Articles

7 Reasons Sales Reps Should Do Reports 7 Reasons Why They Don't

Wed, 09 May 2012 19:04:00 GMT

Sales managers at times wonder "Are the sales reps doing anything out there? We don't hear from them!" Sales reps wonder, "Are they listening to me? I don't hear from them!" Interesting dilemma. Here is some food for thought:

Why sales reps should do reports

Can’t remember everything
Documentation is “protection”
Can review notes for follow up activity
Can take a real vacation with sufficient documentation to keep business moving
In a family emergency business can be triaged out of the way, delegated to others
Removes the ambiguity of what management thinks sales is (is not) doing
Asserts if management can be trusted with information

Why sales reps resist doing reports

They get punished for doing them
Reporting guidelines unwieldy
Reporting objectives unreasonable
No feedback to sales from providing the information- nobody reads the reports
They get feedback but no action- empty promises from management
No perceived value in doing reports- there is no WIIFM.
They don’t trust management

For the sake of discussion, we’ll toss in another reason reps don’t reports: They’re lazy (aka order-takers). Which begs the question: How does someone hire a “lazy” sales rep? Better yet, how can we avoid hiring lazy reps? Find out at our FREE Webinar May 16 "Where Are the GOOD Salespeople?"

Three Year Case Study on Sales Training Effectiveness

Wed, 18 Apr 2012 18:26:00 GMT

Regardless of what industry you are in, this study of sales organizational performance change due to training is universal in that the behaviors of salespeople- good and bad- transcend all industries. Self discipline; the ability to prepare and execute; effective communications; and an inherent understanding of business as it applies to a seller-buyer relationship are all intrinsic qualities of sales excellence in any industry.

Background:

SCAN Healthplan is a Medicare Advantage plan, which is for Medicare Parts A and B persons over the age of 65. In 2003 through 2005, SCAN operated in four counties of Southern California: Los Angeles, Orange, San Bernardino, and Riverside counties.

The Centers for Medicaid and Medicare Services (CMS)- a federal agency- is in charge of distributing funds to the eleven plans (SCAN plus ten competitors) that serve these counties. CMS generates statistics regarding the market size and growth pattern that is very accurate and is reported regularly by CMS to the plans. For the years of this study- 2003, 2004, and 2005, we will focus on Los Angeles, San Bernardino, Riverside, and Orange Counties. There were a little over 1.3 million seniors in the four counties who were eligible for the Medicare Advantage plan offered by the eleven competing plans. The year-to-year growth of this population is slightly less than 1%, so any numbers that exceed this growth rate can be considered market gain due to a competitive advantage.

In 2002 SCAN was in severe financial trouble and brought in a new CEO, Dave Schmidt. Dave was a past acquaintance of ours. What Dave did for SCAN from an executive perspective is really another topic on effective leadership. But for the training side of things Dave called us and simply said this: “I’ve seen how your organization works with people. That’s how I want my people treated. I need your organization to work with our sales team.” No discussion on ROI. No discussion on meeting any numbers. Work with our people. That was it. People. He put us in touch with his VP Sales, Roger Lapp. The objective of the training program for Roger’s sales team was boiled down to a very simple, not measurable objective: create the elated customer. An elated customer becomes a very effective salesperson, which multiplied the sales force and reduced the time to earn trust for the next sale.

Let’s look at the numbers that resulted from the macro objective: Work with our people (Dave Schmidt objective) to create the elated customer (Roger Lapp objective). What’s interesting about the numbers you are about to read is that none of these numbers were used as performance drivers. Following is a year-to-year summary of the numerical results created by focusing on the elated customer as a training objective.

2003 SCAN Healthplan Training Results

We started with SCAN in June 2003. Our first program was sales training, designed around the needs of the Group and Individuals. This program lasted through the summer and into the fall, training all 34 salespeople. The training was a blended training concept, utilizing brief, two-hour live workshops followed up by several weeks of online application. The online version was tailored to their daily activities- the assignments were directly connected to ongoing daily sales activities. Using a Socratic Approach we were able to quickly identify who needed help in what areas as well as who needed help but weren’t willing to admit it.

Although the training was on-line, it was done at such a constant interactive frequency that it was very hands - on and we really got to know the salespeople. We found that the salespeople were focusing on three things:

Just get the order, which can at times sacrifice the goal of creating an elated customer.
They were leading the call with their strongest selling point, mainly because they were impatient to get the order. Don’t kill a fly with a bazooka. You save your best for when you need it.
Third was trying to avoid getting fired. Below 27 orders per month for three consecutive months resulted in termination. That is not a good sales growth strategy or effective sales management tool- unless performing to a minimum and turnover are department objectives.

All three of these approaches boiled sales strategy back down to the first: just get the order. Our task was to go from “just get the order” to “create the elated customer”. By working with the salespeople, we found that much of this behavior- just get the order- was an industry mind-set. While we focused the online Group Discussions on Sales Best Practices, individually in the Private Discussion we coached each salesperson on integrity selling and thinking bigger picture: create the elated customer. We had to pull them away from their industry mind-set.

To their credit, the salespeople “got it” and not only were achieving their goals, but increasing their referral base by being more conscientious about their client- a senior citizen- than just getting the order. What was the result by year-end of 2003? Without setting any numerical goals, what we achieved was:

An average increase of 30% monthly production per salesperson. This added $6 million to the top line sales for the year. Not bad for only being on the job for six months (remember, this started in June).
Eight of the twenty (40%) middle-performing salespeople moved up into the top-performing bonus class.
Four of six salespeople, who were on “write-up” for termination (already below minimum quota of 27 orders per month for two months) moved up into the middle-performing group, and off of termination write-up. What is the cost savings of turnover reduction?
Allegations- which are essentially grievances filed by the Senior if they felt there was some unscrupulous pressure sales tactics or misleading sales tactics- went down as a percentage of sales.

2004 SCAN Healthplan Training Results

During 2004, SCAN’s sales force grew to fifty salespeople. During that time, we engaged in training programs that consisted of four modules:

Product Training with Competitive Analysis: three weeks- two assignments per week with one quiz per week.
New Business Development Training: three weeks- One Group Discussion per week, three Daily Assignments per week, one quiz per week.
Sales Skills Best Practices Training: five weeks: Daily Habit coaching, Weekly Best Practices Reading and Group Discussion, Weekly Quiz.
Sales management training (this became a three year comprehensive curriculum).

While participating in the training was encouraged, it was not mandatory. Then, in early November, SCAN management asked us who had completed all the training programs and who had not. We could have used the rep phone list, but by coincidence, we had just printed out the rep sales ranking performance chart. Since it was a handy and complete list, we used it to highlight who had and who had not completed training. After we highlighted who had completed training, even we were pleasantly surprised at the results.

Sales Rank/ # Completed Training

1-10……9

11-20…..7

21-30…..4

31-40…..3

41-50…..0

It should also be noted that the three who completed training and ranked 31-40 were trending upward in performance. Remember- training was NOT mandatory.

This can be looked at two ways:
1. The people who took the training benefited from the training.

2. The people who took the training are naturally the higher performing people because these people are always looking for an edge.

Either way you look at it, training was the difference. Training helped people get better, or the better people used training to stay better. A third way to look at this: If your better people aren’t getting the training they want to improve, they will move to somewhere that gives them training.

2005: SCAN Healthplan Training Results

In 2005 we delivered a total of nineteen online training programs to the SCAN Healthplan sales force by the end of June. Programs included:

Product training
Service training
Time management training- a two part program delivered in May and June of 2005.
Presentations training

June, 2005 was a record sales month for SCAN, but the real results showed in the year-over-year comparison (2004 to 2005) of the three month period of July, August, September. Again, there was no goal set to beat 2004 by X amount or X% in terms of our training objectives. The goal was to train the sales team in areas that would make them strategically better over the long haul with the ultimate goal of creating the elated customer. As in 2004 we stumbled on a statistical comparison that popped open a few eyeballs. This occurred when we decided to compare the monthly performance statistics of the sales force over a three-month period on a year-to-year basis. The results again showed the payoff of focusing on what Stephen Covey proclaims: Do the right thing, then do things right.

	Reporting Period		Change
	Jul-Sep 04	Jul-Sep 05	Net
Total reps in report	53	48	(-5)
Total orders for period	4,156	5,046	+890/ 21%
Average performance per rep	78/rep	105/rep	+27/ 35%
Reps over 100% bonus	27	48	+21/177%
% of reps over 100% bonus	53%	100%	47%
Reps over 100 orders	10	25	15/ 150%
% of reps over 100 orders	19%	52%	174%
Reps below minimum quota	25	0	(-25)/ -100%

Was the market growing at the same time?

But what about the market itself? Was it growing and SCAN just growing with it? For that information, we used a report generated by the Centers for Medicare and Medicaid Services, the official government agency that pays SCAN plus ten competitors as Medicare Advantage plans in the four county region SCAN serves. The chart is on the follows.

Plan Rank	Dec 04 Members / Market Share	Aug 05 Members / Market Share	% member increase	Net member increase
1. Kaiser	648,280/ 49%	662,149/ 50%	2.1%	13,869
2. Pacificare	357,735/ 27%	358,362/ 27%	0%	627
3. Health Net	96,113/ 7.3%	94,033/ 7.1%	(-2%)	(-2,080)
4. SCAN	64,622/ 4.9%	73,315/ 5.5%	13%	8,693
5. Blue Shield	57,159/ 4.3%	54,546/ 4.1%	(-4.5%)	(-2,613)
6. Blue Cross	35,490/ 2.7%	30,185/ 2.3%	(-15%)	(-5,305)
7. Aetna	27,357/ 2.1%	25,967/ 2.0%	(-5.1%)	(-1,390)
8. InterValley	13,163/ 1%	12,771/ 1%	(-3.0%)	(-392)
9. UHP	13,427/ 1%	9,816/ .7%	(-27%)	(-3,611)
10. Universal	3,990/ .3%	5,658/ .4%	42%	1,668
11. Caremore	2,687/ .2%	3,802/ .3%	41%	1,115
Total	1,320,023	1,330,604	0.8%	10,581

Data Source: CMS Monthly Managed Care Reports

Also note that while SCAN offers healthcare coverage to seniors only, Kaiser is the largest full-service HMO in the four county region, with a natural membership age-in from their existing membership that contributes significantly to their net growth numbers.

Conclusion: We are advocates of establishing and setting measurable outcome objectives for any training program or intervention. However, it is amazing how much performance can improve strictly by establishing- and focusing on- the right behaviors and habits. Three quotes come to mind:

“Do the right thing first, then do things right.”

Stephen Covey

“We are what we repeatedly do. Excellence, therefore, is not an act, but a habit.”

Aristotle

“Do the right thing and the money will come.”

Bobby Unser

Assumed Knowledge: A Management Flaw

Mon, 16 Jan 2012 18:55:00 GMT

Managers and executives fall into the dangerous trap of assumed knowledge. Given very little or no information at all, they assume and clearly know what is going on in a department; with a customer; or on the factory floor when in fact they are in the fog. Nevertheless, they create some version of the events because they must know- they are the boss and bosses are supposed to know everything.

Why do managers do this? Ego. That's it. They are the boss, so they must know everything. They assume because of some past experience they had in a different situation, then it must be true in all situations. This leads to bad decisions that get some serious spin when the confronted with reality where reality shows up in the form of poor business performance numbers. This poor performance gets spun with executive speak that boils down to nothing more than “it’s someone else’s fault”, but gets interpreted as “we are clueless but hope you hadn’t noticed”.

Don't fall into the assumed knowledge trap- don't answer questions you don't know the answer to and don't assume you know what is going on when you don't. Your choices are not always between good and bad. Sometimes they are between bad and worse. While it is bad to not know what is going on, it is worse to assume you know.

TEMAC Sales Management Effectiveness tip

Tue, 11 Oct 2011 20:25:00 GMT

TEMAC Sales Rep Management Effectiveness Tip

As a sales rep manager or executive working toward improving sales rep performance, think TEMAC

Trigger sales reps when they don’t get it. Sometimes sales reps are over-loaded. Set a “trigger” reminder for them until the new process or behavior becomes a habit.

Encourage sales reps when they are getting hammered or just suffered a loss. While sales executives want their salespeople to have thick skins and tough it out, the fact is everyone needs encouragement.

Motivate performance to get sales reps to stretch beyond their reach.

Acknowledge genuine effort where circumstances just didn’t work out as well as accomplishment.

Challenge sales reps when they don’t put in the effort or become insubordinate.

Final thoughts: all sales reps and all sales rep organizations need any and all of the above elements in various doses- but it doesn’t work if only one or two elements are used. However, the Challenge element goes away when you create a culture built around the other four elements, which then creates the TEAM.

Fighting Fires All Day

Fri, 03 Dec 2010 22:28:00 GMT

Do you get trapped fighting the fires of daily business crises? Your day starts out with hopes of working on that big, important project. Then you look at your email inbox and there are forty messages, ten of which have the dreaded “!”. Your voicemail has eight messages you don’t even want to bother with after being already overwhelmed by your email. You get a 9-1-1 text from a sales rep. You haven’t even had your first cup of coffee.

Then you start to dive in to each crisis. The first one you fix successfully. The second one should have been handled by someone else, but since you are someone who gets stuff done, you get the call/ email/ text for help- and then you commit the sin of fixing it. The third one you start to dive into and suddenly it just sucks you into one thing after another after another- and it doesn’t get prettier with each revelation of new information. The fourth one was not a crisis, but the person sending you the crisis message thinks everything is a crisis. Since you responded, you get it resolved anyway.

So the day goes- pull the fire hose out and start to squirt everywhere. You have one hose, but it seems like fifty fires. The day ends, you are exhausted, you put the fire hose away, and leave the smoldering remains of your office- knowing that something else will spontaneously combust overnight and be waiting for your arrival the next day.

Then you think about it. You worked your tail off. You are exhausted. But you accomplished nothing. That big project you wanted to work on? Didn’t put one second of time on it. Yet you know that working on it will either pay off big time down the road or prevent a major crisis from occurring.

What was the big project? Fire prevention process development and training for your team. But, you didn’t have time for it- you were too busy fighting fires.

So, how do you get out of operating in a constant 9-1-1 mode? Maybe you just have to let some people get burned so they figure out they need to help. Others need to understand they can’t yell “fire!” unless there is a fire. Not all fires are of equal crisis mode: figure out which ones you will have to leave burn while paying attention to the really important ones. Get everyone involved- the only way you can fight a fire effectively is with a team effort to put out the fire. Finally, take prudent measures to prevent the fires to begin with- and make sure everyone is accountable to holding that objective.

Take it from Smokey the Bear: “Remember, only YOU can prevent forest fires!”

Lessons In Leadership: How to Build a Winning Team

Tue, 30 Mar 2010 04:48:00 GMT

We’ve all had special people influence our thinking that stamped our souls with virtues, principles, beliefs, and life lessons. Teachers, coaches, parents, ministers, bosses, and neighbors. When I was in high school some thirty-plus years ago I had one of those experiences with my sophomore high school basketball coach. His name was Eugene Zuccarini. Everyone called him “Zook”. At seventy-plus years old he’s still teaching golf. Mentors never cease their passion, do they?

Zook had the uncanny ability to take losing freshmen teams and turn them into winners, which the tenured varsity coach then promptly turned back into losing teams. He didn’t do it by taking freshman teams that won 8 games and lost 9, and then won 9 games and lost 8. He took the group of kids a year older than us, who as freshmen won 6 and lost 11, and went undefeated- 17 wins, no losses! Against the very same teams they had lost to the year before. Our class was more of a lost cause: 5 wins and 13 losses as freshmen, but Zook turned us into a 14 win- 4 loss team. Not just winning games in the last second, but thrashing opponents. We won one game 88-15, and we weren’t running up the score, either. The first string played the first quarter, the second string the second quarter, the third string played the whole second half. In case you were wondering, the halftime score was 44-10, which means the third string outscored the opponents 44-5 in the second half. We were all just playing the way he taught us- full throttle the whole game.

If you look at his leadership style, it defies what most coaches and executives do. He cut no one. He gave us three days to quit, and then whoever showed up the fourth day was on the team. But (and here’s the flip side of the no-cut knife), once you showed up the fourth day, you couldn’t quit- he hated quitters. The first three days of practice, we ran. And ran. And then ran some more. Whoever was willing to go through his first three days of hell and show up on the fourth day was on the team, knowing that it was a commitment for the season.

Did Zook look at who could dribble the best? Shoot the best? Was the tallest? Fastest? None of these were his selection criteria. He wanted to see who had the heart to play and the commitment to stay. He knew from that point on that it was his job to take that heart and commitment and make something of it.

I spoke with Zook and asked him why he didn’t cut anyone. He said, “Because I didn’t know who would blossom later. I wanted to give everyone that chance. I had Jim Smith, and they said would never turn into anything. His junior year, he became star player, and senior year he got a Division I Scholarship. I can go on and on about the list of players who blossomed after our season. You never know who will succeed or not- but you want to give every one of them a chance to succeed later. So, why cut them if they want to play? If they’ve got the heart to try, I’ll give them the tools to succeed. That was my job.”

Zook started out by using the right selection criteria. No prima donnas. No quitters. All heart and soul. Show up and try. If you want to point to the success of Southwest Airlines, Houston’s Restaurants, or In-N-Out Burgers, look at their selection process. It is thorough and it focuses on the people they are picking first, their job skills second.

First Day Speech: Laying Down the Law of Zook

“I don’t like to give speeches at practice. Speeches are like meetings: a waste of time. If I have to give a speech again, that means we lost. You don’t want to hear that speech.” Zook was not a win-at-all costs coach, even though his statement implies it. He believed- and he was right- that our problem was not that we had any less talent than the other teams, but that we were susceptible to a defeatist- a losing- attitude. His threat was more directed at the defeatist attitude than it was at losing per se.

Our practices were only ninety minutes- we started after the varsity started and were on our way home before they were done. Lesson: He doesn’t waste time- neither should we. When practice starts work hard, start to finish. Think of Federal Express type of no-nonsense urgency, Southwest Airlines turning an aircraft around in twenty minutes, or Team Penske changing four tires and adding thirty-five gallons of fuel in a twelve second pit stop.

“I’m going to challenge you to change your losing ways. To do that, you’re going to dislike me at some point during the season, and the sooner the better because you lost too damn much last year, and that attitude has to change in a hurry.”

Former Secretary of State Colin Powell put it this way:

“Being responsible sometimes means pissing people off. Good leadership involves responsibility to the welfare of the group, which means that some people will get angry at your actions and decisions. Trying to get everyone to like you is a sign of mediocrity: you’ll avoid the tough decisions, and you’ll avoid confronting the people that need to be confronted.”

Then Zook told us he’d coach anyone who made it through the first three days and showed up on day four. PROBLEM: There were only fifteen uniforms. What if there were more than fifteen players on Thursday? Zook anticipated that. He said if there were more than fifteen come the fourth day, he’d tell us who the top ten were, and rotate the rest of the uniforms each game. On the fourth day, we had 24 players! He kept his word, and we made it work, rotating the five of the bottom fifteen on a three-game rotation. None of those players quit, none of them missed practice.

The lesson here is Zook was upfront about what might happen (too many players), and what he was going to do about it (rotate the uniforms). He was up front about the problem before it became a problem, and then it wasn’t really a problem. We knew it was coming.

“You can shoot the ball anyway you like to, as long as it goes in the little round thing. As soon as you start missing, you shoot my way.” He gave you enough rope to succeed or fail. If you were a good shooter, he wasn’t going to screw you up like many coaches and managers do by making you do it their way. But if you struggled- well, you didn’t have much to argue about- you shot his way. Which, by the way, did improve many players’ shooting.

Zook hated fade-away jump shots- he believed in a player being able to go right at the defender with the shot, get fouled, and make the basket. He loved that, but he hated fade-away shots. One of my teammates, Dave Wilson, could shoot (and make) fade-away jump shots. Even though Zook hated the shot, he kept his word about shooting any way you want- as long as it went in. In fact, Zook used to send Wilson into games if he thought the opposing zone defense needed a little “loosening up”. Wilson would go in, put up three or four shots from what today is three-point range, and voila- the opponents changed from a zone to a man-to-man defense. Why didn’t Wilson start if he was such a good shot? Because he was a lousy defender, and Zook valued defense first. Lessons: Zook doesn’t let his ego get in the way of allowing players to go outside the guidelines if they are successful, and he isn’t enamored with the appearance of good (a good shooter) versus what is really important (good defense). He also knew how to apply talent in the right situation.

In this same first day speech (people would pay Zook $5,000 an hour to speak today) he told us that we might run into a player on a team that could hit a twenty-foot shot. Then have the ability to fake our defender out, take one dribble and sink the fifteen foot shot. He told us, “Well, there’s nothing you can do about that.” He was a realist. When I worked with Bobby Unser on Winners Are Driven, he thought on the exact same line. Bobby wanted to win, but understood that there might be a faster car out there and he just wasn’t going to win that day. Coming from a Three-time Indy 500 winner, perhaps his realistic approach kept his head on the level to not do something stupid and live through his sixteen Indy losses in order to get his three wins.

Zook told us to stay off the refs. He said, “You can’t get thrown out of a game, but I can because I’m not playing. Besides, if a game is going bad enough I may ask to get thrown out.” Message: He may do something provocative to re-focus our team and the refs at the same time. Another thing he said about refs was quite philosophical: “Heck, if we’re playing bad enough, they’ll make bad calls against us.” If your performance looks consistently lousy, you won’t get the benefit of the doubt.

Our high school team ran a set offense as dictated by the varsity coach. It was called the thirty-two. Freshman year, it was the first thing we learned, and anyone who made the freshmen team knew the offense. We had two freshmen teams- an “A” team and a “B” team, a total of thirty kids. I remember a friend of mine, Mike Murray, who was cut freshmen year, but sophomore year made it to the Thursday practice, thus making the team. On that Thursday, we actually picked up some basketballs and started practicing. Murray was struggling running the offense, basically because he had been cut the year before and hadn’t learned the offense. Zook asked Murray why he was having trouble, Murray meekly replied, “I don’t know the offense. I was cut last year.” Zook looked at him and said, “You were cut??!!” He didn’t have to say anything else: his tone of voice and facial expression were as though he were saying, “Not here. I’m going to turn you into a winner.” Not only did it lift Murray’s spirits, but we all noticed: He wanted us all to succeed. We started diving for balls, crashing into walls, jumping higher, sprinting harder, and pouring our soul into every moment of practice.

When I talked to Zook about this article, he said, “I got kids to believe they could do more than they really could. And they did.” Lesson: You stretch your employees’ performance by instilling a genuine belief in every one of them from bottom to top that they can succeed. The key point here is this wasn’t a tactic, because it wouldn’t work as a tactic. It worked for Zook because it was a belief.

Game time: The Psyche Master

Before each game we had to sit and listen (no talking, no questions: just listen) to Zook’s pre-game talk. When Zook talked, you listened. This was Patton firing up his troops. No two speeches alike- each speech tailored to the opponent we were playing that night. He didn’t talk to the team- he spoke to each player and their role that game, pumping them up: “They’re talking about how they’re going to blow us out of the gym!” He’d explode, eyes on fire, face turning red. “Heck, if Thimm rebounds like he’s been doing this week (Thimm’s focus for the game: rebound, rebound, rebound.), and Prang sets the press the way he can, with Bouchee stealing their long passes…” and through the whole starting line-up that way. The speeches may have been different, but the effect was always the same: when we came out of the locker room, we were like a pack of mean dogs on a very short leash. Going through the pre-game warm-ups we would pace around like panthers waiting for a meal. It wasn’t cockiness or arrogance. It was focused intensity. We didn’t play dirty or out of control, we destroyed teams by playing the game with a blistering press that put them back on their heels from the start and didn’t let up until the finish.

I was the sixth man- first guy off the bench. One weekend we had two games, and I recall playing in seven of the eight quarters. Zook played everyone- not because he was a socialist, but because he sincerely believed everyone could contribute- we all had a role. Besides, there were one of two ways to get taken out of a game by Zook: Because you were exhausted from hustling so hard, or you weren’t hustling enough. You were coming out one way or another and the choice boiled down to which looked better- coming out because you were hustling hard or coming out because you were lazy? If somebody was coming out, then somebody had to go in. So everybody got to play.

Often, by the fourth quarter the third string was in. That’s when the opponents would really complain about Zook “running up the score”, but that wasn’t what he was doing. He coached the bottom five of the lineup with the same enthusiasm he coached the first string, because his job was to develop his players, not worry about the opponent’s feelings. Not only that, but think of the positive impact on these players- that the coach cares about them as much as he does the starters? What about the confidence builder in them because they were playing well and actually contributing to winning, not just going through the motions? What a great lesson for these kids- a third string playing with confidence, and getting coached by the best in the business. Result: they shredded the opponent as well, making it look like the score was being run up.

Lesson: Involve everyone in the process, and you won’t have to worry if Billy or Suzy get sick and don’t show up. You just plug another player into the lineup and go forward. It’s amazing how organizations think that isolating people in silos is beneficial. One silo missing, and the whole thing falls apart.

During the game, if you made a fundamental mistake or lost focus, Zook wouldn’t yell. He didn’t have to. He’d stare a pair of holes through you. He could also tell when you were having a bad day at the office. One game, we were killing the opponent early, and I was in early. But I just couldn’t get “in sync”- things were not going right at all. He yanked me pretty quick, sat me down next to him, and said, “Relax. You’re too wound up. Let Wilson play for a while tonight.” He could distinguish between a loss of focus and a bad day because he was an engaged leader. He engaged with his players enough so he could sense where they were at. Bobby Unser talked about this in Winners Are Driven when he said, “Leaders have to get involved with their people. They have to get out from behind their desks, go out on the factory floor, and get a real sense of what is going on.”

Strategy: The Big Picture Genius.

Zook never drew. He said his job was to make the other coach call time-out and draw. That didn’t mean he wasn’t a planner. He was the consummate planner. He always had a strategy that he went over with us before the game. An effective speaker, he was able to get the message across verbally. Leadership today requires the ability to deliver the message- to communicate with passion and clarity. I remember one game how he got inside the opposing coach’s head in the first minute of the game. Our team was known for pressing the whole game, then falling back to a man-to-man defense. That game, Zook had us start out in a zone defense. Sure enough, the opposing coach called a time-out within a minute and started drawing feverishly on his board. Zook looked over at the opposition huddle, then told us, “OK. He’s now drawing up an offense that goes against our zone defense. Go back to our man-to-man defense. They’ll have to adjust back to the offense they planned at the start of the game. After two minutes, go back to the zone again because they’ll forget everything the coach just drew on the board. They’ll call another time-out.” Sure enough, things went exactly as he said.

He was pro-active in everything he did. Planning his game strategy was always attack, attack, attack, and do it with a little twist here and there to throw off the predictability of where it’s coming from. Make them worry about you. Looking back on his first speech that, too, was proactive. He anticipated we might run into a tough opponent and was matter-of-fact about it. The rules of practice, expectations, and consequences for not meeting those expectations were laid out. So it was no surprise to us when we actually did lose a game after winning our first five: We got the speech, the wake-up reminder to refocus, and then he ran us into the ground to slam home the point.

Halftime: Time to Re-focus.

This was his mid-course reminder for us to stay on track. No matter what the score was, we weren’t going to take anything for granted. He never let us play “not to lose”. One game, we were ahead 38-12 at the half, and he told the second string (who was going to start the second half), “You’ve got them in a hole, don’t even think of letting them out. As far as you guys are concerned, the score is zero to zero.” He never believed in “playing not to lose”. He never sat on a lead, or took one for granted. There were no slam-dunks in his book. How many people play the game to not lose, and then lose anyway? Or brag about the “slam-dunk” deal, only to see it slip through their grasp?

Finish: The Reward

As much as Zook gave you the glare when you lost focus, he also let you know when things went right. Because of our style of play to pressure the opponent and then run them into the ground, we would get spurts in a game where we would score ten or twelve points in a hurry. We’d get a basket. Then steal the ball, and get another. Then another. The crowd (we played in front of big crowds because our game preceded the varsity game) would start to get louder with each score. It was like a feeding frenzy. We’d make a basket and the crowd would cheer. Then a steal and another basket and they’d roar. Now the adrenaline is flowing and we’re like sharks that smell blood in the water. We would make a steal, and the whole team would fan out breaking and running, the ball passing from one player to the other, never touching the ground. The play would finish with a pass and score and the crowd would explode. But above all this noise, the loudest thing we would here on a play like that was Zook bellowing out, “Looked like a million bucks!!” Now the adrenaline spigot was open wide, and we felt like a million bucks! When you’ve got the team pumping on all cylinders and the stuff is just rolling, it makes all the blood, sweat, and tears worthwhile.

Zook Lessons as Applied to the Leadership World Today

Times are tough now in the world we live in. But are the circumstances beating us, or are we letting them beat us? Are we playing so bad that the calls are going against us? Are we playing not to lose? Are we afraid to challenge people to run harder or do better because they might get upset? Are we engaged and coaching the whole team? Are we winning? Do we make our people feel like a million bucks when they do well? What do you think Zook would do?

The Law of Zook

Who’s committed to make change and get things done? If you’re in, I’ll lead you all the way. I don’t quit on you; you don’t quit on me.
The change to becoming a winner will be painful, but the status quo of losing is more painful.
Take action to solve the problem, don’t talk about it.
Credentials are meaningless if there isn’t any desire to perform.
Tell it like it is, not how people wish it to be.
Give your people a chance to fail on their own. They just might succeed.
If they fail, fix it by training them.
Be a players’ coach- earn their respect by being involved.
Communicate the plan, and the belief they can stretch to achieve a higher level.
Coach and train the whole team.
Never play not to lose. Attack continuously.
It’s OK to dish out praise. After all, if you don’t have a million bucks to give them, you can still make them feel like a million bucks.

Massachusetts Moment: Business Lessons for Corporations That Ignore the Guy In the Pick-up Truck

Sat, 27 Mar 2010 05:51:00 GMT

First, a caveat: This is not a political column, this is a business column. The meaning of Scott Brown’s election in Massachusetts is a great metaphor for corporations. Given a “Massachusetts Shock Message” to a corporation (like snowballing employee turnover or customer defections), how many corporate executive teams and organizational leaders go into spin cycle- or worse yet- denial mode? Let’s face it: leadership isn’t just about giving a directional message (“I haven’t explained the message well. They don’t get it”.) That’s top-down management-by-directive, and the problem is the executive is in denial about which way the real message is being sent: it’s not coming from headquarters; it’s coming from the pickup truck- the street.

If there is a problem with the rank and file, it isn’t because the message hasn’t been crafted well so they get it. It’s because there are some serious leadership issues and the leaders better find out what’s really going on at the factory floor level, at the customer level- at the street level. And if they don’t already know how to drive a pickup truck, then they’d better bring in folks that can do that- and listen to their good advice.

What are the metaphorical business messages of the Scott Brown election in Massachusetts?

Stop Talking: Start Listening

Maybe leaders don’t have an inability to articulate their message- maybe they aren’t listening to what’s happening on the ground floor. I went into a retail store- a specialty sports store- a few years ago looking for a sports hat. I forget the details of the hat, but remember the gist of the exchange- the store didn’t have it and the store clerk was upset. He was upset because at least ten customers had come in looking for that type of hat, and they didn’t have it. The clerk’s frustration wasn’t that he didn’t have the hat: the clerk’s frustration was that he had been telling his corporate bosses for several months that they were inventorying the wrong stuff and not bringing in the right stuff. That store is now closed. No wonder. The clerk drove a pick-up truck, but the folks in Washington knew better.

Get Engaged: Stand out at Fenway Park on January 1 in the cold.

SCAN Healthplan is one of the fastest growing Medicare Advantage plans in the country. They aren’t accomplishing this because they are doing over-the-top mergers and acquisitions. They are doing this because all of their senior executives- the CEO, COO, CFO, and every executive Vice-President- actively participate in “Straight-Talk Forums” where they have to engage and listen to their members. Additionally, all executives are required to go on “ride-alongs”- sales calls with a salesperson in a prospect’s home. They drive pickup trucks and aren’t afraid to stand out in the cold.

Don’t Fake It: Anyone can buy a pickup truck, but not everyone can drive a pickup truck.

One of the biggest waste of business transformational effort and expense is to try to imitate some industry standard- be like Jack Welch or Southwest Airlines or Federal Express, etc. The pickup truck wasn’t a gimmick. It was Scott Brown, it was his message, it was what he stood for, and most importantly, it connected with who he was delivering his message to. There are certain things that just don’t fit- and can’t be faked- either as a leader or by the organization. If you suddenly want to re-invent your company by buying a bunch of pick-up trucks, it isn’t going to work if you don’t have people that “fit” the image of the truck. They’d better chuck the suit. They can’t be afraid to get it dirty or to haul stuff in it. And they sure as heck better be able to parallel park it. You can’t be who you aren’t.

A Simple, Resonating Message: Constant Communications and articulating well is meaningless if the message is ignored.

A boy was fishing with his dad. The boy made a great cast to the perfect spot where a fish would surely be lurking. “That’s a perfect cast!” exclaimed the boy. The dad replied, “You know it and I know it, but does the fish know it?”

While some executives will lament, “They don’t get it- so we must articulate our message better (or shove it down their throats harder).” Scott Brown’s message was pretty simple- “I will be the 41^st vote”; “I drive a pickup truck”. I will take action (and the message resonates) and I am one of you (I get it). Yet not one resonating message can be quoted from his opposition- which not only included his opponent, but arguably two of the best Presidential orators of our time.

A few years ago, interviewing the head of training and development of Southwest Airlines, he made a quote about what working at Southwest boils down to: “Seats full, wheels up.” That is a Scott Brown message.

Forecasting a Sure Win Will Lead to Failure: Leaders shouldn’t assume they’ll win tomorrow because they won yesterday.

A thirty-three year straight-commission salesman had some sage advice for his daughter (real estate) and son (B to B) when they went into sales: “Every day is a learning experience. When the day comes that you think you know it all, shoot yourself.”

Sales is- and should always be- a humbling profession. So should leadership. As brash as some salespeople- and leaders- are on the surface, the really successful ones are the ones who never assume that their hard-fought victories or methods of the past will guarantee success tomorrow. Here are some notes from a pre-program interview conducted for a sales training seminar with David O’Connor, New York sales rep for Lubrication Engineers. David had been selling Lubrication Engineers’ products as a straight-commission sales rep for 46 years at that point:

“David, what would you like to take away from this program?”

David O’Connor: “I love going to training programs because there is always a jewel to be taken from them. My biggest need is to open new accounts- usually I have 50-60 new accounts, but I only have 30-40 this year. I’m looking for a few new tips in that area.”

Far too many people in business and sales take the Martha Coakley approach: They assume the victory because they won a few times in the past. Or, some assume victory because they are the brand of choice- they are in Ted Kennedy’s party. They coast. This leads to the next point.

Playing Not To Lose: Panic as the margins slip away.

How many times have we watched a sports team build a great lead in the first half by playing great defense and skillful offense- and most importantly, playing the game with their hearts? Then the second half starts and they start to think- they try to slow down their offense, play a prevent defense, and pray for the clock to move faster. It doesn’t. The opponent stung by the humiliation of the first half comes out playing with fire in the second half. They sense the leading team’s lack of passion and go for broke. The inertia of the lead being whittled away can’t be stopped, until the team that led at the half is finally overtaken- and loses.

Witness the Irish Hurling Final of 2003 in Dublin between the favored Kilkenny and Cork. Hurling is a cross between soccer and field hockey, except they use something that resembles a baseball bat. In the final, Kilkenny had a huge halftime lead. This was the first time I ever watched this sport- and yet, in the second half, I could tell Kilkenny stopped attacking (played not to lose) and the whole momentum swung to Cork’s favor, who eventually won.

In business, the same thing occurs: A business creates a great product, gains huge market share, and generates record revenues and profits. Then they sit back on their invention, reap profits, and hope nobody notices. Competitors start to attack the price margins. Innovation stagnates because the focus is on cost-control (prevent defense). The management strategy is to play not to lose as the margins and market share continue to wilt away. Finally the business loses.

Final Lesson: Learning to drive the pickup truck.

A few years ago, we had a coaching intervention with a regional sales executive in the weekly newspaper print business. The sales executive’s office happened to be at corporate headquarters and his responsibility was for twelve weekly publications- the furthest being a two-hour drive from his office at headquarters.

The challenge was his region was under-performing. The bigger challenge was (at that time) the corporate mentality (his bosses) was, “Make them come to you, don’t go out to them”. It was the Washington DC mentality. Engagement with his twelve publication managers was mostly at the monthly meetings held at his corporate office. If one of the corporate execs slipped into the meeting, it turned into a beating. The only managers he would visit regularly were his two “problem” (really low performing) managers. He only got out to the field (left Washington) when there was trouble. So, a visit by the regional boss to a newspaper office could only mean one thing: that office was in trouble. A visit to a state by Washington can only mean one thing.

The coaching session with the regional exec lasted six weeks. It involved a live visit the first week to review the objectives and guidelines followed by a five-week blended program of online work and teleconference calls. We set a very singular goal for the sales executive: Get out to all twelve publications on a weekly basis- get in the field four days a week. Start racking up the truck miles.

But it wasn’t as simple as that. There were two issues: One was he had to look at all the reports and meetings at corporate and make the conscientious decision that they were not as important as going to the field. In other words, he had to choose NOT to be a part of the report and meeting corporate culture. He had to disengage himself from the Washington DC apparatus. The excuse he used at corporate was he was going out to deliver more beatings instead of doing it monthly. The visits were allowed by corporate as long as beatings were in order.

The other issue was that he just couldn’t get in the pickup truck and drive out to one of the twelve local newspaper offices and announce, “Here I am!” They’d brush him off, not trust what he was up to, think this was a new management gimmick, or just throw him out (Don’t tread on me!). His visits normally meant trouble, and he had a credibility gap that he had to bridge in a hurry. Without getting into details, we were also at that time running the third in a series of blended (live and online) programs for the twelve managers. We were already driving the pickup truck around and knew what it would take for him to “fit in”- and we could facilitate the introduction to the locals as to why this change would work. We had their ear.

His weekly goal was to add one-half to one full day in the field per week- adding two to three newspaper offices per week to his weekly “truck” visit list. The biggest challenge was to get two of his most independent (and top-performing) managers to allow him to visit. Again, without getting into details, as an “advance team” (for lack of a better term) we had the managers’ ear and were able to get them to think differently about the role of the sales executive and the opportunity this presented to them.

The results can be summed up in the following unsolicited phone calls from the sales executive to us during the intervention:

Week 3: He called to exclaim, “The two most difficult managers for me to work with called me today and invited me to their offices!” We did not suggest they do this- we merely helped them see him and their relationship with him differently. The “locals” gave him permission to bring his truck to town- and it was entirely their call.

Week 4: “I was out four days this week and made it to all twelve publications for the first time.” He’s going to get 200,000 miles on that truck- and that will have meaning.

Week 5: “We had our monthly meeting at corporate today, and for the first time I was in charge of the whole meeting- and didn’t have to refer to one report. I knew what was going on.” Well now, there’s a revelation. Listen, learn, and lead.

What was the effect? Performance of his twelve publications exceeded goal over the following twelve months by over 20% and year-over-year growth of 25%. Let’s see: The President carried Massachusetts by a 26% margin in 2008- Scott Brown won by 5%- a 31% swing. Anybody detect a pattern?

Leaders don’t need to own or even know how to drive a pickup truck. They need to respect it, pay attention to it, and understand its meaning. It looks like it’ll help improve productivity 20 to 30%. And the competition will wind up as road kill.

Recognizing Talent: From Busboy to Six Figure Salesman

Sat, 30 Jan 2010 04:29:00 GMT

Where do you find good salespeople? First, you have to define “a good salesperson”. With no college curriculum or extensive certification process for someone to be called a salesperson, a “good” salesperson is a highly subjective definition. Here’s the acid test for executives as to whether or not they know a person is a “good” salesperson or not: Can the executive make an accurate evaluation without looking at the sales numbers or track record- and will the sales numbers verify the executive’s decision to hire? Would an executive of a prominent electrical wholesaler hire a food server at a restaurant with the intent of making him an outside salesperson? John Walter of Walter’s Wholesale Electric did that very thing about twelve years ago.

As is the case with many business executives- particularly those close to the sales function- John Walter had his regular restaurants. One was Hof’s Hut in Torrance, CA. And as is also the case with many regular customers, John had a favorite server- Tony Estrada.

After some time, John realized Tony was more than a food server: Tony was a salesman. While many executives who had frequented Tony’s serving area had suggested Tony get into sales, no one had actually offered him a job. After all, Tony was only twenty-one and had no college degree. Who would offer him a job in sales? John Walter did. With the confidence built up from other customers’ comments about going into sales, Tony accepted the opportunity at Walter’s Wholesale Electric.

Tony started out in the warehouse- filling orders. He had to get the feel of the products he would be selling, like starting out in the kitchen of a restaurant. Then he moved to counter sales, working with walk-in contractors. Tony would ask questions about what types of projects they were working on so he could connect the products ordered to the type of project. Most importantly, he was learning about the contractor’s business and earning their trust. At Hof’s Hut, his attitude was to always put himself in the customer’s shoes: “How would I want to be treated if I were them?”

This sounds like common sense, but if that’s the case, why do so many salespeople and sales training programs focus on presenting features-and-benefits when they should be focused on learning what the customer needs and building trusting relationships? It’s a rather universal concept with successful salespeople, but so few executives realize this value and so few salespeople “get it”.

Because of his focus on the customer, most of Tony’s business is via referral- even in this down economy. Paying attention to customers, feeling their pain, being accountable, and most importantly- enjoying the interaction- these are the universal things that Tony Estrada took from the restaurant to the contractor world.

And the “bottom-line” result? Tony has been selling for Walter’s Wholesale for a little over ten years. Dick Benbow, Vice President of Sales at Walters, says Tony has produced- in terms of both gross sales and gross profits- in the top ten out of ninety-three seasoned veterans for the past five years running, earning a six-figure income. Apparently, John Walter knows what a good salesperson is when he sees one in action- and case of Tony Estrada, the numbers have proven his decision. Where do you look for salespeople?

Thoughts from 1965- Lessons for 2010

Wed, 09 Dec 2009 05:56:00 GMT

The following is a memo sent in January, 1965, from J.A. Sexauer to his 75 field salespeople. Interesting how some of his thoughts and philosophies are somewhat timeless:

Progress will continue as our most important project during 1965. It will not, however, result from chance shots.
There is a price to be paid- and the following precepts will determine the cost viz…. Integrity! Intelligence! Industry! Intensity! Success will not be on arrival. It will be the fun we enjoy while overcoming the obstacles on the way.
“Service” will have a far greater meaning and continuing emphasis. Service creates confidence… it lessens the labor of the individual doubt while speedily dispatching business. It brings buyer and seller together to a satisfying state of mutual benefits and does so more quickly than any other system.
Once Service, in its true sense, has been established, we have the basis for a reasonable profit…. despite the multitude assuming its merits in every day competition.

Any fool may claim to sell cheaper… but it takes service in one’s soul to sell so that the customer will come back and buy more of the same thing… that gets the buyer and seller to do more business at a profit to both… for service determines the cost and value of a thing.
There is one other precept of the many, equally vital… to wit… “Self satisfaction without progress is stagnation.”
This business world of ours has its multitudes stuck in the mud of self-satisfaction. Once the dry-rot of self-satisfaction takes hold, the winter of discontent becomes twelve months long, unless we keep the fires of purpose and enthusiasm at white heat.
This “service above self” in helping others, while helping ourselves, will command a respect and confidence far more valuable than any amount of money… and as we plan our progress for 1965… so will we shape our tomorrow.

Small Manufacturing Growth for 2010: Economic Survey

Tue, 06 Oct 2009 02:31:00 GMT

On Sep 24-25, 2009, Peter Zafiro and I ran a workshop on behalf of Manufacturers Agents National Association (MANA) in Chicago. The workshop is called Building A Successful (Independent) Representative Network. Typically companies attending the program are companies that are growing and need more sales; are entering a new market; or are not growing and have had to lay off their direct sales force in lieu of hiring an independent, straight commission sales force.

We have run this program twice a year on behalf of MANA since 2003. The usual attendance for this event is about 15 to 20 manufacturers. This year the average attendance has been close to 40 for each of the two events- double the normal attendance. When you consider that this program is now going through its first recessionary period, perhaps that in itself is an indicator. Realizing this, we added one question to our anonymous attendee demographic survey conducted at the beginning of the program. In addition to the demographic questions asked below, we asked about projected revenues for 2010.

There is some fairly interesting- and telling- information about the state of the economy of these attending manufacturers from this survey. A total of 39 attendees representing 34 manufacturers attended. The countries where these manufacturers have their corporate headquarters and principle manufacturing facilities are: (30) United States; (2) Canada; (1) Mexico: (1) China Note that not all of the people complete the survey, and that not all of the surveys are completely filled in- this is not required information or course material. Consequently, there is not a one-to-one relationship of the data throughout the survey results. Here are the results of the survey for your review:

1. Company size:
The vast majority of the companies were small manufacturers.
a. Under $5 million: 9
b. $5-25 million: 14
c. $25-100 million: 2
d. Over $100 million: 3

2. Position:
This program, “Successful Sales Rep Network Development” is a high profile priority for these businesses.
a. Entrepreneur: 1
b. CEO/ Pres: 5
c. Exec Sales Mgr: 12
d. Regional Mgr: 2

3. Reason for attending:
While several are looking to get more performance (straight commission) for their sales dollar, many are looking for quick sales growth due to immediate opportunities via an experienced rep network. Still other companies are looking to enter new markets to mitigate their narrow market economic dependence.
a. Transitioning from direct to independent rep sales force: 9
b. Growing needs require hiring sales: 14
c. New market entry: 7

4. Typical order size:
While most of the typical orders from customers are relatively small, twelve were over $10k each, and five of those companies say their typical order size was over $50k, indicating typically a major purchase by OEMs or an investment in a manufacturing process line.
a. Under $1K: 4
b. $1K to $10K: 14
c. $10K to $50K: 7
d. Over $50K: 5

5. Typical Customer type:
The vast majority of customers for the attendees are OEM’s. An assumption could be made that these attendee manufacturers- all relatively small- are feeding products some larger OEM fish, who in turn are looking up forecast-wise.
a. Original Equipment Manufacturer: 19
b. Distributor: 9 Value-added reseller: 2
c. End user: 5
d. Contractor: 3
e. Retail: 0

6. PROJECTED SALES 2010
This statistic wraps up all the other statistics- as well as the assumption that anyone attending this program is, for the most part going to grow. Those that are not growing are probably eliminating the overhead of a direct sales force or scrambling to get into some new markets because their current market is in an economic abyss.
a. UP OVER 10%: 10
b. UP 5 TO 10%: 6
c. -4% TO +4%: 3
d. DOWN 5% TO 10%: 2
e. DOWN OVER 10%: 2

Economically, this is a small group of small manufacturers. However, the fact of the matter is- and has been for every recession recovery since 1981- small business is where the economy will recover from. Small business has created the largest number of new jobs in every recession recovery and expansion since 1981.

Trust and Integrity- Winners Are Driven book excerpt

Mon, 31 Aug 2009 22:56:00 GMT

The following is an excerpt from Chapter 7, Winners Are Driven
(Bobby Unser, Paul Pease, Wiley, copyright by Mi-5, 2003). It seems that some stories are timeless, but we can't seem to get the lessons to stick:

"People fundamentally know that trust is a good thing. Why do so many good, trustworthy people sway off course? How can you avoid their mistakes? With all of the problems going on with some major corporate executives destroying trust in the executive ranks, how do you avoid their traps? I’ll talk about the temptations that can take you off the path and crash an honest reputation. Then I’ll tell you how to avoid these potential crashes that kill careers…….
…….In this day and age of constant bombardment of material wants and wealth and instant gratification, some people need to understand why it’s so important to pave a path to success with trust, instead of greed and impatience. That’s why you need to know how trust benefits you. By knowing the benefits of trust, you won’t likely sway off the path when instant gratification or greed tempts you…

……In business, something is either going wrong, or it’s changing. It’s no different than racing. There’s always some sort of pothole, bump, or debris on the road to success. Sometimes, there’s a major crash, creating a momentary crisis. These are all unexpected events that challenge race-car drivers. In your career, there are also external events constantly occurring that affect your performance…..
…..The big worry people have today is that as soon as something goes wrong, their division will be sold, their department budget cut, or they’ll get laid off. Some people even have this worry if things are going right- that’s how bad it gets. If we learn to trust each other to work through the challenges and hold together, then we create stability in the long-term.
The problem with change is people don’t trust that the outcome will be better. When change occurs for the wrong reasons- like greed and impatience- then it becomes a bad thing and the result is bad. That’s why people feel uncomfortable with change- anything new is presumed to be a devil they don’t know. Changing for the right reasons- like improving the way things are done- is a better way to do it. Then it’s not a devil of any sort. In fact, it’s an angel, a savior.
When you change for the right reasons and things go wrong- and they will- people trust eventually the outcome will get better. As long as you drive the right reasons, then people won’t be as stressed out about adapting- they’ll feel more secure about going forward. If you are moving in a pro-active, positive direction, many people will trust the change and feel secure moving forward….

….Trust saves time from constant follow-up.
No matter what problems I had with any racing team, owner, or anybody in business, there was one thing people knew when they dealt with Bobby Unser: I was going to show up on time and give 100%. If things didn’t turn out in a race the way we hoped it would, well it sure wasn’t from a lack of total effort.
On the other side of that, when a leader is trusted, and the leader says “Go!” their people “Go!” The leader doesn’t have to waste time constantly being second-guessed by people constantly asking “Why?” Likewise, when the leader trusts you, they don’t waste time asking, “What are you doing?” “How are you going to do it?” “Why are you doing it that way?” and so on. ….
…..It takes time to earn trust, but once that happens, it takes less time to manage trust. You don’t have to keep checking on people to see if they’re doing their job. Likewise, when you are trustworthy, they don’t have to keep on checking up on you. If time is money, and trust saves time, then trust saves money. It also makes money.
When I look back on my path to success there are a lot of people whom I can point to and say, “That person helped me.” They were all different in their personalities, and if you put some of them in the same room, they’d probably start a good fight. But the one common thing about all of them was trust. I could trust them, and they could trust me.
We can see that when people believe in each other that they can relax about what they’re doing, focus on what they need to get done and not waste time nagging others to get their tasks done….
….. Trust builds morale.
Another huge benefit of trust is building confidence in others by giving them the opportunity to succeed. Additionally, it builds self-confidence. People become self-assured when you give them more control over their job….
…..Giving people more authority to make their own decisions, like Roger Penske did, can help you when working with teams. By trusting them to be accountable for their actions, you become a much more effective leader for them. You also build their self-confidence, which makes them a better employee….
…Trust is something that is earned through a combination of words and actions. Since you need believable actions to develop trust, it takes a long time to build a relationship on trust…..

Always give full effort.
Some people may interpret full effort as commitment, but it goes beyond that. You are really building trust. In my last race for Dan Gurney in Phoenix in 1978, I knew I was quitting his team and going to work for Roger Penske as soon as the race was over. But I gave 100% during that race for Dan Gurney’s All American Racers’ Team, because that was the team I was on, and I was going to do my best. In fact, I raced against Team Penske’s Tom Sneva that day and beat him. I wasn’t going to pull any favors for Penske, even though I was going there as soon as the race was over. And I sure as hell wasn’t going to do anything less than 100% for Dan Gurney and the All American Racers, because they all worked hard to get there.
One thing that is truly, truly American is giving 100%. That’s what everybody likes, and that’s why so many people pull for the underdog. People love to see effort, and they really love to see effort win. The other absolutely great thing about someone that has a reputation to go full out the whole time is you trust that person to give it a full shot, and for many employers, that is a big deal.

Actions that back up words.
I’ve always believed that the only way I could be successful was to do things- to take action. When you commit to something- do it. If you can’t make it happen, don’t commit to it. Let’s look at two viewpoints of this issue- taking action to earn trust.
First, let’s look at you and your own career. If you want to be really successful, start out by making sure that whatever you commit do and then you do it. Even if you have to stretch a little to make your commitment- get it done. Look at the long-standing relationship I had with Don Shepherd because he made it to the race, through hell and high water. Or the trust the car parts suppliers had in me for my 1959 Pikes Peak Hill Climb- I always paid my bills on time to them. I did what I said I was going to do. The return in long-term relationships built through actions that make your words true is immense.
Now let’s look at this – building believability through actions- from another viewpoint of this topic: You as the business leader. Some leaders just like to say a bunch of words that try to appease everyone, but then can’t make things happen. Other leaders just give the dirty work to other people- they just give orders. Either way, that’s lazy leadership, and in the end, unbelievable leadership.
The only way you can lead successfully is to motivate your people through your actions, not your words. Get involved with what your people do on a day-to-day basis. This is how you build believable trust with your people. It is taking leadership action that not only shows you care, but brings reality to your leadership. When you are involved with your people, you know how to give them tasks that they will do, and do them right. They believe you because you have taken action to be with them, and, you know not to give them assignments they can’t possibly finish.
You also have to willing to take tough actions and make hard decisions as a leader. I had a guy working for me in my shop for eighteen years, and I had to fire him for drinking during work hours. I caught him by accident. I was out running some noon time errands, and happened to see his truck parked in the parking lot of a bar. I went in, and there he was with a beer in his hand. I asked him what on earth he was doing, and he just said that it was no big deal, to have a couple of beers at lunch. Well, I sure as hell didn’t let any pit crew members on my race team work on my car after having a few beers. I wasn’t about to let one of my mechanics work on a customer’s car after a few beers. That was an easy, clear-cut decision for me, and everybody knew it. So, I fired him. I had to. I had to take believable action to earn the trust of the rest of the employees and my customers.

Losing trust: crashing and burning.
Look at all the people in the corporate world today that make it to the top, and then have to lie and cheat to stay at the top. Some of them even lie to get to the top. Why do they do this? There are three causes I know of.
Causes of losing trust:
1. Impatience.
2. Don’t know how to deal with falling.
3. Material desires exceed the passion for the game.

Impatience.
I didn’t make it to the Indianapolis 500 until I was 29 years old. I had already been racing fifteen years by that time, and had been in many hundreds of races. Despite that long apprenticeship in racing, I never really felt I took any short-cuts to get there. In fact, even the first year, 1963, I wasn’t sure I was ready for Indianapolis.
What drives impatience? Why have we become a world driven by instant gratification? What’s wrong with doing things right, instead of getting instant results? People want to see how quickly anything can be done, including rising to the top of a profession. The big sacrifice they make in being impatient is things may not get done right- they’ll skip steps. The bigger sacrifice is they may lie to cut corners. Getting the result becomes so important, that they lie and cheat their way up the ladder.
We’ve seen many people’s careers ruined because they lied on their resume. Why do they do this? Well they swayed off course- they felt the result was more important than the means they took to get there. They justify the means, even if it means cheating and lying. Everybody has to pay their dues to get to the top- nobody gets in for free. A big part of the dues is to be honest about the path and steps you take to get there, which means you have to be patient until you get there. Some people who read this will think, “Bobby, you’re one of the most impatient people I know. How can you talk about patience?” I’m not patient when it comes to taking action. I just know I can’t take short cuts or fake the results. You can be impatient to do things, but not at the expense of doing things right and truthfully.
Some people don’t take short-cuts to the top, and get there without lying or cheating. But then they make a mistake by lying and cheating to stay on top.

Don’t know how to fall from the top.
After I won the USAC National Racing Championship in 1968 and won the Indy 500, my brother Al asked me, “Well, you are the only one on top. The top is the very peak, and there’s only room for one person up there. You are the champion. What are you going to do?”
I replied, “Well, I’m going to try my best to stay there!”
He said, “Yeah, but you probably can’t stay on top.”
I told him, “It’s okay. I see what you’re getting at, but maybe I won’t fall too far. That way I don’t have to kick so many asses to get back up there again. Don’t you worry about that.”
A lot of people get on top, and then they have to hold on for dear life. They cheat to stay there because they’re worried about falling. I knew I was going to fall. Everybody falls. That’s the way life is. I accepted it. What I didn’t do was deny the fact I would fall, and I didn’t let myself get dejected when I fell. I knew I would get back up to the top again, and I did so in 1974, winning the Championship again.
Even in individual races, I often realized I wasn’t going to win. Sometimes I had a car that just wasn’t fast enough to win. We couldn’t set it up any better and I couldn’t get any more out of it. First place just was not going to happen. That didn’t mean we didn’t run the race as hard as we could- effort was never a question with me or the crew. It’s just we weren’t going to get any more than our best effort could give us, and on a given day with a given car that wasn’t going to be first. I accepted that as a fact, but some people just can’t do that. In fact, many corporations lie about performance when it looks like they can’t win, get first place, grow, or whatever measure they’re using to show “success”. Then they start bouncing checks and the financial reports become fuzzy.

Material desires exceed passion for the game.
Remember, it’s OK to fall now and then. You just have to get back up. But that’s a big problem with many people. They need too much material nonsense to keep themselves “happy”. Once you’ve made enough to live a good life, what else do you need? Why do you need more? You’ve got to keep the fires for the game burning. When your material wants drive you harder than your desire to play the game, you’re going to start losing.
The year I retired from racing, 1981, I was making $180,000 under contract plus over a million dollars in winnings that year, driving for Team Penske. As soon as I quit, I had offers for $1,000,000 just for driving, plus my winnings! Over five times what I was earning for Team Penske! But I didn’t go back for the money. I knew better. I didn’t quit because of the money, so why should I go back for the money?
Drivers today have long-term, high dollar contracts. That’s wrong and it’s bad. It’s wrong because they should have to prove themselves before they get rewarded. Yes, auto-racing is a risky sport. Drivers use the excuse that they secure these long-term large contracts “just in case” something bad happens, but they know this is a risky business. That’s the risk they take for the big money they earn…..
…..I know a lot of “successful” businesspeople that made a lot more money than I ever did and they are flat broke today. They let their material desires take over. Then when they had to feed their material appetite again, it was a win-at-all costs proposition, which often involved cheating and lying. And somewhere along the way they forgot about the fun of the game they were playing- they’re desire to do the right thing the right way- and got lost on the path of material self-destruction….

……Trust is built and earned over a period of time. It is created through a series of circumstances and principles upheld in those circumstances that make trust believable.
Trust is a personal aspect of success that you never want lose. Don’t yield to the temptations of material gains, instant gratification, or skipping steps in the process of becoming successful. Creating a legacy of trust builds a reputation of integrity.

AREA: Attributes of Successful Salespeople

Sat, 30 Jan 2010 19:29:00 GMT

NOTE: Following is a letter written from a 33-year straight commission salesman to his daughter as she embarked on her sales career- note the last sentence.

November 25, 1988

Dear Les:

Now that you are firmly entrenched in the sales profession I am submitting the following for you to chew on and digest. I was fortunate enough to work for a man (John A. Sexauer) who was tough but sincere. I worked for him- straight commission- from 1947 to 1979. He had a formula for hiring people- the formula was reduced to an acronym: AREA.

“A” is for Adaptability; using your talent to rectify errors that occur to the customer through no fault of your own- wrong merchandise shipped, poor quality, or a billing error. The ability to cope with the situation personally, without help from your superiors, is adaptability. It is a prime selling fundamental.

“R” is for Responsibility; to yourself, to your company; and to your clientele. “To yourself” is probably the most difficult since it requires self-discipline: Get out of bed, get on the road, and make sales calls without the boss telling you to do so. “To your company” simply means giving them a productive effort for your wages. “To your clientele” responsibility is usually reflected by the results of “to yourself” discipline because it proves that you are reliable. Hence a customer rapport is established that challenges the competition. You can serve a client without being subservient. There is a great distinction between the two: stand ten feet tall but remember you are there to serve and not to surrender.

“E” is for Enthusiasm, for which there is no substitute! Without this element life is an abyss. No salesperson can afford to ignore it. It is the spark that ignites attention faster than any other medium of salesmanship. You cannot expect to sell something unless you are sold on it yourself. Hence the reason for genuine sincerity in your presentation. When you have convinced the client that you are providing him value- then price becomes secondary.

Like a good cook, add ingredients to boost the flavor, such as consideration and integrity. Consideration is necessary when you are about to close the deal and the client suddenly has an emergency that delays the order. You have to be considerate of the circumstances. Integrity can only come with time; time for the client to judge your character for honesty. Integrity is a priceless ingredient for any transaction. Your word is your bond, Les, and never forget it.

“A” is for Ambition which is not only for the money but certainly does not discount it. Ambition seems to be inherent- either you have it or you don’t. It cannot be taught. If it must be taught then it is no longer ambition but simply obedience to the teacher. Salespeople who lack ambition are merely “order takers” because they have no spark.

Hope this helps you out, Les; nothing moves in the entire world until a sale is made. And when the day comes that you think you know it all, shoot yourself.

Love you

Dad

Training ROI

Thu, 18 Feb 2010 17:34:00 GMT

Employee and team development- whether through training or interventions- is a critical element to the adaptation and ultimate success of a business in the ever-changing landscape of the global economy. Measuring the direct effect on human performance based solely on training is virtually impossible. There are a multitude of variables that are always changing inside and outside the business that effect measured outcomes- with or without training. The effect of any training program can be- and should be- measured over time. Even then, the impact training has on productivity can only be measured in general terms relative to some norm.

Some executives may feel that only way they can be sure they are going to get what they pay for is to ask the training provider to guarantee an ROI. This is a bizarre twist of everything we (and any executive) experienced from kindergarten through college. Accountability to learn the course material rests entirely on the student to study course material, pass the tests, pass the class, and earn a degree, no matter how good or bad the professor is or how relevant or irrelevant the course is for the student. Additionally, there is some substantial financial skin in the game on the part of the student.

In the business world, that accountability shifts to the trainer and the training program- and there is no financial skin in the game for any trainee- student. It doesn’t take a lot of intuition to figure out that the college student is significantly more focused and vested in learning than their business trainee counterpart because the college student is accountable for learning and paying for the experience.

Once the accountability for the ROI of training is placed where it needs to be- with the trainees- then businesses will see significantly better ROI’s for their training investment.

The best way to ensure a proper ROI for training is to clearly define the objectives- the problem to fix or the goal to achieve- that will provide a measurable return over time. Then, perform due diligence on the training firm hired to make a confident decision. Training shouldn’t be a cost line item or a department that has to justify its existence- it should be part of the business culture. Making it a part of the culture will always net an ROI.

Executives Who "Get It" Managing Sales

Wed, 15 Jul 2009 18:48:00 GMT

When it comes to understanding the role of sales and how to maximize sales performance, not too many business executives “get it”. Hint: Managing sales is not about dictating control. If your salespeople are totally controllable by you, then what are they like when negotiating on your behalf? Worse yet, if you have total control over them, then do they have to wait for you to tell them to do something before they do it? Two major characteristics of great salespeople are the strength to negotiate value in the face of a buyer’s price pressure and the self-discipline to get things done without adult supervision. Neither of these characteristics are those of someone who is “controllable”. In fact, another inherent characteristic of great salespeople is they are fiercely independent.

But this doesn’t mean they are insubordinate, cocky, or arrogant. It’s just that their independence is built with the passion to solve problems for customers at a profit to the company without sacrificing their deeply driven principals centered on integrity. These salespeople walk away from bad deals for either customer or the company. At the same time they are willing to stand up to management that is not delivering the goods, the promises, or is actually getting in the way of the salesperson’s ability to sell by restricting (controlling) their behavior. Independence also doesn’t mean great salespeople aren’t team players- quite the contrary. They function well with teams. They just happen to be the ones that lead the charge to get things done- like generating new business.

Here is an unedited email from (with permission) from Dick Benbow, Vice-President of Walter’s Wholesale Electric- an executive who clearly “gets it”:

Paul, you mentioned managers "governing" from afar. They have their people filling out sales call sheets, contact reports, expense reports, projections, marketing reports, etc. Nothing but stumbling blocks to success. They do these things because they don't trust the system. They don't trust the people they hire. We are fortunate when our competition goes to market that way. I contend, hire the right person, get accounting people to make out all the reports you want.

Have your salespeople on a commission program that rewards high achievers, SUBSTANTIALLY. You can't be afraid of overpaying them. A sales manager is lost as soon as he feels no one salesperson should make as much or more than he does. I pride myself in claiming I have a number of salespeople that have higher incomes than we V.P.'s of our company. The more they make the more we make.

For the life of me, I don't see how one manages people by not being with the people you are responsible for. How can one manage people when you aren't in the field seeing first hand what they are up against. How many of these managers woke up one morning and found out that one of their high achievers just left the company. Probably wouldn't have happened had he/she had been out there in the trenches with that individual, at least it would not have come a surprise to that manager.

Check out Walter’s Wholesale Electric growth and success story over the last forty years. They are cleaning their competition’s clock, and doing it profitably. An executive of another extremely successful company (even in this tough economy) Russ Lesser, President of Body Glove International, is an accountant by profession who understands the value of the sales function. At a recent lunch he commented, “I don’t need any accountants if I don’t have any salespeople because without any sales we won’t have any money to count! It’s crazy for an accountant to get upset with a salesperson because the salesperson is making more than the accountant.”

Russ continued, “Two stories come to mind about how NOT to treat salespeople. One has to do with a salesman I knew back in the 60’s who sold for Hang Ten. He made $75,000/ year, which back then was not bad. He called me up one day and said he was quitting Hang Ten because they were cutting his territory and cutting his commission. They were punishing his success. So he went to work for an upstart company called OP- Ocean Pacific. Three years later he was making a million dollars per year selling for OP and Hang Ten was bankrupt.”

“Another story was about someone I knew making $180,000/ year on straight commission. Then the company said they were going to do away with the commission and go to a $200,000/ year salary, so he quit. You would think that getting a guaranteed $20,000/ year raise wasn’t so bad, except this guy wanted the incentive- or perhaps fear- to get out of bed every day and sell. Also, even though he made less than the salary, the thought that he was limited in income was a turn-off, even if the salary was high.”

How about another story of another exec who “gets it”? The Los Angeles Business Journal as “CFO of the Year for 2008”, Dennis Eder, CFO of SCAN Heathplan, the fastest growing Medicare Advantage plan in the country. We had Dennis do a presentation to the SCAN sales team about the fundamentals of SCAN’s financial structure, how they bid the Medicare process, and how the monies are distributed. Dennis’ opening remarks to the sales team were- with arms wide open for emphasis- “THANK YOU for feeding my family!” That was not scripted. Sales went up 20% that month. That was the result of his genuinely sincere statement.

What about execs that don’t “get it”? We’ve met a few of those. One president of a $120 million division of a $700 million company had 12 sales managers covering territories spread across the United States. Every month, he would make these managers fly in to a meeting near the company headquarters. We asked him why he did this. He said, “My philosophy is to make them come to me. And the one time we did not have the monthly meeting, they did not make their numbers, so we concluded that the monthly meeting is a necessity.”

We asked him, “Do you have a yearly strategy for these meetings? In other words, does one meeting strategically lead into another with some major milestone objective toward the end of the fiscal year?”

“No, we can’t do that because we don’t know what we need to fix from one meeting to the next.” That didn’t sound too productive. In fact, it is totally reactive- just like the management style.

This was really more of a monthly beating, than a meeting. The first time we presented at one of their monthly meetings, we opened with an interactive question that generated conversation every time for other clients. Except for this one. The silence was absolutely deafening if not alarming. It is difficult to “fix” a problem when the guy paying you is the problem. We suffered through this for two years. The only reason we were kept in the game was his boss- the company president- insisted on our involvement with the division. Sometimes the most influential sales calls come when you are seated next to the big boss for five hours on a cross country flight.

Finally, the division president was fired. Guess what happened? Sales shot up 20% across the board! So, the manage-by-dictating control was hurting sales to the tune of 20%. We have seen the same result in at least five other cases in the last ten years; a manage-by-directive sales tyrant is terminated resulting in an immediate across-the-board net sales productivity improvement of about 20%.

What’s the pattern? Performance-based pay (commission) that rewards- not punishes- success. Business systems that don’t stifle, but support sales activity. An organizational culture that embraces sales not as a necessary evil, but as a competitive edge. A management team that understands that good salespeople are independent and management’s job is to leverage that independence strategically. Fundamentally, in business the executives that win believe that a good defense is a great offense- and offense in business can only come from sales. Unfortunately, these execs and CFO’s are the exception when it comes to their view on sales. But, I’m sure they don’t mind being the exception, because that is why they keep winning.

Forecasts or Honest Information

Tue, 23 Jun 2009 19:30:00 GMT

The predictability of future business through the eyes of the field sales force is critical to effective decision-making on the part of any executive. What is the trend? What is changing? What’s over the horizon? Knowing this can help make the necessary strategic decisions that keep a company in step with the changing marketplace and ahead of the competition. The problem is most organizations utilize an outdated business school approach to getting this information: sales forecasts.

Why is forecasting- in its traditional business sense- the wrong thing to do? Let’s look at how well people who are paid big money to forecast business do. Let’s look at economists. Every December, Business Week solicits the expert predictions of 54 of the top economists in the country. In 2000, their predictions for 2001 were:

 3.1% GDP growth (average of the 54)
 4.3% jobless rate
 Of the 54, the lowest prediction for FY 2000 GDP growth was 1.7%

Here’s what actually happened in 2001 (Note that 9/11 had no appreciable bearing on the 2001 forecast because the forecast is for FY Oct 1 2000- Sep 30 2001):
• GDP grew at less than 1%- a three-fold margin of error as the predicted average of the 54 experts.
• Unemployment hit 5.7%, 33% higher than the gurus predicted.
• To add insult to injury, the closest expert (the lowest of the 54) was off by a whopping 70% (and he was noted as being the best of the best in the article).
Conclusion
• Economists can only predict upswings in the economy, and then only by luck. They may hit the number, but not for the reasons they predicted.
• They can’t predict downturns, which is really the only time they need to get it right.
• Question: If the best minds that are paid to predict the economy can’t get it right, why do we ask our salespeople to predict outcomes?

Why does management need forecasts?
• Resource allocation planning- personnel, financial, materials, capital equipment, production scheduling, etc.
• Forecasting shows if sales activity is in line with the business strategy.
• It gives management and stockholders a feeling (albeit a false one) of assured growth.

Getting forecasts from field sales is more challenging than ever. It’s difficult enough to get quality, timely communications from the field. Forecasts are worse. Why do salespeople hate forecasts?
• They hate doing any reports.
• They get punished (beat up) for doing them.
• Their experience in field sales tells them the future is not predictable- they will hear “no” more than they will hear “yes”. Consequently, they don’t know which ones will hit.
• A naïve management (to the sales process) has hounded them to bring in the orders- make the numbers. This is the birth of sales orders a la Enron smoke and mirrors.

The problem isn’t that forecasting isn’t prudent business practice, nor is it that forecasting is a waste of valuable sales time. The problem is management doesn’t know how to get salespeople to give them what they really need: good honest information- especially the bad news.

Forecast or Threat?
In the early 1980’s, Gould went on a business buying spree. One company they bought in 1981, Gettys, started to suffer greatly during the 1982 recession. Gould then decided to push Gettys’ sales to “make (up) numbers”. They asked the Gettys’ sales engineers to “forecast” 1983 territory numbers, as long as each territory grew by $1 million. That’s not a forecast- it’s a threat. Which is a typical use of sales forecasting. Then Gould started to maneuver more numbers- holding the sales books open past the end of a month, shipping products early to make the monthly numbers, shipping partials but invoicing for the complete order, and so on. Gould eventually disappeared. Enron isn’t the first, nor will they be the last- company to “cook the books”. It usually starts with unrealistic forecasts and the fact that management and Wall Street will not accept reality- which is occasionally in the form of bad news.
The economy expands, then it pulls back. It always has, it always will despite our meager efforts to forecast infinite growth. The sooner management accepts lowered forecasts as a warning of business contraction rather than a confrontation with field sales, the sooner management will start getting some real information. Furthermore, armed with real information, management will be able to make better decisions to mitigate the effect of the downturn.

Specific Sales Are Unpredictable
Any manager who beats up a salesperson for “not getting the order at XYZ company or not making forecast” has never spent a second of their business lives in the field on a sales call- or was that over-achieving egomaniac salesperson promoted to management that should not be in charge of people. On one hand- the manager that just simply doesn’t get sales- they only go to the field for the pre-arranged “feel good” calls. Not much going on there in terms of understanding the reality of sales. On the other hand, the ego-maniac can’t help but to take over every call and bully their salespeople. Again, totally devoid of reality and definitely never getting any real information from salespeople.
Now an exec will say, “But I want to see the trend.” Fine. Get copies of field correspondence and read them: the quotes, proposals, etc. If execs are close enough to field sales, then they will also know the predictability of these events. This brings up another issue about forecasting: probability of closure. How consistent is that over the span of the sales force? The optimists disappoint management because they don’t bring in everything they hope to bring in, and the pessimists are accused of sand-bagging. Furthermore, there is no such thing as getting 70% of an order. Either you get the order, or you don’t.

The Solution: Copies of correspondence; candid communication; Mutual Action Planning.
In addition to copies of correspondence to customers, the other important aspect of getting information from the field is for any manager to be in continuous verbal contact with their field salespeople. Taking notes of pertinent comments made during conversations is the best and most accurate way information flows because it is unconditional and voluntary.
The third element of good information flow is for each sales territory to have a Mutual Action Plan with the home office. This Mutual Action Plan aligns a successful local selling strategy with the overall corporate strategy. It also serves as a focal point for decision-making and territory growth management. Mutual Action Planning is detailed in another article.

Without question it is critical that the executive suite of any business get accurate information from field sales as to what the trends in the marketplace are. The problem is that there are far too many executives that go about this the wrong way by dictating the format, the frequency, and sometimes the goals- which leads to a lot of reporting, but no information flow or false information flow. Forecasting as a means to extract meaningful information from field sales is an approach that has never led to the desired result- nor will it ever. Continuous information flow via candid and unconditional communications built around a Mutual Action Plan will give the executive what they need: a clearer picture of trends and changes in the marketplace.