Tag Archives: Sales

How Do You Accelerate the Progress of a New Sales Person? Four Pieces of Advice

Situation: A CEO recently hired a new sales person. To date, this individual has signed some good customers, but is struggling to generated sales. How patient should the CEO be with this person? How much time should be allowed to demonstrate performance? What metrics do others use to assess and incentivize sales performance?
Advice from the CEOs:
• Set 90 day targets that you expect for the individual to reach: X new accounts, Y in sales revenue, other measures as appropriate to your business. Set these targets WITH the individual, not FOR them so that the individual has ownership of the targets. Monitor the individual’s progress frequently. If the trend is below the target, ask what the individual plans to do to meet or exceed the target. Targets are best set at the time of hiring. If the individual cannot approach these numbers then it’s better to cut sooner rather than later.
• How do you differentiate the sales person from the sales talker? Set firm targets and expect to see results quickly.
• The traits that correlate with success are not traits that that salespeople develop after they are hired. They have to demonstrate these from the beginning. The hiring process must select for these traits.
• There are a number of companies that offering tool that will help identify whether candidates for a sales position possess the traits that your company deems most important. Among these is TTI – Target Training International – www.ttisi.com and Sandler Sales – www.sandler.com.

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How Do You Establish Sales Accountability? Three Approaches

Situation: Several CEOs have experienced difficulty establishing accountability within their sales teams. Sone sales reps consistently come up with excuses for not generating new accounts or meeting their sales objectives. The impact of lost sales had significant effects on revenue performance. How do you establish sales accountability?
Advice from the CEOs:
• It is vital to understand who are the best customers and most profitable products and services for those customers. Establish regular sales meetings to discuss customers, products and services, to identify promising sales opportunities and to coordinate sales efforts.
• Work with both sales management and individual team members to determine desired outcomes:
 Set sales targets – work with the team to establish firm expectations on reasonable and achievable sales targets. Agree on a tracking system to measure progress toward those targets. Encourage members of the team to work together to achieve the targets.
 Customer type – who are they, what are their priorities and expectations, and how can the company best address these.
 Product(s) – work with the team to determine which products best fit each customer type and develop creative ways to position those products to increase sales.
• Establish measurable behaviors which if done will result in success. For example:
 Calls per week and results of those calls.
 Relationships with key decision makers and development of additional relationships within existing and potential customers.
 Thorough qualification before quoting, presenting, demo, and so on. The who, what and why that connects with successful sales..

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How Do You Focus Your Team? Six Points

Situation: Several CEOs asked how others have had success improving company performance and is interested in how they focused their teams. How do you focus your team?

Advice from the CEOs:

  • Important tasks for any company are to validate the value proposition, technology, target customer, and the rate of market expansion, and minimize risk and liability. This should be a regular company exercise – not a one-time event.
  • Assuming that a company has goals and people who can align with and achieve them, a company needs a vision – the broader strategic picture of where they are going. Often some of the best ideas come from line staff who are enabled by their company’s culture.
  • It is critical that companies are able to quickly identify problems and have systems in place to drive problem resolution. The minigame technique is very useful in these cases.
  • Companies should have a plan for transitioning employees into new roles as the company grows. The key is clear identification of the individual’s role within the company, and how that role compliments achievement of company objectives.
  • If a company wants to grow sales from, say, $20 to $60 million, it will need a professional sales leader. In addition, growth may require a change in company culture from engineering and development centric to sales centric.
  • A significant challenge is determining how to define corporate success. Much depends upon the questions asked. The Great Game of Business by Jack Stack provides guidelines and tools for assessing options. Anyone starting or growing a business should look at this book.

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How Do You Guide a Company Through a Sale? Five Thoughts

Situation: A company was built on capital equipment complemented by annuity sales of supplies used by the equipment. The company is moving toward automation of technology and offshore production of OEM equipment. An OEM partner will take on the equipment side of the business and the company will focus on automated supply solutions with sales direct to the end customer. The OEM partner has approached the company with a purchase offer. How do you guide a company through a sale?

Advice from the CEOs:

  • It is important to determine the value proposition, both from the company’s standpoint and the standpoint of the OEM buyer. The company’s objective will be to optimize the intersection of these two views of the value proposition — to its benefit.
  • Look at current employees and the technology and determine what to do to preserve their positions and interests. This will become part of the negotiation, but it is essential to have a clear idea of how this meshes with the CEO’s personal priorities.
  • Look to outside experts for advice on exit and succession planning.
  • Determine the CEO’s vision and path of involvement up to the sale. This involvement is negotiable, but should remain consistent with the CEO’s vision during the negotiation.
  • What is the company’s patent position, and the value of the patents in terms of future revenue? IP produces a future revenue stream. Consider the valuation to be in the range of 4 years of IP value.

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How Do You Implement Your Vision for the Future? Seven Points

Situation: A CEO has a clear vision for the future of her company and what she wants to build. Her ambition is to revolutionize her industry. What are the most important things that she should to make her vision a reality? How do you implement your vision for the future?

Advice from the CEOs:

  • It is critical to take charge of the vision for the company and to see that the company has or hires the right people to implement the vision.
  • As CEO, remove yourself from the day to day.
    • Hire a Director of Operations ASAP.
    • With the right experienced Director of Operations, the infrastructure to support the program will fall into place. This individual will help to assure that this happens because he/she will be incentivized and motivated to perform.
  • Concentrate the focus for the next 4-6 months to scale the present operation to the point where the model can be “franchised.” Consider expanding the model through sites with managers who have an ownership interest.
  • An important initial step is rounding out the training process.
  • The greatest value of the present site is to serve as a demonstration site to show potential customers how installation of the technology in their operation would work. With this in mind, build a working demonstration model on the present site to the dimensions and scale that customers would see on their sites.
  • To shorten the lengthy sales cycle, create and sell a feasibility study for the technology. Agreement to a feasibility study represents commitment from the prospect and conducting the study will create buy-in on the part of the customer.
  • As the new technology is launched, CEO time will be spent away from the initial site. Prove that the site can run in the CEO’s absence before leaving for extended periods of time.

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What Is Your Exit Strategy? Three Options and Approaches

Situation: Every CEO needs an exit strategy, if only for the good of the business because the future is uncertain. In this case, the Founder CEO wants to reduce her involvement in the business over the next 3-5 years. Her company has an offering that addresses domestic and international concerns about global warming. The CEO seeks help evaluating options. What is your exit strategy?

Advice from the CEOs:

  • The CEO sees several strategic options. Which option is more likely to yield results in a timeline that fits a 3-5 year exit strategy – a major international push, a partnering strategy, or leveraging current business to gain additional sales and market share by tweaking the current product line?
  • International Strategy.
    • The company needs international partners, not just a sales presence. This will require substantial time and upfront commitment from the CEO, not just a salesperson.
    • Where and who are the predominant businesses in the international markets under consideration?
    • Can an international strategy be executed and produce fruit in time to complement the exit strategy?
  • Partnering.
    • Partner with a hardware company to increase visibility and usage.
    • Partner with some of the top prospects for an exit strategy.
  • Focusing on the Product Line.
    • Employ customer shadowing to better understand how customers currently use the software and what challenges they encounter or opportunities they see – involve marketing, and R&D, not just the sales team.
    • Reposition the current offering to take advantage of opportunities.
    • Simplify installation and implementation.
    • Look at the product development strategy. Can revenue be bumped or upgraded from renewal customers? Are there options for “deluxe” versions with a premium price for upgrades, that become the following year’s standard upgrades?
  • Gather the company’s team and work through the scenarios for these options. Once this is done, prioritize them based of timeliness and potential impact on the bottom line and company valuation.
  • Also look at the Board structure – are there gaps in regulatory or sales and marketing expertise. What about adding someone who has connections to a key customer base?

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How Do You Transition from Service to Product? Four Strategies

Situation: A company is transitioning from a service model to a product model. A major challenge is meeting funding needs during the transition. Funding sources perceive the current service model as heavy on cost of sales vs. implementation and this hinders acquisition of funds. The CEO sees this as a short-term problem as the company will quickly start to generate more cash through the product model. How do you transition from service to product?

Advice from the CEOs:

  • In a competitive funding environment, it is important that the offering be credible. While others may be offering similar solutions, believability will prove to be a strong differentiator.
  • Where to focus over the short term?
    • Create a hybrid model as a transition between the current service offering and the planned product offering. Demonstrate that current customers have responded favorably to the product/hybrid opportunity.
    • Test this concept with an investor. The story is that the company needs funding to get to a saleable product model.
  • What is the message to investors?
    • Helping the company to achieve a short-term and very feasible objective gives the investor the following advantages: purchasing at a lower valuation, getting a larger share of the company for less, and at a low risk.
    • As the valuation of the company increases, the earliest investors will get the best deal!
    • During meetings with investors, ask them for advice on the current and following rounds and financing, and what they will find most appealing.
  • How do you mitigate the risk to the first investor?
    • Have a solid business plan and projections that have been vetted by others.
    • Have a list of referenceable clients.
    • Utilize the current service model and demonstrate the product/hybrid Package. Build a case on the advantages of the hybrid model including the financial case. The company is always there to provide back-up assistance to meet customer needs in the hybrid model.
    • Demonstrate flexibility – the customer can always choose the service model or convert to this if they wish.
    • A Key Point: You are selling yourself as the trustable resource, not the product or service.
    • Reference previous investment including founders’ investments. The founders did not invest to fail!

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How Do You Manage Culture as You Grow? Six Solutions

Situation: A tech company has grown to twenty people. The CEO is concerned that if they grow much beyond this their culture will start to change. The principal question is whether team leadership structure will remain tight and focused, while teams will continue to be flexible and have fun. How do you manage culture as you grow?

Advice from the CEOs:

  • Other companies have grown to twice this size and continue to increase their number of employees.
    • One uses component owners as leads, with people under them. Leads are more technical than managers and aren’t expected to be superb managers.
    • They grow middle managers organically instead of hiring from outside.
    • If an individual’s plate is full, give them the ability to delegate work to an up and comer.
  • Active communication has number limits.
    • The optimal functioning group is 7-12; higher functioning teams are even smaller with 7-8 members.
    • Create flexible teams that maintain communication pathways and culture.
    • Consider using reconfigurable space.
  • When one company grew from 25 to 60, they noticed that at 30 people it became difficult to track people; they needed to develop systems and internal management tools.
    • Much more attention was needed on sales forecasting and expense elasticity. The solution was to study peaks and valleys and built a model that could function within historic peak /valley limits.
  • How do you maintain the contractor pool?
    • Keep a list and actively communicate with them about current and anticipated needs.
    • One company’s rule: consultants are 100% billable – functionally they are only able to realize 98%, but the rule keeps this number high.
  • Use contractor pools to supplement project tasks. If your primary differentiating focus is on successfully closing projects, focus contractors on ramping new projects.
  • Hire people who embody you and your culture. Hire in your own image.

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How Do You Plan for Business Expansion? Five Factors

Situation: A company has built a very successful single site business, and wants to expand geographically. They are investigating where it makes sense to duplicate operations in new sites and where it makes sense to consolidate operations. The company’s secret sauce is in their system and procedures. How do you plan for business expansion?

Advice from the CEOs:

  • Look at the shared services piece and the cost/benefit tradeoffs. What services are best centralized, and what are the critical on-site services that you want duplicate in remote sites?
  • Other companies use remote offices for field personnel, but centralize all shared services. Centralized shared services include invoicing and collections, financial reporting, telemarketing, anything dealing with trade names and print or trade-marked collateral, and an array of other services which would be too expensive for individual sites to duplicate, or where leaving things to the individual sites might result in inconsistency of service and erosion of the brand.
  • How do you replicate key talent? Consider whether key talent can be retained in the shared services side of the business, not the cloneable service delivery sites. Typical franchise operations have people who are difficult to replace or replicate so most do not try to include these roles in the service delivery operations.
  • You will need to provide for a sales role in your remote offices as business development will be critical to early success of new sites.
  • In the transition from “successful small” to “successful large” most businesses find that the medium stage is the most difficult. Issues to consider include:
    • Does your direction match your expertise – do you have support of individuals knowledgeable about franchising?
    • What are the margin differentials within the business? Do you want to clone the high or low-margin areas of the business? Develop profitability models for your central and remote sites, and assure that the sites will have sufficient profitability to assure their short-term success. This will make it easier to proliferate the remote sites.

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Should a Start-up Focus on Team Dynamics? Four Thoughts

Situation: An early stage company is wrestling with team dynamics and coordinating the achievement of critical milestones. The strategic picture seems to change on almost a daily basis. New employees who have big company experience want to see formal job descriptions and role definition. Older employees are jealous of the attention that newer, more highly qualified employees are receiving. Where should the CEO be focusing. How should she be handling these challenges? Should a start-up focus on team dynamics?

Advice from the CEOs:

  • At this point, the company is in start-up stage. The most critical issue isn’t team dynamics, it’s getting a product to market and demonstrating that you can sell it. If you don’t have a product, you don’t have a company.
  • Your top 4 areas of focus for the next 3-6 months should be:
    • Get the product out.
    • Close 3-4 good customers – preferably customers that you can reference.
    • Securing the funding – partnership or investor – that will get you to your next key milestones or to positive cash flow.
    • Build your organization and keep planning.
  • As an early stage company, distinct roles and job definitions make no sense. Your strategic picture is currently very dynamic. You need good people who can flexibly wear several hats and fill diverse roles.
    • If employees with big company backgrounds press you on job descriptions and role definitions, tell them that as a small company you must be quick on your feet, and that you need them to fill flexible roles. As you grow beyond 35 employees then roles will start to become more clarified. Ask for their patience.
    • If they continue to struggle with loose role definitions, then they aren’t the right people for an early stage company.
  • Employees who started with you early were great for the beginning. However, they may not be the best for you long-term. They may feel hurt as newer employees with deeper expertise and resumes start to replace them. In the interests of the company, the game is not longevity with the company; it’s about quality and putting the most competent people in the most critical roles.
    • If you are playing pick-up basketball, you play with whoever comes along.
    • If you decide to form a team and to compete, you need quality players. Some of your pick-up players won’t make the cut and need to go find another pick-up game.

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