Sales Management Newsletter (1/3/2006) Featured Articles by Heather Baldwin
If the old saying about a first impression being a lasting impression is true then the most important meeting with prospects is the first one. What you do and say in that initial meeting either leaves prospects envisioning themselves doing business with you and interested in meeting with you again or you with more prospects who won?t return your calls. As another old saying goes, you only get one chance to make a first impression. No pressure right? That?s right, as long as you follow these eight tips from Robert Bly, an independent copywriter, consultant (www.bly.com) and author of Magnetic Selling (AMACOM, 2006).
1. Silence is golden. Nervousness or excitement can make any sales rep babble. Instead, sit back, ask one or two short questions, look friendly and expectant and let prospects tell you all about their problems. When you want to speak, force yourself to speak slowly and briefly.
2. Behave as if you already have the job. Sidestep the whole audition mode by leaving your sample case and PowerPoint presentation in the car. Bring only a pen and pad of paper. Start with questions about what prospects need; go home with an assignment.
3. Once you?ve heard their needs, you?ll know what to tell them about yourself. Mention only the bits that will identify you as the person they want. Find low-key ways to work them into the discussion. ?Don?t include your whole work history; use only the things that relate to prospects? business or problems,? cautions Bly.
4. Don?t show and tell unless you?re asked. In other words, don?t show your samples, resumes, job photos or brochures unless prospects ask for them. Remember, you want to be out of the job-applicant mode and in the consultant-on-the-job mode as fast as possible.
5. Project success. Prospects only want to associate with success so make sure you come across as a success. Don?t tell your sad stories; stress only the positive.
6. Don?t drop names. Name dropping tends to turn off or bore prospects. Besides, you run the risk of dropping the name of someone they despise. You also risk making prospects fear that you will betray their confidence if they hire you. So instead of stating that you recently did a big job for Pepsi Cola,, say:, I recently helped one of my large customers deal with a problem similar to yours, suggests Bly. The fact that you?re discreet when discussing other customers? problems will impress prospects.
7. Develop ways to end the meeting profitably. In other words, ask for the order, schedule a follow-on meeting or propose definite next steps. If it?s a meeting for a major project, try mentioning a smaller part of the project and ask to do it independently. Say to the prospect: Why not let me do that for you right now? Then you?ll have that taken care of and you can see firsthand how I work.
8. Don?t hang around. You?re an enthusiastic, friendly consultant who?d love to do business with the prospect. Because you?re so capable you?re also busy, so don?t hang around. Hanging around gives the impression that your time, which you?re tying to sell to the prospect for a hefty price, is not valuable.
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Sales Ineffectiveness?
Sales, more than any other operational function in a company, has the ability to make the difference between a ho-hum financial result and a great one. So you?d think most organizations would bend over backward to ensure their sales team was operating at peak efficiency. Unfortunately, that?s not the case. According to Proudfoot Consulting?s “2005 Productivity Report,” an annual international study of company-level productivity, salespeople spend almost 80%of their time not selling ? and they are unaware of it. Proudfoot used a two-stage methodology in their evaluation of sales effectiveness. In Stage One it asked salespeople to give a realistic estimate of the time spent in six activity categories. It then asked salespeople to declare how much time they would like to spend in each category. Finally, researchers observed how much time salespeople actually devoted to each category. In Stage Two researchers observed firsthand how effective reps were, scoring them in eight key areas of competency. Here?s what they found.
Stage One: Use of Time. The salespeople spent the following percentages of their time in each activity:
Active selling ? 11%
Prospecting ? 10%
Traveling ? 21%
Administration ? 27%
Problem solving ? 14%
Nonvalue added time ?17%
As in previous years, the standout figure continues to be the small amount of time salespeople spend actively selling to or prospecting for customers. Last year it was 20%; this year it was 21%, a paltry 1% improvement. Another notable figure is the amount of time salespeople spend on administrative tasks ? almost one-third of their day! When interviewed, reps said the ideal level would be around half of that. Finally, the amount of unproductive time ? 17% for nonvalue added time ? remained the same in 2005 as in 2004. Also as in the last year?s study, reps were unaware that so much of their time was unproductive. Their perception, said the researchers, was that just 4% of their time was unproductive.
“Despite some minor variances in the division of work, one overall fact has barely changed: salespeople are spending four-fifths of available time doing something other than seeking sales,” the report concludes. “Significantly, people believed they spent almost 50% more time selling than we recorded. Salespeople acknowledge that almost half of all available time ought to be devoted to the active pursuit of orders.”
Stage Two: Personal Effectiveness. With only 21% of available time spent actively selling or prospecting, Proudfoot researchers wondered how effectively that time was being used. The answer is not very effectively at all. In making this determination researchers used a simple scale ranking system as they observed the sales reps, rating them in eight key sales skills before, during and after each face-to-face or telephone call. Here are the eight observed competencies and the percentage of reps who rated poor, improvement needed and good:
Preparing ?28% (poor), 25% (improvement needed), 47% (good)
Positioning ? 33% (poor), 33% (improvement needed), 34% (good)
Discovering ? 15% (poor), 34% (improvement needed), 51% (good)
Building ? 33% (poor), 33% (improvement needed), 34% (good)
Presenting ? 48% (poor), 26% (improvement needed), 26% (good)
Securing ? 37% (poor); 38% (improvement needed); 25% (good)
Concluding ? 46% (poor), 29% (improvement needed), 25% (good)
Debriefing ? 60% (poor), 25% (improvement needed), 15% (good)
The greatest deficiency ? debriefing ? has considerable impact, say the researchers. They define debriefing as ensuring all commitments are met, issues are identified, reviewed and resolved and output is recorded for the next meeting. Poor performance in this area means commitments made to customers are broken, issues discussed are unresolved and order details are poorly communicated internally, resulting in errors.
So what?s the lesson for sales managers? Proudfoot Consulting says those responsible for sales teams need to review the administrative tasks demanded of their people and the processes used to manage them. Any extra time freed up, they point out, “would be wisely invested in key skills training and reinforced with active, on-the-job coaching.”
The “2005 Productivity Report” is based on nearly 11,000 hours of observation and analysis of 2,614 detailed studies from 100 client projects in medium to large firms in 12 countries. The findings then were compared to the results of an opinion poll of 816 business executives in 11 countries. For a copy of the report, visit www.proudfootconsulting.com.
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What to Do When Friends Become Subordinates
Words have amazing power. If you don?t think so, watch what happens when you change the word representative in a salesperson?s title to the word manager. That one simple change can drastically alter the entire dynamic of a sales team. Friends are suddenly subordinates, certain colleagues who yesterday were cordial now act resentful and star reps who emulated you before now intimidate you, all because of a simple word change. So how do you manage these former peers? In his upcoming book, Fundamentals of Sales Management for the Newly Appointed Sales Manager (AMACOM, 2006), Matthew Schwartz looks at how new sales managers should approach these three categories of team members.
Managing friends. The inherent premise in a friendship is that both people are more or less on par with one another. Thus the promotion of one over the other potentially can strain and complicate that friendship. To avoid that problem, Schwartz says managers must do proper goal setting and provide goal-oriented feedback. ?If you set goals properly and both parties accept them, the manager won?t appear to be judging the friend,? he says. ?The friend?s achievement will be measured by whether or not the goal is reached.?
As you work with your friend, you?ll inevitably find areas of weakness that must be addressed. To correct these problem spots without destroying your friendship, you must specifically define and isolate the negative behavior by focusing on job and performance requirements, not on personality. For example, instead of saying: Sally, what?s with all the complaints about the finance department? You?re really overreacting to this, you might say: Sally, why don?t we sit down together with Steve in the finance department and talk about their requirements? Maybe we can both learn about the thinking behind their new policies and you could explain to him your concerns about the impact of those policies on our customers. The first statement makes a negative judgment about Sally ? that she is overreacting ? which likely will cause her to become defensive; the second statement is more objective and opens the way for dialogue.
One final challenge when working with friends is maintaining the friendship without letting it interfere with the success of the entire team. ?You must establish and agree on a business relationship as well as a social one,? explains Schwartz. ?Others must not feel alienated or as if they are at a disadvantage.? In other words, treat everyone on your team equally and fairly.
Managing nonallies. You know who they are, the people who didn?t think twice about you when you were a sales rep but now harbor great resentment over your promotion. Perhaps they think they or someone else deserved the promotion. Or they simply don?t like reporting to someone who was their peer only a few days ago. Whatever the cause of their lack of support, your job as manager is to pull their best performance out of them regardless of their personal feelings toward you. The way you do that, says Schwartz, is to master the competencies of great sales managers. ?This is not something that happens overnight, so it will require patience on your part,? he cautions. But if you consistently practice solid management fundamentals, nonallies eventually can become your most ardent supporters.
Managing superstars. It is common for new managers to question their own abilities when managing a seasoned or star salesperson. So keep in mind that these stars don?t expect you to know everything on day one. They?ll regard you more highly and you?ll avoid lots of mistakes if you seek their advice. Your willingness to admit you don?t know everything and to get input from those whose experience covers your gaps in knowledge will gain you incredible respect. Another challenge with veterans is how much supervision to give them. It?s tough to walk that fine line so they don?t feel ignored, smothered or micromanaged, but you need to find it. Finally, as with managing friends, you?ll win the confidence of superstars through goal setting and focusing on the position and its expectations and outcomes.
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Concede Like a Pro
In the 1995 movie Clueless, the lead character, a likeable ditzy blonde played by Alicia Silverstone, tells her lawyer father not to worry about her less-than-stellar report card. The report card, she says dismissively, is simply a jumping-off point to start negotiations. Your clients likely feel the same way about your prices and product or service options. So if you want to sign these negotiators as clients, you might need to make some concessions ? an art that takes skill and practice. Here?s how to do it, says Harry Mills, CEO of The Mills Group (www.millsonline.com) and author of The StreetSmart Negotiator (AMACOM, 2005).
1. Trade for advantage. In other words make all concessions conditional on getting something in return. Do this by using the if-then formula: If you will pay within seven days, then I?ll increase your discount to 27%. Using the if-then formula requires you to determine the answer to three questions before making any concession: What value is the concession to the other party? What will it cost me? What do I need in return? If you?re dealing with multiple offers and concessions, keep track of everything. You?ll start to notice patterns that will reveal insights into the other party?s priorities that you can use to your advantage in negotiating.
2. Start high, concede slowly. The most successful concession strategy is to start high, then gradually concede to the moderate point. Negotiators who use this strategy, says Mills, close more deals, make more money per deal and make the people with whom they negotiate much happier with their agreements than those with whom negotiators refused to budge, even from the moderate point. So don?t open with your best discount offer. Make an initial offer and let the client negotiate with you to move you to a better discount, even if that better discount was one you were prepared to offer in the first place. Here are some more tips from Mills.
Signal when you are reaching your limit by sharply cutting the size of your concessions.
Make a series of small concessions instead of one or two large concessions.
Hold some concessions in reserve for last-minute demands.
Never make a concession without getting a concession in return; remember that ?if/then? formula.
3. Build momentum. It?s easy to lose momentum in negotiations and get stuck in a deadlock. Avoid that trap by doing these four things.
Reward concessions. When the other side grants a concession, say I appreciate that rather than that?s not good enough.
Avoid making statements such as: This is my final offer. Such statements communicate a take-it-or-leave-it mindset. Remember that you want the prospect as a client, so you must communicate that you?re willing to work with him or her to find a mutually-agreeable solution.
Shift issues when you start getting bogged down in one area. This keeps things moving and builds momentum that should continue when you come back to the sticky issue.
Handle ridiculous offers with care. Rather than storm out or lock up, stay calm and polite.
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