IT STARTS WITH UNDERSTANDING PERFORMANCE

Let’s start with the problem that you have seen me write about again, again and again. 

Perry Marshall’s book – The 80/20 of Sales and Marketing created a major shift in how I think and go about talking to prospects about their sales team and its ability or inability to demonstrate consistent and predictable sales growth.  Everything, and I MEAN EVERYTHING, starts with an understanding of how your sales team is performing. 

IS THERE A PROBLEM?

This exercise identifies if there is a problem or not.  It really IS that simple.  All you have to do is a little simple math and then answer the question – Is this a problem?

I recently reviewed the productivity of a group we are in discussions with.  Nothing is final yet as the company is in that early step of the process – trying to determine if there is a problem.  To help them in the process, we sign the NDA and ask for their production numbers.  I get the numbers, stack rank them and start applying the 80/20 rule.  I don’t follow the exact procedure; instead, I just take the number of people on the list and break the group into fifths.  If I have 100 salespeople, I end up with 5 groups of 20.  Then, I just do the math.

• What percentage of the total is being produced by the top quintile?
• What percentage of the total is being produced by the middle quintile?
• How much is being produced by the 5^th quintile?

ACTUAL NUMBERS MAY BE DISTURBING

The findings were not startling in and of themselves because the top two fifths closely resembled what you would expect from the 80/20 rule.  What was interesting (and what would interest you) was the discussion about the bottom two fifths.  When we discovered that the bottom two fifths generated less than 5% of the total revenue, we then got into the compensation/revenue discussion. 

• How much is 5% of the total revenue?
• How much in compensation alone is it costing to generate that 5% of revenue?

TIME FOR THE “LET’S PRETEND” EXERCISE

I won’t go into all the details, but when we played “let’s pretend”, then everyone in the room got real serious.

• “Let’s pretend that we fired all of those people in the bottom two fifths, how much would that save in compensation alone?”
• Subtract the revenue
• What’s the profit?

I assure that in most, if not all, companies (I suggest you stop reading and do this right now) the profit is significant.  So much so that it starts a really good debate that starts with the question:

Why in the heck are those people still with us?

GET RESULTS WITH AN ESTABLISHED PROCESS

The discussion was robust, honest, helpful and productive. And, yes, they all agreed that they have a “have to fix” problem. But my post today isn’t just about getting to a point where you can determine a problem and the severity of the problem, but more about the cost of the approaching the solution the right way.

Understand we don’t get to close all the opportunities we engage in.  We don’t get them all because, at the risk of sounding arrogant, not everyone qualifies (We just failed to make the cut on a recent opportunity because of our commitment to the process).  Our process, just as yours should be, follows a fairly strict set of guidelines. We follow these guidelines because we know we can guarantee results when they are followed. We have experiences from early on in our business when we didn’t follow the guidelines – we didn’t get results and we didn’t keep the relationship.

INVALUABLE DATA FROM THE RIGHT ASSESSMENT TOOL

The primary step in our approach is the use of an assessment tool.  Specifically, we use the Objective Management Sales Effectiveness and Impact Analysis (SEIA).  It gives our new clients and us everything we need to impact revenue, profit and growth.  Let me explain by using one of the tools we get from the SEIA.  (see chart below)

This chart represents those people in a sales organization that are succeeding and failing the most.   Assuming for a minute that you don't understand the meaning of the headings, just look at the colors:  Green is good, red is bad, high numbers good, low numbers bad.  The first column identifies if the people are performing to goal or not.  The only anomaly in the group is the third person from the top.  I inquired about this and there are two pieces of information that are good to know. 

• The data we collected on performance was based on the previous years sales.
• The manager answering the question “Is this person performing as expected” answered the question for the current year.

So, what we have is someone that performed exceedingly well in one year and is now failing.  What the graph helps the manager do is have a very significant discussion on “why” there is a change.  I won’t go into all the details as to what that discussion should sound like, but now the manager has some interesting data to look at and digest in order to help frame the narrative of the required intentional coaching session to be scheduled. 

TIME TO GET REAL - THE BOTTOM LINE

What I believe is most important is to get arms around the total picture provided by hard data and assessment data.  What we know is the following:

• Coaching the top group will be effective because they are coachable and have the will to sell
• Investing in the bottom group will bring little or no return:
  • They lack desire
  • They lack commitment
  • They have a poor outlook
  • They won’t take responsibility
  • And they are not motivated to succeed in selling
• You can assume (because I did further analysis) that at least one of the other fifths in the organization looks like the top group and one looks like the bottom group.
• The one fifth that looks like the top group may not hit the top ranking because they lack tenure in the company or in the business.
• There is at least one other group that looks like the bottom quintile. They may or may not be new.  In this case, the bottom quintile we are illustrating is NOT at the bottom of the ranking because they are new. They are at the bottom because they suck at what they do!
• The question(s) you have to ask about the entire team is:
  • Did I hire them this way?
  • Did I make them this way?
• This applies to every quintile that you look at.

So, getting back to the title – The Impact on Revenue, Profit and Growth - consider the following:

• What is it costing you to carry those that are failing to perform – in real dollars and lost opportunity? You MUST calculate the cost as if you were reporting this to the board!
• What would the impact be to the bottom line if you fired them all today? Certainly, sales would not suffer.  Also, you have to consider that if they are this bad at selling, what else are they bad at and what is that costing you?
• What is the financial impact of those that looked like your worse performers but have exited over the last 12 to 24 months? Those that you fired or exited? What did that cost you in time, training, recruiting dollars, on boarding, compensation AND lost opportunities?
• How many training dollars will you pour down the rat hole attempting to fix people that are un-trainable or un-coachable? What impact could you have if those resources were redirected to sales management improvement, more focus on developing new hires with skills and true potential, recruiting talent that mimics your current top performers?
• What is the impact of keeping non- and low performers on the team? How do those in the middle react to the stack ranking knowing that those on the bottom are not at risk of losing their jobs? Why should they worry?

Okay, so maybe I’ve beat this drum enough – you got the point.  What’s the solution, what am I getting to, how do you (as the person responsible for revenue and growth) make sure you are making wise decisions when it comes to hiring, managing and developing talent?

DON’T GO IN BLIND

Think “doctor”.  I just completed an abdominal biopsy.  Prior to the procedure last Friday, I had a CAT scan, a Pet Scan, Ultrasound and another CAT scan plus results from the same test taken a year ago. 

I’m glad Dr. Max didn’t go in blind.  It was tough enough even with all the data he had.  Without it, there would have been virtually no chance to get it right.  That’s the point. Don’t go in blind.  Assess your talent, assess your new candidates, know what makes your current successful people successful and know why those that are failing are failing – DON’T REPEAT.

Additional Resources:

• Contact us to find out how to properly assess talent – Jeni@anthonycoletraining.com
• Contact us to have an 80/20 discussion – call me at 513.226.3913 or text.  Subject line: 80/20 and then make sure to include your name.
• Request an SEIA demo – traci@anthonycoletraining.com

START WITH "WHY"

Let’s look at Simon Sinek’s Golden Circle Formula and go right to the heart of the issue – “why”. (If you have not watched this video on Ted Talks, do so; it is a must for anyone in leadership, management AND sales.)

“Why” is the most important thing to uncover when…

• attempting to alter behavior,
• move towards a specific outcome or
• understand why someone would be willing to go through the pain of change when it is so much easier to deal with the status quo.

PAIN... IS A POWERFUL MOTIVATOR

Years ago, when I heard Tony Robbins speak in Cincinnati about Pain and Pleasure, he stated:

“People will do whatever it takes to avoid the pain they have today,
the pain they foresee in the future or to arrive at a pleasurable outcome. 
Avoiding pain will always trump pursuing pleasurable outcomes.”

Sales meetings, great massages and colonoscopy visits – when conducted and executed well - change behavior, improve skill and impact future outcomes.  However, yes, they can be painful. 

A LITTLE BACKGROUND TO GET THINGS ROLLING

This week, I had a massage… as well as a colonoscopy (although I realize that is more information than you wanted to know…).  During the massage a couple days ago, they found a pressure point in the middle of my right shoulder blade that was tense with stress. When the masseuse applied pressure, there was definite pain.  But, once I got through the pain, I was rewarded with less stress and now the impinged shoulder isn’t as painful.

Today, I had my colonoscopy.  Now, if you’ve done this in the past, you know the drill and the “pain” of it all.  The pain or discomfort isn’t so much with the procedure, but with the prep. That god-awful stuff you have to drink, the endless hours on the commode, the cramps in your intestines as well as all the good-natured ribbing you get at work (What? You don’t share this moment with co-workers?).  And then, you have some definite discomfort at the end when you are trying to relieve the pressure while in the post-op “GAS CHAMBER”.

HOW ALL THIS RELATES TO SALES MEETINGS

So, after laying all that as a foundation, I’m sure you are wondering, “Why is Tony talking about sales meetings, massages and colonoscopies?!?” Well…

• Too many sales meetings are conducted like a great massage:
  • Soothing
  • Relaxing
  • No tension
  • Positive environment
  • People leave without any kind of stress or care
    
    
• Too many sales meetings are also being conducted like colonoscopies
  • People that have been to them before don’t want to do them again
  • The prep for both is critical for success
  • Often, if the environment isn’t controlled, there ends up being a lot of gas expelled
  • Sometimes, depending on the doctor, the anesthesia and/or the meeting, people are put to sleep or, at a minimum, in “twilight”
  • Everyone is starving for something productive to happen during the “meetings”, but too often they come to “the table” hungry and leave hungry
  • Everyone is thrilled that they only have to go through all that once in a while

Do you see any correlations? You might find yourself agreeing to many of the bullet points above.  You might also be able to relate to some of the things that aren’t too good about the sales meetings you have attended or conducted.  The purpose of this writing is to help shed some light on the right combination of things in a meeting that should happen so that:

• Meetings are productive
• No one wants to miss your meetings
• People learn and grow their practices as a result of the meetings
• They don’t have to sit through painful re-enactments of each salesperson’s pipeline discussion (Truly, this is like multiple colonoscopies on the same day!)
  
  

WHEN THE BENEFITS OUTWEIGH THE PAIN 

Here are the correct procedures for sales meetings, massages and medical procedures that will result in a clean bill of health:

• At a certain age, colonoscopies are non-negotiable. Effective sales meetings are not negotiable any time for any company of any age.
• Preparation is required to have a great outcome
• You know you have great outcomes if: (These are in BOLD because they are IMPORTANT!)
  • People never miss, leave early, or arrive late
  • Your people learn something that they can implement right away to help them grow their business
  • The meetings are all about selling and driving sales growth
    • No ops discussions
    • No underwriting discussions
    • No business strategy discussions but “foot soldier” discussions on strategies to gain entry into markets
    • Anything that can be communicated via email should be done so
  • People should leave the meeting re-invigorated, but also mindful of what it takes to maintain a stress-free existence in the organization
    • Activity and production requirements must be met
    • Mediocrity is unacceptable
    • People will be coached with a disciplined approach for improvement if they begin failing at activity or production
  • And finally, just like after a colonoscopy, people may not always want to return for another one; but the upside is that benefits (health and sales success) outweigh the pain of the procedure!
    
    

WHAT I GAINED FROM THE EXPERIENCE 

During my exam, they found 5 polyps and removed them all.  Don’t panic; the doctor did not indicate that I had a problem. It’s just when you get to a certain age, you find little skin things hanging off of your body all over the place. Why should the colon be exempted? (Again, too much information? Ha ha) 

Here are my other massage and colonoscopy outcomes:

• I learned from it: keep doing the right things – exercise, diet and sleep
• I am now stress-free for a while because I have a clean bill of health on my colon
• I feel 5 pounds lighter, which is always a good thing
• I came home and slept soundly for another 5 hours after only getting 3.5 hours of interrupted sleep the night before. Admit it, you would all like to sleep like that once in a while and you KNOW it would be good for you
• It brought my wife and I closer together. We both had the chance to be supportive because she also went through this; hers was last week.  It was an opportunity to put the world outside for a while and just focus on each other.
  
  

 WHAT YOU CAN GAIN FROM THE EXPERIENCE

Positive outcomes of a great sales meeting:

• Unsuitable opportunities (that actually create an unhealthy approach to prospecting) are jettisoned from the pipeline
• Something is learned that can have a positive and dramatic impact on sales success
• Salespeople, who are getting the right results and doing the right things, get recognized
• Sales skills are improved because upcoming sales or prospecting calls are role-played and practiced
• People left the meeting feeling like part of a successful team – where everyone cares about one another and knows they are all fighting for the same successful outcomes

Additional Resources:

• Effective Sales Meetings – An Audio Postcard to listen to or send to someone else
• Performance Management Learning Module Sample 
• Get a Healthier Pipeline by Starting With Better Appointments – The 8 Step Process to Qualified Appointments (an online learning course)

Even if you are not in “sales”, you’ve actually been in sales your whole life and you’ve had sales get stuck in the pipeline. No? You don’t think so. Well, let me provide a few examples to clarify.

• When you were 5, you spent an entire 30 minutes of shopping time at the grocery store asking your mom to buy you the shiny toy, and after asking please 100 times, you worked down the “buyer” and you got the toy.
• When you were in high school, you wanted your own car and, after asking mom and dad 25 times, promising to do better in school, working part-time on weekends and getting all A’s and B’s on your report card, you finally drove your date to the prom in your own car.
• Let’s be candid on this next one – how many “attempts to close” before you had that first “intimate moment” with that person you are now engaged to/in love with/married to?
• Asking for the promotion
• Asking for a raise
• Asking to be transferred to another department
• Asking for a shot at being partner

Every one of these situations requires some “selling”, and in every situation, you had to make a case for why the outcome you desired was a good outcome.  That, my friend, is the essence of selling.  So, why do sales get stuck?

I’m working on an opportunity right now that has hit a snag. Coincidentally, at the suggestion of Dave Kurlan at Objective Management Group, I’m reading SALES EQ by Jeb Blount.  Based on the 29 pages I’ve read so far, I think I’ve figured out why we - the stakeholders and I - are stuck.

SITUATION:  The stakeholders were looking for a solution to a management problem. They, based on PEAR (Previous experiences/Education/expectations Appearing Real), had a vision of what that solution would and should look like – Sales Management Coaching.

WHY WE’RE STUCK:

1. I succeeded in uncovering the emotional motivation for taking action, BUT I have also introduced additional factors they have to consider because these new factors help solve the root cause of the problem(s) they face.
2. These additional factors have created cognitive dissonance for the stakeholders and they are now in a pattern of trying to reconcile 1)what they initially thought they needed with 2) this “shiny new object” (this new solution that makes sense to them but something they weren’t prepared to deal with from a functional or investment perspective).
3. I failed to meet with one of the money decision makers. This isn’t always a problem, but in this case, I believe it is a problem because he has no emotional attachment to the “new” direction regarding the solution.

cog·ni·tive dis·so·nance noun PSYCHOLOGY

noun: cognitive dissonance 1.the state of having inconsistent thoughts, beliefs, or attitudes, especially as relating to behavioral decisions and attitude change.

3 Steps to Close More Deals More Quickly (To Keep Deals from Getting Stuck)

1. You must create cognitive dissonance (show them the “shiny new object”). This is done when you can express a value proposition, a brand promise, a catalytic mechanism that sets you apart and keeps you from looking, sounding and acting like everyone else selling anything else.
   1. NOTE: This is important!  Keep in mind that your prospects face lots of salespeople in lots of different aspects of their life.  They’ve been inundated with sales pitches and so are numb to the same old same old.
2. You must find a way to connect your pitch to their experience. Mitch Anthony and Scott West do a great job of helping sales professionals do this in their book – Story Selling for Financial Advisors
   1. NOTE: Don’t let the title fool you or discourage you.  The principles of right brain selling work and make a difference in even the most left brain world like engineering and technology.
3. You must “rehearse” their decision-making. What I mean by this is that, no matter what the situation…
   • Go to committee
   • Work with other trusted advisors
   • Talk to partners
   • Run it up the ladder
   • Think it over
   • Talk to spouse

The buyer(s) will go through a process of:

• Remembering their original intent and have difficulty reconciling that original direction with the new information/potential solution you help them discover.
• Then, assuming for a minute that your solution expanded their thinking and may require they expand their wallet, your prospect will start left brain thinking (logic). Depending on their finances, they may default to their original plan with someone else (they trust) simply because of the money involved.
• **NOTE: “Rehearsing them” simply means that you must take them through the process of their thinking. Ask them what they will do when someone on the committee challenges their thinking.  What will they do when the current provider sharpens their pencil?  How will they deal with a partner who doubts or challenges a solution that differs from the original objective(s)?

Additional resources:

• Why is Selling So %$#$ Hard? – Get the Free Book
• Inquire About Sales Scorecards – Call Mark Trinkle – 513.791.3458 or write: Mark@anthonycoletraining.com.  Subject Line: Sales scorecard.
• Find out if your sales process is effective – Sales Process Grader

In many cases, here’s the problem: Sales results are not what you expected.  Regardless of your role - sales manager or salesperson - you are looking at your sales results YTD and you are:

• Not ahead of last year’s production
• Not on pace to hit this year’s goals (personal or corporate)
• Not keeping pace with those in your peer group (those you should be able to compete with based on experience and previous success)
• Not up to par with your efficiency (conversion ratios aren’t the same, average size deal isn’t the same, you’re not getting the leads you used to)
• Taking longer to get sales closed
• Running out of time at the end of the week to get your prospecting done

Those are just a few of the symptoms observed by me, my staff and the many companies we work with when attempting to get our heads and arms around driving sales growth.  I have discovered that there are 2 “MUST TAKE” steps to address this; but, first…

I’m shooting in my first ever National Field Archery Association Indoor Nationals Tournament.  My brother, Michael, and his wife, Gwen, owners of Insight Archery in Binghamton, New York, have participated in this tournament for years.  This year, it is in Cincinnati, so I thought I’d enter.  The first round is today.

Yesterday, we went to the Duke Energy Center where the tournament is being held.  We registered, stored our bow cases and made our way to the practice venue.  I’ve been practicing some, but not enough, in the basement of my house.  My wife, Linda, is not thrilled with this, but I'm a pretty good shooter and honestly, there is very little down there for me to damage. 

The range I have in my home is about 11.5 yards long. The scores I am shooting (25 points per end) are really not a good indicator of how I’m shooting because the distance is too short.  The other night I shot a 244 out of a possible 250 and one floor joist when my release strap broke from my wrist and the arrow in the bow got away from me.

(Nice Shot!)

Yesterday, we practiced awhile and I realized that the shooting regulation distance – 20 yards – is a WHOLE lot different than the 11.5 yards I’ve been shooting at home.  The main problems, of which there are many, are

• I can not see very well out of my right eye due to recent surgery.
• The vision in my left eye isn’t nearly what it used to be.
• Wearing glasses is not an answer because I haven’t figured out how to see around the frame of the glasses.
• I shake a little more than I used to when I get up to about 50 shots because I haven’t had the time to practice to build up my endurance.
• When I shoot by myself, I'm by myself. When you shoot in a tournament, there is someone right behind you and right in front of you creating a heck of a distraction.

When we finished practice, we walked over to another practice range and met up with Hilda, a friend of Mike’s and Gwen’s, who is also shooting in the tournament.  Right next to her was an older large gentleman with his bows and arrows… who  only had one arm.  He’s shooting at the same type of target I am …but minus his right arm.

I’ve seen videos of people doing this and I’ve heard stories about this, but I had never before witnessed it live.  He placed the bow (to rest on the stabilizer) on the floor between his knees.  He notched his arrow and lifted the bow with his left hand to bring the bow string close to his mouth.  He grabbed the release with his teeth and pushed the bow out to full draw with his left hand. He steadied his left arm, sighted slightly with his head and, finally, released the arrow by opening his mouth.

Then and there this article hit me!  I realized that the solution to sales success, sales growth and sales results really comes down to 2 basic fundamentals.  Sure, the man has skills, strength and stamina to do this, but he has 2 other things that trump everything else:

1. Effort
2. No Excuses

You don’t just show up at a tournament and NOT put forth the effort to compete... and then expect to compete.

AND… You don't allow excuses to get in the way of the effort (like I did - see above).

Sir, I don't know who you are. But I hope I see you again today, so I can say hello and let you know what an inspiration you are to me and maybe to anyone else who might read this article.

Additional Resources:

The What Works for Biz Interview (Greg Miller interviews Tony Cole): Peak Sales Performers ARE Out There

Master the Sales Managed Environment® with the SME Video Practice Center

Are You Owning Your Sales Results? Listen here

I'm sure someone from the Harvard Business Review or the University of Pennsylvania Wharton School of Business could prove otherwise, but when it comes to defining success, I don’t believe there is an art to it.

Artbusiness.com

• DeWitt Cheng, freelance art writer and critic, Bay Area, CA: Jorge Luis Borges wrote," Art has become, in the experimental 20th and 21st centuries, impossible to define."
• Robert Berman, Robert Berman Gallery, Los Angeles: "Reality is by agreement. The reality of art is usually by some kind of agreement. The arbiters are the museums, the museum curators, the people who spend their lives and their time actually being critical of what they see and judging what they see. If you add in four or five art critics who are then able to write about it, if you get four or five major collectors who are passionate about what they collect to patronize it, and several major auction houses to auction it, then a consensus or vetting process begins to unfold."

I don’t have the space to include, and you don’t have time to continue to read, all the articles available when I google "What Makes a Work of Art Successful", so we’ll let these two quotes validate that, when it comes to defining sales success, it is best not to be arbitrary or hope for a consensus.

Science Defined by Merriam Webster:

1:  the state of knowing :  knowledge as distinguished from ignorance or misunderstanding

2a :  a department of systematized knowledge as an object of study the science of theology  b :  something (as a sport or technique) that may be studied or learned like systematized knowledge have it down to a science.

It is safe to say that if, within your sales managed environment®, you have "defining success" down to a science, then you will be in a better position to identify:

• Metrics that determine success
• What leading indicators lead to success (kind of like a math problem – although there are a multitude of formulas you could use to arrive at the number 4, there are probably only a couple that people would use:
  • 2 +2
  • 3 +1
  • The square root of 16

• Define the goal to be achieved – it’s a number or a definitive outcome.

But…

Maybe there is something beside the math/science that has to go into it.  I’m not sure it’s art (so I would love to hear from you what you think it is…) but here is what’s been noodling in my head for a couple of days.

This basketball season, Northwestern University of the Big Ten Conference, beat Michigan (Sorry, Jack, Mark and Marty...) with a buzzer beater full court pass and short jump shot.  Take a look here:  NCAA Video

In the aftermath, every sportscaster was talking about how this was the most wins in NWU history, it will be the first time EVER that the school has made it to the NCAA tournament and the coach, Chris Collins, has increased the number of wins every year he has been the head coach at the University.  With the win over Michigan, they recorded their 21^st win of the season.  This information would lead us to believe that Coach Collins is successful because you are comparing his results to a standard that is generally accepted as success:  Winning 20 games a season and qualifying for the NCAA tournament.

The head coach at Columbia University with the most wins is Lou Little.  Lou coached the Lions to 110 victories!  When Coach Ray Tellier retired from Columbia in 2002, the article announcing his retirement declared that he was the 2^nd all-time “winningest” coach in Columbia’s history behind Lou Little.  When I read this, I was impressed and happy for him; Coach Tellier was an assistant coach at the University of Connecticut when I played there.

What I didn’t know at the time of the article, but found out later, was that Coach Tellier, over a 13-year period, lead his teams to victory 42 times - a 30.7% winning record.  And he was second on the list at Columbia.  Coach Little, with the most wins, had a winning percentage of 48.8% and averaged just over 4 wins a season over a 26-year career as the head coach at Columbia.

What does this have to do with selling and determining sales success? Everything.

Companies collect lots of data and sales managers do their very best to spin a good story when outcomes are not equal to or greater than expectations (goals).  Here are some examples of how outcomes are described when attempting to put a good spin on a bad outcome:

• We are trending the right direction
• Our year over year production is positive
• We are outperforming our peer group
• We have gone from #____ in stack ranking to #______
• We will finish in the top percentile of our district
• _____% of our team will qualify for incentive compensation

Those descriptions tell you nothing about how a team is actually performing.

What to do instead:

• Identify metrics that are critical success factors for your organization. (In most organization the #1 metric is revenue – it pays the bills.)
• Establish standards for those metrics that exceed previous performance levels and are consistent with what the market will allow. (You wouldn’t expect an operating unit in Bangor Maine to produce the same loan revenue as you would an operating unit in Manhattan.)
• Make sure you are looking at execution metrics so that your success is duplicable and you can identify choke points when there is failure.

Do this now:

• Call me about Scorecards for sales opportunities – 513.226.3913

• Email me to get more information about Performance Management – tony@anthonycoletraining.com

• Coach Your People to Success video