Sales Management Refresher
From the desk of Bob Currie
After 40 years of consulting to manufacturers and distribution companies, the changes in sales and sales management have been dramatic (technology) and surprisingly minimal (behaviors) at the same time. The sports analogy for this is that technology (video, statistics, training) have made great strides in coaches understanding the game, however, the game is still played between the lines by dedicated athletes–hopefully, well coached athletes. The “technology” helps us coach those athletes (sales people) better, but the players (athletes and sales people) must be strong, trainable, and coachable. Is there a better example of trainable, well coached players than the 2019 USA Women Soccer Team?
Coaches having a “concept of the game” is central to the coaching of sales people. Often sales managers become sales administrators distracted by order entry, order expediting, pricing, commission calculations, contact management and a host of other administrative duties. Our observation as a management consulting firm is that this administrative process has, little by little, squeezed out the day-to-day coaching of “between the lines” activities. In the industrial equipment world, this situation is observable at the manufacturer level as well as distribution level.
In the distribution level, where the interaction is between a sales person and a customer, the concept of the game should be quite clear. It centers around the sales close. Referring back to the soccer example above, the process is: we put the ball in their net and stop them from putting the ball in our net. Recently we conducted a sales manager conference which brought up the inevitable question about lowering prices to stay competitive. We asked the sales managers to articulate the method of dealing with price objection, or any normal sales objection. The answers were not vibrant. So, we followed up with the question of the standard sales close. What do you train sales people to say at the time of close? Again, no vibrant answer.
Standard close is: “As we discussed, customer A, we have (feature 1) which is something you said you liked and wanted, and, we have (feature 2) which is also something you said you liked and needed. To buy a different product that doesn’t give you the things you like, want, and need simply because they have a lower price (quicker delivery, a well-known manufacturer, local dealer) is not a decision you will be happy with in the long run. We have everything you want, like and need. (*slight pause*) All I need is a purchase order number and we can place this order in the queue for manufacturing and delivery.”
For those products that have parts, service and rental demands, the standard close for service contracts is similar: “As we discussed, we have 50 field service techs we can dispatch quickly to deal with maximizing your uptime, which you said was important to you. Plus, we have $ 5,000,000 of parts inventory to support this uptime goal, and we have $ 10,000,000 of rental equipment to get you through peak demand situations–two more things you want to maximize through/put in your operations. To have a support relationship with another service company that can’t give you what you want, simply because they have a lower service rate or a small parts discount, is not a decision that you will be happy with in the future. We have the product support team that can give you the back-up you want and need, (*slight pause*) all I need is a purchase order number and we can process this order.”
You may need to wordsmith both of these scripts to fit your individual company. However, from these scripts, sales managers can work back through sales presentations, qualifying questions, sales approaches and the like to close the sale. These scripts define the end of the process where the player scores the goal. Using the soccer analogy, if the player says he didn’t kick the ball toward the goal because it was on his wrong foot, the coach will train him to kick with either foot, or, will work on technique to be open on the preferred foot. Coincidently, a defender, at the professional level, should know if an opposing player only kicks from one side, thus, taking away that option for the opposing player. All sports have similar methodologies. It’s called the concept of the game.
Without this concept, many sales organization’s failsafe is to discount. The value proposition imbedded in the close process shown here won’t make price questions go away, but it will reframe those issues to focus on a high value proposition. Further, if a sales organization feels it must discount, but you have won the value game, now you are in a position to negotiate–a price concession for something else. For many dealers this could be a full maintenance and repair agreement on the units being purchased or on all units in the customer’s fleet. The point is to win the value battle first. How many sales reps have said, “It’s not about value with customers; it’s only about price”. They are defeated before they take the field.
As mentioned above, the standard close implies an effective, deep, product presentation. Three elements are central to this process: product knowledge (your product and competitors), communication skill (a sales rep articulating clearly with a customer-focused sales story for each key product feature), and sales skill (the sales rep uses trial closes to lay the ground work for the final close).
Does the sales team minimize the sales presentation and go immediately to, “How do we compare on price?” It is human nature for people to seek the easiest process. If the product presentation process (product knowledge, communication skill, sales skill) is perceived as difficult and/or not relevant, then sales reps will revert to: “Do you have anything I can quote on?” followed by “How do we compare on price?”
Naturally, sales presentations are not a random recitation of product features, but a carefully tailored collection of features chosen for their impact on this specific prospect/customer. How do we know which features to choose? That decision comes from a well-constructed qualifying process, and an application survey. But what if we don’t need an application survey? The application survey sends a message to the prospect about the sales rep’s professionalism. If there isn’t a survey, there should be a set of notes taken by the sales rep during the initial discussions with the prospect.
The title of this article is Sales Manager Refresher, so the point is: Do sales managers view the game between the lines this way, or, in some other more effective way? Are they reacting to the pressures of the day and have they lost sight of the structure of the play? Sales management work, like any coaching, requires a lot of preparation in order to coach the sales reps (players). You need to construct the game plan identifying existing accounts and conquest accounts. Further, all major accounts, both existing and conquest, must have a clear, tailored strategy specific to that account. Major accounts are identified by a Pareto process. Generally, 80% of the sales opportunity comes from 20% of the customers. In industrial distribution our research shows that more than 70% of unit sales come from fewer than 10% of end users. So, major accounts, at a minimum, include this 10% of end users.
Once the general game plan is developed (in detail), the sales manager (coach) must train the sales reps on implementing the game plan. This is the time on the practice field: tedious, boring, frustrating, but critical to preparing the sales reps (players). But, sales managers retort that it takes productive field time away from the sales reps. Are those reps really productive, really effective, really focused on the value proposition? More field time for unproductive, ineffective, unfocused sales reps will not win the game.
Central to this process is the sales manager. The sales manager is the coach who develops the game plan, trains and develops the sales reps, runs regularly scheduled intensive practice sessions with sales reps, inspires and/or cajoles those reps, celebrates victories, dissects losses, and spends more than 50% of their time in the field with sales reps developing their skills.
For manufacturers, this process creates a development issue for the manufacturers field force. Certainly, distribution sales managers must develop structures, game plans, scripts, and behaviors. However, they should be supported by the manufacturer’s field force. We believe the manufacturer’s field team should be full of experts in coaching the sales managers as they coach the sales reps. That means the manufacturers know the game plan, the value proposition, the behaviors of good sales reps, the behaviors of poor performing reps, and how to change them or release them. The manufacturer’s field team should consist of shadow sales managers. They are sales managers without authority. Actually, they don’t need authority, they have knowledge, leadership, experience and other skills so that they have gravitas without resorting to authority.
As a consulting firm, we know that each engagement with a client is a learning experience for the client and also for the consultant. The manufacturer’s field team must be constantly learning about what characteristics of a sales department drive success. Further, how those characteristics are introduced and managed in successful firms. Plus, and perhaps most critical, how we win with the current players (sales reps), as opposed to waiting until better ones show up. The field organization of a manufacturer must become the repository of knowledge about sales force development. Support people to the manufacturer’s field organization likewise should be well versed in success initiatives of the distribution sales organizations’ development and growth. Human Resources can train and develop sales managers in such areas such as recruiting, selecting, and on-boarding. Marketing professionals can assist in website development, digital marketing (remember 70% of unit sales are in only 10% of end users, the other 90% of end users could/should be covered electronically), case histories, scripts for sales people and other such support actions. The collaboration between the manufacturer and distribution must be strengthened on the sales side given the current forecasts for capital goods confidence indices and spending patterns.
As stated earlier, this article is a sales manager refresher. With potentially significant changes arising on the capital spending side, with increasing global competition, with higher expectations from customers, with generational changes in employees–all these factors prompt this renewal effort. That effort can be a dramatic major overhaul (rife with anxiety but quick with implementation) or a series of small steps (lengthy and disjointed). In either case, the end product must be clear, the concept of the game, and the details on what happens between the lines. Next year, 2020, might be a difficult market. Getting prepared with game plans and implementation plans is critical.