Welcome to The Pipeline.

Personal Deficiency Bonus0

By Tibor Shanto - tibor.shanto@sellbetter.ca 

2nd prize

With special thanks to S.G. and my friend B.P.

Everyone, including me, writes a piece this time of year about closing the year strong. For the most part these are aimed at front line sales people, and the better ones offer choices that make sense year-round even if initially implemented in Q4. Few are aimed at helping managers in helping their sales team adopt new habits, or create breakthroughs for their reps that can again be extended as a regular practice, and that is the thought here, helping managers, or actually sales coaches, which good sales managers are.

Often when speaking to managers they point to “that one thing”, that if the rep in question would change or address, it would have a dramatically beneficial impact on their execution and results. A personal deficiency. Could be anything, tardiness in updating the CRM, slow to move on renewals or price increases, insufficient preparation for prospecting, you name it. These elements are important to achieving results, and are often included as elements of a balanced scorecard. But the fact remains that most bonuses are paid out based on achieved results or specific objectives in the case of MBO.

Traditionally bonuses are meant to reward positives, and negatives either limit or eliminate rewards. But what if you turned things around. What if you put a positive focus on personal deficiencies, hence the Personal Deficiency Bonus.

Here is how it goes. Say you want a rep to develop a habit, any of the above, we’ll pick prospecting prep. Say a rep is consistently hovering just below quota, Based on their personal metrics, it is clear that two or three more first meeting with prospects would give him/her enough prospects to get them to quota, they just need to develop the habit of being prepared in order to land those meetings. You know, they know, you talk about it in the usual terms, but nothing changes. I would argue because the reward is paid out on something other than what needs to change. So let’s put a focus on what needs to change. And it’s not more sales, not more prospects, but more, better and consistent prep, bonus that.

In Q4, pay some portion of their bonus on changing that one habit, more prep for prospecting giving them more prospect meetings, leading to more pipeline opportunities, helping them exceed quota. It offers a coaching opportunity, with a more willing participant as they get paid not for an abstract related outcome, but for the specific deficiency, prep.

What you’ll find is that once they develop the habit, they will stick with it, next January and beyond. More importantly a rep who can now be coached and taken further, sometimes by focusing and rewarding the positive, but also by focusing on their Personal Deficiency Bonus.

What’s in Your Pipeline?
Tibor Shanto 

Is Sales a Numbers Game? (#video)3

By Tibor Shanto - tibor.shanto@sellbetter.ca 

TV Head

Nobody talks about the world being flat or round, so why does this topic merit discussion, there so many other more important unsolved mysteries in sales.  Take a look at what I mean:

What’s in Your Pipeline?
Tibor Shanto 

Are Buyers Liars?3

By Tibor Shanto - tibor.shanto@sellbetter.ca 

TV Head

 

Of course not, prospects are liars. No no, that’s not true either. It is less about lying, and more about rationalizing why we lost, take a look at what I mean:

What’s in Your Pipeline?
Tibor Shanto 

Seriously – You’re Not That Different – Sales eXecution 2640

By Tibor Shanto - tibor.shanto@sellbetter.ca 

Different 3

Being different seems to be really important to some people in sales. From their buyers, to product, to the way the sell, people want to cling to being different. It is like “Difference” is some sort of badge of honour, a reason to pay a premium, or worse, a rationale for results.

You often hear people talk about how the complexity of their sale makes it different. But all sales are complex in their own way, just because one may have more moving parts than another, does not make it more complex or different. Sure the moving parts in selling desalination plants may differ from those found in selling business process outsourcing, but the core components and core execution, not that different. Wanting it to be different does not change the fact that it has to be executed along a defined path (or process, you know, that’s a bit more complex), and one step at a time.

The “sophistication of the solution”, does not equate to “different” or “complex”. Just ask someone selling a fairly simple and standard product, in a highly competitive, price sensitive environment; these sales people have a much more complex selling challenge, especially if they can maintain price integrity. But in the end there is less difference than many sales professionals would want to pretend.

I remember meeting with a VP of Sales with a “Solutions Provider “, and indeed they had a product that was “cool”, and in demand, addressing a common requirement in their target market. From the time we met at a conference he was into the “I am interested in what you do Tibor, but you gotta understand we’re different.” I don’t know, he like everyone at their booth, had two arms, two legs, a big mouth, didn’t seem that different, maybe I’ll figure it out when we meet at their office.

Later at the office, he was right back at it, preaching the (invisible) difference. As one who likes to break the sale down to logical sequential steps, I thought I would explore.

TS:     So let me get this straight, your people do not have to prospect, you went to the conference because you had marketing budget to blow. You normally have prospects lined up out the door, but you knew I was coming this morning, so cleared a path for me?

VP:     No, no, our folks have to prospect, they need to make calls every day, I have them working the show leads now, those shows are expensive, I am always reviewing their activity, and we should be converting more of these leads, especially with our product.

TS:     OK, but once you get in front of the prospect, it is smooth sailing, they get it, and want to switch or buy right away, no?

VP:     I wish, we have to needs assessments, work through a bunch of data, and for sure three demos, sometimes more.

TS:     But at that point, they just ask for the proposal, and away we go.

VP:     Rarely, we have to help them maneuver internally, that’s why we end up doing multi demos, and data crunching, all the players involved.

TS:     All laid out in your process, right?

VP:     Not really, what we laid out should follow a different path.

TS:     But once you present the proposal, it’s done, no back and forth, no negotiations, no price haggling.

VP:     Are you kidding, even after all that, we still have to deal with that, all the ROI we show them, and we still go through that.

TS:     So tell me again how you are different?

What’s in Your Pipeline?
Tibor Shanto 

KPI’s – What Are They To You?0

By Tibor Shanto - tibor.shanto@sellbetter.ca 

Impact Question

Talk to any ‘executoide’, and KPI’s (Key Performance Indicators) are bound to be part of the conversation. Nice and practical concept, good resume fodder, often misused or abused by many, especially from a sales point of view. I often get the sense that many see KPI standing for Key Political Initiatives or Key (to my) Personal Incentive.

As a concept, KPI’s are great, helping sales organizations in defining and measuring progress against stated objectives or goals. Determined in advance, measurable and quantifiable, they are instrumental in helping to assess progress, and plan course correction if needed. Examples in sales may be lead to opportunity conversions, or proposals to close. Based on these measures you can make adjustments and respond to conditions on the ground to ensure those goals are attained. You often hear sales managers and director speak of how they are doing against their KPI’s. Looking at it that way can be a part of potential problems.

In the wrong hands, with wrong intents, the best concepts can come back to bite you; in sales it is usually the disconnect between what’s being measured and the desired results. There are many KPI’s being met without delivering the intended result or economic benefit, leading to a culture of measurement rather than success. When reps feel measured instead of being led to success, they turn to rationalizing their performance with the very same KPI’s. I hear reps say “well I delivered against the KPI, I got eight meetings every week this quarter.” Or “what do you want me to do, get sales or complete the KPI’s you gave me?”

It doesn’t help when sales leaders are incented on meeting KPI’s rather than result. While I am a big proponent of paying for success based on leading indicators, it should be on how those leading indicators are leading to consistent and improving results. Without that, when you pay for a checkmark, you get checkmarks, you pay for results you get results.

I was recently contacted by a sales director about training the team. As we discussed the program and roll-out, he insisted on doing things the first week of every quarter, when I asked why, he told me team quarterly development was one of his KPI’s, and the team meets the first week of each quarter. We assessed the team, had input from a number of people in the company, and customers, and designed training that required two days of delivery at the start, followed by Renbor’s Follow-Through Action Plan regimen. He loved the program, but asked that I cut it down to a half day. “What do you want me to cut?” “No no, I love the program as is, we just need to do it in half a day, I have to include some product training in October as well (another KPI no doubt).

No matter how much I tried to impress on him that he was making a mistake, he insisted. Knowing the type, that when things hit the fan, I will be blamed for the failure, even as he collects his KPI based bonus, I confronted him. I revamped the program to make it a one day affair, but he was still reluctant; half glancing at his phone as he explained his situation, including meeting KPI’s. I finally offered to send him some workbooks, pre-filled certificates he can distribute, come in and read a few pages to the team, and he could hit his KPI, and not bother with the challenge of training, but still be able to put the tick in the box next to training. “That’s your goal right?”. I swear he thought about it for a minute before realizing he was being mocked.

We finally agreed to the abridged one day program, with a clear understanding that we would include the remaining material into the January training. Now I have four months to work with and on the executives to change things, either the director or his KPI’s.

What’s in Your Pipeline?
Tibor Shanto 

To Shine or Not To Shine – Sales eXecution 2620

By Tibor Shanto - tibor.shanto@sellbetter.ca 

Shoes

Vote in the poll at the end of the post!

Given that it is a holiday Monday, at least where I am, I thought I’d explore a lighter side of sales, but one worth pondering for a number of reasons. It comes down to how we present ourselves and how the buyer sees us, and it’s impact on their thinking and outcome of our efforts. I want to share with you two viewpoints, not sure where I land but interested in your views.

I know a couple of sales people, both guys, both top rate, as evidenced by their numbers and the quality of conversation when you meet them. They share a number of views on sales and their success, and they each have habits or in some cases rituals or superstitions that they rely on for their outstanding success. One point of key difference is shoes; yes I said shoes, we’re you expecting closing techniques?

One will call Mo, not because it’s his name, but we gotta call him something. Mo never wears new or clean shoes to an important sales call, especially what is commonly called a “closing meeting”. His view is that he does not want to upstage the buyer, his way of not wanting to appear to be better than the buyer, or flaunt his success. While he puts on a clean suit, freshly ironed shirt and the appropriate smart ties, there is never polish on his shoes. “I look professional, but that I still need your business.”

Bob (not his real name either), goes to the other extreme, what he does to his shoes before key meetings is nothing short of a ritual; in fact when you consider his closing ratio, it approaches being a religious experience. Bob buys all his “Power Shoes” at the same shop. “If you’re going to close business right, you have to look just so.”. Emphasis on the so. “I am asking these people to trust, to put their success, the fate of the project in my hands. To do that I have to look like the embodiment of success, someone they respect, look up to, would want be if they were selling. Part of that means they should be able to see themselves in my shoes when they look down just before they sign. The shine on my shoes is the final reassurance they need.”

Bob shines his shoes every weekend no matter what is in his pipeline. But the day before the close meeting, he goes into a higher mode. He pre cleans his shoes, then applies a specific polish, lets it sit for an hour, the using a special cloth r something he buffs and shines that thing till it looks like a mirror. He credits his days as a cadet for his prowess.

They are both exceptional sales people, they are both into the shoe thing, I am not sure what it has to do with their success.

What do you think: [yop_poll id="2"]

Tell us about your sales rituals!

What’s in Your Pipeline?
Tibor Shanto 

Micromanage Me, Please0

By Tibor Shanto - tibor.shanto@sellbetter.ca

microscope

The best way to turn a positive in to a negative is to give it a nasty name. A great example in sales is the use of the word “Micromanagement”, a favourite among those looking to shirk some responsibility and/or accountability that comes with “Active Management”. VP’s, Directors, Managers, and Front-line reps all love to throw up the Word to avoid dealing with issues and/or challenges they face but don’t like, i.e. “Active Management”.

I do want to acknowledge that real micromanagement, the wet blanket type, in the classic sense is not good (most of the time), but what a lot of people in sales label as micromanagement, is nothing more than active management. This includes real expectations, measured or tied to benchmarks and metrics. And it is usually those who fall short on the measured areas who cry “Micromanagement”.

Regardless of the title, the role of the front line manager is to lead their teams in executing the process, by leveraging and balancing activities and the coaching of their team to consistently better execute the high value activities that drive the process. Straight forward enough but not necessarily simple.

Let’s use the example of a core metric important in driving sales, one of the simplest, proposal to closing ratio. You would expect that most sales people would know their own, and that their manager would too, otherwise how could they possibly coach them. There are a host of indicators that can be used to manage activity and coach for improvement, of course as a leader you want to focus on the leading indicators.

I was interviewing a team last week, including their manager (he’s been around a while, so his title was VP, but he was a line manager), and when I asked him about some key conversion rates, he responded that he did not want to “get involved to that level, I don’t want to micromanage”. This would seem OK if they were blowing their numbers away, but that’s not why I was there. I asked what expectations are set either in terms of activities, pipeline coverage, or territory contact/coverage/penetration. And in all instances, the reply was basically that the guys are professionals, “do things their way, and don’t like to be micromanaged.” Apparently, they don’t like to exceed quota either.

When I asked about how the team was coached, the typical, “we talk every day, they call me when they have issues with a deal, and we meet once a month as a team to talk about the market.” Any coaching plans for the reps? “We do a performance management meeting every six months.”

When I spoke to the reps, I got their version of the “I don’t want to be micromanaged” routine.

Now we all know if I went back and asked them what their favourite ball player’s batting average, or RBI numbers were; or +/- in hockey, they would know it. I am willing to bet that if a ball player didn’t follow the coach’s system, they would expect the coach to get involved, and why not, just look at the success Phil Jackson was able to drive with his process, was he micromanaging? Or if someone was not producing as many goals as in previous years, they would lead the “trade them” charge. If the team was underperforming they would be calling for the coach to be fired, but not when it comes to their performance, the very same expectation would be met with the “micromanagement” cry.

Active management is a must for any professional team to continue to outperform their competitors, sales is no less a profession. You want to succeed, embrace active management.

Hey, if you liked what you saw here, invite me to speak at your next meeting!

What’s in Your Pipeline?
Tibor Shanto 

Game the Plan – With Chris Cabrera0

By Tibor Shanto - tibor.shanto@sellbetter.ca

Game the plan

Almost everyone in sales will tell you that incentives drive behaviour, but beyond that there is often little agreement among the pundits as to what the right incentive plan is. Some see it as a black art, while others, usually sales people, see it as something to manipulate, hence the expression ‘gaming the plan’. But ask Christopher Cabrera, founder, president and CEO of Xactly Corporation, who has a different view, and believes that front line reps and CFOs do not need to be at odds when it comes to incentives. In fact, Cabrera literally wrote the book on incentives, “Game the Plan: Every Sales Rep’s Dream; Every CFO’s Nightmare”, which suggests that when it’s done right, reps can and should game and maximize the plan, and everyone wins.

I had the opportunity to discuss incentives and the book with Cabrera, and ask him some questions many of my clients ask when it comes to their challenges around incentives and driving behaviour that leads to everyone’s success, buyer, seller, and company.

One aspect of the incentive where the pendulum of opinion swings back and forth is between simplicity and complexity of a plan. While some try to engineer things down to the minute detail, others, look to perhaps over simplify by offering 100% commission based pay. As you would suspect, the reality is somewhere in between. Cabrera’s view is that 100% is not the most effective, but over engineering a plan has faults as well. He suggests that structure is much more important than the specifics. What “counts is the number of measures; there is a strong correlation between the number of measures and a successful plan.” Measures being the elements being paid on, Cabrera suggests that optimal number is three measures being incented. As you exceed that number, you lose focus and therefore the effectiveness of the plan.

Another factor was the number of people being paid on any given deal, an extreme example Cabrera gave was a company that had over a hundred people on any given deal. He suggest that the right number of people is five.

Cabrera is also a proponent of paying different rates on different products. While paying on net revenue is a start, companies should also incent higher margin products at a higher rate, thereby driving sales and higher profits. He also discussed that managing activity is the role of management not the incentive plan.

Another area of discussion was the use of SPIFFs (Sales Promotion Incentive Fund). Cabrera explained that while this was an effective practice, companies need to keep them fresh and not overuse them. “Keep them guessing by changing the annual cadence, if they know it is coming and when, it loses the desired effect.” He also recommends that they not be overused, three times a year, and at different times, for different element. Tying them to quarter end each time really misses the mark.

The thing that gives the book teeth and makes it a must read for sales leaders and sales people is not only Cabrera’s own extensive experience in the field of sales incentive and incentive management. But more importantly, the volume of data that is available to him as a result of the work Xactly does. The ability to leverage the empirical, anecdotal and other elements give Cabrera, the book, and by extension the reader, an unparalleled level of insight into incentives, and doing it right.

What’s in Your Pipeline?
Tibor Shanto 

Customers, Employees and Influencers as High Performing Sales and Marketing Channels1

Beedon Headshot

The Pipeline Guest Post – Dick Beedon

Although brand advocacy has always been important, it is critical today. The path to purchase has changed forever. Because there is so much data available, and because communication is so easy, today’s buyer almost always seeks advice from a trusted friend or consumer source before making a purchase. Brands are now starting to realize that what others say and write about them defines who they are.

Smart brands know they must build strategies and systems to generate, track and manage brand advocacy. They know they must encourage and enable the people that know and trust them – their customers, employees and 3rd party influencers – to advocate on behalf of the brand.

And it works. By encouraging and empowering these customers, employees and influencers, they will drive peer-to-peer referrals, forward content, share information about new products and promotions, and write testimonials. And they can do it at scale and more efficiently than traditional channels.

The Benefits of New Channels are Compelling (examples)

  1. They Build Brand Awareness – when a customer shares something about the brand with a friend, there is no better way of building the brand.
  2. They Generate Leads – those friends that respond and go to the brand for more information become the best leads a brand can get. There are few people on earth who will argue that leads generated from referrals are the best leads. 
  3. They Drive New Customer Acquisition – Leads from referrals close faster, they buy more and they stay longer. 

Other reasons customers, employees and influencers make good sales and marketing channels;

1.  Identify Brand Advocates and Build a Rich “Social” Data Set

Brand Advocates are identified when they register for or engage with your programs. By using technology systems, brands know who “opts-in” and advocates, how often they do it, what their sharing preferences are and how big their network is. We learn who they know and how influential they are. Brands are able to now get a deeper 360 view of their customer’s network value.

2. You’ll Know when Potential Customers are “In-Market”
Social channels provide insights and information not previously available. At the most basic level, social channels extend a brand’s sales force (with zero overhead) and they solve one of the biggest challenges brand’s face: knowing when a potential buyer is in-market. Only your current customers know when the people they know are ready to buy.
3. The cost of acquisition is lower.
This channel is always on and continually active – making referrals, amplifying products and promotions, and posting positive information about your brand. Brand advocates do this for a brand because they trust the brand and they want do it. Therefore, the time and cost invested into this channel is significantly less than other channels.
4. New customers that are referred by someone in your Social Channel are Valuable.
Research has consistently shown that consumers who convert as a result of a referral from a friend, are more loyal to a brand, spend more and stay longer.

Who are your Potential Channels and how Well can they Perform?

Customers, partners and employees are the fastest growing sales and marketing channel today. By utilizing the latest in social marketing software and technology, business leaders can mobilize these social relationships to generate new customers, and they can track and manage social behavior that is critical to the success of their company.

Customers recommend your products because they have first-hand, positive experience with them.

Today’s truly successful companies understand the importance of leveraging their customers into sales and marketing channels that drive corporate productivity. Creating and cultivating a large group of advocates can: pay huge dividends in the growth of your brand, increase subscribers, and boost profits. The financial investment to create this channel is minimal when you compare it to the long-term payoff for the brand.

About Richard Beedon

Richard Beedon is a founder and CEO of Amplifinity.  Beedon has led the acquisition of both Entyre Doc Prep (by Wolters Kluwer) and University Netcasting, who merged with Student Advantage (now collegesports.com) and was acquired by CBS. Dick’s thought leadership and early adaption of SaaS based technologies that allow brands to manage advocacy marketing has been instrumental in the success and growth of Amplifinity.

Dear Sales Diary3

By Tibor Shanto - tibor.shanto@sellbetter.ca

Diary

Those of you have kept or keep diaries, know that one of the reasons it has such great value is not just because you open up about intimate secrets, but that you share everything, not just the good, not just the bad, but all that and everything in between. You were able to go back and relive the experience, and more often than not glean lesson and things you would do differently if you had to do them all again. You didn’t just look at what you did well, or things that turned out to be good, living up to and beyond your expectations. You looked at the bad things that happened and tried to understand how you might avoid similar things in the future. The more honest you were the more rewarding the experience. If you skewed or slanted things one way, you may feel better for a while, but reality comes creeping back in, forcing us to deal with the bad, and the gray.

Sales people and sales organization need to keep a diary of their experiences, all of them, the good, the bad, and the in between. Most already do deal reviews in some format, but many do not, either choosing to them selectively, or just enough to satisfy a KPI or ScoreCard requirement. Few do the real deep dive required in order to get the most out of it, in the process allowing both a learning and revenue improvement get away. To be clear, and as you will see further on, “deep dive” does not have to be a laborious time consuming exercise with minimal payoffs, it can and should be an ongoing process that helps you with deals you are currently involved in, while also allowing you to capture and repurpose things on the fly. Done right, it should resemble the old EDS add about building an airplane while it is flying, the opportunity for sales people and organizations, is to build a continuously better sales, even as they are executing current sales, and prospecting for their next one.

Specifically this involves reviewing all deals you were involved in, those you won, those you lost, and those which go to “no decision”. Note, if you are involved in ten to a dozen deal a month, I recommend you review all of them; if on the other hand you are involved in dozens of deals, you may want to review a representative sample. If you have 7 wins, 15 losses, and 6 no decisions, review 25%, or seven, and you will get good, executable output. But as you’ll see, even if you don’t formally review each one, you will produce usable output.

Now some of you reading this may be aware that I am the coauthor of an award winning book about Trigger Events. In that book the recommendation was that you focus your reviews to only those deals you win. This will allow you to continuously repeat those things that are consistently help you win deals. Sound thinking, to a point. Let me explain, coauthoring a book is a lesson in compromise, you give you, you learn, you take, and in the end you produce a book that reflects the learning of both. But as you move on, the hope is that both authors evolve, not limited by the required compromises, and we each continue down our path, shaped by or experiences.

Since the release of that book, my thinking has evolved to where I see focusing strictly on one segment of your activities and only one of many outcomes, brings an unnecessary level of risk to one’s sales success, regardless of which one of the three possible outcomes you focus on. Given that on average, wins make up less than half of potential deals, if for no other reason than to broaden you perspectives, you should review outcomes other than just wins.

This is why the 360 Deal View was developed. It allows you to capture relevant information about the sale, the outcome and specific contributors to that. As with most tools, it is less about the tool itself, and much more about the approach and behaviours it promotes, which in turn lead to the desired results in more repeatable, predictable and consistent ways. It allows you to evolve you selling along with the way your market and buyers evolve.

While there is no denying that you want to know exactly what you are doing that is helping you win, you want to know what unfolded on the buyer’s side that prompted them to engage, and what outside and inside factors accelerate your sales cycle or cause it to slow and stall. What were the buyer’s objectives that allowed you to gain traction, and how you were able to connect with those? All important things you want to leverage. But it would be dangerous if not naïve to not go through a similar exercise with the other outcomes, losses and “no decisions”. Two simple advantageous to knowing why you lose, first, it may just take a small adjustment to change some of the inputs that will move a loss to the won column. Second, you may discover that a segment that made sense on initial exploration made sense to pursue, based on practice does not. Looking at “no decisions” will often allow you to understand when would be the best time to reengage, and take the cycle to fruition. It will also help you detect tire kickers a lot earlier.

These will be fallouts if you only review wins, but there is no denying that focusing on just one area, will lead to tunnel vision, causing you to miss changing trends that are more evident in the other categories, and more importantly, leave you very open to be blindsided. If you rely on one set of data, you will continue to find others who fit the mold, but it does not speak to the size of a market, things can continue to look good in a shrinking market, and by the time you react, many opportunities will have been missed, and competitors will have made unnecessary gains at your expense.

Most CRM’s and related apps will allow you to do a complete all three, and even allow you to get more granular if need be. You can download our tool here, but the key to success is not the tool, but the philosophy, and more specifically the discipline of doing it in up, down, or sideways markets. Just as with a diary, the best ones were usually written in simple notebooks, not fancy specially diaries, what made them great was the depth and completeness of what was captured, and the consistency of execution.

What’s in Your Pipeline?
Tibor Shanto

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