Why taking action now to
improve the company’s selling effectiveness will pay off for the Sales Director
By
Graham French
Some CEOs and sales directors of
small-to-medium sized industrial or technology product and services companies
understandably feel that the current economic situation makes it impossible to
achieve profitable growth. They are resigned to doing badly for the time being,
responding to the situation by reducing their selling and marketing cost base, hoping
that the company will survive the downturn.
But technology and industrial needs
haven’t disappeared. The market is just depressed. What would it take for your company not
merely to survive the downturn but actually make gains over your competitors?
A survey conducted some years ago now by
KPMG and the Computer Services and Software Association (CSSA) found that the
drivers for IT purchasing decisions were cost savings and a quick return on
investment. I believe that this still holds true, not just for high tech, but
also across industrial and commercial markets.
Orders being placed now are about “fixing
the leaky pipe”, i.e. fixing any process that costs money. For example,
excessive inventory, repeated service calls, cancelled orders, delayed
responses.
Although, apart perhaps from the public
sector, there is typically little budget nowadays for anything new, money will
be found to plug the leaks. If your product or services can address “leaky
pipe” problems, this might be a
Barriers to
success
Apart from the economic climate, about
which we can do little, what are some of the main barriers to sales success?
Sales people generally think they know but
the evidence is that very few really know how their prospects buy and hence
companies do too little to make it easier for prospects to buy from them.
Too few sales campaigns address the
prospect’s need to overcome fear of failure or produce the ROI analyses
necessary to gain funding. This is
fatal. It leads to prospects making no
decision at all, taking a year or more to decide or dramatically paring down
their investment.
Prospects today are knowledgeable about
the market and increasingly want solutions that bring a true return on
investment. It is no longer enough for sales people to simply to “pitch” the
product. They must be able to present, add value in sales conversations and
deliver compelling business cases.
Each company must work hard to understand
the true ROI contribution that their product or service makes. But curiously, few technology companies seem
to understand how their products and services actually benefit their customers.
There is a huge gap between the best sales
performers and the rest. It not that unusual for less than half of a sales team
to win 95% of the business – which means that over 50% of the team are bringing
in just 5% of the sales!
Neil Rackham, founder of Huthwaite Inc,
calls this the “rock star trap”. He believes that a company’s dependence on
just a few selling superstars is too risky and needs to change.
One way to help this along is for sales
management to be more pro-active in a) identifying the way their best people
sell their products and b) imparting this know-how so that the entire sales
team can succeed.
In a recession, companies become more risk
averse and tend to play safe in their purchasing. Larger more established
“brands” are perceived to offer more stability via their larger customer base and bigger sales
and marketing channels. Customers are
reluctant to move to new suppliers unless a considerable amount of benefit in
productivity and performance can be realised. CSO Insights in their 2009 survey
report that the top reason for winning deals is – the existing relationship.
This is why it is tough for the smaller
company to break in.
Sharpen your Sales
Approach and See Results This Year
How, with so much stacked up against it,
is an SME technology or industrial product company with a
·
then
teach your entire sales force to execute it
Couldn’t improving the way your people
sell deliver a 10%, 30%, 50% increase in sales? How would this impact the
success of the company?
Improving your seller/buyer interactions
will have more impact on sales even than improving the product or service. In
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