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Sales

Who Bought That Chair You’re Sitting In?

By Jack Malcolm / 11.4.2013 / No Comment

Don’t get too comfortable

This post is mainly addressed to people who are not directly in the sales force, although I have met a few salespeople who could stand a reminder as well.

One of the more amusing practices in American higher education is the endowed chair. Universities have endowed professorships which are named after the deep-pocketed donors who paid for them. The professors may have never met the donor in person, but they owe their position to that specific person.

It’s almost exactly the same in private business. A donor also paid for that chair you’re sitting in. That donor’s name is Customer. The main difference is that unlike in academia, Customer did not endow the funds for your position. An endowment is a permanent donation, which is necessary in academia so that donors won’t have an influence on what or how the professor teaches.

Customer (or Client, if you prefer) exchanged funds for value received. No value, no Customer. Unlike in academia, the exchange has to be renewed every single day, because Customer has the option to withdraw future funds at any time if they perceive value is not being delivered.

For example, if you are an engineer, you probably did not choose engineering as a major because you had a dream of serving Customer—but that is what you do. That code you write? It’s for Customer. That wastewater treatment plant you’re designing? It’s for Customer. That patent you worked so hard to earn? It’s for Customer.

In my classes, I like to ask the attendees what their company’s most important asset is. The number one answer I get is “people”. But when I ask which people, I almost never hear the real answer: Customer. Keep in mind that the people I usually train are the people most directly tasked with the acquisition, care and maintenance of these critical assets, but even they almost never think of it that way.

Peter Drucker said: “Every business exists to serve customers…profitably.” Without Customer, the business would not exist, and your job would not exist, and no one would pay for that chair you’re sitting in.

So, next time you say that sales is not your job, reflect on the fact that without sales you wouldn’t have a job. And even if you never meet Customer in the flesh, you are a key contributor to the entire enterprise that exists only to make Customer happy.

Even if you don’t talk to Customer directly, what are you doing to help your business serve Customer profitably?

(P.S. Next time you see one of your company’s salespeople, be sure to thank them for getting you a place to park your butt.)

Clear thinking

Improving Thinking through Precise Questions

By Jack Malcolm / 11.1.2013 / No Comment

Have you ever had the dubious pleasure of presenting a proposal to someone who had a knack for asking exactly the right question to get right to the heart of the matter, or to expose all the things you didn’t think of before you went in?

How would you like to make sure you won’t get exposed if you have to do it again, or better yet, become one of those people yourself?

Many senior executives have developed that ability through years of experience in evaluating proposals and ideas, but there is a way to shortcut the learning process. It’s a powerful tool kit developed by Vervago called Precision Questioning, and I like it so much that it is the only material I teach that I’ve licensed from someone else.

Precision questions can be used to test the soundness of an idea, whether you’re evaluating someone else’s or if you want to test your own idea before putting your credibility on the line. I’ve personally found it useful to prepare for critical presentations and sales calls.

It comprises seven types of questions:

Go/No Go: Should we have this discussion right now, and if so, how should we talk about it? Just asking these types of questions could save untold hours in unproductive meetings.

Clarification: What do you mean? One of the quickest ways to spot the shallowness of someone’s thinking is to determine how vague their terms are. Clarification questions can clarify meaning or quantity. Remember the Mars orbiter that missed its target because of confusion whether a set of measurements was metric or imperial units? One simple clarification could have saved hundreds of millions of dollars.

Assumption: What are the assumptions you are making? We couldn’t function without assumptions, but sometimes we need to reexamine them, especially in a dynamic environment. In 2003, we assumed that Iraq had weapons of mass destruction. As I’ve written before, there are at least a dozen different types of assumptions that people can make, and they are the hardest to uncover because we tend to take them for granted.

Data: What’s the quality of the evidence? Is it accurate, relevant and sufficient? Persuasive communication is fundamentally about credibility, and credibility ultimately rests on being right, and being able to show you’re right with sound evidence.

Causes: What’s causing the situation that needs to be changed or resolved? Are we addressing the problem at the correct level? Sometimes we need to drill all the way down to root causes, and sometimes a band-aid will suffice. (If you’re not sure, ask a few go/no go or consequences questions).

Consequences: What happens if we do this? What happens if we don’t? What are possible side effects? What are the opportunity costs?

Actions: What should we do about this? What specific time-bound steps will everyone take? How does this align with our strategies or other initiatives?

For every one of the seven types of questions, there are various subsets and an endless variety of specific drill-downs that you could ask depending on the situation, and on the answers you get. Great questioners can easily ask dozens in a brief conversation, because they usually know precisely what they’re looking for. The questions are not a script that are followed in any particular order; you still have to use your own judgment and experience to direct the conversation

There is an endless variety of ways you can express your message to increase their chance of being accepted by others, many of which I’ve written about in this blog. But in the end, the best way to get your ideas to stick is to have good ideas. The best way to ensure your ideas are good is to think about them carefully and pressure test them through a rigorous—and precise—questioning process.

Persuasive communication

The Man Who Taught Us How to Rescue Trust

By Jack Malcolm / 10.31.2013 / No Comment

Lawrence Foster died on October 17^th. You may not recognize the name; I certainly didn’t, but I knew who he was and what he did. Foster ran the PR department at Johnson & Johnson and crafted the strategy that set the gold standard for corporate communications in a crisis.

As a quick reminder, in 1982 seven people died in the Chicago area after taking Extra Strength Tylenol. It wasn’t a bad batch—someone was deliberately injecting cyanide into capsules and putting the packages back onto store shelves. (For my younger readers: we didn’t have tamper-resistant packages back then; they were invented in response to this incident.) Although it wasn’t the company’s fault, the publicity threatened to kill the brand.

As the New York Times obituary reports, Foster advised the J&J Chairman to: “…put consumer safety first, to respond to the media with alacrity and to be entirely honest.”

Let’s break it down:

Put consumer safety first: This is the most important part of the strategy. Foster did not see this as just a communications problem. The bigger picture was that seven people had died, and no one knew how many others would be at risk. The first priority was not “spinning” the news, it was saving lives. J&J showed its commitment by spending over $100 million to immediately pull over 30 million bottles of Tylenol off the shelves. The public saw them as sincerely caring about doing the right thing.

Respond to the media with alacrity: Foster knew you can run but you can’t hide, so he urged the company to run to the problem. When the news is bad, it’s a natural reaction to want to circle the wagons and try to avoid the hard questions. Generations of politicians and CEOs have learned that this is precisely the wrong approach. The more you try to hide, the harder the media will dig for the story, and when they find it, they will dictate the terms of the story.

Be entirely honest: The risk in responding quickly is that you don’t have all the facts, so even well-intentioned statements may look like prevarications when the complete picture emerges. Foster’s approach is worth quoting verbatim:

“This is the principle we’re going to follow. We’re going to tell them what we know, and we’re not going to tell them what we don’t know. We’ll tell them we don’t know, and we’ll get back to them when we do know.”

Any company, especially one that earns a living selling stuff that people put in their mouths, lives and dies on trust. When trust dies, no amount of corporate spin or advertising dollars can resurrect it. So, when trust is threatened, the only way to preserve it is to show you care, have the courage to face the problem, and be completely transparent.

Do you think we could use some of that in Washington today?

Sales

And Never the Twain Shall Meet: What You Say Is Important vs. What Customers Say Is Important

By Jack Malcolm / 10.30.2013 / 1 Comment

Abraham Lincoln once said that when preparing for a speech he would spend two-thirds of his time thinking about what the audience wanted to hear, and then one-third thinking about what he wanted to say. Based on recent research announced in this article in McKinsey Quarterly, B2B companies should pay more attention to that advice.

A brand sends a message to customers and prospective customers what they can expect if they do business with a company: its perceived capabilities and competencies, unique selling points and value proposition all wrapped into one. The brand message is not completely within the company’s control, especially in this age of social media, but it’s critical that the company do the best job possible in getting out in front with a compelling message. That’s why big B2B companies put an enormous amount of effort and money into building their brands—but according to the research they’re doing a terrible job of it.

Researchers examined publicly available documents from Fortune 500 and DAX 30 companies and identified thirteen themes. They then measured how the largest 90 global B2B companies linked their brand messages to these themes. Here are the top four, gauged by the percentage of the companies that aligned their messages with them:

Role-models corporate social responsibility in its work (86%)
Promotes and practices sustainability in its products or services (84%)
Has global reach (79%)
Shapes the direction of the market (72%)

The researchers also surveyed more than 700 global executives to find out how important each of the thirteen themes were to how they evaluated suppliers.

Guess how many of those top four matched the customers’ top four? ZERO

Here are the top four themes that customers pay attention to:

Cares about honest, open dialogue with its customers and society
Acts responsibly across its supply chain
Has a high level of specialist expertise
Fits in well with my values and beliefs

Their most important theme was not even mentioned by any of the top 90 companies in the survey!

What I know about PR and Marketing might fit into about half a blog post, so I can’t speculate too much on why the big companies have such a large mismatch between what they want to say and what their customers want to hear, but a clue emerges in the footnotes of the article, which is worth quoting verbatim:

” Face-to-face and phone contact with sales representatives ranked highest among B2B customers considering, evaluating, and purchasing products, as well as in product-loyalty decisions. This was true across all industries and regions in our sample.”

Is it maybe just slightly possible that those companies should actually talk to their own salespeople more, to find out what customers care about? (Or maybe talk to customers themselves—but let’s not get carried away here…)