasks. Most firms don’t do this—either because leaders are not clear about strategy or they worry this information will get to competitors. If the issue is the former, then clarify strategy: it’s hard for people to execute what they don’t understand. And if the issue is the latter, you have bigger problems to worry about than competitors reading your strategy documents if your salespeople don’t understand them.

CG: And the key takeaways for those carrying a bag or managing a sales effort?

FC: First, as always, People: You need disciplined hiring that’s linked to your strategy, focused and customized training initiatives, and on-going attention to broadening salespeople’s skills as markets and sales tasks change. Sorry, but almost all serious research about people in business underscores these fundamentals and debunks glib prescriptions about talent acquisition.

Second, Performance Reviews are still grossly underutilized levers for influencing behavior in many sales organizations. Busy managers treat them as drive-by conversations that are really about compensation, not review, evaluation, and development. But so much of strategy – sales alignment is only visible and manageable through on-going account and performance reviews. This is a trainable skill and there’s lots of room for improvement in most sales forces when it comes to conducting performance reviews.

Third, Perspective: Strategy is about confronting external market facts, and customers ultimately determine what are relevant selling behaviors today, not yesterday. It’s not the responsibility of the market to be kind to your strategy or current sales model. It’s your responsibility to understand the evolving market and its sales tasks. And you can’t do that from headquarters, the branch office, or solely through data analytics. A character in a John le Carre novel says something that every sales leader and C-suite executive should engrave on their desk or tattoo on some prominent body part: “A desk is a dangerous place from which to watch the world,” especially the sales world.

CG: Frank, this has been great. I’m still kind of amazed that there is such an enormous opportunity that’s been relatively overlooked; but there it is, and you’ve laid it out very clearly.

FC: Charlie, it’s truly been my pleasure. You’ve made TrustMatters a wonderful, straight-shooting medium for people to engage about sales. I thank you for the chance to add to that dialogue.

Relationships or Metrics? I Haven’t Got Time for Both

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I heard it again today. I hear it in almost every workshop I do, and in every – bar none – big company sales organization I work with.  It sounds like this:

I believe in trust and relationships, but it’s a luxury problem. Here in the real world, the pressure’s on. I don’t have time to do all that nicey-nice stuff, I’ve got to hit my numbers. And even if I did have that kind of time, my clients don’t. The days of easy-going ‘what’s keeping you up at night’ conversations are over – they’ve got as much pressure as I do, and maybe more.

I just don’t have time to build trust-based relationships. Hopefully, someday I will.

But with that attitude, that day will never come. Because trust-based relationships don’t come when you’ve got plenty of time – they’re forged when you don’t have time, and have to trust someone. The whole relationships-vs.-metrics debate is based on four false beliefs. When will you get rid of them?

Myth Number One: You Don’t Have the Time

Maybe you’re old enough to remember an old ad for Fram Oil Filters: “You can pay me now – or you can pay me later.” It stuck because it rang very true – if you refused to pay for a cheap oil filter, you’d end up paying for much more expensive engine repairs later.

It’s the same here. Every phone call, conversation and meeting that you cut short to “save time” puts a label on your head. The label says, “I’m a transactional sales guy; I will never invest in my customer, and I’ll blame you for being the busy one.”

As Aristotle said, you become what you practice. If you never take time for relationships, if all you do is transact, then you become a transactor. And nobody suddenly decides one day out of the blue that they really want to have a trust-based relationship with someone who’s been transacting with them since forever.

The truth is, a little time taken now, up front, results in far more efficient use of time down the road – even just next month. Trust-based relationships aren’t just more effective, they’re more timely and less costly.

You do have the time; you’re just constantly refusing to invest it for returns in future time.

Myth Number Two: Your Client Doesn’t Have the Time

How do you know? Because they told you so? Get real. What client is about to tell you they’re not busy? They want to control their time with you, not give control over to you.

And the same logic applies: our customers are as short-sighted as we are, constantly failing to invest a bit of time up front for future gains of time. So they tell you they don’t have the time, and you believe it, and the two of you race off so as to cut the elapsed time of your transaction. And then do it all over again the next time you meet.

They have as much time or as little time as you do; and if neither of you breaks the vicious cycle, the cycle will stay unbroken.

Who should break it? That’s easy – you should.

Myth Number Three: Trusted Relationships Take Time to Create

The truth is, people form strong impressions of trust and relationship very, very quickly. Initial impressions get formed in much less than a second.

Think about someone you trust. If asked why, your first thought is not, “our trust has grown over the last 6 years.” It’s far more likely something like, “One day we were talking about XYZ and he said an amazing thing…ever since…”

Because trusted relationships are step functions, not continuous curves. They are based on events, moments, instances. Trust gets created in those moments. If you never let yourself be open to those moments, it will never happen.

Trust doesn’t take time. The only sense in which it does is the creation of a track record. All qualitative aspects of trust take virtually no time at all.

Myth Number Four: Relationships are Built on Quantity of Time

Wrong. Relationships are built on quality, not quantity. It’s true with your dog.  It’s true with your five-year old child. And it’s equally true with your client.

The quality of your time matters far more than the quantity. An hour on the golf course or hoisting a beer doesn’t hold a candle to sincerely asking a difficult question, and conveying to your client that you care about the answer, and that you’re a safe haven in discussing it.

A lot of the “I don’t have time for relationships” line is frankly a cover-up for fear of customer intimacy. Invariably, the workshop participants who tell me they haven’t got time are the same workshop participants who tell me that customer intimacy is too risky, and potentially unprofessional. Meanwhile, their compatriots who understand the qualitative basis for relationships are selling circles around them.

Haven’t got time to form relationships and still meet your metrics? If that’s what you’re saying, you don’t understand how to meet your metrics. In any medium timeframe, the person with the relationships will outperform on all business metrics the person without the relationships.

And being busy’s got little to do with it.

Competing with Colleagues

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The Trusted Advisor: Click to BuyWhen I wrote The Trusted Advisor with David Maister and Rob Galford a few years back, it became reasonably successful within several months. (Amazingly, it still ranks #8,050 – as of this morning – on the list of all books on Amazon. That’s all books, including Harry Potter (#54), Capital (#41), etc. I’ll take long-sellers over best-sellers any day of the week).

With its success came a happy problem: how to parcel out the leads between the three of us? Let me be clear, the book wasn’t drowning us in leads; any one of the three of us could have happily fielded all inquiries. And while we wanted to be fair to each other, we were also all of us very clearly in competition with each other.

So the question: how do you compete with colleagues?

Competing with Colleagues

What if one of us got a lead based on the book? Did we have any obligation to pass it along to the other two? If so, how?  Should we establish a quota system, whereby each of us would get every third lead?

Should we let the market dictate things, and let whomever the client had reached out to handle the response? What if the client had written to all three of us?  Should we all respond confidentially, or in some sense share our responses?

The problem was not unique to us, though it seemed so at the time.  You may face a similar problem within your organization – who gets the lead? Who gets to present?

Or, you may come face to face with an  old friend who has changed uniforms and now works for a competitor. In any case, the tension is much the same – the sensation of being a colleague feels intensely in conflict with the sensation of being a competitor.

How do you resolve it?

The Solution

The answer to the problem came to us fairly quickly, on reflection, and I documented it as part of the Four Trust Principles in my later books. The answer lies in true focus on client needs.

In our case: we agreed that we should all respond similarly to all client inquiries, regardless of to whom they were addressed. In all cases, we would say words to the effect of:

The Trusted Advisor was written by the three of us. I suspect that each of us could do an excellent job in response to your query, and each of us would handle the work slightly differently. You would be best served by having discussions with each of us, and making up your mind on that basis.

We will each be candid with respect to our own strengths and weaknesses, and answer questions to the best of our ability about the others. Each of us will respect your decision, and we are each committed to you making the best decision possible for you.

The best decision for you is what all three of us seek, and each of us will do our best to help you reach it, regardless of your choice.

This solution made everything easier. It kept our relationship collegial. It removed any awkwardness about responding to clients. It removed any awkwardness that clients might experience in choosing whom to talk to.

And, of course, it resulted in the best decision for clients, as each of us have our own particular skills and drawbacks.

So what’s the answer?  Grindingly relentless focus on client service, and the willingness to pursue that logic wherever it leads.

Relationship Inflation

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photo“Now our global sales team can create customer relationships instantly from anywhere.”

Jeremy Stoppelman, CEO of YELP, in an ad for the Salesforce1 Mobile App in the Economist.

“Run your business from your phone,” the ad goes on to say. Including the instant creation of customer relationships, with just a click.

Of course, we get what it means. Salesforce is a powerful tool; I use it. We’ve even got our own app on Salesforce for Trust-based Selling (and are proud of it).

But let’s just pause a moment and note the grade inflation that has come about with the use of the word “relationship.”

Relationship Inflation

Never mind the dictionary. Just use your own built-in definitions. What does the word “relationship” mean, and what does it suggest when we use it as synonymous with something clickable?

This is not a Luddite rant – I love my CRM-flavored apps as much as anyone. And I’m not going to bemoan the demise of deep connection at the hands of social media.

But I am going to protest the casual use of a rich word in ways that flatten and cheapen its meaning.

Dimensions of Relationships

When we think of relationships, we naturally think in two dimensions – depth and breadth. There is the sense of connection, empathy, shared knowledge, and the promise of more to come. That’s the deep part, and the deep part adds value.

The breadth part is equally important – because it shares value. The plural of relationship is network. Relationships times depth equals shared value.

The problem comes when we over-emphasize one dimension to the exclusion of another. The digital explosion has enabled both.  The ability to quickly scan and dive deep into data, or to quickly access past experiences (think your email history, think LinkedIn) can greatly help on depth.

But the emphasis in many ways has been far more on the breadth side of things. When zero marginal cost meets an ethos that says more followers/clicks/eyeballs are always better, that’s where the qualitative gets run out of town by the quantitative.  Deep gets beat by broad.

The Cost of Breadth at all Costs

When the intersection of Deep Street and Broad Street gets paved over by an expansion into Broad Boulevard, we lose something. The value of what we’re sharing diminishes. That means less value, less insight, less impact, less connection, less meaning.

In the world of sales, it’s no accident that we’re hearing about the power of insight – we’re starved for insight in a world that has been bingeing on breadth.  In the world of content, it’s no accident that we’re seeing an explosion of (often fairly good) TV programming enabled by online broadcast capabilities; we’ve been starved for it.

We need both dimensions for balance. Lately we’re out of balance, and it’s the deep content side that needs redressing.

Selling To a Friend

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Sell to a friend? Or not?

Maybe your firm would like to sell to XYZ company and it turns out you have a college classmate who works there.  Maybe you’ve become friendly with someone in a client company for which you’d like to do further work elsewhere in the organization. Maybe a neighbor down the street works for an organization you wish you could sell to.

Can you sell to a friend?  Should you? And even if the answers are ‘yes’ – how do you go about doing it?

The Ethical Quandary

Let’s face this head-on. The reason you’re reading this article in the first place is that you feel somehow squeamish about the prospect of selling to a friend. Part of you feels it’s unfair to take advantage of a friendship for the sake of sales. Or that it cheapens your friendship. More importantly, you’re concerned you might put your friendship at risk by appearing to use it for your own commercial gain.

Worst of all – you’re worried what your friend might think of you.

Well, rest assured: there are some times when it’s wrong to sell to a friend – and there are some times when it’s right. There are ways to tell the difference. And there is a way to do it that minimizes any risk. And when you follow these rules, any ethical quandary disappears.

Let’s be clear. If you’re coldly using a personal connection solely to get business, but you pretend otherwise, and you don’t truthfully much care about the consequences to your friendship, then you are indeed behaving unethically. And we struggle not only to be clear about our own motives, but with how it will appear to our friend. So, how can it be done ethically?

The Brother-in-Law Test

Imagine you’re watching football (your version of ‘football,’ of course) on the couch with your brother-in-law who is over to visit for the holiday weekend. At a break in the action, he asks you, “Listen, your company works in the widget services business. We’re thinking about buying some widget services; who do you think we should be talking to, and what should we be careful about in talking to them? And should we be talking to you guys?”

Most likely, your first response is not “Boy, have I got a deal for you!” You’d probably say something like, “Well, there are several things to think about. We do widget services of course, but there are others as well in that business. The first thing you need to think about is the scale of involvement you want; and next is probably the complexity of your customer base. Depending on those answers, you might want to talk to us, or to someone else.”

In other words, you’d probably approach your brother-in-law in the manner of a trusted advisor – someone who applies his expertise with the best interests of the client in mind. You place the long-term interests of a close relationship (family in this case) over the short-term interests of your business.

And, if you knew your firm wasn’t the best choice for your brother-in-law, you’d probably tell him as much. The point is, you’re more attached to your long-term relationship with family than you are to a sales transaction at work.

So – what’s the difference with a friend?

Selling to a Friend

The correct answer is – there shouldn’t be any difference. If your services aren’t the best fit for your friend’s company, then you shouldn’t be pitching her. And if you really do have the best solution for your friend’s company – then you should be selling it, if only because you’d like to see your friend and her company do well.

The real question isn’t whether you should treat a friend like a brother-in-law – it’s why you would treat any customer any differently?

Making the Sale

Notwithstanding all the above, it can be socially awkward to sell to friends – as much for the friend as for you. Relax, you don’t have to jointly take an ethics course. All you have to do is Name It and Claim It.

Acknowledge the issue out loud, and the elephant in the room disappears. You might say something like, “Look, I realize it could be awkward for us as friends to do business; I have no intention of jeopardizing our friendship, so I’m making this suggestion very mindfully.” Or, “I initially hesitated to raise this given our friendship, but realized I’d be cutting you off from something valuable if I didn’t speak up.”

In sum: if you wouldn’t sell it to your brother-in-law, don’t sell it to your friend. And if you would sell it to either one, say so, and say clearly why you’re doing it. If it’s the right thing for your friend to buy, then it’s the right thing for you to sell – to your friend as much as to anyone else.

The NFL, Ed Reed, and Trust

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photo via jumpingpolarbear.comEd Reed is an NFL veteran defensive safety with an outstanding record of performance. But it’s not just physical prowess that gives him his edge – it’s mental too.

And I’m not talking about toughness, or attitude, or no-pain-no-gain hype. I’m talking about insight, knowledge, and learning. Those of us in advisory or sales capacities have a lot to learn from him.

Analysis or Instinct?

Which is better: to trust your gut, or to study a situation carefully? We have heard both answers, proverbially speaking: both “don’t jump to conclusions,” and, “he who hesitates is lost.

A better answer is – it depends. On the one hand – in a crazy stock market, it’s the cool-headed trader who can recognize fundamental dynamics and make the smart move. On the other hand – in a difficult meeting, it’s the person who can sense subtle mood shifts and instinctively respond who adds the most value.

But the best answer is – both. And this is what Ed Reed embodies.

Reed is legendary for his ability to read offenses. Increasingly, it’s noted that he spends a lot of time watching opposing teams’ video tapes, something that only coaches used to do. In a recent NYTimes article, Reed is quoted as saying, “When you see something on film, just believe it. Believe that something’s going to happen, and just go.”

This is trusting your instincts. It is also putting in time in careful study. “Before you come to work, come to work,” says Reed.

What’s the relationship? It’s one of sequence. The same as what Tiger Woods’ father told him when young: Practice, practice, practice – and then, trust your swing.

Study – then react. Think – then feel. Be intelligent – then sentient.

Being Ed Reed in Your Practice

We can’t all replicate anyone else we choose to. But we can pretty much all move in that direction, if we choose strongly enough.

If you’re in sales, get a process – but don’t treat it like the end-tool, use it to inform your relationships. By all means, get Salesforce – but don’t think great CRM alone will tell you how to read the body language on your client when you’re pitching the sale.  By all means do analytics on your past performance – just don’t forget to internalize the results.

(By the way, if you’ll forgive the obvious pitch: get the best of both by buying my Trust-based Selling Salesforce App, just released with Soliant Consulting).

If you’re in an advisory or consultative or coaching/mentoring role, get a model – but don’t treat it like a one-size fits all blunt instrument, use it to inform your judgment. Read Freud, and Covey, and Schein – but don’t treat your client like a final exam.

Above all, do your research in advance. The final thing you should do before going in to interact with clients and customers is to clear your mind, relax, turn on your senses. Stop rehearsing, stop repeating mantras, stop trying to motivate yourself.  Step aside, and trust your swing.

Being Ed Reed in Life

As I read up on Ed Reed for this blogpost, I couldn’t help but notice what people say about his personality. A particularly good piece is Ed Reed: Hiding in Plain Sight, by veteran ESPN sportswriter Kevin Van Valkenburg.

What emerges is the portrait of someone who has native intelligence, but who is also deeply empathetic. Comfortable in his own skin, not seeking the limelight. Someone who leads by attraction, not promotion. Someone who has the personal comfort level to feel the equal of his coaches, as well as humbly one of the team of players.

And while this post is just about the link between cognition and instinct, I can’t help but believe that link is greatly strengthened by his overall emotional make-up.

In so many ways, Descartes had it wrong when he said cogito, ergo sum. So often, it’s como sum, como cogito. (In case my Latin is faulty, that’s meant to say, “As I am, so do I think”).

Discomfort with Selling: Interview with Author Jeff Shore

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Jeff Shore talks about being bold in the face of discomfort – a subject that quicklyBe Bold and Win got my attention.

Jeff is a sales expert, speaker, author and executive coach. He focuses far more than the usual person in this field on mindset issues, perhaps due to his combination of sales and cognitive behavioral therapy approach. Maybe that’s why I was so intrigued. His first book, Deal With It, was for salespeople coping with rejection.  His latest book, Be Bold and Win the Sale: Get Out of Your Comfort Zone and Boost Your Performance, is forthcoming from McGraw-Hill in January 2014.

Here’s our conversation:

Charles Green. The title of your new book, Be Bold and Win the Sale, sounds very upbeat and motivational. Yet the book is built very much around the idea of embracing discomfort. That sounds like a very negative approach. How do you get from discomfort to being positive in relation to sales?

Jeff Shore. Discomfort is an inevitable part of the sales process. The most successful sales people have learned to embrace discomfort as an opportunity for growth, vs. avoiding it. From the perspective of potential change and growth, discomfort is inherently positive.

We all know people who have found a way of enjoying discomfort in order to achieve a goal or to maintain their daily life. We may not think about it in those exact terms, but when we do, it isn’t hard to come up with a list of people who experience joy in the discomfort of their pursuits. (Professional athletes, humanitarian aid workers, the list can go on and on).

We tend to think that people who enjoy discomfort are simply made of different stuff than the rest of us. That’s a handy explanation, but completely untrue. People who enjoy discomfort have trained themselves to do so. They have learned, on a deeper level, how and why the gain is worth the pain and they have reprogrammed their knee-jerk reaction to discomfort in order to recognize it for what it is: the means to a greater good.

CG: You also write and speak extensively about being bold. What does being bold mean to you and how is it related to discomfort in sales?

JS: It’s different from what we sometimes think of as “bold,” in that it’s not about aggressive selling or plowing over people to reach our individual goals. It is a humble, servant-oriented mindset. But it’s also the strategy we use to dismantle what I call “comfort addictions.” Being bold is about focusing on strengthening oneself in order to be equipped to better focus on and serve one’s clients.

Every time we have a moment of discomfort we also have a moment of decision. It takes boldness and a willingness to embrace discomfort to peel back the layers of our habitual actions that are based on decisions we make so quickly that we don’t even realize we are making them.

CG: This is very similar to what I mean by lowering our self-orientation. If we can stop feeling personally attacked, or fearful, in high-stress situations, then we can be free to pay attention to and be of service to our clients.

JS: Yes, and when we take the time to be honest and examine what we are thinking (fearing) and then analyze how those thoughts are defining our actions, we can gain a new understanding for ways in which we can improve in not only sales, but all of life. It’s not at all comfortable to face one’s own well-worn rationalizations or to choose to take action that is not our norm.

CG: Interesting. This reminds me a bit of Julien Smith’s excellent eBook, Flinch: he suggests we need to face our “flinch” moments and drive through them. So, how does ‘trust’ come into play in your message of being bold?

JS: First, trust always has to do with complete honesty and that is what I encourage people to embrace as a starting point: total honesty with themselves. Sales professionals are busy people with demanding quotas and deadlines. Over time, out of a sense of survival and/or efficiency, sales people inevitably develop habits that are not based on self-honesty.

By that I mean, there are so many potentially awkward moments in the sales process that sales people learn how to largely avoid these moments by basing their actions on possible outcomes vs. what actually is. The fear of losing a sale or of experiencing an intensely uncomfortable situation is what largely motivates most sales people. I believe that if a person can change their level of honesty with themselves, they will be freed up to change their actions and then, as I always say, they will be able to change someone’s world.

CG: Fear is a great motivator, but ultimately a limiting one. We need to get over it to get to a higher, more client-focused level.

JS: Trust also comes into play in my message of being bold in that it is crucial for people to understand and believe (trust) that boldness is not an inherent personality trait that is possessed by only the “heroes” amongst us. Boldness is a choice and an action. It can be learned. I have learned, and continue to, that this is true for everyone, including myself. If I hadn’t seen evidence of this in countless aspects of my own life, including my work in sales, I wouldn’t be so convinced of it. But, I have…over and over!

CG: I would echo that. Personally, I’ve never learned as well from positive examples or even positive experiences as from negative ones.

JS: I am utterly convinced that there is no growth without discomfort. Period. If you want to accomplish big things you must first accept and then appreciate discomfort. Every time you find yourself in an uncomfortable position you can be assured that an opportunity for success is around the corner. My mantra is: a moment of discomfort ALWAYS leads to a moment of decision.

CG: And what about that “moment of decision?” Say a bit more about how people can best respond to a moment of decision?

JS: In the book, I explore, analyze and dissect all of the how’s and why’s behind the sequence of feeling discomfort and then making a decision. I talk at length about retraining one’s mind and making “pre-decisions.” Again, being bold has everything to do with being bold with oneself: taking the time to recognize those moments in the sales process that are uncomfortable and coming to grips with one’s fears in relation to them.

When we honestly recognize how our actions are based on our perceived fears, it is then that we can make a plan for change and improvement. I encourage people to be very practical and pro-active in this process. In the book, there are spaces for readers to record what their usual responses (actions) to discomforts are and write down exact plans for different actions. This is part of the pre-decision process. When someone takes the time to foresee discomfort and plans for it by pre-deciding a positive response vs. their usual response, life changes for that person!

CG: You mentioned your work in sales. Can you give us a brief description of your career in sales and how you came to be an author?

JS: My sales career spans almost 30 years and in that time I’ve done it all – sales, sales leadership, executive leadership, consulting, training, speaking and writing. I wrote my first book, Deal With It!, to help salespeople overcome objections (a specialty of mine).

Be Bold and Win the Sale is my legacy book, my vocational ambition for many years. So much of a salesperson’s success is mental. I want to help high achievers to break through barriers and find the real prize.

CG: Jeff, thanks so much for taking the time to share with me today; I love your approach.

For more about Jeff Shore:

Learn more at JeffShore.com
follow Jeff on Twitter
pre-order Jeff’s book Be Bold and Win the Sale: Get Out of Your Comfort Zone and Boost Your Performance

Applying Trust Principles to Pricing

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A New Perspective on PricingLet’s get tactical.

Friend Mark runs a small coaching business, mainly by himself.  He focuses on an intersection of personal and business development issues: helping people get unstuck.

The usual approaches to pricing in that business are tried and true. Rates are typically quoted for a month at a time, over a planned period of months. Variations on the theme are weekly rates, or hourly rates with a stipulated number of hours agreed upon up front.

Basically, it’s a time-based fee linked to some agreement about the period of time over which the agreement will be in effect. It’s an arrangement familiar not only to coaches, but to consultants, lawyers and other professionals.

Attempts are occasionally made to introduce value-based billing. The attempts succeed or founder based on both the definition of value, and the percent of said value attributable to the professional. I’d love to hear from readers about successful examples, but I’ve rarely run across them.
Mark, however, has some interesting ideas.  Let him tell it.

Many of my clients are hourly-type billers like me.  Since it takes me 8 hours, on average, to get a client from stuck to where they want to be…one approach is to charge them 8x the rate THEY bill at. Using their rates rather than mine, I suspect, is both easier to comprehend for them, and it strikes them as client-focused.

Another approach is that I figure I can work with about a hundred paying clients a year.  So, each client represents 1% of my income.  So I now ask 1% of their income as the fee.

Again, from what I can see, it engenders even more trust in the coaching relationship, helps things go faster, and makes it more likely for clients to refer.  Now, there’s no way I’d ask them to verify that the figure they give me is 1% of their income – I leave it all up to them.  And, of course, if they aren’t satisfied with the journey, I don’t charge them at all.  I leave that entirely up to them.  [David Maister used to do the same—CHG]

I see two powerful themes in the approaches that Mark is developing. First, I’m sure the pricing feels more ‘fair’ to his clients, because he is overtly working off their economic model, not his. It’s the opposite of one size fits all.

The other thing is that he trusts his clients – right from the outset. And as I’ve often written about, the impulse toward reciprocity plays out strongly in trust. We live up to the trust people place in us – and live down to the suspicions others have of us.

I asked Mark, “Have you ever, to your knowledge, been screwed over by an unscrupulous client taking advantage of your ‘honor-box’ approach to pricing?”

Mark’s answer: “Never.”

Riding the Shark: Vanquishing Fear in Selling, Part 4 of 4: Shark-proof Your Selling

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Shark ProofingThis is the final post in a four-part series on Fear in Selling.  In the first part, I talked about the importance of dealing with fear in sales. In the second part, I wrote about the four types of fear.  In the third part I talked about fending off the sharks of fear. In this last part I talk about Shark-proofing your market – how to banish fear permanently.

The Sharks of Fear: Beyond Shark Repellent

There are Four Sharks of Fear:

1. Execution Fear. “I might mess up in doing this sale; I might not do it right.”
2. Competence Fear. “I might not know how to do this sale right; I may not even know I don’t know.”
3. Outcome Fear. “I might not get the deal at all – everything I wanted to happen won’t happen.”
4. Shame-based Fear. “They’re not going to like me or respect me anymore; and they’re probably right.”

While each can be dealt with tactically (see part 3), fear is a classic case where an ounce of prevention is better than a pound of cure.  So – how do you conduct your selling life in ways that keep the Sharks of Fear permanently at bay?

It can be done.

Five Keys to Vanquishing the Sharks of Fear in Selling

First, let’s be clear where the solution does not lie. It is not in your sales process. You won’t find the key in sales management, and you won’t get there by tweaking your value proposition.

Instead, it consists of constantly applying five principles, or values, to every aspect of your selling life.  And here they are.

1. Always Sit on the Same Side of the Table. You are on the same team as your customer. Your interests are allied. There is no such thing as win-lose or lose-win, there is only win-win or part on friendly terms. You are not playing a zero-sum game, you are looking for a mutually beneficial relationship.

Don’t speak, write or think anything that posits you vs. your customer – your proper seat is on the same side of the table as your customer.

2. The Customer Gets Theirs First. The way to a successful partnership is not by insisting on 50-50 from the outset and at every step of the way. It comes from being gracious, putting the customer’s needs first, offering up some value, taking some risks, and listening before talking. The single best behavioral tool you can employ for this principle is – listen empathetically, long, and well. The result is that, when it’s your turn, you will be listened to in the same way.

Yes, a trust-based partnership has to work for both of you; but you get there by being willing to first focus on the customer’s needs, not your own.

3. Play the Long Game. The most powerful force in selling is the natural human tendency to return good for good, and bad for bad. Again – the most powerful force. Time, though of this way, is your friend, because time lets you develop relationships, not transactions. The more you develop relationships, the more your transactions will have context; and it’s a context of mutual courtesy, obligation and goodwill.

Don’t think of the sales process as a transaction, to be repeated. Think of it as a relationship, with ongoing interactions, but with a permanence all its own. And remember – the way you behave is the way you will be treated in turn. You empower what you fear; and you get back what you put out.

4. Keep No Secrets.  Transparency is to fear as a cross is to vampires. If you have no secrets, then there can be no surprises. If you don’t know something, say so. If you have information, share it. If you’re the best for the job, say so and say why. And if you’re not, say so as well – and that will be a lot more believable. Be the same person at all times to all people.

There are three exceptions, of course. Don’t give away trade secrets; don’t do anything illegal; and don’t hurt someone. Other than that, deal strictly in the Truth in all your affairs, and no one can or will fault you.  (And if you think giving away all your information will empower your competitors, think again – they can never replicate your relationships).

5. Lead With Your Chin. The thing that triggers trust, allows you to play the long game, and encourages collaborative reciprocal behavior is to be the one to take the first risk. Never mind what Ronald Reagan said – there is no trust without risk. If you want to create trust, you must lead with risk-taking.

Talk price early, not late. Admit your shortcomings up front. Give away samples – especially if you’re in an intangible services business. Have a point of view. Go out on a limb. Invest a little time, rather than checking your sales efficiency watch every minute. Dare to empathize.

 

That’s it. If you conduct your sales life by those principles, about 90% of customers will return your behavior in kind. The other 10%? Leave them to your competitors. Life is too short. And be assured, they won’t do as well as you and the 90% anyway.

Riding the Shark: Vanquishing Fear in Selling, part 2 of 4

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4 Sharks Of Fear (photo via Iggy.)There are many ways to think about sales and selling. You can focus on value propositions, sales processes, sales management, motivation, techniques, and models. In this blogpost series,  I focus on something else that’s common in sales – fear.

In Part 1 I talked about the importance of dealing with fear in sales. Here I’d like to talk about how to recognize and categorize fear. In Part 3 I’ll talk about solutions, and in Part 4 I’ll talk about Shark-proofing your market – how to replace fear permanently.

The Four Sharks of Fear

There are many ways to categorize fears, just as there are ways to categorize sharks. I like to lump them in progressively more fearful categories, from relatively tame to terrifyingly fearful.

  1. Execution Fear. “I might mess up in doing this sale; I might not do it right.”
  2. Competence Fear. “I might not know how to do this sale right; I may not even know what I don’t know.”
  3. Outcome Fear. “I might not get the deal at all – everything I wanted to happen won’t happen.”
  4. Shame-based Fear. “They’re not going to like me or respect me anymore; and they’re probably right.”

The first thing you’ll notice about that list is that it gets “worse” as you go down the list – it starts off with incomplete education and ends up with self-loathing. All of us find it a lot easier to deal with the former than the latter.

But they all can drive equally negative impact on sales.

How Fear Affects Selling

Whether your fear is tactical, existential, or in between, it will keep you from doing something right.

  1. If you have execution fear, you are likely to not make the call, schedule the appointment, or send the email. You will be physically not present. You will miss opportunities and appear undependable.
  2. If you have competence fear, you are likely to appear ragged, unconfident, changeable and second-guessing.
  3. If you have outcome fear, you are likely to annoy everyone around you, because you try to over-control, micro-manage, obsess, and frequently blame others; you are in a bad mood because the world doesn’t obey your commands.
  4. If you have shame-based fear, you are mentally not present; you are probably chronically sick, or often busy elsewhere; you are probably inconsistent, moody, and often a poor listener. And in sales, the inability to listen is a major handicap.

Have you been mentally jotting notes?  Write them down. Which type of fears do you seem particularly prone to?

Negative Feedback Loops

One of the most pernicious aspects of fear is its self-fulfilling nature. If you don’t make the appointment for fear of making an error, you have made an error. If you’re afraid of appearing competent, almost anyone will perceive that fear and interpret it as – incompetence.

If you’re afraid of a bad outcome, some kind of karmic rule of life intervenes – you nurture what you fear. And if you are ashamed of yourself, nobody will be comfortable  being around you; which of course is more fish-food for the shark of shame.

This feeds-on-itself aspect of fear is powerful – picture a feeding frenzy when sharks congregate around some little piece of distress, compounding the terror.

The Wrong Shark Repellent 

Unfortunately, people are almost hard-wired to respond badly to the Sharks of Sales. In the real world, if we see a shark in the water – we run.  Good call; avoiding the shark is the right thing to do.

But with Sales Sharks, that’s exactly wrong. In almost all cases, fear of doing something wrong drives us to not do something that is right. Think sins of commission and sins of omission.

We are so afraid of saying the wrong thing that we say nothing. We may not lose what we have (dignity), but we create a much bigger failure to get something we wanted (the sale).

Imagine a lifeguard who sees someone drowning. If the guard dives in to save the person, and it turns out the person was just playing, the lifeguard may be slightly embarrassed, and feel put out.

But what if the person really was drowning and the lifeguard thought, “Well, I’d look stupid if I dove in after them and it was a false alarm, let me wait a bit longer and see.” Wrong answer!  Yet that is the mistake that fear drives us to make in sales.

The pattern is clear: fear drives us to avoidance, which ensures failure. You can probably envision some of the solutions to fear in sales, but in any case, that’s the next post. Stay tuned.