Sales Leadership In An Economic Downturn

If sales leadership is about creating the right motivating atmosphere, one that stimulates salespeople to give their best as frequently as possible, it raises an intriguing question – what is the correct Sales Leadership position going into a recession?
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In our work we are seeing some intriguing evidence emerging:

  1. The first thing is whether the sales leader is old enough to have been in a previous recession. If a definition of leadership is ‘grace under pressure’ we find sales leaders who are able to contextualise the current situation transmit greater confidence to their salespeople. Being able to show how the market is likely to behave, how customers will want to shape the relationship agenda differently, and how the salespeoples’ own organisation is likely to behave, all give salespeople the idea that their leader knows what is going on.
  2. Next, understand what you are dealing with when it comes to the sales force. Have they seen a recession before? Have they been tested in these conditions? Put more controversially, many haven’t really been asked to sell until now. In a recession the only way to maintain sales levels is to take market share, this means selling competitively, beating the competition to business opportunities. This requires a tougher sales stance, one that demonstrates resilience in the face of rejection and a dynamic, clear line of approach around why the customer should buy from you. Seasoned sales directors know this; they prepare their salespeople to move out of the reactive sales comfort zone and into the tougher area of proactive business taking. We find that organisations where salespeople routinely develop new/new (new customers, new business) revenues are better equipped for difficult economic conditions.
  3. The biggest risk a salesperson can take in their job is to sit in front of an actual or potential customer and ask for the business. There is nothing more dangerous they can do. What is critical to understand about sales motivation is when sales people feel stressed, unconfident, a failure, this critical activity becomes too difficult, so they avoid it. What is known as Failure Avoidance. This appears completely counter intuitive. You would think when the going gets tough, the salesperson seeks more closing opportunities, but that’s only true when they are well motivated and feel confident in their ability to cope with objection and possible rejection. If not, you will see procrastination, and more secondary activity (admin, report writing, customer research etc). The number of closing opportunities created goes up with successful salespeople and goes down with struggling ones, which of course reinforces each mode of behaviour and becomes a self fulfilling prophecy. Sales leaders see this and coach to avoid it becoming ‘grooved behaviour’. The quickest way to increase sales confidence is through success, the quickest way to success is to be around customer opportunities, get out there guys!

There is a companion piece to this article With A Recession Coming (or Not) 10 Things Management Can Do To Keep the Sales Force Focused, Positive & Performing. Click here to view the article.
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SalesPathways run workshops for sales teams around increasing performance. To find out more, please contact us.

Leading Through Values – The Way To Avoid Irresponsible Business Practice

With the banking crisis encouraging thoughts of financial meltdown it’s perhaps instructive to find a bank that has taken a different approach and as a consequence is likely to weather the credit crunch hurricane better than most. Wells Fargo is a medium sized US West Coast bank. Just have a look at the following Wells Fargo Sentiments:

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A motivated employee will sell more than an un-motivated employee
A common sense of purpose is more important than monetary incentives.
Happy to grumpy employees stands at 8.5:1 compared to 2:1 for the US business population
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An average cross-sell rate of 5.64 products per customer, double the competitor average

“It’s about our culture. I could leave our strategy on an aeroplane seat and have a competitor read it and it would not make any difference”
John Stumpf CEO, Financial Times, 25 August 2008

The reason many financial institutions are struggling is more than a failure of strategy, but a failure of values. Money making strategies that are not connected to a values anchor will drift into doing things just because they make money, without thinking ‘is this the kind of activity a business like ours should be doing, how could it affect in the long term, the well being of our shareholders, customers and employees?’ I’m sure when this is all over there is a piece of research to do that shows a relationship between the size of bonuses paid out and the degree of poor judgement demonstrated. People talk about risk needing to be well rewarded, but where are the leaders who decide when the risk is irresponsible?

Any business that sees its collective objective to make money for personal gain only will in the end eat itself. The argument that is sometimes made that if it’s legal then it’s legitimate doesn’t cut it. Modern business moves at such pace and with such complexity regulators and legislators can’t keep up, or sometimes even envisage what limiting framework is required until it’s too late. What is required is capitalism with a responsible dimension, which means being values driven, and that requires leading with integrity, a curiously old fashioned sounding notion.

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Wells Fargo seems to be a company that is staying in touch with its values.

To understand how values can significantly impact the bottom line, please contact us.

Some Service Blind Spots

Everybody talks about how critical service is in differentiating you from the competition. Unfortunately for many businesses this is just rhetoric rather than reality. Below are some of the more frustrating service blind spots.

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  1. The call centre script. This is a huge source of frustration for many people. The call centre operative is working with screen based prompts that only work if the enquiry is one of a small number of standard, predicable requests. The minute you want to have a conversation with a person you are lost in a world of robotic replies and ‘system says no’ cul-de-sacs. It can be made significantly worse by following the script in ways that are completely inappropriate. At the end of a 20 minute circular discussion about an unconnected phone with Pipex with the frustration levels hitting critical, the person said ‘Now is there anything else I can help with?’ This situation is made worse when dealing with off-shore call centres where the opportunity to defuse your frustration with humour or local empathy is lost. As always, First Direct is a model of excellence here, following the three principles of service excellence on the phone: no call routing prompts at the start; people trained to deviate from the script when required, and based in the UK.
  2. Transferring onto an earlier flight at the airport. Flying these days is all about hurry up and wait. Check in early, fight through security and take off way after the advertised time. This means many people get to the airport with time to spare and see an earlier fight still open. Some airlines make it easy to transfer onto this more convenient plane really easy. Lufthansa simply ripped up my boarding pass and issued a new one with the doors about to close, no problem, delighted to be of service. A similar airline wanted £40 for the privilege, on a ticket that cost £80.
  3. Tap water in restaurants. Some try to charge for it, others bring it reluctantly. Zizzi Pizzas bring it with ice and lemon, free of charge. A simple way of demonstrating the service imperative.
  4. When you go into a head office building (especially shared ones) do you notice the huge disconnect between the branding and quality of the service from the front desk/security compared to the ‘real’ reception. In some organisations the gap in quality is really horrible, in others they have worked hard at getting it right.
  5. The Saturday high street product knowledge obstacle course. Much of retail relies on school children at weekends. Some retailers think that product training involves telling the kids to read the features card in front of the product. This has everything to do with low cost (the ages fall outside the minimum wage), and nothing to do with providing a service. John Lewis has a different approach with proper training for all.

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Check your own service orientation. It’s still easy to stand out from the crowd. If you’d like to discuss how to improve your own service offering, please contact us.

The Biggest Business Cliché – Our People Are Our Greatest Asset

This comment has become so hackneyed it’s also achieved a kind of post modern status – you can’t be serious. When people hear it they smile wryly, waiting for the ironic or platitudinous punch line, never expecting to discover any real evidence or intention that gives the statement meaning or weight.
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Look at how much organisations pay annually in servicing and licensing costs above the original purchase/installation cost, thousands, sometimes hundreds of thousands per annum. And then look at the per-captia spend reinvesting in their people – the lowest pay settlement the company can get away with and a few hundred £/€/$ per person spent on training (which is often the first thing to be cut in difficult trading conditions). Not a very compelling justification of the ‘greatest asset’ claim.

Let’s look more positively at how an organisation might live up to the statement. Take the material valuing of someone. If we ignore market-rate pay and benefits, treating both as a base line required minimum investment, the valuing part of the statement would be demonstrated in the premium invested above that base line.

Bonuses are an interesting area. If they are paid for individual performance they are being paid conditionally, if the performance wasn’t there then neither would the bonus. This is why people can earn huge sums of money and still view their employment transactionally, because their employer views them in the same way.

The employee would really be valued (as the most important asset) if the employer spent money on them above the market norm unconditionally. Giving somebody a bonus/time/benefit for who they are (a great person) rather than specifically for what they have done, shows how they are really valued. Plus the monetary worth expended for the motivational impact is hugely disproportionate. For example; somebody who has used all their holiday entitlement and is on a tight budget, has a significant personal problem for which they would ordinarily take time from their vacation allowance and they can’t afford unpaid leave. Their line-manager sees this dilemma and helps out with some additional paid time off. The manager subverts the system for the benefit of the employee. There is all kind of risks: precedents being created, people taking advantage, others piling in with requests etc. All those risks are worthwhile, because the demonstration of some humanity towards this employee and their problem will create a deeper permanent level of engagement. They will feel valued.
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Next month we will look at non material ways of valuing employees, reflecting their ‘greatest asset’ status.

Predaptive works with organisations on increasing employee engagement and developing motivating environments. To talk through your particular needs please contact us.

Diversity – It’s About Contribution, Not Quotas

We hear a lot about diversity in organisations, with many who want to retain their image as socially responsible employers hiring Diversity Managers to ensure their credentials, yet does a focus on diversity bring it about?
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Many diversity initiatives mean that the numbers of people in different sorts of jobs are calculated according to age, gender and ethnic origin with any areas which stand out as unbalanced being investigated.

Whilst it’s critical that organisations discriminate on ability rather than sex or race, many other aspects of the benefits of diversity in organisations are ignored, or even stamped out. Having a truly diverse team with a variety of talents means having differences in background, in industry experience, in educational specialism, in life stage, in social activities and interests.

There are no laws to ensure these elements of diversity, and so no legal compulsion to keep an appropriate balance, yet smart managers know that they can build a more effective business that can respond better to different market conditions, different customer types and different employee demands if they have true diversity within the team.

To find out more about developing real diversity in your organisation contact us.

Managing Complex Communications

If you’re reading this we haven’t all been swallowed into a black hole. That’s a good thing, and the people at CERN have been working hard to re-assure everyone that when they switch on the Large Hadron Collider there will be lots of interesting data generated, which may change our view of the universe and challenge our assumptions, but no ‘end of the world’ scenario.
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Many organisations struggle with small scale communications of change and new ways of working, finding large scale changes and world wide communications close to impossible. Scientists are not often held up as the best communicators, but on this occasion they’ve certainly tried hard and achieved a good deal of success. There’s plenty that HR teams can learn about clear communication of complex messages.

What can we learn from the CERN experience?

  • Begin your communication plan early
  • Match your communication to your audiences – choose the content carefully
  • Build your communication in manageable chunks, from awareness to understanding
  • Work to engage your audience(s), make your message interesting and relevant
  • Expect people to have fears, be prepared to answer questions honestly
  • Utilise trusted people to help get your message across, a team of Pathfinders or Champions
  • Don’t be afraid of not having all the answers – with any change programme it’s OK to have a few ‘don’t knows’ as long as the overall message is clear

You may or may not want to supplement your message with a rap video, it worked for CERN, but it’s not likely to work for you.

Be Careful, Your Prejudices Are On Show

You cannot understand others unless you understand yourself. Self awareness and personal insight increases perception and sensitivity towards others.
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A way of observing managers who have little self awareness is to look at whom they are close to at work and who they are not, often showing their prejudices in revealing ways.

Take the building of teams. A manager will struggle to build a high performing team if they suffer from PLUS (People Like Us Syndrome), by only selecting people they know from previous circumstances who are facsimiles of themselves, conforming to their prejudices, i.e. if you don’t keep fit you can’t be effective – ‘I run, what do you do?’. These new recruits are also the same age profile, gender, hobbies, personal circumstances etc. This is very sub-optimal. Diverse teams outperform homogeneous ones. Diversity is good for profitability. We are not talking about the political correctness of diversity here, ticking the boxes to cover all the relevant minorities in tokenistic ways, but real diversity; of views, of perspectives, of experiences, of backgrounds, of skills. When these are blended around common purpose, underpinned with mutual respect, team synergies really do become apparent.

Where does prejudice come from?
Experiences forming opinions that, over time, become fixed, containing discriminatory judgements that seems to confirm a discernable pattern of outcome. The problem is once this way of thinking about something is established people become more suggestible to seeing new reinforcing examples more often than contradictory ones, so the prejudice becomes deeper. Referring back to the manager that believes fit people are more effective, the prejudice is that unfit people are ineffective because s/he can cite examples that conform to this particular mental model, but I’m sure you can think of ineffective fit people and visa versa.

Everybody has prejudices; the more interesting thing is to understand why you have those particular ones you have and how they constantly affect your behaviour, either consciously or unconsciously.

Can you manage/change them?
As we age our views of the world can become more rigid, with some (many?) unfortunate people intellectually dying in their 30s but not being buried until many years later. So the key seems to be to continue to seek experiences that challenge your world view. Try to correlate the strength of your opinion on a subject/issue/person with the depth of your knowledge and first hand experience of it, because prejudice’s partner is unthinking ignorance. People who are able to confront and challenge their own prejudices by making themselves more available to new opinions and experiences, combined with a solid knowledge base around the thing in question, keep prejudice at bay, gain greater insight into themselves and consequently grow as people (and managers).
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Final point; beware the person who says they don’t have prejudices, because it’s not true. (Is that a prejudice?)

Structured Training encourages mangers to think and shows them how to build better teams. For more information take a look at High Performance Sales Management or for an informal discussion please contact us.

Can’t Buy Me Success

As Manchester City changes hands again, from a very wealthy owner to a stupendously wealthy one, fans and impartial observers alike are thinking ahead to a Premier League that will be just a little different over the next few years. Manchester City has always had to look across the city to their more successful neighbours in red and wonder why it wasn’t happening for them.
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Money has been cited as the reason in recent years with the spending power of Sir Alex Ferguson at key rivals Manchester United only rivalled at Chelsea. Yet as Chelsea have found, money doesn’t always buy success. Whatever the reasons behind Andrei Shevchenko’s lack of form at Chelsea, his term of employment was a spectacularly expensive failure.

Building a team of superstars only works if you can truly build a team rather than a group of people who are all hugely talented, but want their own opportunity to shine individually more than team success. The same holds true in the business world, mavericks that bring in successes at the expense of values, best practice and decent inter-personal behaviours may be attractive in the short term, but can leave a lasting negative impression on a team and organisation which takes a long time to heal.

When thinking through how you are going to build and manage your teams, it pays to think about balancing real-world team dynamics: how to develop and grow talent through coaching, how to recruit a balanced team and how to motivate them. To find out more take a look at Fundamentals of Management .

What We’re Playing: Princes of Florence

 

 

In Princes of Florence players compete to attract the best, most talented professionals to work in their part of Florence. Starting with a restricted budget and a limited number of opportunities to enhance their particular Palazzo, to attract new employees the game tests player’s strategic thinking, bargaining and planning skills as well as assessing their judgement.

 

The best employees produce their best work when they are happy (worth remembering in the workplace). Players earn both more money and more prestige through commissioning the best works. To ensure that you get the best chance of winning you’ll need to attract professionals by offering them an attractive working environment, state of the art facilities and freedom to express themselves in the ways they feel most strongly about.

 

Whilst the game is set in Renaissance Florence, the principles hold just as true today in business parks in Slough, office blocks in Manchester and warehouses in Edinburgh.
Give Princes of Florence a try before you next think about how you go about attracting new employees, retaining them and becoming the employer of choice in your area. It may just give you a few ideas.