Antifragility in Sales

What if you could win on every number?

Salespeople are not fragile. It’s well known that resiliency is a crucial prerequisite for successful salespeople. It’s not just the frequency of rejection they face, because when long term results are fairly predictable it’s easy to take short term losses in stride—think of a .300 hitter in baseball. Resiliency is more important because results in sales can be so random and unpredictable. While it’s true that skilled salespeople with a good product at the right price can produce reasonably predictable results, there is still a lot of randomness that is out of their control. Maybe the reputation of their company is damaged because of something someone else does, or a long-time champion moves to a different company, or a competitor introduces a new technology that changes the rules.

Fragile egos don’t hold up for long in the face of such uncertainty. It takes robustness and resiliency. When you’re robust, randomness does not damage you; when you’re resilient, you may be damaged but you quickly recover.

Robustness is not just about a personal mental quality. A full funnel is robust, because it can withstand the shocks of losing deals. Or having a good number of smaller deals as protection in case the “big deal of the year” does not pan out. Not being dependent on a particular industry can also be robust, because you’re not as subject to cyclical downturns. Your compensation plan can even make you robust or fragile. Quarterly plans can make careers very fragile, because two bad quarters in a row can undo even someone with a few years of stellar performance.

Even better than robustness and resiliency is the quality of being antifragile. This term was coined by Nassim Nicholas Taleb in his fascinating and challenging book by the same name. Antifragility means that besides being able to withstand random setbacks and shocks you actually profit or improve from them. Things that go wrong may have short term or local negative effects but make the organism or the system stronger in the long run.

Anitfragility is actually common in nature. When you work out, you damage your muscle fibers, but the healing and rebuilding process makes those fibers larger and stronger. Natural selection is the ultimate antifragile phenomenon; although organisms die, species adapt and evolve.

There are three main ways to apply the concept of antifragility in sales—to profit from randomness and volatility: learning, maintaining optionality, and avoiding iatrogenics.

Learning: Use failure as your textbook

None of us welcome obstacles, failure and uncomfortable change, and it’s tempting to shove negative experiences to the back of our minds. Yet losses and setbacks offer limitless opportunities for antifragility, such as:

• Learning, not just recovering, from your mistakes
• Improving your offering in response to a competitor’s move
• Conducting after-action reviews after every sales call
• Using loss reviews to improve your approach or your offering
• Fostering a climate that learns from losses rather than immediately assigning blame
• Responding faster than your competitors to new information or conditions in the market
• Resolving a complaint in a manner that makes customers happier than they were before
• Listening, curiosity and lifelong learning, because they have low downsides and high upsides
• Constantly looking for information that disconfirms your expectations and projections
• Using failure and rejection as information and as a stimulus to more intelligent effort
• Even success can teach lessons, as long as you don’t automatically assume it happened because you’re so smart.

Optionality: Build a secure floor and no ceiling

Besides personal assets or psychological qualities that can increase antifragility, there are also ways to structure your work to reduce downside and take advantage of randomness.  The key concept is to maintain options so that you are not forced into poor choices.

If you can build a secure base that does not take all your time, you can then focus the rest of your attention on the really big deals that bring the big paydays, the recognition, and the trips to Hawaii. Taleb call this the “Barbell” strategy, because it’s a way of focusing on both ends of a range rather than in the middle. The way this would work in a sales portfolio or a funnel is to build a secure base of customers that will keep you in the game and insulate you from large losses. It’s best to have a lot of smaller deals, where the loss of a few won’t hurt too much. While it’s tempting to see security in having a few larger customers, with which you have very solid relationships and big barriers to competitive entry, this is much more fragile than it seems.

Iatrogenics: Don’t screw it up

When something is naturally antifragile, managing it too closely or intervening too much can cause unintended harm. Iatrogenics is technically a medical term, describing unintended harmful results from medical treatment,[1] but the idea applies to other systems as well. For instance, prevention of minor forest fires makes the ecosystem more fragile by preventing the burning off of underbrush, leading to catastrophic fires at some point.

Sales managers always want to do something, but sometimes doing nothing may be the best management. Sales managers contribute to iatrogenics by excessively monitoring sales activity, by rigid procedures to regulate action, by automatically stepping in or by dropping prices to avoid losing deals.

If you’re a sales leader, you need to work on removing sources of fragility, without adding those of your own unintended doing. Since personal learning is one of the most powerful antidotes to fragility, anything that discourages learning is going to make your performance fragile. Blaming people for mistakes; fostering a culture of fear (e.g. “third prize: you’re fired”) Excessive monitoring of activity and rigid procedures that allow little room for initiative or flexibility cause fragility.

We salespeople like to say we make our own luck, and I believe that’s roughly true in the long run. But maybe the surest way to build a successful long term career is to put yourself in a position where even bad luck is ultimately good.