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Numbers Don't Lie

Almost every time I tell a story that involves my chastising a salesperson who won't listen to the boss, won't get busy selling, won't try something new, won't keep learning, won't measure his or her sales funnel objectively, won't show his or her activity to the rest of the team, and so forth, somebody asks, "Why are you so hard on salespeople?"

I'm not hard on salespeople. In fact, there are few things about my day I enjoy more than getting shoulder to shoulder with the ones who want to succeed and are willing to work at it.

What I am hard on is salespeople who talk a good game but can't or won't do anything else.

The only thing worse than no salesperson is a crappy salesperson. Let's take a look at a real sales team (the names have been changed to protect the guilty), and I'll show you what I mean.

Joan's Team

Joan is the chief executive officer of Three Tiers Creative, where she manages 15 salespeople who have each been with the company at least 18 months.

During the past 12 months, these salespeople sold exactly this much business:

 
• Livia - $1,200,000 
• David - $950,000 
• George - $925,000 
• Muthu - $712,000 
• Doug - $651,000 
• Darlene - $401,000 
• Tiffany - $385,000 
• Bassam - $384,000 
• Eric - $290,000 
• Kim - $183,000 
• Jo - $125,000 
• Vince - $112,000 
• Manish - $107,000 
• Jeff - $98,000 
• Eli - $33,000

Performance Groups

To determine the negative impact of her under-performing salespeople, Joan must first break them into performance groups, then compare their numbers. There are many complex formulas for accomplishing this, but we like to keep things as simple as possible, so we'll use the formula provided by Dr. Wendell Williams, of Scientific Selection LLC.

If you total the production from Joan's team and divide by three, you'll get a cut-point that allows you to divide her team into three meaningful production levels, or "tiers."

Total sales of $6,556,000 divided by 3 equals a cut-point of $2,185,333 per production tier.

Determining Tiers

Now we must determine into which tier each salesperson falls. Starting at the top, we'll calculate a running total of our team's results, until the total exceeds our cut-point of $2,185,333.

Livia ($1,200,000) + David ($950,000) + George ($925,000) = $3,075,000. This is our Tier 1 group.

Starting with the next person in our list, we'll begin again until we hit our cut-point with Tier 2: Muthu ($712,000) + Doug ($651,000) + Darlene ($401,000) + Tiffany ($385,000) + Bassam ($384,000) = $2,533,000.

Our remaining people compose our Tier 3 group: Eric ($290,000) + Kim ($183,000) + Jo ($125,000) + Vince ($112,000) + Manish ($107,000) + Jeff ($98,000) + Eli ($33,000) = $948,000.

Difference In Production

Now we must determine the difference in production between the tiers. While I would prefer to hold Tier 3 people to the Tier 1 standard, Dr. Williams advises we use a more conservative model, and compare them to Tier 2 instead.

To compare these tiers, simply determine the average production within each tier, then calculate the difference between the two:

Tier 2: $2,533,000 divided by 5 = $506,600 average sales.
Tier 3: $948,000 divided by 7 = $135,429 average sales.

To get the average lost-opportunity cost of a Tier 3 salesperson, subtract the Tier 3 average from the Tier 2 average: $506,600 - $135,429 = $371,171.

Cost To The Company

Every salesperson in Tier 3 is costing Joan's company an average of $371,171 in lost opportunities per year. Multiply this by the number of people in Tier 3 to get Joan's total lost-opportunity cost: $371,171 x 7 = $2,598,197.

These seven bad salespeople are costing Joan's company $2,598,197 in lost opportunities every 12 months, yet they eat up just as much in company resources as the Tier 1 and Tier 2 salespeople.

All of these people have been with the company long enough to justify comparing them to one another. Every one of them looked good enough to hire. All have had the same chance to excel.

At this moment, Joan has more than 2.5 million reasons to fire Eric, Kim, Jo, Vince, Manish, Jeff and Eli, and replace them with one Livia, or a Muthu and a Doug. And I'm hard on salespeople, because the fist step toward helping the Tier 3 folks is to tell them the brutal truth -- to be as hard on them as is needed to wake them up.

Do you know into which sales tier you fall at your company?

You should.

--
Gill E. Wagner, Sage of Selling
President of Honest Selling
Founder of the Yellow-Tie International Business Development Association

Book Review: Selling With Integrity

Selling With Integrity, by Sharon Drew Morgan -- review by Gill E. Wagner

Prologue

As part of the competitive research effort that went into starting Honest Selling, I actually read "Selling With Integrity" in early 2000. My initial interest was, of course, the name of the book, as it seemed to match my philosophy and ideas about selling.

While nothing written in the book contradicts the philosophy conveyed by the title, I remember having an uneasy feeling that something was missing as I worked my way through the book. It wasn't until rereading the book for this review that I figured out from where that feeling came.

I hope you find that aspect of this review interesting.

Enjoy,

Gill

Philosophy

"Selling With Integrity" is indeed a book for anyone who is struggling to make the conceptual switch from using manipulation to using honesty to sell. Throughout the book, using many religious undertones, Ms. Morgan places an emphasis on doing what's right, thinking of the prospect's problems first, putting your needs second and generally collaborating to identify whether a reason to do business exists. (These are all ideals with which I agree.)

In chapter three, she summarizes these ideals with what she calls the "Six Principles Of Buying Facilitation."

1. You have nothing to sell if there's no one to buy.
2. Relationship comes first, task second.
3. The buyer has the answers; the seller has the questions.
4. Service is the goal; discovery is the outcome; a sale may be the solution.
5. People buy only when they can't fill their own needs.
6. People buy using their own buying patterns, not a seller's selling patterns.

Each of these principles is then explained in one or two pages of detail that will probably help you if you're trying to justify the switch to honesty in sales.

In addition, this book attempts to outline methods for getting inside the head of the buyer, so you can sell the way the buyer buys instead of manipulating him or her into buying the way you sell.

While I am totally on board with that concept, the actual examples and ideas get you, at best, half way to that goal.

The Process

If there's any area where this book falls short, it's in defining a process for accomplishing the results you're after. I'm a huge believer in process, so I found myself ready to jot down "do this, do that" notes, only to be left with less than a page of implementation ideas after I finished reading. (I like books that give me homework, so I'm undoubtedly biased here.)

Still, some good examples are dotted throughout the text, as are some really good lists of questions you might ask your prospects. And there are a few good examples of how certain styles of questions work better or worse than others, or how one style elicits a negative reaction, while another elicits a positive one.

So what I suggest is that, before reading this book, you assemble all your current material (marketing plans, sales checklists and questions, etc.) and then take notes in the margins of that material as you go. That way, you'll be able to slightly improve your approach based on what Ms. Morgan has to say.

My Reservations

My single biggest reservation comes not from the book itself, but from the response I got when I contacted Ms. Morgan with a question.

I had noticed that every example in the book ended in a positive outcome. For instance, the book conveys that, to get a great conversation with a prospect, all you have to do is call and say, "This is a sales call." So I actually tried doing exactly what the book said, and I tracked my results:

• I dialed the phone 150 times.
• I reached a gatekeeper 31 times and my prospect 21 times. (The remainder were busy signals, no-answers, auto attendants, voice-mails, etc.)
• I introduced myself and said, "This is a sales call."
• Every gatekeeper responded with some form of: "[Mr. Jones] doesn't take sales calls."
• Every prospect responded with some form of: "I don't take sales calls."

In reality, this was about what I expected, because despite the blatantly honest approach, I wasn't actually adding value to anyone's day.

But nothing is 100 percent, so I decided to play mystery shopper, contact Ms. Morgan and ask, "How many phone calls do you actually have to make before you get one of those great conversations you describe in your book?"

After dodging the question by telling me "I don't track such things," I forced the issue once more, and she finally said, "If you insist on questioning the process, then you clearly aren't committed to making it work." (These quotes are from memory, so while they convey her attitude, they are probably not exact wording.)

That's when the light bulb finally turned on and I realized what was missing from the book. It has no actual statistics and no real-world failure examples.

Opinion: When I called, I expected to speak with someone who would interview me and help me decide whether her course was for me. What I got instead was more like what I'd expect from a cult leader who wanted to indoctrinate me, and who expected me to accept everything on blind faith.

Opinion: I have a standing rule to always be suspect of any sales professional that doesn't track dialing activity, because salespeople often wear rose-colored glasses and conveniently forget the hundreds of bad results once the cherry comes along. I also don't use any professional who failes to practice what he or she preaches.

Recommendation

For those who still struggle to understand why honesty in sales works, or who want to punch up some of their prospect questions, the book is worth reading. Just don't accept on blind faith any of the results claimed in the book. Instead, test the ideas for yourself, and track your results.

--
Gill E. Wagner, Sage of Selling
President of Honest Selling
Founder of the Yellow-Tie International Business Development Association

The Gleam In Your Eye

I am the only man I know who can remember the exact moment the woman I would marry fell forever in love with me (and actually confirmed it at that very moment; first rule of sales: Never assume anything!).

It was April 3, 1982, about two months after we began dating (although we had been great friends for years). I was driving Cindy to my aunt and uncle's 25th wedding anniversary party, and I happened to briefly glance her way. I saw something in her eyes I had never seen before -- a gleam. I took a small gulp of air, grinned slightly and then asked, "You just fell in love with me, didn't you?"

Cindy's simple reply of "Yep" began a love affair that has lasted 24 years and is still going strong.

A few months ago I was working with a new client who hired me to conduct a sales audit, which involved my looking over everything and offering opinions as to what needed to be fixed and how to fix it. (Gill:? Offer an opinion? Really?) I had learned that the company's two biggest problems were several crappy salespeople, and a lack of objective communication among the entire team.

These two issues were causing a host of problems ranging from nit-picking to full-blown backstabbing. And it was making it impossible to hire good salespeople or keep the currently employed ones from jumping ship.

Since increasing communication was the key to solving both problems, that's where I focused my efforts.

During a meeting with their entire team, I explained the problem. I documented examples. And I gave my client three suggestions for immediately increasing the quality of communication among team members and, thereby, increasing their sales results.

First, I explained an easy-to-use method of measuring each salesperson's sales funnel based on objective thinking, and explained how comparing a salesperson's actual funnel to his or her target funnel would identify exactly what behaviors to change.

At this point the executive, his sales managers and about two-thirds of the sales team (group one) began nodding their heads and displaying other physical signs of "that makes sense" agreement. At the same time, the other third of the salespeople (group two) began to shift uncomfortably in their chairs.

Second, I showed them all how to measure each sales opportunity based on where the buyer is in his or her buying process, instead of where the salesperson is in his or her selling process.

When I added, "After all, it's what the buyer is thinking that counts," two things happened. In group one, the head-nodding intensified, smiles were added, and note-taking and sales funnel evaluating began in earnest. At the same time, those in group two began to show even stronger visible signs of distress, including sunken shoulders, bowed heads and "oh, no" stares.

Third, I told everyone that the only way to ensure team-wide success was to make all of this measuring publicly visible -- so that every person at the company could see exactly what the sales team was doing.

It was during this explanation that I saw many of the sunken shoulders expand and bowed heads raise -- but not in a positive way. You see, when a guy like me tells bosses to publicly expose salespeople's lack of progress, the moods of those bad salespeople will always change from downtrodden to hostile. I am, after all, eliminating their ability to hide their weaknesses by exposing them to the world.

In this particular case, the hostility was voiced in the following way (by my favorite fictional salesperson "Joe"):

Joe: "You don't understand how I sell. And having my daily activity critiqued by everyone at this company will only add to the problems we're having on this team."

Gill:: "So you don't feel that what you do at the company should be seen and evaluated by the rest of the people here?"

Joe: "No."

Gill:: "Let me ask you a question. Suppose you met with a prospect for breakfast and learned that the opportunity for business with his company was huge. That if you close it, this would be the biggest sale you'll make this year. You with me so far?"

Joe: "Sure."

Gill:: "Suppose that after meeting with you, the prospect wanted to come straight here to tour the office, meet some decision-makers and get a feel for how you guys operate. Still with me?"

Joe: "Yeah."

Gill:: "Suppose, as you walk in the front door with your prospect in tow, you find handprints all over the glass, mud tracked across the carpet and trash cans that are overflowing. In other words, suppose your prospect's first impression of the place is that you work in a pigsty. After your prospect laughs and leaves, who will receive your wrath?"

Joe: "The janitorial staff, of course."

Gill:: "So you depend on the janitors to keep this company's image strong. And when they screw up, it can easily cost you a sale and your commission. Is that right?"

Joe: "Sure."

Gill:: "Who pays the janitorial staff?"

Joe: "The company."

Gill:: "If you people don't sell, will the company have money to pay them?"

Joe (sheepishly): "I guess not."

Gill:: "So if you don't find leads and close business, those janitors are out of a job. Right?"

Joe: "I suppose."

Gill:: "You both rely on one another for your income. Do you really think it's fair that you get to view their work and complain when they don't do their jobs, but they don't get to view your work and complain when you don't do yours?"

Joe stared at me like he'd been shot. When he couldn't find anything to say, I glanced in the direction of the Senior VP of Sales (the top executive in the room). The gleam in his eye spoke volumes.

Just like with Cindy 24 years ago, that gleam in his eye told me everything -- it told me he now believed in objectively measuring his sales team's performance. It told me he understood my explanation of doing just that. It told me he believed in publicly displaying the results. And it told me exactly how successful his sales team was going to be -- the success of that team will be equal to the intensity of the gleam in that executive's eyes.

Are you the leader of your sales team?

How intense is the gleam in your eye?

--
Gill E. Wagner, Sage of Selling
President of Honest Selling
Founder of the Yellow-Tie International Business Development Association

Can I Be Useful?

One of the reasons I absolutely love sales training, coaching, etc., is that I get free training from my clients every day. (Well, actually, they pay me, and I learn from them, so it's even better than free.)

Take yesterday, for example.

I was working with two executives and two salespeople at Access US. The purpose of the meeting was to help with a salesperson (let's call him "Sam") the company just hired -- to get him ready to start dialing the phone, which included guiding him on his opening script for the phone calls.

The basic plan was quite simple: The executives assigned Sam 98 small customers. And his task was to do the following:

1. Spend about five minutes looking at a customer's billing records and website (i.e., try to learn something timely about the customer's business).
2. Call the customer.
3. Introduce himself.
4. Tell the customer something along the lines of "I'm new at Access US, and I've been assigned to your account."
5. Mention the current services being provided, such as "I understand that you're currently hosting your website with us."
6. Incorporate the current information into the conversation: "I just visited your website and noticed you're trying to find some new truck drivers."
7. Ask how he could help.
8. If the customer engaged, say anything along the lines of "I'd like to meet you and learn more about your business. Can I buy you a cup of coffee sometime soon?"

While Sam understood the basic concept, we could tell that a live example would bring it home, so Vic Mattision, the president of Access US, picked up the phone, dialed one of the 98 customers, introduced himself, and said, "I'm calling to see whether I can be useful to you."

I've been selling and teaching sales for pushing 30 years now, and I've never heard "How can I help?" phrased so eloquently:

"I'm calling to see whether I can be useful to you."

I've had people get hostile when I asked whether I could help, but I can't imagine anyone getting hostile if I ask whether I can be useful.

And I don't know about you, but this is exactly the kind of Internet service provider and web-development company I want (not to mention attorney, accountant, phone company, printing company, etc.).

And more importantly, it's the kind of professional I want to be. So ...

... Can I be useful to you?

--
Gill E. Wagner, Sage of Selling
President of Honest Selling
Founder of the Yellow-Tie International Business Development Association