Tag Archives: qualify

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There Are Two Types Of Prospects…

Mary runs a sales development team for a technology company based in San Francisco. She was previously employed by another customer of mine, so we had some positive working history. Her boss was breathing down her neck and demanding results. She asked me to listen in to phone calls her reps were making to identify the problem.

After listening to multiple calls by various reps, I codified their process into the following:

  • Hi, my name is <Name>
  • I work for <Company Name>
  • We are the leader in <Solution Definition>
  • I’m calling you today because <Ask>

I pulled her team together, wrote this list on the board, but made two changes. The first was that I put all of my information in the brackets, such as, “Hi, my name is Kevin Temple, I work for ESG,” and so forth. The second change I made was I added another step, “I help SDR’s who are frustrated by low hit rates, phone hang ups, and escalating pressure to improve results”.

Then I asked them one by one to vote for the one topic that would cause them to want to talk with me. Unfortunately for my ego, it wasn’t my name, my company name, or my consulting practice description; but I knew that before I asked the question.

Without exception, they all selected the added line, “I help SDR’s who are frustrated by low hit rates, phone hang ups, and escalating pressure to improve results”. When the realization sank in, I saw the heads slowly rise and fall with understanding. Then I asked them to apply the same thing to their prospecting.

Before you run full blast forward with this notion, I should explain there are two types of prospects;those that don’t know they have a problem that can or should be solved, and those that know they have a problem and are looking for a solution. In either case, the problem set is the key to getting their attention.

In the first category, the prospect is more likely to resonate if they are approached with a problem they would recognize. It turns out this is much easier than it may sound. I’ve found there’s a variation of Pareto’s law at play here; about 80% of prospects for any specific solution have a predictable overlapping problem set. It’s even stronger for prospects within the same market vertical. For example, one insurance company probably has a very similar problem set as the next insurance company. Its simply a matter of identifying the problem set.

My approach to the problem identification task is to make a list of the best capabilities of the solution/product/service, and then identify the problem that each capability solves. For instance, let’s say you sell services, or services that augment your technology solution. Most service capabilities include installation, customization, and training. There are typically three problems that connect to these service capabilities:

  1. Lacking enough resources to get the job done.
  2. The current resources lack the skill or knowledge to get the job done.
  3. The current resources would provide more value by working on core activities, not secondary activities like installation or roll out.

The objective is to use these problems as the interest generating topic. It may take a little trial and error to find the top three for your list, but in short order you can have a very succinct list of attention getting problems to use in your outbound prospecting activities.

As you recall, the second set of prospects are those that know they have a problem and are probably seeking a solution. These people tend to be the ones that have visited your website, downloaded a whitepaper, attended a webinar, read certain periodicals, and the like. They are actively identifying themselves as prospects. In essence, they’re saying “I know I have a problem, now I’m trying to find out who solves it better then anyone else.”

In this case, our objective is to use the problem set to either make our differentiators stand out, or expand the problem set to tee up our differentiators in other areas of our solution. In this second case, the process is the same. Make a list of your differentiated capabilities in all major solutions, then identify the problem each one addresses. The seller uses the problems that link to clear differentiators in the core solution, or differentiators that link to secondary solutions to expand the criteria. For example, one of my current customers’ provides solutions for identifying the origin for open source software code that ends up in a software product. Their attention getting problem probe might sound like this:

Almost all software developed today has open source software aggregated from outside sources. While many development teams understand there are legal licensing implications (core solution problem target) that can result in huge financial liabilities, many are not aware of the number of security vulnerabilities (expanded problem set to differentiate against lesser solutions) that are being introduced by this process.

When Mary’s group edited their voice scripts to leverage the most common problem set they address, their hit rate for conversations tripled, and their pipeline almost doubled within 30 days.

What are your salespeople using to get attention?

And do they identify which prospect type they are engaging?

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Do You Qualify a Prospect, or Create a Qualified Buyer?

When I started selling years ago, my first sales manager coached me to qualify an opportunity by asking if there was a budget allocated to my product or service. That was his entire definition of a qualified opportunity! Even worse, I was hired as specialist selling a new “revolutionary” product, so there were no budgets developed or allocated for my product. With his definition, not a single prospect I had targeted was qualified.

Since then, I have had the privilege to sell many more disruptive technologies that didn’t have the luxury of an existing line item in a budget. So I’ve developed a much more refined vision of qualification which doesn’t necessarily include a question about budget in the direct manner described above. My perspective is that qualification is a spectrum of potential positions. Ultimately, the best qualified opportunity is one that has just given you a purchase order, and anything less than that is somewhere on the spectrum of being developed into a qualified opportunity. I have a grouping of four buckets that help determine the level of qualification of the opportunity. I’ve organized it into a formula for making it easy to remember:

Customer Qualification = Vision x Impact x Power x Proof

Vision

The first checkpoint involves the level of synchronicity between the prospect’s view of their problem and our solution as the answer. In other words, do they view my solution as the best way to address their challenges and contribute to resolving a critical business issue? If they don’t view my solution as the best, or that it will address their challenges, or that it will contribute to resolving their current business issue, than this qualification component is weak. This also implies that I must confirm their view on these subjects as part of my qualification process.

Impact

The second component is directly related to their sense of urgency and priority for my sale. My objective is to develop or uncover the impact of taking action or not taking action in order to help the prospect motivate themselves to take action. If I don’t explore this dialog, I have hampered my ability to heighten their motivation to take action, and my ability to qualify their intent.

Power

Next is the stakeholder and authority aspect of a decision. The qualification of an opportunity is directly dependent upon the ultimate decision maker deciding he or she sees the impact of your solution as having a significant priority (See Vision above), and that it is the best solution to resolve their challenges and contribute to resolving a critical business issue (See Impact above). Qualification of this category also requires that the decision maker has discretion over funds and can allocate budget if none exists. Further, this category should also take into account the backing or opposition of the purchase by other stakeholders who can sway a decision maker.

Proof

Finally, the last bucket incorporates their decision process. Do I know their decision criteria? Have they verbalized when the decision must be made and why that particular time frame? Do I have these items confirmed back in some written form? The confirmation of the subject is the highest level of qualification for each individual category.

So how does this help a sales person sell more? The major contribution is to provide a guide. If the seller is setting out to answer the questions I’ve outlined, they will actually be doing a better job of facilitating a purchase. This reduces the contribution of “no decisions” to the outcome of a forecast in two ways. With this process, some opportunities can be moved from a “no decision” outcome to a winning decision, usually by helping to illuminate the connection to the impact and the current business issue. Further, disqualifying opportunities that have no chance of making a decision allows the seller to focus their efforts on opportunities that do have a solid chance of being won. It’s a tragedy to miss a perfectly good opportunity because the seller was focused on a deal that never had a chance of being won. That’s two losses in one.

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When To Walk Away From A Prospect

For those of you that experienced it, you would probably agree the financial meltdown of 2008-2010 was not a fun time for most in the profession of sales. 

During the meltdown, one of my former colleagues, Tom Brigiotta, Senior Vice President of Sales for Imprivata Inc., reached out to me with a conundrum. He said even though the financial meltdown was in full swing, they were experiencing more leads than ever before, but not surprising, their conversion ratio was progressively worsening. He wondered if I could help them navigate the situation.

After talking to several people on his sales team, we rationalized the uptick in MQL’s (marketing qualified leads) as a combination of their recent investment in better marketing automation and lots of people who now had excess time on their hands. It appeared the economic slowdown left many IT people with more time to research solutions but less budget to spend. Translation: They were getting flooded with tire kickers.

As I’ve reflected on in past articles (No Decision Takes Twice As Long As Wins), a prospect that doesn’t buy actually robs you twice. First because you spent time with them and end up with nothing to show for it, but worse, they rob you of the time you could have spent with a prospect that was better prepared to buy.

No matter how well your organization defines qualification, most sellers tend to view “interest” as the dominant qualification question. Unfortunately, in tough times, every interested prospect seems like a rare commodity so there’s a heightened tendency hang on for dear life to the detriment of the seller. Imprivata was no exception, which meant they were spending too much time with interested contacts who couldn’t buy. As a result we decided to take the opposite tack and implement a disqualification process.

We broke down the disqualification process into these questions:

  • Can the contact articulate the problems they were trying to solve? (Or in the absence thereof, agree that a suggested set of problems were relevant and important to address.)
  • Could the contact articulate the cost of not solving the problems? (Or conversely, the value of solving the problems.)
  • Could the contact articulate the business issues that currently had the attention of their senior executives? (The goal is to align the purchase with the current focus of the senior decision maker, otherwise the chance for a no decision outcome increases, especially in a tight market.)

In the event that a contact could not positively answer one of more of the questions above, we posed one second level question to determine if any more time should be spent on the dialog:

  • Can they bring someone into the discussion who could answer these questions?

If the contact refused to bring another person into the conversation and could not represent any answers to the first three questions, they were to be put back into the marketing lead automation system and the sales person was to move on to the next lead. The goal was to filter out the tire kickers and find prospects who were better prepared to buy in the tough economic conditions.

The result was astounding. Imprivata closed 20% more transactions that year than they did prior to the economic melt down, and their average contract size improved by 19%. My analysis led me to conclude the increase in contract size was due to the contact’s ability to more effectively articulate the value proposition in their internal justification. Even though most sales leaders were biting their nails at that time, Tom told me this experience was the most fun he’s had as a sales leader. 

Currently we find ourselves in a different place economically. But even though the market is much healthier, it’s possible to find yourself with the same problem. Too many leads that seem to be interested, but not enough that will pull the purchase trigger. If that sounds familiar to you, then make note of the questions above and apply a disqualification process to your MQL list. I’m sure you’ll find yourself with a more manageable list of prospects that are ready to buy effectively.

Kevin Temple guides sales teams to be more agile and improve revenue outcomes. He can be contacted at kevin@enterprise-selling.com. The Enterprise Selling Group is a leader in delivering sales training, coaching and project oversight to improve the agility of sales teams around the world.

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Jury Duty Can Help You Sell More: Disqualifying Prospects

If you noticed my lack of posting last week, it’s because I was called up for jury duty.

The dread was palpable when I saw the envelope with the familiar red stripe across the top of the envelope and the bold “Jury Summons” label. In my household, it seems like I always get a jury summons every two years. Nobody else in my family ever seems to get one.

The thought of a week in a courtroom was not a pleasant one. But I know it’s my civic duty and I’ve drilled the concept into the heads of my now adult children, so sucking it up was the only answer.

The courtroom was filled with 78 potential jurors in this criminal DUI case. The process for selecting, or rather, deselecting potential jurors was arduous and repetitive. But something caught my attention about the people they let go.

While many people were granted deferments for a variety of scheduling problems, there were at least three categories of people that were outright dismissed from duty:

  • The Heavily Biased
  • The Poor Communicators
  • The Quiet Type

The heavily biased were drilled by the judge to qualify whether they truly were heavily biased or just trying to get out of the assignment. Most, who started with a claim of bias, eventually capitulated to the judge’s expert grilling and said they could weigh the evidence and reach a verdict of not guilty or guilty beyond a reasonable doubt. Only two were let go with a claim of bias, but around ten people originally claimed they were.

There were three poor communicators. One gentlemen who simply shrugged and quietly smiled at almost every question the judge asked, a trauma nurse who would take two or three whole minutes in silence while formulating her response to each question, only to spur the judge to dig in more after an incomprehensible answer, and the unfortunate guy who apparently enjoyed the 60’s a little too much. He sounded a lot like the present day Ozzy Osbourne if you know what I mean.

Although I was grateful for the dismissals of the poor communicators, and I developed an appreciation for how skilled the judge was at disqualifying bias, the quiet type dismissal caught my attention the most.  These people did not raise their hand when either the prosecutor, defense attorney or the judge asked a group question. When asked questions directly, they gave very brief answers. No elaboration whatsoever. At a high level I could discern they weren’t inarticulate. The speed of their response and vocabulary were strong indicators. They also didn’t announce any bias one way or the other, yet they were dismissed by either the prosecutor or the defense in round after round of peremptory challenge. (No reason has to be given by either party, but each side is allowed a certain number for juror dismissal.)

Then it dawned on me. They couldn’t get a gage for how that person was feeling. They were holding their cards too close to their vest, and neither side of the case wanted to take a chance on the quiet type.

So what does this have to do with sales?

The biggest productivity challenge and frustration for most professional sales people is the no decision outcome. Our research indicates the three largest contributors to a no decision outcome are:

  • Inability of the prospect to articulate or agree on the problem set.
  • Inability of the prospect to articulate or agree on the value proposition.
  • Inability or refusal to mobilize other more powerful stakeholders into the dialog.

All three of these behaviors are often masked with silence, short but nonproductive answers, redirection, or outright refusal to engage on the subject. In other words, they operate like the quiet type juror. You can’t tell what they are thinking; they keep the information to a minimum, and end up wasting your time.

The next time you’re sitting across from someone who won’t discuss their problems, can’t estimate the value of resolving the problems, and/or refuses to bring others into the conversation, remember the prosecutor that is trying to sell his case beyond a reasonable doubt. Then politely excuse yourself from the conversation and move on to someone who is better prepared to buy.

Please “like” this post or leave a comment! It helps to spread the word on best practices.

Kevin Temple guides sales teams to be more agile and improve revenue outcomes. He can be contacted at kevin@enterprise-selling.com. The Enterprise Selling Group is a leader in delivering sales training, coaching and project oversight to improve the agility of sales teams around the world.

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The Biggest Challenge in Sales: The Unknown

I was conducting a coaching session yesterday with a sales rep in one of my client accounts. He’s relatively new to sales, having transitioned from the customer side to the supplier side, but he’s learning fast. After guiding him through some opportunity reviews, I asked him to share his perspective on the toughest challenge he’s identified as a professional seller. He said, “It’s the uneasy feeling of not knowing.”

Having spent my career in sales, I had to agree. But I wanted him to know that he didn’t have to dangle in the wind as often as he was.

Here are the top three tactics I shared with him for reducing the unknown:

1. Anticipate the problem. I suggest something I call “conditional access”. If you’ve ever engaged a high level stakeholder who acknowledges a need but wants to hand you off to a lower level contact to validate your offering, this is a valuable tactic. When they suggest you continue the dialog with one of their underlings, acknowledge the direction, but ask for access back if something should go awry. Then document it in your email recap. I’ve never been turned down on the request, and have enjoyed the benefit on the occasion I’ve had to call the higher level contact when my calls were not being returned at a lower level. Many times it’s a matter of reinforcing the sense of urgency from the leader, which is more powerful if it comes from their lips.

 

During a contentious telephone call with a rude purchasing agent a few years ago, I acknowledged that we had reached an impasse and suggested we call the General Manager that initiated the discussion with me. The purchasing agent actually said she didn’t think he’d take my call. She was completely caught off guard when I added him into the call, and became very compliant after he reinforced how important it was to get the contracts sorted out that day. Had I not lined up the conditional access beforehand, the alternative would have been to spend a couple of weeks leaving voicemails for the purchasing agent who would have happily watched me sweat until I met her demands.

 2. Confirm, confirm, confirm. Confirm the problem set in writing after your first dialog. Confirm the value proposition in terms of the cost of not making a decision in writing. Confirm the evaluation process in writing. Confirm every agreement you make along the way. If your contact goes quiet or won’t share some information that you need to understand the buying process more clearly, recall one of the agreements to refresh their memory on the priority of the initiative.

One of my sales methodology students, a sales representative at Cisco, shared the results of this tactic. Near the end of particularly harrowing quarter, the point of contact for his most important opportunity said they were going to delay the purchase until the next quarter simply because they had too much going on. He nodded his head in disappointment, and said, “ok, I understand, but I can’t get this picture out of my head.” He piqued the buyer’s curiosity, because the buyer asked, “what picture?” The Cisco rep replied, “I have this picture in my head of you rolling a wheel barrel full of cash out into the parking lot, dumping it over, and setting it on fire. You told me that you were burning way too much money supporting a constantly failing network.” The contact nodded his head at the reminder and placed the order that day.

3. Fan out. If you find yourself selling to one set of stakeholders, say IT for instance, and you convince yourself they are the right people since they have the budget, have purchased something similar before, and have demonstrated interest, your setting yourself up for the queasy feeling of the unknown sometime in the future. The point is, they can become easily distracted by the fire fight of the day, and they are probably buying your solution to satisfy their customer, another set of internal stakeholders.

When the phone calls go unanswered, your best bet is to have already made friends with the stakeholders on the business side of the house. If they have a vested stake in your solution, they are most likely to give you some timely insight or rattle a door if asked.

Also, if the infrastructure contact wants to keep the order size small due to budget constraints, a well-placed supporter on the business side can probably fatten the budget with other discretionary funds. Keep in mind most IT organizations get 1-2% of the company budget, while General & Administration (including marketing and sales) get upwards of the 50% of the budget.

In summary, the learning opportunity is to plan ahead for the uneasy silence. Everyone gets distracted, most people find it easier not to reply than having an awkward conversation when the situation changes, and most IT people adjust to a tight budget by squeezing the seller, not the end customer who would rather have the proper solution. Incorporate the conditional access, confirmation habit and fanning out as a daily practice and you should see the number of unknowns diminish and your forecast accuracy improve.

*** Please “like” this post or forward it to anyone you know looking for an advantage in selling.

Kevin Temple guides sales teams to be more agile and improve revenue outcomes. He can be contacted at kevin@enterprise-selling.com. The Enterprise Selling Group is a leader in delivering sales training, coaching and project oversight to improve the agility of sales teams around the world.

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No Decisions Take Twice As Long As Wins!

Our firm recently completed an analysis of the pipeline statistics for a large software company. Like many of the companies we perform this service for, the most revealing statistic to them was the time it takes to reach a No Decision outcome. For those of you that might be new to the term, a No Decision is the result of a sales engagement where the buying team “decides” not to buy anything. Some refer to it as a decision not to decide. There have been lots of statistics published about the percentage of No Decisions in the average pipeline; it’s not uncommon to see No Decisions make up 40-60% of most enterprise selling pipelines. But the fact that they take twice as long to conclude was mind blowing to this sales team as well as others.

Early in my career a sales manager told me No Decisions rob you twice. First because you don’t get paid for the work you did, and second because you could have worked on another opportunity that you could have won. Since then, I’ve updated that perspective. You actually get robbed three times over since you could have worked on TWO other more probable opportunities in the same timeframe AND you didn’t get paid for the one you did work on!

So why do they take longer to conclude? I think there are two primary factors. First, the buying sponsor has some level of commitment to the solution, but lacks the ability or argument to mobilize and convince others – so they keep trying. But they keep their voices down to the mutual detriment of both parties. If you’ve ever heard a buyer say, “I’ll bring it up, but now is not the right time.” You were hearing the telltale sign of a No Decision in process. If the argument really is compelling, now is the time to bring it up! 

The second reason is the seller’s reticence to qualify engagements out of the pipeline. The continued engagement of the sponsor seems like a positive buying signal so they keep investing time and resources. However, they would be better served by frequently qualifying the engagement against some common indicators of a successful outcome, and taking the appropriate steps to back burner the opportunity if they don’t make the cut. These should include:

  • Has there been a clear identification of the problems to be solved?
  • Has the impact of taking or not taking action been clearly identified in terms of money?
  • Do the problems contribute to a business issue that currently has the attention of more senior management? (Versus a business issue we think they should be concerned about.)
  • Does the sponsor mobilize other more powerful stakeholders into the conversation?

Recently, a client of ours implemented this type of “qualify out” process and ended up closing 20% more transactions per rep AND witnessed a 19% increase in average contract value! The first metric was not a surprise. Spending less time on engagements that have no chance of closing should produce more success, but my curiosity was piqued when we found the average contract value improved as well.

My rationalization of the outcome centers on the influence of the qualifying questions. By doing a better job of articulating the problem statement, the impact of not taking action and the connection to current business issues, the opportunity gained more visibility and better sponsorship. As a result, the natural tendency to start with a small pilot trial was enhanced with a higher sense of urgency to resolve the problems and deliver a business impact resulting in a higher initial spends.

If your pipeline is suffering from a high percentage of No Decision outcomes or you’re looking for a way to improve revenue results in general, I’d suggest a qualify-out initiative. At a minimum, you should see an improvement in win rates, but don’t be surprised if your average contract value improves as well.

Kevin Temple guides sales teams to be more agile and improve revenue outcomes. He can be contacted at kevin@enterprise-selling.com. The Enterprise Selling Group is a leader in delivering sales training, coaching and project oversight to improve the agility of sales teams around the world.

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Reducing “No Decision” Outcomes: The Forensics of Selling

I read a quote the other day attributed to Sirius Decisions, the sales research organization. It stated, “71% of sales leaders attribute difficulty in revenue growth to the lack of ability of their sales people to connect their solutions to the business issues of their customers.”

If you’re in the 71% struggling to get over the goal line, there’s good news and bad news. The bad news is that sales training doesn’t solve the problem – as if that’s news to you. The good news is that Selling Forensics can.

Selling Forensics is the science of examining the work product produced by your sales team. Work products are the distinct communication vehicles developed and delivered to the customer during the sales process. They include presentations, email confirmations, proposals and the like.  Just like fingerprints can reveal who was at the scene of a crime, the work product captures the customer conversation of your sales team for each individual account opportunity, revealing insight into the selling mechanics of the sales person or the entire team if taken in whole.

However, the interesting aspect is that just observing work products can produce positive results. In applied physics, there’s a principle that comes into play whenever anything is measured. It’s called invasive testing, where the test itself can alter the results. For example, consider a scientist trying to measure the temperature of a liquid in a vat. Placing a thermometer into the solution can actually change the temperature of the liquid. If the thermometer is colder than the solution, when inserted it robs some of the energy of the liquid as predicted by the second law of thermodynamics, producing a different reading than the temperature of the liquid prior to measurement.

When a sales leader initiates a work product review, the work product will change. Instead of the laws of thermodynamics, I call this the laws of selling. They are:

  1. The energy exhibited by a sales person is equal to the amount of energy need to just barely get the job done plus the level of oversight on the activity. To improve a sales effort, oversight has to be applied.
  2. When two closed systems come in contact, a buyer’s organization and a seller’s organization, the resulting entropy is equal to the quality of communication exchanged between the two. Buyers are more motivated to change if the seller connects their solution to the buyer’s business issues and challenges.
  3. The entropy of a minimum selling effort is zero if the buyer doesn’t recognize a reason to change. This is why so many sales organizations have 40-60% no decision outcomes. Minimum selling efforts will result in fewer buying decisions.

All kidding aside, inspecting work product and identifying short falls will improve the work product, the quality of communication and ultimately the number of buying decisions made in your favor.

Years ago, a software company called Cadence Design Systems was undergoing a sales transformation. As part of the transformation a decree was made that no proposals could be submitted to a customer until it was inspected and passed the test for three criteria: the business issues of the customer were identified, the underlying people, process and technology problems were reiterated, and the impact of the customer taking or not taking action was cited. The thought was that while the sales person may not be able to access the decision maker, the proposal probably could. They wanted the proposal to sell for them in their absence.

At the beginning of this initiative, almost all proposals failed the test. By day 60, almost all proposals passed the test.  The testing itself changed the outcome of the test. But even better, their average contract value (ACV) increased 38% in just 90 days. They didn’t just close more deals, they closed bigger deals as well.

On a side note, you can imagine the number of conversations this caused that went like this: “My boss won’t let me submit a proposal until I get three questions answered that I forgot to ask. Accompanied by the reply, “ok, what do you need to know?”

If you’re one of those sales leaders that could benefit from your team’s ability to connect the customer’s business issues to your solution, then I recommend an initiative to test your work product. Ultimately, the proposal is the final communication that either captures the compelling reason to change, or demonstrates a minimum selling effort with a price quote wrapped in a gracious thank you.

Your inspection should include evidence of:

  • The current business issues identified and confirmed with the customer.
  • The top three to five underlying challenges or problems that you can solve better than other solutions.
  • The impact of making the decision in their terms, not yours. We’re trying to cite their metrics for achievement, not ours reflecting other customer successes.

I’ve implemented this Selling Forensics initiative at a variety of companies and the result is always the same: average contract values improve and no decision outcomes decrease.

Kevin Temple guides sales teams to be more agile and improve revenue outcomes. He can be contacted at kevin@enterprise-selling.com. The Enterprise Selling Group is a leader in delivering training, coaching and project oversight to improve the agility of sales teams around the world.

Missed Kevin’s other posts on Sales Agility? Take a look at his m

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Sales Agility: Selling Around I.T.

Kansas_coal_miner

Y’all a bunch of coal miners in a gold mine!”

The words stung when they first rolled off of Hank’s tongue. I felt like it was an insult to our sales team, but rather than show my irritation, I asked Hank to clarify what he meant.

Hank was a new board member brought on to help our software company revitalize its lost growth luster. He smiled his approval at my curiosity, and explained. “Every day your sales team comes the work, it’s like they walk through a long dark tunnel to spend the day hacking away at the wall to generate a few hundred dollars’ worth of coal. On their way through the tunnel, they keep tripping over these large yellow rocks, so they kick them out of the way. What they don’t realize is those rocks are made of gold.” His Texas accent only made the analogy more powerful for me.

Hank was explaining that selling to IT was like coal mining. He continued by pointing out our own IT department had a budget equal to 1% of the company’s planned spending, while our sales department had 26% of the overall budget. His point was well made. We were working like dogs to scratch a living out of selling to IT. And they never had a kind word for us in return.

I spent the next nine months leading our sales team to be more agile in selling to the real stakeholders in their accounts. It didn’t happen overnight, but the results were mind blowing. Our largest deal size before Hank spoke up were in the $1M -$3M range. Within a few months we were booking $15m – $20M deals.

Although selling to General Managers and CEOs seems like a no brainer, we had to overcome years of ingrained habits to succeed. Here’s a short list of the challenges we faced in this particular situation:

  • Our messaging was tailored to I.T., not CEO’s.
  • I.T. did not have the mojo to sponsor us to the business side, nor did they want to.
  • Most of the business leaders who would benefit from our solution had no idea who we were.
  • Our sales people lacked the confidence to take on a new stakeholder conversation.

Sound familiar? Almost every technology company I’ve helped since then faced the same set of challenges.

Here’s how we overcame these challenges and became gold miners.

  1. We profiled the problems faced by the executives in our major target verticals. This means capturing their business issues, underlying problems, potential impact of changing in dollars, and the connection to our solution. We drilled this into our sales team, even requiring them to become certified in this type of dialog.
  2. We created new messaging that focused on the business issues, problems and impact that we could deliver to these new stakeholders with stories to illustrate real life examples.
  3. We went through an exercise to calculate how much value we contribute to the world on an annual basis. Without an exception, every sales rep came to the same conclusion. We delivered billions in cost savings and revenue acceleration, yet we were only billing about $200M at the time. We implemented this exercise to build the confidence within our sales people to carry their message to more powerful stakeholders.
  4. We challenged our sales people to take this message to three senior leaders in their accounts. We tracked and measured the initiative. Almost every sales person uncovered an opportunity that over shadowed previous projects. This alone fueled their appetite to prospect even more opportunities outside of IT, and created a workforce of gold miners.

In addition to the deal size growing tremendously, we had several other benefits emerge as well. Our discounting practice dropped by over 30%. Our breadth of products per transaction jumped dramatically, and our services bookings jumped from $2M the year prior to over $98M in less than nine months. This initiative revitalized our growth to the 30% range and took us to the billion dollar revenue mark in a few short years.

Although changing a culture to target business leaders outside of IT seems like a sales challenge, it’s really a leadership challenge. I’ve worked with many technology companies on this challenge, and the one common denominator for success with this level of agility is leadership.

Do your sales managers need to become sales leaders?

Kevin Temple guides sales teams to be more agile and improve revenue outcomes. The Enterprise Selling Group is a leader in delivering training, coaching and project oversight to improve the agility of sales teams around the world.

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Sales Agility: "No Budget"

This is my favorite objection! Ever!

Ok, it’s not really an objection, it’s an invitation. So it’s my favorite buying invitation,ever!

Every seller has heard “lack of budget” as an excuse on multiple occasions. When I conduct AgileSelling workshops I gather the most frustrating sales challenges from the audience. Lack of Budget is usually in the top five.

Let’s start by translating what it really means. When a contact says, “we don’t have a budget for this”, they’re really saying, “I don’t have the authority to change the budget.” This means someone else does have the authority to execute a reshuffle of the budget.

Now comes the interesting part: The agile seller uses lack of budget as an invitation to meet the real budget authority and sell larger deals.

A couple of days ago, I had a LinkedIn message exchange with a former colleague of mine, Steve Flannery. Our quick exchange reminded me of a time when Steve had overcome this challenge in spades. I recall reviewing his year in advance forecast with him during a Q1 Ops review. During the review Steve revealed his largest customer, Unisys, would not be spending any money on our solution in the coming year. They were dropping from spending over a million dollars a year to zero – nada, zilch. When I asked why, he described a situation where Unisys was consolidating from five product lines down to one and laying off personnel, leaving them saturated with our software solution. He ended his story with the words, “so they slashed the budget”.

I suggested it was an invitation to meet with the person who slashed the budget.

Steve set up a meeting with the General Manager of this particular Unisys division. When Steve met with the GM, he found the situation was even worse that he previously understood. As a result of waves of personnel layoffs, their best remaining people were shopping their resumes and were likely to jump ship. That meant the GM wouldn’t have enough of the right people to get their only remaining product line to market.

Steve ended up closing a $75M contract for services to insure the one remaining product line succeeded.

Here’s what I learned from Steve’s experience:

  1. If there’s a big problem lower in the organization, it’s probably more painful higher up.
  2. Budget is an amorphous solid. If you forgot your high school chemistry, an amorphous solid is one that can change shape, usually by adding some heat.
  3. The Agile Seller uses lack of budget as a reason to meet with the person who can reshape a budget.
  4. An effective problem diagnosis can create a larger opportunity with the person who has the authority to move money around.

Let’s exit Steve’s example, and talk about the everyday, ordinary selling campaign. Can a seller still use lack of budget as way to get to a decision maker and overcome the obstacle? The answer is yes, if…

If… the seller does an agile job diagnosing the problem set and uncovers the impact of not taking action. When done effectively, the contact will usually respond positively to a request to collaborate together to get the purchase funded, including taking the message to more powerful budget holders.

So the next time your hear “no budget”, translate it in your head as an invitation. It’s an invitation to diagnose effectively, meet other stakeholders and create a larger opportunity.

Kevin Temple guides sales teams to be more agile and improve revenue outcomes. The Enterprise Selling Group is a leader in delivering training, coaching and project oversight to improve the agility of sales teams around the world.

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Sales Agility: Cross Selling

Almost every sales leader is familiar with this problem. Pareto’s law, otherwise known as the 80/20 rule, applies to most sales organizations. Eighty percent of their revenue comes from less than 20% of their solution portfolio. If you combine this with Forrester’s research finding it’s five times less expensive to sell to an existing customer than a new one, you will probably reach the conclusion that selling across the product line to existing customers should be a major component of any revenue growth strategy. Unfortunately, most sales teams lack the agility to execute on this skill set. But the good news is it can be learned at an individual contributor level and at the organizational level.

There are two factors that dictate the agility of a sales organization when it comes to selling across the product line. First, the learning model they apply to the challenge, and second, the accountability factor.

Left to their own devices, most organizations unconsciously apply the same failed learning model for new products. They shovel facts and capabilities at the seller, load on a couple of reference logos and call it a day.

Unfortunately, most sellers, even the brightest, hit learning saturation and can’t digest nor retain this information. Worse, this information does very little to prepare the seller to create need for the target product or differentiate in the face of competition.

I’ll share a real life example.

Years ago, I received a call from Brian Powers, the director of training for Dell at the time. Brian said my name was handed to him by a Gartner representative. He was calling to get my input on a cross selling challenge they were facing. At that time, Dell was in transition. They were attempting to fuel revenue growth by adding servers, storage and services to their solution line up. This was not a single new product addition; they were expanding their portfolio dramatically in an instant across three new product lines!

When I asked to see their training materials, I would describe them as glorified data sheets. They were attempting to shovel facts and specifications into the minds of their sellers, thinking this was going to get the job done.

I was not surprised to hear the initiative was not meeting expectations.

I was taught a lesson by a stereo sales person a long time ago. When I went to buy a home entertainment system, I was confused by the long system specification lists displayed in front of each product. The seller approached me and asked if I was overwhelmed by the choices. I acknowledged I was. He glanced down at my then five year old son, standing next to me, and said, I could ask you one question that will make this very easy to figure out. He had my attention. He asked, “do you envision entertaining adults in one room or on the patio with some nice music while the children are kept occupied in another room with a movie or TV show? I said yes. He then pointed to the system at the top of the shelf and said there was only one model that could do both. I went home with the most expensive system he had.

With that lesson in mind, here’s what we did to reshape Dell’s outcome. First we broke down each major product into a set of need creation questions. These questions come from analyzing the problems that can be solved by the new product, not the capabilities. For example rather than asking, “Would you like services to install a consistent operating system image on all 200 PC’s you’re buying?”, we had them alternatively define a problem set first. “Does your support team run into problems when the operating system installs are not consistent across the organization?” This creates the need for the solution by focusing on a problem rather than the solution itself.

As humans have evolved, we’ve developed pattern recognition for identifying problems, not solutions. We learned to identify a predator, feel the temperature change, or stop at the edge of a cliff with very little coaching. The answers to each of these problems took much longer to learn, pass on, or execute with consistency. From a learning perspective, problem identification is a more productive learning model than solution definition. This applies to sales as well. As exemplified by my stereo example, the seller only had to remember one problem definition to make the sale, versus digesting hundreds of specifications for comparison.

But learning isn’t the only obstacle. Accountability is as well.

Customers don’t typically demand the secondary products in a seller’s portfolio. Worse, if a seller spends time on a new product and gets beat by a competitor, they shy away from a similar time investment to insure they spend time on the in demand products.

In order to apply some level of accountability to cross selling, some teams stratify the quota by product line. Some incent with SPIFF’s. While others simply set expectations, measure, provide feedback and reward in other, non-financial ways. The success of any accountability strategy is highly dependent on the culture of the organization and leadership bench strength. Dell’s approach was the latter of the three. They maintained visible scoreboards, and publically acknowledged the success of the early adopters.

In any case, the learning model needs to be supported by an effective accountability model that compels application and rewards outcomes.

Within 30 days, Dell was able to track a 26% increase in their “attach” metric, an indicator of multiple products being sold in each transaction. This fueled their new product sales which grew to become a $15B contributor to their business. This is an example of a large organization learning to become agile again.

How well does your team sell across the product line? Do they need to improve their cross selling agility in order to continue reaching revenue growth expectations?

Kevin Temple helps sales teams optimize their behavior and improve revenue outcomes. The Enterprise Selling Group is a leader in delivering training, coaching and project oversight to improve the agility of sales teams around the world.