Sales Machine

Many companies struggle with forecasting, big time and many sales forecasts are consistently dead wrong.  They spend a lot of time and energy and don’t get all much out of it.

Here’s how the sales forecasting process usually goes:

• Step #1: The sales reps provide a forecast. Each sales rep guesses what he or she thinks she might be able to sell, and then predicts they’ll make about 5% less. That way, if a deal falls through, the rep can still make the number, but if not the rep will look like an over-achiever.
• Step #2: The sales managers adjust the forecast. Because each sales manager knows that his sales reps are padding, he adds and subtracts from whatever numbers he gets from the sales reps, reflecting his best judgment of what he thinks will really happen.
• Step #3: The sales VP re-adjusts the forecast. Because the sales VP knows that the sales managers are changing the numbers, he figures that the numbers aren’t accurate, so he plays around with them some more, adding and subtracting as necessary.
• Step #4: The marketing VP does his own forecast. Because the marketing group doesn’t trust the sales group, they make their own forecast, usually based upon the numbers they would like to make combined with some BS market research.
• Step #5: The head of manufacturing does his own forecast. This long-suffering individual actually has to worry about inventory and other issues, so he makes his own forecast of what he’s going to build, hoping that whatever he builds will actually be sold.
• Step #6: The CEO makes up a new forecast. The CEO wants to make sure that the stock price keeps going up (thereby increasing the value of his options).  So he tells the investors that the company will make big numbers. He then tell the rest of the company to go back and change their forecasts match his promises.

Frankly, most of this activity isn’t all that useful.  It only creates an illusion of predictability, when in fact there is very little predictability when it comes to selling.

I wonder sometimes whether it makes sense to spend all that time and energy on what’s really just an internal political rock-fetch.

Wouldn’t it just be easier to look at what was sold over the past few months and assume that the next few months will follow about the same pattern?

Honestly, in most cases, I think you’d probably end up with a forecast about as accurate as the one that emerges from all the organizational brouhaha.

What do you think?

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Here’s a post you can share with your customers… if you’re brave enough.

I recently had a conversation with a professional buyer who deals with millions of dollars of B2B contracts.  I asked him what advice he’d give to other buyers. He answered, providing I’d keep his name a secret.  I agreed.

Here’s what he had to say:

• LAW #1: DON’T hire a vendor just because they give good presentations. It’s a myth that a vendor’s ability to help you can be gauged by how well the firm can sell. Unless you’re planning to learn from their style, a vendor’s ability to sell is completely irrelevant.
• LAW #2. DON’T hire a vendor just because they’ve helped you in the past. It’s a mistake to choose based purely upon a positive experience in the past. While the vendor’s products may have been useful once, they’re not necessarily the products that will serve you best today.
• LAW #3. DON’T hire a vendor just because you’re impressed by their CEO. CEOs are often dynamic, charismatic individuals that can wow a crowd at a conference or webinar. However, that doesn’t mean that the vendor has a product that’s useful for your company.
• LAW #4. DON’T hire a vendor because they’ve worked with your competition. If the vendor is responsible for your competitor being successful, then there’s a good chance they’ll try to clone what they did before. Imitating competitors is a go-out-of-business strategy.
• LAW #5. DON’T hire a vendor because they’ve got “best practices.” “Best practices” inside one industry may be nonsensical inside another. Even within one industry, the “best practices” that work for one firm may not work for a firm with a different strategy.
• LAW #6. DON’T hire a vendor just because they’ve got a good brand name. Going with a top vendor just because of their reputation is like buying a car just because it has a familiar name. Common sense says to decide what you really need before you pull out your checkbook.
• LAW #7. DON’T EVER hire a vendor who exaggerates or misrepresents. If your drill-down reveals that the vendor is not being entirely straightforward, remove that vendor from the short list.  This is one case where “zero-tolerance” must always be the rule.

READERS: Do you think he’s right?  Or are these laws getting in the way of buying the right products and services?

Yesterday, in “How to Kill an Objection For Good“, explained how to put an objection permanently to rest. It’s a useful, classic technique.  However, I would be remiss if I didn’t point out that there’s another school of thought when it comes to objections.

Some experts in selling techniques believe that answering objections individually is like playing whack-a-mole with hydra heads.  You can’t really win, because all objections are actually just reflections of the customer’s state-of-mind.  Objections are just another way of saying:

I am not yet convinced of the value of buying.

This school of thought believes that should focus on working with the customer to create a value proposition that makes overwhelming financial sense, and then the individual objections will disappear.

It’s really a profoundly different way of looking at sales.  The traditional sales model assumes that the sales professional is actively persuading the prospect to buy, in which case overcoming objections is simply part of the sales process leading to the close.

In the more consultative model, the sales professional is supposed to be helping the customer decide whether or not buying makes sense — and is willing to concede that it might not make sense.  In this case, objections aren’t all that important.

READERS: What do you think?  Is it possible to sell without answering objections?

SCENARIO: You’re tasked with selling CRM solutions to large enterprises.  On a puddle-jump flight, you end up sitting next to the Sales VP for a big company.  He asks what you do for a living and you tell him.  He says that they “have one of those”, but he makes a wry face, so sense that he’s not satisfied with it.  Your challenge: turn the situation into a sales opportunity.

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CLICK for the correct answer »

According to John Asher, CEO of the sales training firm Asher Strategies, there are 10 key sales skills, without which you will never reach your potential as a sales professional. I think there’s a lot of wisdom in what he has to say, so I’ve created a post to help you assess your own skill level, for each of these key skill.  I’ve also provide a link to a blog post that can help you develop any key skill which needs improvement.

I truly believe that this could be the most useful quiz I’ve ever posted here.

Give it a try, and tell me what you think!

CLICK for the first key sales skill »

The powers-that-be have reminded me that this is supposed to be a SERIOUS blog, and that stuff like Top 10 Sales Tips from the Seinfeld Show distracts from that purpose.  With that in mind, here is a series of videos that explain, in six easy steps, exactly how companies make buying decisions for mission-critical B2B solutions.

Step #1: The Customer Sets a Corporate Strategy

Your customer’s corporate strategy is the most important determinant of whether they will purchase your offering.  Therefore, it is essential to understand exactly how they’ve set that strategy, which will determine the basic parameters of their business model.

Note: This video has two segments; ignore the second part.

CLICK for step #2 of the customer buying process »

If you want to build business by word of mouth, you’ve got to have the kind of story that customers and prospects tell each other.  You need to give them something called a “useful, compelling narrative.”  Let me explain.

A narrative is a simple story (i.e. something with a plot, a protagonist, and an antagonist) that’s easy to for one person to tell another.  A compelling narrative is one that has an emotional component that inspires people to tell that story to others, thereby creating word of mouth.  A useful compelling narrative is one that drives desirable behavior — like convincing prospects to give you a call.

Every successful word of mouth campaign has a useful compelling narrative.  Here are two classic examples:

• Basic Narrative: Apple computer (the protagonist) wins hearts and minds (the plot) from IBM (the antagonist).
• Why It Was Compelling: It’s a classic underdog story that makes the “little people” feel powerful.
• Why It Was Useful: It established Apple Computers as a niche product category.

• Basic Narrative: Media outsider Matt Drudge (the protagonist) reveals secrets (the plot) missed by mainstream media (the antagonist).
• Why It Was Compelling: Some people distrust mainstream journalism.
• Why It Was Useful: It established Drudge as a marketable alternative, creating a site with ad revenue.

Although the two examples are very different, in both cases, the narrative was easy to tell, with easily grasped emotions, and drove towards a clear business model.

In sales, your narrative almost always has the same plot: how the customer (the protagonist) worked with you (the plot) to overcome a problem (the antagonist.)  Note that you are NOT the protagonist, but part of the plot line.

Remember: the word of mouth that builds your business is the story that your CUSTOMER tells about himself.  It’s not about how wonderful you were at helping them, but how smart the customer was to work with you in order to solve the problem.

The reason that the recipient of the story calls you (creating the all-important referral) is because the recipient wants to be able to tell the same narrative (i.e. success story) to his or her chums.  And that’s what builds word of mouth.

Here’s another way of looking at it.  Which of the following customer remarks do you think are likely to go viral?

1. Joe is a great guy and easy to work with.  You should call him if you’ve got inventory problems.
2. We just saved $10 million by getting rid of excess inventory.  How?  I worked with Joe.

Obviously, it’s the second message that’s going to resonate (i.e. is compelling) and, more importantly, is more likely to be useful and drive some business your way.

Once you understand your “useful, compelling narrative,” you can create word-of-mouth sales by helping your existing customers to tell that story, either by asking them to act as reference accounts, asking that they call potential prospects, setting them up with speaking opportunities, and so forth.

There are few things more valued in a sales professional than being a “closer.”  If you know how to close, then you end up making as many sales as possible; if you lack that skill, you’re probably floundering.

So, then, how do you know if you’re a closer?  Looking at the number of sales you make — even compared to your peers — doesn’t tell you much, because you can still make big sales (but not fulfill your potential) if you’re strong in other areas.

A better way is to ask yourself these five questions:

• #1: How would I rate myself as a closer?  In fact, you probably know, in your gut, whether you’re good a closing business.  A little self-honesty goes a long way when it comes to self-assessment.
• #2: Am I cultivating the right attitude to close business on a daily basis?  Closing business is about laying the groundwork from the get-go.  If you’re not getting ready to close, you’re not a closer.
• #3: Am I dependent upon high pressure sales techniques?  If you’re using trick closes and high pressure to try to get business, you’re not a closer, you’re a peddler.  Different thing entirely.
• # 4: Have I ever delayed closing because I wanted to enjoy the fantasy of getting the business?  This is probably the most common debilitating behavior in sales.  If you’re doing it, stop.  Right now.
• #5: What would it be worth to me if I could easily and simply close more business?  If you can still  visualize making more money and creating more success, you’re probably not at your peak.  Not yet.

The above is based on a conversation I had a few years ago with the amazing and perceptive sales guru Linda Richardson, founder of the eponymous sales training firm.

Here are some posts to help you hone your closing skills:

• The ABCs of Closing
• How to Close Without Tricks
• How to Close the Deal, Perfectly

This morning I introduced you to Lt. Col. Rob “Waldo” Waldman, author of the newly published book “Never Fly Solo.”  About three years ago, I spent an hour with Waldo, being “trained” to fly on “sales missions.”  Here’s how to use the lessons of successful fighter pilots (i.e. Top Guns) in your sales process:

• Step 1. Achieve the right attitude. In combat, “The Right Stuff” is the attitude of confidence that a jet pilot needs to strap himself or herself into a vehicle that moves faster than the speed of sound and then start dodging missiles. In sales, “The Right Stuff” comes from knowing your objective for the call, relentlessly preparing for the call, and getting focused on the primary mission objective, which is helping the customer.
• Step 2. Gather intelligence. Before any flight mission, pilots gather every bit of information they can about the environment into which their jets will be flying - not just enemy positions, but every aspect of the situation that might have an effect on the mission. In sales, you gather intelligence by studying the customer’s website, press releases, current vendors, and your competition.
• Step 3. Devise contingency plans. The “fog of war” means that the real world and combat conditions are likely to change, sometimes radically, from moment to moment. In sales, you build a contingency plan by asking yourself “what-if” questions: What if they challenge me with price? What if they are currently engaged with another vendor? What if they ask for as referral? Have answers to these objections ready and waiting.
• Step 4. Mentally rehearse the call. Jet pilots always “chair fly” a mission, multiple times, envisioning the entire mission, including the effective handling of unexpected events and the final outcome.  Thisacclimatizes the mind to successful execution in the real world. In sales, this means envisioning the call in your mind - delivering your value proposal, asking the right questions, and rebutting her concerns.
• Step 5. Brief the mission. Immediately prior to a mission, jet pilots always review and confirm their mission objectives, roles and responsibilities, latest intelligence, and contingencies. In sales, spend at least fifteen minutes prior to any sales call going over everything you know about the customer, your overall plan for the sales call, your responses to objections and (this is important) the condition of your equipment.
• Step 6. Build Situational Awareness. Jet pilots know that the success of a mission depends upon their Situational Awareness (SA), which is their ability to perceive such as weather, enemy threat, airspeed, location of wingmen, fuel state, and terrain. In sales, SA means listening to the customer. Ask questions based questions upon research, listen to the responses and adapt your approach accordingly.
• Step 7. Document what happens. Jet fighters always have flight recorders that track exactly what happened at every moment of the mission. This allows a pilot to more easily replicate success, and avoid future problems. In a sales call, your “flight recorder” is your record every important detail of the call. You’ll need this intelligence to refer to next time you contact that customer for a follow-up.
• Step 8. Make your go/no-go decision. There comes a point in every flight mission where the fighter pilot needs to decide whether the mission, if pursued, will succeed or fail. Same is true in Sales. When your objective is met or when you feel the prospect is no longer willing to listen, end the call. But be sure you come up with a follow-on objective/plan for what to do after the call.
• Step 9. Debrief the mission. Fighter pilots always debrief a mission, in order to determine what can be learned and how the team can improve. After every sales call, take off your ‘rank’ so that everyone is on an even playing field. This facilitates open communication and allows you (and your support team) to admit their mistakes. Review the positive and negative events that took place and draw lessons from them.
• Step 10.  Execute the Follow-Through. Fighter pilots complete their mission by filing a report, requesting service on the aircraft, expanding their training commitments, and so forth, to make each mission part of a process of constant improvement. In sales, the follow-through is doing whatever it takes to develop the ongoing customer relationship. Most of all, it means delivering on your promises!

Powerful stuff, eh?  And good advice.

Happy hunting.

Want to sell more quickly?  Then you’ve got to be able to read your customer’s mind.  Fortunately for you, your customers are all thinking the exact same thing… in the exact same order.  The big questions is: do you know that order?  Here’s a little game that assesses how well you can read the customer’s mind when it comes to this all-important decision-making process.

When you first contact a prospect, which of the following questions is uppermost in the prospect’s mind?

• Does the value and price of this product meet my expectations?
• Is this the right time to make a decision to buy this product?
• Do I want to do business with the firm this sales professional represents?
• Do I want to do business with this particular sales professional?
• Do I want and need the product this sales professional is offering?