What if there was a way to significantly improve the performance of your sales team, and it was staring you in the face? Well it just might be. This paper will identify one of the most significant opportunities for dramatically improving sales performance and the best part is that it may require less energy to implement that other sales optimization alternatives.
A startling fact was highlighted in the 2009 Sales Performance Optimization report issued by CSO Insights. They report that organizations with the highest sales productivity metrics operate in a somewhat exclusive zone defined by how they sell and how they manage (not surprising). The significant operating advantages include the percentage of sales reps achieving quota, the percentage achieving company plan, win rates, loss rates and no decision rates (Figure 2). Across the span of operating results, this minority of 24% of the 1800 plus companies responding to their survey are enjoying much higher revenue productivity results largely because of how they implement their chosen sales process.
This is particularly noteworthy because the barrier for entry into this high achievement zone is relatively low (very surprising!).
This paper will describe the Dynamic Sales Process Adherence (DSPA)concept, introduce the ImperativeSelling DSPA framework, steer you to a complete set of tools for implementing your own DSPA initiative, and illustrate how one company jumped from the Sleepless Nights category to the Successful Years category in a six month time frame (during the height of the recession, nonetheless).
What do These Charts Mean?
(29% of firms surveyed)
(47% of firms surveyed)
(24% of firms surveyed)
% Reps making quota
% of Company plan
% Forecast - wins
% Forecast - losses
% Forecast - no decisions
Fig.2: Performance Contrast - 2009 SPO Survey Analysis (Courtesy CSO Insights )
Most CSO's are aware of the sales productivity advantages that can be gained by a sales person who operates more consultatively than their product centric brethren. But they also know that getting a whole sales organization to operate at this level is an elusive target.
The Sales Relationship/Process (SRP) Matix from CSO Insights 2009 (available at www.imperativeselling.com ) identifies the five categories of sales relationships as they progress toward more and more consultative models. Approved Vendor, Preferred Supplier, Solutions Consultant, Strategic Contributor, and Trusted Partner.
The horizontal axis describes the application of sales process as a management practice. Briefly,
· Random: represents a sales culture where no defined process is in place; this translates to each sales person operating under their own process definition.
· Informal: describes the organization that has defined the sales process, but does not spend energy reinforcing the process.
· Formal: characterized by an organization that has defined their process, and spends considerable energy reinforcing the process in a general application fashion.
· Dynamic: characterized by the organization that continually reexamines their operating results looking for challenges and opportunities that can be addressed with their defined process.
What makes the Dynamic category so interesting is that it contributes higher productivity returns and can be easier to implement than a Formal Sales Process Adherence approach.
Before I go into detail about a DSPA process, let's examine the reasons for considering this in your operation.
With the distinct operating advantages and the relatively low barrier to entry, I wouldn't think I'd need to whip out the old carrot and stick, but as one of my mentors once told me, "CSO's are like everyone else, they need to be motivated to change".
Starting with the obvious, let's compare the increase in productivity that comes with moving from the "sleepless nights" category to the "successful years" category:
· Imagine improving the number of reps making quota by 22%!
· Ratchet your forecast-wins up by 27%
· Decreasing the forecast-losses by 23%
· Eliminating 17% of the no-decisions that waste time and prevent your team from working on better opportunities
In a nutshell, the most compelling reason to look at a DSPA initiative is to improve your business results. Better still, as we'll discuss in the next section, the risk for failure appears to much lower than other sales productivity initiatives.
But before I get to that, let me finish the motivation discussion with the other side of the coin. For those of you that don't find the pure performance enhancement opportunity enough to motivate you to pursue this topic, perhaps the provocative side of the discussion is for you.
What's the Downside of Not Doing Anything?
The fact is that CSO's operate in one of the highest turnover professions on the face of the planet. (Even exceeding turnover rates in teaching and healthcare, often refereed to as the highest turnover professions.) According the 2008 Compensation Survey by PhoneWorks, 68% of sales leaders have been in their job less than 3 years, and 32% for less than a year.
Ironically, the recent recession may have actually provided CSO's with some relief from the turnover churn. How many CSO's were spared their jobs in the last eighteen months because disappointing results were rationalized by the economic toilet flush? (The 2009 Phone Works Compensation report will be released in December providing a comparison point.)
As the recession ebbs, and expectations for results increase, it's not beyond imagination to assume the turnover rate will be fueled again by CSO's who don't find an answer for renewed growth fast enough.
On the other side of the equation, the previous growth economy also provided cover fire. While the economy was booming, there were billions of dollars spent by CSO's on sales optimization initiatives that failed to produce results. However, because the economy was in a growth cycle and most businesses were trending upwards, missteps were overlooked on a regular basis.
To illustrate, in the 90's, CRM was the sole focus of sales enablement technology and yet the failure rate of CRM initiatives was astounding. In 2001, Garter put the failure rate at 50%, and yet in 2009, Forrester still cites a 47% failure rate for a market that was sized at $9.8 billion last year.
Likewise, CSO's spend in excess of $7 Billion on sales training annually while ES Research reports that 85% of sales training initiatives fail to produce lasting results after 90 days.
Although it's difficult to predict whether the level of disappointing results in CRM and Sales Training will continue to be tolerated, as a culture, B2B CSO's are quarterly driven, and long term change based initiatives do not have a high track record for success.
So the options are;
1. Do nothing different, and risk the churn that comes with the job.
2. Implement additional automation solutions that may no longer be low risk.
3. Pursue a dynamic sales process adherence initiative that has a track record for success with high payoffs.
To meet expectations for renewed revenue growth, it's clear that CSO's need an alterative strategy that's easier to implement than CRM or formal sales methodology with a premium placed on timeliness.
MarketingSherpa estimates that eight out of ten B2B sales are now originated by the buyer finding the seller. A characteristic made possible by the Internet. Buyers are getting bombarded by more information about solutions to problems than ever before, and they can research information far and wide prior to contacting a sales person. A fact highlighted by the difference in the buyer/seller engagement as portrayed by two different studies a decade apart. In a study by the Kennan Flagler Business School in 1996, the most common engagement point for a seller was about one third of the way in the buying process. Now, it's estimated by Tippit that buyers prefer to engage the seller in the last third of the buying process.
This combination of easy research and delayed seller engagement results in a buyer who is better informed by the time they do come in contact with a seller.
So that sounds good, right? Buyers who know what they want and are already in buying mode? Well yes and no. It's great because it might indicate the seller doesn't have to cold call if there are enough buyers finding your solution. On the other hand, if your solution can't be easily found on the internet, the buyer will likely buy from someone else. But more importantly, if they do find you, they are further down the buying path and often don't understand the value of dialoging about the reasons for their interest in your solution. They just want to dig into their questions about your capabilities; especially if they were tasked with the investigation rather than initiating it.
In the past, the sales person was often a primary source of information about new technology, but now, many potential prospects no longer see the value of an early dialog with a sales person. As a result, they are ignoring introductory requests at the highest levels ever. As a point of validation, a recent survey on LinkedIn revealed the number one challenge on the minds of sales professionals as "getting the attention of prospects".
Because they are much further down the buying process, when the buyer does engage the sales person, they are more likely to be in the mode of evaluating alternatives. This compels the prospect to dive into deep technical discussions or requests to evaluate the solution at the beginning of the sales engagement.
This creates a dialog that is being driven by the buyer to their own detriment. Since most solution investigation is delegated down in the buying organization, a buyer that is not knowledgeable about the impetus for the investigation is at a disadvantage in justifying a purchase or making capabilities tradeoffs in light of the business challenge driving the inquiry. The result is a higher percentage of "no decision" outcomes.
If that's not enough, consider how the economy has also contributed to changing the buying process. Due to the increased purchasing scrutiny that is occurring in a majority of companies; the average number of buyers involved in a complex solution purchase is now 6.8 according to MarketingSherpa, and in large organizations, that number can be 21 buyers. Compound this with further insight from the PhoneWorks survey indicating the average number of deals conducted per quarter by sales person dropped from 32 in 2007 to 17 in 2008.
This means there are more buyers pushing the sales person into more unproductive dialogs in fewer deals. As a prudent adaptation strategy, a DSPA initiative can be used to address the changing buying process. Later in this paper, a case example will be used to illustrate this opportunity.
Sales methodology introductions tend to be comprehensive and far reaching in terms of application to multiple aspects of the sales person's job, but short in time duration. The result is a flood of sales process awareness and a requirement to police the implementation to achieve a significant level of adoption. As mentioned earlier, a Formal sales process adherence practice is a challenging task. It requires a sales leadership team that is determined, focused, and capable of holding that focus for essentially an indefinite time period.
Like their CSO counterparts, sales people and sales managers are quarterly driven. If they can't see results in 90 days or less, their attention span doesn't wane, it retrenches with lightning fast reaction.
So the net outcome is that most sales organizations don't have the attention span and discipline to maintain a Formal sales process environment for an extended period of time. Most slip backwards into an Informal environment or Random environment within a short time period.
What's needed is a short term focus on current challenges that can be addressed with a subset of the sales methodology menu and produce measurable results. This is the definition of a dynamic process application.
If you didn't catch that last paragraph, read it again. The easiest path to higher performance is not through rigorous formal, long term application of a comprehensive sales methodology. In reality, the path to higher operating performance is to use the strength of the target audience to fulfill the requirement. Much like the martial arts instructor suggests pulling the punch through to upset your opponent's footing, a DSPA initiative leverages the short term focus of the existing culture to succeed where pushing a much broader adoption philosophy on the ADHD demographic has not worked effectively in the past.
Most people will pitch in to fill sandbags when a river floods without thought of compensation or reward; even if their own property is not at risk. But ask them to do it every day, day in and day out, and you'd be surprised to see anyone there after a week.
The same principle applies to sales process application. Short focused bursts with immediate payback do more for sustaining success than a long and frequently tedious and resistance filled approach. Further, the short bursts of success end up influencing the sales team to adopt the focused subjects more effectively. It's well known that adults learn by doing, so short focused applications align better with adult learning fundamentals than drawn out, overly comprehensive mastery attempts.
I have withheld their actual name to protect the competitive advantage they are enjoying in their industry. As the leader in their industry, ABC Company also enjoys the benefit of being the thought leader in their marketplace. This means they generate a lot of activity through their website which results in an abundance of probable prospects.
However, just as a majority of the world's companies, ABC Company felt the crunch of the recession as orders slowed and sales cycles elongated. Even though they had plenty of suspects pinging on their website, the percentage of these suspects being in a buying mode had diminished because of the belt tightening effect of the economic recession.
Tom B. is Senior Vice President of World Wide Sales for ABC Company. When the economy slowed, Tom took the initiative to introduce a comprehensive sales methodology to his organization. But he didn't stop there.
He also identified three key challenges that required a series of focused DSPA initiatives. The challenges were:
· The high ratio of suspects contacting ABC Company's sales people meant they were spending considerable time with people who weren't ready to buy yet; potentially spending time on a "no decision" outcome and not working on another suspect who could be converted to a qualified prospect. A double whammy on sales effectiveness.
· The buyer driven process that inevitably began with a request to evaluate the product was determined to be an ineffective customer conversion process. Previously, the practice was helpful as the product sold itself in most evaluations. However, during the recession it spread resources too thin with less payback.
· With the general belt tightening, ABC Company was intent on improving their ASP as a revenue growth strategy.
With these three challenges squarely in their sights, ABC Company implemented the DSPA initiatives in series. The key objectives for initiatives were:
· Regain control of the sales cycle and qualify out prospects who aren't ready to buy
· Minimize the number of physical evaluations required to validate their product capabilities
· Maintain control and leverage the momentum to steer the sales cycle to deal enhancing and sales cycle shortening dialogs; namely professional services.
As mentioned earlier, an informed buyer starts off the conversation deep in the buying process. If the seller goes along with this dynamic, the result is a lack of control in the sales process. Indicators of this dynamic include lengthy technical discussions or evaluation requests early in the customer engagement. Digging into the performance chart supplied by CSO Insights (Figure 2), indicates that selling dialogs in the sleepless nights category have a 27% higher rate of "no decisions" than formally or dynamically driven diagnostic sales dialogs. I'm suggesting there is a direct connection between a buyer that doesn't explore the business reasons for the purchase and a high rate of no decision sales cycles. (Read that as "rejected purchase requisitions".) In the current market, if the buyer is not guided or coached on justifying the purchase, the likelihood of a successful purchase diminishes.
The first phase in ABC Company's DSPA initiative series was to back the customer up to the first step in the buying process. The first words out of the seller's mouth were used to reset the conversation. For example "Why are we here?" Or, "What challenges brought you to investigate our solution?"
The objective was to get the prospect to share the impetus for the inquiry. Without this information the seller is blind in the process. Further, if the contact was not able to describe what the business reason was for their investigation of ABC Company, the directive to the sales force was to do one of two things, either ask for access to someone who could answer the question, or walk from the opportunity. (In reality, they were simply pushed back into the lead nurturing process managed by the marketing team.)
When the economy was growing, ABC Company regularly used an onsite evaluation to help sell the product based on its ease of use and immediate payoff. But as the economy slowed, this practice was deemed a luxury that actually slowed down the decision process.
ABC Company began a proactive process of leading the prospect to a validation dialog. In effect, they anticipated the prospect's need to verify the product would work in their environment. Instead of saying "yes" to an evaluation request, the ABC Company sales team proactively recommended a technical discussion to verify the product would work in the customer's environment.
"Next we typically engage our technical support staff to ensure our solution is capable of working in your environment. Does that make sense to you?"
This practice often eliminated the perceived need to borrow the technology for a more in-depth evaluation. It also added to the credibility of the sales team which made the next initiative possible.
By this stage in the DSPA process, the typical ABC Company rep had become adapt at qualifying out low probability engagements, and had used a technical resource dialog to reduce the need for an evaluation. The next DSPA initiative was designed to continue leveraging momentum by leading the prospect to a deal size enhancing dialog.
Literally, they would lead the prospect to the next step by dictating the process:
" At this point, we usually introduce our services architect to assess if you have the resources necessary to implement our solution effectively. Can I set up that phone call for you?"
The purpose of leading the prospect to a services dialog was to expand the deal size, eliminate any remaining perception of risk from the sponsor's mind, and ensure a successful deployment.
By implementing the qualification process, ABC Company tracked a 20% increase in the number of deals closed on a quarterly basis. The injection of the services discussion fueled a 300% increase in quarterly services bookings, which contributed to a 19% increase in overall ASP. But most indicative of their success is the virtual elimination of evaluations from their telesales engagement cycle. Since the other indicators could be impacted by other behaviors or by simply focusing on the metric, the virtual elimination of evaluations confirms they had established control of a buying process that had gone awry.
ABC Company has a choice to make. They can either hone their focus on these DSPA initiatives, or they can lift the hood and look for the next set of problems to address, design a new DSPA initiative series and begin a new implementation campaign.
If the sales leadership and sales force at ABC Company is just as human as you or I, they are likely to follow a predictable pattern if they make the first choice. They will eventually lose focus on this particular set of issues. Unfortunately, quarterly driven distractions and the alleviation of the core problems would override the compulsion to continue the focus long term. Without something to refocus their attention, they would slip back into an Informal process adherence practice.
The more productive path will be to examine their operating metrics or best practices and identify the next set of challenges to address. Then design a new DSPA initiative and start the process over. The previous behavior changes are likely to be inculcated into the standard practice because of its success, and the impetus for addressing a new set of challenges re-stimulates the engagement of the whole organization on the next initiative.
Imagine what it takes to get your whole organization to take action on an initiative. There needs to be succinct vision which communicates why, how, and when the initiative needs to be executed. But that's just the start.
Sales people are inherently skeptical about sales leadership initiatives. They've witnessed so many come and go, they tend to assume the next will suffer the same fate. Sometimes they'll even help the ship sink by undermining the initiative. You'll have to anticipate this behavior and consider ways to build credibility for the initiative.
Further, a sales organization does not operate in a vacuum. To achieve a new performance milestone, they often run into ecosystem related challenges and require the help of other organizations like marketing, technical support or the executive staff to remove these obstacles. Obstacles might include current processes or systems, resource constraints, or lack of skills as a short list of possibilities.
Lastly, it takes some energy to start an initiative, but some seem to take on a life of their own. It turns out that some Harvard research has shed some light on this phenomenon. To capture momentum and add fuel to the initiative, some early signs of success should be targeted, achieved and communicated. Early wins are critical to creating an initiative that builds steam and take on a life of its own.
To ensure the success of your DSPA campaign, I'll introduce the ImperativeSelling DSPA framework with the following overview.
The ImperativeSelling DSPA framework has six components designed to provide your management team with the tools to begin your DSPA initiative on the right foot. As a checklist, every DSPA initiative should incorporate the following:
When a DSPA initiative is implemented correctly, the results will be immediate and grow. When done wrong, the initiative fades from the forefront and sales practices regress to previous expectations and norms.
Every initiative will have dissenters. The highest potential for early dissension starts with any absent leaders, so leaving them out of the process is not a good idea. Also, the vision statement should be communicated by each individual leader to their team, and being outside of the development process impairs their ability to communicate effectively. So count on developing the vision statement with your entire leadership team.
As I've said, sales people are used to initiatives that fade rather quickly. They've seen sales methodology introductions come and go, and they've witnessed CRM implementations go unused. They are expecting the next initiative to suffer the same fate.
The success of a DSPA campaign is heavily dependent upon the credibility of the leadership and the initiative itself. A concerted effort is required to establish credibility for both.
For leaders, the display of rolling up the shirt sleeves to role model the new behaviors or skills are central to establishing credibility. Since the new skills or applications may be unfamiliar to the leaders, extra effort may be required to embed the skills in the leadership ranks. As a baseline, setting a series of measurable goals for the leadership to walk the talk is critical for establishing credibility.
To leverage the steam roller momentum, it's important to target a series of early wins to establish credibility for the overall initiative and harness more buy in. These are measurable achievements that demonstrate the initiative is on the track to success. Usually a subset of the overall imperative, they should be staged for achievement on a 30, 60, and 90 day series.
The research from Harvard on the subject indicates that a majority of failed initiatives did not have an early win target. It's a simple process, and usually provides a powerful leadership lesson for the entire sales management team, so don't overlook the value of this step.
All sizable sales initiatives cross organization boundaries. To ensure the buy-in and support of other organizations, it's a sound practice to form a formal coalition. The coalition will be chartered with identifying obstacles and providing support for changes required in other organizations.
Identify the key stakeholders in other organizations that are in a position to support your DSPA initiative, and invite them to contribute on a formal panel. Define when and how often they will meet as well as their role in the initiative.
Over time, systems, processes and culture develop to support a norm of expectations and behaviors. When a sales leader sets out to change the behaviors or practices of an organization even for a focused initiative, these previously supportive ecosystem mechanisms can become obstacles. They span reward and recognition practices, existing systems or processes, and cultural norms or beliefs that might impede the DSPA initiative.
With the help of the Coalition, the leader is tasked with identifying the obstacles, prioritizing their importance to the initiative, and tackling them in a progressive fashion.
Significant changes may require new skills; or in extreme initiatives, new personnel. The leader must clearly set expectations for new skills, provide training venues, and communicate objective evaluations of progress.
Imagine the military base that skips inspections, or the building inspector who relaxes his inspections with a drive by sign off. The results are predictable; sloppy implementations, missing deliverables, and more.
The timeline for every sales leader involved with achieving the DSPA should be inspected on a regular basis during the initiative. Since the core of a DSPA initiative is a set of leadership tactics, any shortcomings on deliverables are identified, isolated and tracked for completion.
A DSPA campaign that leverages a review process has a higher chance of establishing accountability, driving a timeline, and reinforcing the urgency of the imperative.
 Sales Performance Optimization
2009 Survey Results and Analysis,
Jim Dickie, Barry Trailer
Sales Mastery Press
SRP Matrix is a Trademark of CSO Insights
 Phone Works VP Sales Compensation Report Q4 2008
 ZDNet, CRM failure rates: 2001-2009, Michael Krigsman, August 3, 2009
 Heller Report on Educational Technology Markets
 How to Find New Customers; The Definitive Guide to Driving Demand for your Company's Products and Services, Jeff Ogden
 Selling to Senior Executives; How salespeople establish trust and credibility with senior executives; Alston Gardner, Stephen J. Bistritz, Ed.D.,
Jay E. Klompmaker, Ph.D.
 The Definitive Guide to Lead Nurturing , A Marketo Workbook
 Phone Works VP Sales Compensation Report Q4 2008
 "Leading Change", John Kotter, HBSP 1996
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