This is leadership?
“Leadership” is the sexiest topic in all of business writing, and it’s even more so in sales, with its emphasis on getting the best possible performance out of creative, street-wise and strong-minded individuals. We admire sales leaders like the one personified by Alec Baldwin in Glengarry Glen Ross, who parachute in and solve sales problems through an artful combination of incentives and intimidation. (First prize in the sales contest, new Cadillac; second prize, set of steak knives; third prize, you’re fired)
I think it’s time to point out that this emperor’s clothes are wearing very thin. We need to recognize and promote the sales leader’s quiet and unassuming little brother (or sister): the sales manager. We have too many leaders and too few managers.
There’s a wonderful phrase in Michael Webb’s book, Sales and Marketing the Six Sigma Way: “yelling at the thermometer”. He says that trying to solve sales problems is like trying to fix the temperature by yelling at the thermometer. How many sales “leaders” try to solve sales problems in a similar fashion?
The 4 I’s of Sales Leadership
Sales leaders like to be the indispensable heroes in the middle of the action. They have four major tools that they use as necessary when there is a sales problem:
Intuition: “Analysis is for wusses. I know what worked for me, and by golly, it will work for them.”
Inspiration: “Don’t fire them; fire them up.” (Anyone remember that book from the 80s?)
Incentives: I once worked for a guy who thought the best way to increase sales was to encourage his salespeople to go into heavy debt.
Intimidation: “Of course they’ll use the CRM system. They know what will happen if the don’t.”
There’s nothing fundamentally wrong with any of the tools above, except when they are all you have. Let’s see how sales managers do it.
Who remembers Gus Pagonis?
We all remember Stormin’ Norman Schwarzkopf for his brilliant generalship during the first Gulf War, but it takes a geek to remember the real hero of that war. Gus Pagonis was the logistician who accomplished the astonishing feat of moving, equipping and feeding an army of half a million troops to the Gulf and back again. An Abrams tank without gas is just a hot piece of metal sitting out there in the middle of a desert. His fundamental contribution was to make sure the shooters had everything they needed to do their job.
What does this have to do with sales? A sales manager’s job is to make sure their sales teams have everything they need to do their jobs as effectively and efficiently as possible. This requires systems thinking, systematic problem-solving, and process orientation, and future focus.
Systems thinking: Deming said that “a bad system will beat a good person every time.” The sales manager’s job is to implement and maintain a good system-one that gives the right people the tools they need to succeed and gets out of their way.
Problem-solving: Without systems thinking, problem-solving becomes an exercise in “wack-a-mole”, where you hit any problem that comes up as hard as you can (using the 4 I’s), only to have another problem pop up in a different place. Sales managers take the time to analyze problems, get to the root cause, experiment with solutions, gather data, and keep what works. It’s not as exciting as leadership, but it works.
Process: Sales managers know that one of the most important concepts in sales is process. As Dave Brock tells us, “The data shows that people and organizations that use a sales process consistently perform at much higher levels than those who don’t.” While sales often calls for imagination and flexibility, there is a surprising amount of commonality and standard work in all sales efforts, and codifying and improving this work can improve the entire sales organization.
Future focus: Sales managers build for the long term, so that they can leave behind a system that continues to thrive even after they’ve moved on. For example sales leaders like to ride to the rescue to close an important deal (and show the sales team they still have it); sales managers make sure their people get the right coaching, support and training so that they can confidently close the deals themselves.
If you’re a sales leader and find that you have to keep continually applying the 4 I’s of your trade, maybe you should try to ease up—do a little less leading and a little more managing.
If you’re interested in improving sales performance the right way rather than throwing the usual quick fixes at it (training, incentives, threats), then Sales and Marketing the Six Sigma Way, by Michael Webb with Tom Gorman, would be worth your investment.[1]
Don’t be put off by the title. Six sigma is not an esoteric, cult-like system for turning your sales force into unthinking automatons. In practical terms, it’s simply the application of scientific method to understanding your sales processes and finding ways to improve it.
In fact, applied to sales, you might be able to think of it as two sigma. In production systems, six sigma is a quality measure that represents only 3.4 defects per million. Most sales organizations would be happy with a defect rate of one sigma, which is almost 700,000 defects per million. That sounds high, but it’s a close rate of 30%. Two sigma would be an improvement of more than 100%, or a close rate of 70%. These numbers show that there is tremendous room for improvement via the application of some of the tools and techniques outlined in this book—without going crazy. As Webb tells us, “When you’ve got a process operating at one sigma, you don’t have to worry about the design of experiments.”
What you do have to worry about is taking a methodological approach to defining, measuring, analyzing, improving and controlling (DMAIC) your sales process.
Yelling at the thermometer
It sounds like common sense, but it’s definitely not common practice in sales leadership, which often approaches sales problems intuitively, or merely throws training or incentives at the problem without taking the time to understand the underlying process. The way that many sales managers operate is like yelling at the thermometer because you don’t like the temperature.
It’s all about the process
Understanding the underlying sales process begins with mapping your customer’s buying process. How do customers become aware of problems and find solutions to them? In every prospect organization, there is an ongoing discussion about their business goals, the need to improve performance, problems that stand in their way, etc. The sales professional’s job is to contribute meaningfully to that conversation, by providing useful information (often in the form of questions, not simply telling) that helps the customer improve their business and personal outcomes.
Too often, sales processes are undefined, or are defined by what salespeople have traditionally done, or are the default process codified in the CRM system you bought. They are not based on how the customer decides and how you can smooth that path for them.
That in turn drives the definition of value in the sales process. Value is defined by the customer, and Webb defines it simply as “anything the customer will take action to obtain.” When you see value this way, you can design your sales process so that it provides that value at the various stages along the customer’s decision process. This provides measurable and meaningful progress, because it’s now measured not by how busy your salespeople are, but by what actions the customers take along the way.
It also lessens resistance. One of the major sources of “defects” in the sales process is customer resistance, and resistance occurs when customers feel like you are doing something to them, which either does not add value to them or forces them to act before they are ready.
The principles of six sigma are:
- Viewing the sales and marketing process as a production process that produces profitable revenue. When you see it this way, you can apply many of the tools that have been so successful in manufacturing and demystify the “art” of sales.
- Creating value for customers. As discussed above, if customers will take action to get the value you provide at each stage of the sales cycle, the sales path becomes much smoother.
- Managing on data and facts. What a concept. Reminds me of the quote by Philip Dick: “Reality is that which, when you stop believing in it, doesn’t go away.”
- Analyzing cause and effect. See above.
- Minimizing waste and defects. Understanding what activities create value helps you identify and work on eliminating those that do not.
- Collaboration. Sales and marketing, in this view, are not separate, often conflicting silos. The marketing process provides outputs for their customers: salespeople. In fact, Webb’s definition of good marketing is “anything that makes the salesperson’s job easier.”
There is a lot to cover in these six principles, but the book does a good job through detailed case studies that illuminate through example and furnish credibility. In fact, the appendix is worth studying carefully because it has real-life examples of some of the more important tools used. If you specialize in complex B2B sales, the example used can be a little simplistic, but you can extrapolate from there.
A common lament among sales professionals is that sales does not get enough respect as a profession and the major contributor to business success. Perhaps if we can learn to reliably and consistently improve revenue and profits by applying greater rigor to understanding and improving the sales process, that day will come.
[1] The reason I don’t include the hyperlink to the book on Amazon is that a new copy is priced at over $400! Astute shoppers will be able to pay much less.
