Текст книги "Make Winning a Habit [с таблицами]"

Автор книги: Rick Page

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Performance Reviews – More Than Just Deal Competence

One of the biggest mistakes companies make is reserving employee performance feedback for the typical annual review.

Eric Gist and Patrick Mosher, Accenture,

The Sales Performance Challenge

I am still amazed at how many companies don’t consistently use performance reviews at all and how many sales organizations use the standard one provided by HR as a way to review salespeople. Based on the effectiveness of most canned reviews, one can understand why.

The best practice is to write performance reviews for salespeople that include the skills, knowledge, and behaviors required to execute your best practices sales cycle. Otherwise, reviews usually are a waste of time.

But there is more to overall performance than deal competency and personality. In addition to competence and chemistry, many salespeople fail because of a lack of commitment, lack of character, lack of communication skills, or lack of cognitive ability to think quickly on their feet.

Deal competency alone may be less than half of overall sales competency, and this can only be measured by observation by sales managers and documented in a performance review designed specifically to measure performance in the field. Figure 9–2 presents a useful diagnostic tool for identifying performance problems in both deal management and the other important elements of overall performance.

Written tests and training session “smile sheets” only measure awareness and acceptance. Assessments on behavioral “smile sheets” only measure awareness and acceptance. Assessments on behavioral traits and other things just measure potential. Win-loss reports and numbers just measure deal competency. Only a manager can tell whether the salesperson is competent, as well as committed.

Salespeople become unmotivated because their goals are out of reach, they have lost belief in the company, they have lost belief in the products, or maybe they have personal distractions or have lost confidence all together.

We find that a large number of salespeople fail because of a lack of character. They are not trustworthy. They think selling is a manipulative game. They are not honest with their clients, they are not honest with their managers, and they are not honest with themselves.

Some of them have other businesses on the side. Some of them are not honest with their managers about where they stand in their deals. Some of them set expectations too high, hoping they’ll be gone by the time the price has to be paid.

In order to build trust with a client, a person first has to be trustworthy. It’s not a matter of what they do; it’s a matter of who they are. This goes back to the hiring profile and can only be identified after the hire by performance. Obviously, a 360-degree assessment is even better because teammates and customers sometimes will spot this before the sales manager will.

Numbers alone are not always adequate. A sales rep can make his or her number and still lose a lot of business based on the territory’s potential. I’ve seen hot markets where a chimpanzee in a three-piece suit could make quota.

Conversely, I’ve observed one of the best salespeople I know do everything right and still struggle for a year. A good performance review spotted the problem (we had changed his territory twice – he had been setting up deals that other salespeople closed). Performance observation saved a future star who went on to become an extremely successful performer and manager.

What about Motivation?

To me, there are two sources of motivation– inside-out and outside-in. One lasts; the other doesn’t. I think real motivation comes from inside:

• A quality solution or product that they feel really helps a customer – one that the customer will thank them later for selling to them.

• A solution that can win. It doesn’t have to be superior; it just has to have relative strengths that they can focus on the right prospect without stretching the truth. It must be one in which they can have contagious conviction. Salespeople have to have a playable hand. They can only make up so much gap.

• Good compensation – competitive, no-caps, fair, high-upside. In most companies with successful sales forces, a salesperson is often the most highly paid person in direct compensation. And management thinks that this is wonderful because the stock would be sky high if the company had 20 more of them. And never, never cut it in the middle of a year unless somehow you think 100 percent sales force turnover is a strategy. (It’s happened.)

• Trips. It’s not just the trip; they can afford the trip. It’s the peer and management recognition. And it’s being able to go to your spouse and tell them you won them a trip to a very nice place. Visions of warm climates seem to drive salespeople though the snows of December.

• Personal standards and drivers. Ambition, ego, self-image, fear of poverty, achievement mentality – I’ve seen them all work.

• Working for good management that they can trust and the opportunity for personal growth.

• Achievable goals. Make ’em stretch – but an unattainable goal will demotivate a sales force faster than anything.

• A support organization that will help the sales force create a great buying experience for the customer and make them feel good about what they sold.

If you don’t have these things, a motivational speech, cheerleading, or a merchandise contest won’t help. If you do have these things, you don’t need the others. Focus your speakers on achieving the preceding.

Primary Intelligence has an excellent “Sales Confidence Index” survey that actually measures confidence of sales forces in the preceding factors. If your salespeople don’t believe in your company and your solutions, then they can’t sell them with conviction, and you may not know until too late without third-party feedback.

Win-Loss Reviews – The Silver Bullets of Truth

Another great metric is a win-loss analysis by a third-party organization. The words of the client as to why you won or lost are the silver bullets of truth.

Companies such as Primary Intelligence create win-loss reports that are invaluable and must be conducted by an outside third party. These reports collect information and feedback as to why you lost so that you don’t make the same mistake over and over again. This information is pure gold (and you are going to pay for it in one way or another) and needs to be refreshed on an almost-daily basis.

It will help salespeople learn from win-loss reports if they first accept that all losses are the result of being outsold. Some will say that they were just in the wrong deal. If this is the case, and they stayed until the end, they were outsold.

In the case of the “lesser product” excuse, if they sometimes win with the lesser product due to superior selling, then they must have been outsold. If price is the excuse for the loss, why didn’t they find that out earlier?

It has been said that there are three things that can happen in a deal: You can win, walk, or get outsold. In reality, there are four. You can also lose to no decision after wasting resources.

You can create your own win-loss reports, but the answers are almost always predictable. “We won because of superior salesmanship” or “We lost because of price and product.” You might as well have them preprinted.

The only caution or filter required to make the best use of this information is to remember that customers are making an emotional and political decision in the end. However, when they give answers about their decisions, they will say that the decisions were logical and rational.

The key is knowing how to dig down into the political and emotional dynamics of the deal. An effective third-party company calling on the customer will uncover incredible things about preparation, personality, politics, competitive strategies, failure to link into issues, and misreading of accounts. They are a treasure trove of corrective information.

Perpetual Advantage Competetive Cycle Speed—Get Ahead and Stay Ahead

Sustaining advantage requires continuous improvement and change, not a static solution in which strategy can be set and forgotten.

Michael Porter

Speed has become an important element of strategy.

Regis McKenna

Execution, rather than awareness, is at the heart of making winning a habit. Speed and consistency of execution and innovation are the path to sustainable competitive advantage (see Figure 9–3).

Feedback from all these sources and metrics should cause sales forces to continuously evaluate personnel, sales messages, product offerings, value propositions, and customer loyalty. If these are well implemented and used effectively, the result is a move from inconsistent, up and down results to perpetual advantage.

We discussed in an earlier chapter how Col. John Boyd revolutionized military thinking and maneuver warfare. His acronym for competitive cycle speed in a fighter plane and then a military unit was the OODA loop. OODA stands for observe, orient, decide, and act, and it changed everything.

Winning pilots or winning generals get information faster than the opponent, process it faster, and react more quickly according to principles to gain an advantage in every situation. It isn’t the plan but the speed and effectiveness of the adjustment process that gives them the advantage.

Speed and accuracy of information drive speed and accuracy of strategy, which drive competitive advantage. The battles of Napoléon, Nelson, Jackson, and Patton, as well as many marketing campaigns, all teach us this lesson from history.

New technologies can enable the right metrics and adjustment processes without requiring additional input from sales reps to slow them down.

If you can measure in less than one year which salespeople can drive a complex sale, if you can detect and correct deals that are out of control at each phase of the cycle, if you can improve messages in response to the competition within 48 hours, if you can improve your sales cycle model and hiring profile with every win or loss – then you and your sales organization can get ahead, stay ahead, and achieve perpetual advantage. Somebody’s going to do it right first. Will it be you?

Summary: Trail Map to Transformation

1. Establish realistic expectations with upper management.

2. Assess your individual and organizational pains.

3. Compare these pains with your vision – identify your performance gaps.

4. Prioritize your initiatives:

• Build a management team that shares your vision.

• Upgrade quickly those who can’t or won’t improve.

• Define your own best sales cycle model.

• Build a new hiring profile for reps; repeat upgrade.

• Re-examine your messaging positioning.

• Train on the methodology using your unique sales cycle and live accounts.

• Only then automate your process, giving reps what they need to win.

• Build your methodology into your forecast, performance reviews, compensation, and hiring profile.

5. Execute change while selling; you can’t stop to rebuild.

6. Document some quick wins to build belief and trust.

7. Reinforce coaching discipline to make winning a habit.

8. Introduce new metrics for accountability, continuous improvement, and perpetual advantage without slowing the reps down.

Transformation Scorecard
Best Practices, Transformation	Importance	Execution
	Degree of Importance (1 = low, 10 = high)	Agree, but we never do this	We sometimes do this	We often do this	We do this consistently
Individual
We conduct sales-specific performance reviews for salespeople that include the specific skills, knowledge, and behaviors required to execute our best practices sales cycle.
Opportunity Management
Training is relevant and involves working live deals in class.
We have a coaching feedback system from strategy sessions that is a part of our forecast.
We have a presentation and messaging feedback system to measure presentation effectiveness.
Account Management
We have a closed-loop sales and marketing system that integrates sales, service, marketing, and design.
Managers attend and help lead training sessions.
Managers can track action item completion and training follow-through by individual.
Industry/Market
We have a top-management commitment to full integration of all sales processes – training, compensation, rewards, hiring, and tools.
Our feedback and innovation processes keep our competition reacting to our initiatives.

Appendix-Review

R.A.D.A.R.^® Six P’s of Winning a Complex Sale

As described in detail in Hope Is Not A Strategy, R.A.D.A.R.^® is an opportunity management process for controlling competitive evaluations involving politics, strategic solutions, competition, and decision-making processes by committees. This section provides greater detail on the six-P process, so that this book will be complete in itself. If you have already read Hope, this is a review.

Link Solutions to Pain

In fact, how well and quickly you review and revise your plan is more important than the perfection of the original plan.

The first step in the process is to understand the client’s pain (or gain). What problem is the client trying to solve? A dormant pain is a problem clients don’t even know they have compared with an active pain that they have not only acknowledged but for which they are actively seeking a solution.

Active pains already have money budgeted and teams working with vendors to find a solution. But if you can uncover a dormant problem, elevate it to an active pain, and effectively link your solution to solving it, you gain competitive advantage.

When linking your solution to a benefit, remember to ask yourself what the customer is always thinking: “So what? What does it mean to me?” Failing to answer this question leaves the job of linking your solution to the client’s business pain up to the client, which results in a loss of control and perceived value of your solution. You need to make sure to sell strategic benefits to strategic buyers and sell technical benefits to tactical buyers.

Qualify the Prospect

How you qualify a prospect depends on the number of opportunities in your pipeline and your available resources. The first question you should ask yourself when qualifying a prospect is, “Will this business happen for anyone at all?”

Many deals are lost to “No decision.” This is so for two reasons: Either the business pain that you solve is not urgent enough to act upon or there is no political sponsor strong enough to push it through. The pain needs to be strong enough and emotional enough to drive change and create a source of urgency, or else the deal will sit on the forecast.

The next question should be, “Is this a good opportunity for us?” Keep in mind that in many evaluations the client has already decided who they are going to buy from.

Build Competitive Preference

There is a wide range of preference in complex sales ranging all the way from disclosure, where the client is telling you what you need to know to help you win, to the highest level, trust, where they’re buying whatever you’re selling. There is also a spectrum of negative preference, which ranges from skeptical to even open hostility.

The pain needs to be strong enough and emotional enough to drive change and create a source of urgency or else the deal will sit on the forecast.

In the last 20 years, some methodologies also have taught building preference with everybody. We disagree. First of all, there isn’t time. Second, it isn’t necessary. Third, it can actually be counterproductive. Not that we should ever alienate anyone, but based on the decision-making process and the roles people play, we can win the business by focusing our preference-building efforts on the people who have the most impact on the decision.

Building preference in all directions, without a strategy, is a waste of time. Selling to everyone equally not only spreads your efforts too thin, but it can help the competition. For example, the people down on the hostile end of the scale are probably too far gone. The other problem is that they often don’t act hostile. They may be very nice to you, when, in fact, they are taking everything you give them and passing it straight to the competition.

In account strategy sessions, we see people pounding away on these antagonists in the hope of winning everyone’s vote, sending pounds and pounds of literature and wasting sales calls. Based on the decision-making process, if a complete consensus is not required, we may be able to win without their vote. They may not even have a vote.

And don’t confuse access or politeness with preference. Just because they will meet with you and are nice to you doesn’t mean they will sponsor you. The quality of relationships, from the salesperson’s view, is the most frequently misread and overestimated part of a salesperson’s plan.

You need to know not only if people are for you but also how strongly they are for you. When the pressure builds, you need to know if they are going to fold their cards.

To build competitive preference in an opportunity, you have to establish the political point of entry and then effectively differentiate your company and solution and build positive mindshare with key influencers – before your competition does it.

At the account level, building preference in the long run means overdelivering on what you sold them. Then you need to move from loyalty to trust by never giving them a reason to go to anyone else. You have to make your sponsors look good for having chosen you.

Determine the Decision-Making Process

Before you can drive an effective strategy, you have to understand the client’s decision-making process. This is different from the client’s evaluation process. It is also different from the approval process (see Figure A-1).

As most competitive evaluations progress, there is a point where they turn from logical and rational to emotional and political. This is typically because the principals have not reached a consensus and have divided camps. Because they can’t find everything they want from a single vendor, they often can’t agree on what their priorities are. Sometimes the result is a power struggle, where multimillion dollar deals flip in a matter of hours.

We use the metaphor of the canyon and the crucible to describe this dynamic. The canyon is the narrowing list of vendors with only one survivor (it’s not a funnel – gravity, nor large numbers do anything for you). The crucible, as in chemistry, is where political pressure builds, the decision process melts down, and tempers often explode.

In other cases, clients can find a solution from several vendors, and the issues shift to non-product differentiators. Some evaluations stall out altogether from increased risk, low value, or lack of sponsorship.

As one of our clients said, “They don’t decide how to decide until they can’t decide.” Things move fast in the crucible, which means that strategy revision should be daily and dynamic.

When Jack Barr was selling to Lockheed Martin for SAP Software, the evaluation committee at Lockheed included 207 members. But, in reality, the decision was made by only five people.

Though those five were positioned as only a part of a democratic vote, it was really an algebraic democracy. Both Jack and his competitor knew this, but the competitor didn’t believe it.

In the end, Jack concentrated his efforts on the right people and won.

Decisions in a buying committee often are reached by what we call algebraic democracy. Although most people have some sort of vote, some votes count more than other people’s votes. While some votes count x, other votes count 5x, and some votes equal the sum of all other votes plus one. This is a blind spot in most sales plans. Other decisions may be by department or autocratic or may be twotiered.

Sell to Power

In an organization, power is both invisible and dynamic. Some power comes from positional authority, but many people hold personal power and influence without a powerful title.

To make things even more complicated, people within a company gain and lose power every day. You have to be able to identify power in a prospect account and win the prospect’s support early on in the sales cycle. Start early figuring out multiple navigation routes to powerful people. If you can build preference and win the hearts of the powerful people, they will help you win the votes you need.

You also can borrow power from one person to gain access to someone else. In the very beginning, start asking questions about political power so that you can find out who has it and where you should spend your time.

Develop and Communicate the Plan

Some methodologies have defined strategy at only the account or opportunity level – frontal (price and product superiority), flanking (changing the pain, process, or power), fractional (divide and conquer or take a slice), and timing (delay or accelerate). These are important models, but without a plan for how to win the hearts of each individual stakeholder or to live without their vote, you have a strategy in name only. You have the what but not the how-to action items to execute your plan.

A winning strategy enables you to anticipate events and communicate your plan. Complex sales strategies must be driven at the industry, enterprise, opportunity, and individual levels. Without a plan, you are at risk of having more than one salesperson on an account saying the wrong things to the wrong people.

Collaboration is critical to the extended sales team. Not only do you have to have a clear strategy, but you also have to be able to communicate the plan to the team. Everyone on the team must know the goals and objectives and must be accountable for their part.

Additionally, you need to have a plan B. Once you have tested your plan, develop alternative strategies. Bad news early is good news because you can still change your plan. Like poker, the worst outcome is to finish second, late after you’ve spent your resources.