We are not defined by what happens to us, but how we react to what happens to us.

Today I met Elijah, Elijah Sebuchu from Kampala, Uganda. Elijah is the eighth of thirty-eight children. His father has twelve wives. His grandfather was chief over 60 villages. He was twelve when he got his first blanket all his own. He was fifteen when he got his first pair of shoes. He was twenty before he knew food was sold in stores. He was over thirty when he met his first westerner. He never had anything. Drinking water was as scarce as food. He has to travel six kilometers to get water and bring it home in a bucket. That water has to be boiled before it can be consumed.

He now runs an orphanage for 460 orphans whose parents have died of AIDS. These orphans just come to him because they are hungry, thirsty and alone. They sleep on the ground or in bushes. Finding shelter is a very big problem for them. Elijah feels blessed and is happy that he has the opportunities he has. When he first came to America in 2007 he couldn't sleep for three days because of the abundance all around him. We water our lawns with water his people would die for. But he is in no way angry. He knows we are blessed so that we can bless others.

WOW, can I be an Elijah? We are all dealing with problems in this down economy. I am certainly no exception. I haven't blogged in several months because I was just heads down trying to cope. I certainly don't mean to trivialize our problems, but maybe put them in perspective. We are blessed to be born and live in one of the greatest countries in human history. We have access to almost unlimited resources, opportunities and ideas.

Plato said "Necessity is the mother of invention." On Maslow's hierarchy of needs, we as Americans very seldom go without the physiological needs of food and water. We seldom truly deal with the issue of true safety on a regular basis. We may at times feel insecure or even afraid, but it is typically transient. The needs that drive our invention are belonging, self esteem and self actualization, the higher needs.

Today I was reminded that I am blessed beyond my comprehension. I will survive and prosper. I always have. I am blessed so that I may bless others.

Commission Only Sales?

Recently I have been involved in a number of "commission only" sales discussions. It's only natural in a down economy to try to find ways to cut cost and remove risk. I will give you my bias up front, I have never had a commission only position and I have never wanted to implement one within my organizations. Keep in mind that I have spent most of my career in technical sales, with long sales cycles (typically more than two or three visits) and a fairly strong price tag. It has been a solutions environment, not a product environment.

Now having said that, I'm not opposed to commission only sales positions. I do think that several conditions need apply for it to be successful.

1. Short sales cycle, one stop selling is best.
   
2. Lower price point, typically one that would facilitate an immediate decision
   
3. High transaction level, several sales per day or week
   
4. Simplistic sales methodology, the fewer steps the better
   
5. Strong lead generation program to support the process
   

I know of a couple of companies that have tiered compensation plans. A new Territory Manager might start out year one with a reasonable base and lower commissions. Year two they are required to select either a lower base and higher commissions or commission only, which pays the highest commission rate. The reason this model is successful is because the sales cycle for the initial system is long, but there is a high volume of additional sales once the system is installed. The really good sales people have a strong base and recurring revenue. They have a steady stream of revenue every month thus insuring a monthly income.

So if the environment is right, what's the down side? I have heard it stated by several sources that the cost of hiring a sales person, including training cost, is $40,000 to $100,000. Most sales people become more efficient and productive the longer they are in territory. The risk in a commission only sales position is employee turnover. What is the incentive for the sales person to stay? How does the company protect their investment?

The second downside is loyalty. Many commission only sales people do not see the need to act out of a sense of loyalty toward the company that has hired them. They are very territorial in their approach. They tend to not share best practices. They are very reluctant to perform most administrative tasks that don't lead directly to compensation. They feel they do not owe the company anything, because they only get a small portion of what they provide to the company via sales. If they are making enough money and the company provides them the freedom they want, they may stay indefinitely. But that decision is predicated on them achieving their goals, not the companies.

If the current economy is causing you to seriously change the compensation plan to a commission only plan, think long and hard first. It may be the solution, it may compound the problem. Trying to multiply the sales force by reducing the base may not work as well as you think. The numbers may say differently, but give it the logic test. Will six commission only sales people outsell three with a small base? What will the administrative cost be with higher turnover and a sales force that just doesn't seem to get around to the paperwork. Can they hunt on their own (and what is the incentive for them to do that for you verse anyone else) or do you need to provide leads? If they don't follow procedures what's your leverage?

Again, I have intentionally stayed away from commodity, product sales so I wouldn't look for a commission only sales position. I have always felt my value to my employer and my client was my ability to solve problems. There is a place for commission only sales. Many very good sales people have made a very good living on this type of plan. But it comes at a cost for both.

What makes "Cold Calling" such a hot topic?

Cold calling is an old and fundamental sales skill like closing. 10 years ago a sales person might use direct closing techniques like assumptive closes. Today smart sales people let the prospect close themselves by constantly injecting soft closes in the discussion. No one likes to be sold, but everyone likes to buy. Leading the prospect in direction you want them to go builds long lasting relationships.

Cold calling is another very old sales technique that has changed over the years. It doesn't make sense to start dialing through the phone book. There are just too many defensive strategies that your prospects have already engaged. They are inundated will sales pitches. The old adage that you have 3 seconds to get 3 minutes to get 30 minutes applies. If you can't say something in the first 3 seconds that gets them to stop multi-tasking and respond, you'll never get to your 30 second elevator pitch.

What that means is that you need to already know what would stop them in their tracks before you dial the phone. As a cold caller you will need to segment your market so that each group has a discrete business problem that they would stop what they're doing to hear more about. You can't use a shot gun here, its work for a sniper. You have to be able to present that business problem in the form of a question that they would respond to. And then you have 30 seconds to hook them into a conversation.

Most cold callers are dialing machines. They could care less what the response is on the other end. They assume they will lose 98% of the time. They are trying to get through the no's to get to a yes. This is brutal on everyone. If you really planned out your approach you might only get shot down 93% of the time. Your probability of success goes up if the caller knows and expects you to call. That is where referral marketing, web marketing, snail mail, and e-mail marketing can help. It's like artillery bombardment before the beach landing.

If this is an important tool in your sales arsenal, then it makes sense to think the entire process through from the prospects end before dialing the first number.

How should a Sales Program be created and run?

Kees Vogelesang, Head of Business Operations, Oracle EMEA Strategic Accounts division
wrote:


Best Answer: Took some time for me to rate all the answers ;-)

--------------------
His Question: How should a Sales Program be created and run?

My Answer:
First of all I distinguish "Sales Program" from "Sales Process" they are very different. You're at Oracle, so the first question is; "What is the sales program for? Is it to grow revenue organically or provide market share growth?" Sales programs around market share growth are much more difficult than programs geared toward organic growth.

In any case I would start with an analysis of the installed base. What have they bought, when have they bought and who are they. Knowing the business profile of the clients that bought the product you want to promote during the same time frame you have targeted gives you a running start. If you don't know what you want to promote or when, this might help answer that question. Sometimes a trend pops out that answers the question for you. During this analysis for another program my staff noticed a very large installed base of EOL software; we quickly created a sales program to get these upgraded. Easy money…

Once you have a good understanding of who buys today and why, you have the starting point to move forward. Again, not knowing specifically what you would like to accomplish I can only guess at potential avenues to follow. I generally have target revenue for my program, so I work backward. What is the value of the product I want to promote and how many of these do I have to sell to make my target? I can look at my data to see who has bought it in the past. I can project that profile over the market to see the potential prospects. I can calculate the probability of success.

Now the hard part… the science is easy, the art isn't…. Now you have to be able to exploit the unique sales proposition you have in the market place to create two important things… a driving mechanism and a critical event. You have to create an offer that is so compelling that the market will want to act and a time frame to act that causes them to make a decision. Without these you have nothing….

Once you have these in place; (i.e. steps 10 through 600 are left up to you) you can create a program roll-out package for the sales force. They need the list of targets, sales training, the product promotional, and the calling scripts. Personally I would go one step further and provide proposal boilerplate and sample letters. The less you leave up to them the faster they can execute.

Last, and I always leave this to last, you will need a sales SPIFF. Some incentive to get them to act differently during this campaign then they would normally. Sales activity is driven by the compensation plan. Tie it to desired financial goals, not sales activity.

This is the best I can do without writing a book.

"Two men are walking in the woods when they come across a bear...”

At the point of conception we are endowed with a stew of DNA. It determines our height, our weight, our hair color, our eye color, everything about us. This includes our intelligence, our passions, our resilience and our desires. We have a DNA blueprint of how our lives could roll out. We are in part a reflection of our life experiences, but more importantly, if we choose, we are the product of who we are destine to be.

Every morning when we first wake we are given a chance to mold the rest of our day. We can choose to look backward at those things that have happen to us or we can chose to look forward to how we will change our existence into something of meaning. All too often I meet people whose yardstick of success is predicated on the performance of those around them. In the story of two hikers in the woods who come across a bear, the one hiker puts on running shoes. The other asked "why, you can't outrun the bear." The first responds "I only have to outrun you." I would suggest that we are all given the innate ability to overcome the bear in our own unique way, without sacrificing someone else.

The travesty of this "outrun you "mentality is that first of all it creates a win-lose scenario and second it robs us of our true potential and our self actualization. We go through life thinking that we have to be better than someone else to have meaning and value. The problem is that we will always know people who are better than us in many ways. Ways in which we are not naturally talented or gifted. The truly competitive people among us become good at marginalizing these talents in an effort to build themselves up.

I know that a better approach is to surround yourself with those much more talented than you and learn from them. "Fly with the eagles." Know that your destiny is as unique as your talents, passion and drive. Spend every day living up to your DNA. The great thing about following your passions is that it makes everyday an adventure. It's easier to get up, it's easier to learn, it's easier to excel and you can do it longer.

Nothing could be more tragic than a life wasted and yet I see it every day, people going through life trying to be better than their neighbors or co-workers, but falling short of their true potential. In time this constant competition, in which we are doomed to lose, wears us down. Retirement is that far off goals that signifies the end of the race. Those, whose focus is on living to their potential, don't want the race to end. They are still creating the person they ultimately want to be. Retirement means no longer working for money.

At conception each and every one of us has all the tools to be successful and happy. It is not externally driven, but internal. Madison Avenue, MTV or Vogue Magazine doesn't own your potential, don't let them form it. Find that which your inner-self longs for, nurture it, feed it and watch it grow. Jack Trout, one of the great pioneers in marketing says "If you can't be first to market, create your own market."

Hiring Soft verses Hard Sales Management Skills

 

Now is a key time to upgrade you staff. As unemployment rises more qualified people find themselves out of a job. If you have questions about your staff's ability to take you to the next level now is the time to make a critical review and take action if required. I want to provide a framework for thinking about this next step. I have hired or help organizations hire hundreds of sales people and sales managers. This discussion is about sales leadership, but some of the principals could be applied to hiring individual contributors.

So you have two candidates which one do you hire? Candidate "A" has a strong understanding of the correct profile of high producing employees. This person can articulate a sound sales methodology and has documented success in teaching and coaching sales skills, but they have average knowledge of the industry and although they know many of the businesses in the territory they don't have personal relationships with decision makers. Candidate "B" has a good track record of sales success but can't easily tell you the profile of a good sales person, their sales methodology is generic and simple and they say they are good a sales training and coaching, but can't give good example where they have actually done it. The good news is that they have been in the industry for years; know all the key players, including the one you're trying to land and can walk the sales people into a few good accounts.

 

Skill	Candidate "A"	Candidate "B"
Employee Profiling	High	Average
Sales Methodology	High	Average
Sales Training and Coaching	High	Average
Industry Knowledge	Average	High
Territory Knowledge	Average	High
Rolodex	Average	High

 

What I find is that most CEO's and business owners with say candidate "A", but their interview techniques lead them straight to Candidate "B". Now I'm going to distinguish between large company CEO's and small companies CEO's at this point because large company CEO's have a tendency to be more strategic in their outlook, because they have staff to handle the tactical issues of implementing the vision. Small companies CEO and middle managers of large companies are more tactical in nature. Small company CEO's and middle managers of larger companies are closer to the market. They naturally understand the need to get into XYZ Corporation or out sell ABC Company at a pragmatic level. Someone else has helped profile the employment candidates (if it is even done), build out the sales methodology (which might be a natural melding of past managers) and they have third parties do their sales training (outside firms or dedicated training departments).

The end result is that the hiring manager has pointed and specific questions about competitors, companies, decision makers and tactical sales strategies. They know the objections they are trying to overcome; they know the frustrations in the market. They are focused on the next 30 days, 6 months and year, not how to sustain growth over extended periods. They could and sometime do ask questions about the perfect sales person, but they don't know the answer, so they have no gauge. Their sales methodology is a simple six step sales process. They sometime feel if they can hire someone to come in to train the sales force once a year or once a quarter, they don't need to want their sales manager to take the time to do it. They need to be closing business. In the end they can full quantify a candidate's ability to interact with the market, but they can't quantify their soft skills. So the hire hard skills

Here is the reality of your decision. Markets change, people come and go. Any industry, business or decision makers knowledge a sale leader brings to your company will be dated in 6 months. Once they run through their rolodex they don't have any new value to add. Once new competitors come into the market or old ones change their products, their value diminishes. From that point on they will be doing an average job of managing your sales organization. Here is what I would suggest. Turn your hiring criteria around 180 degrees. Hire a consultant to get you into the prime accounts. Hire consultants to update your organization on industry knowledge. Hire your sales leader to build and maintain an innovative sales methodology that will constantly change with the market. Hire a sales leader that will teach your sales people to be successful in any environment. At the leadership level hire someone who knows the science of sales and sales leadership. Know that they can coach the sales people into executing the strategy that produces results. They need to be a student of sales, sales processes, sales strategies and tactics, not a student of the industry or the geography.

You can hire sales people to get you into accounts, but once they are there can they close business?

 

The battle sir, is not of the strong alone.

Patrick Henry said: 'An appeal to arms and the God of hosts is all that is left us. But we shall not fight our battle alone. There is a just God that presides over the destinies of nations. The battle sir, is not of the strong alone. Is life so dear or peace so sweet as to be purchased at the price of chains and slavery? Forbid it almighty God. I know not what course others may take, but as for me, give me liberty, or give me death.'

I was reminded of this passage recently. It is an incredible call to arms. It envisions patriotism, honor, valor, and bravery. It inspires us to reach deep inside ourselves to seize that part of us that longs for heroics. It is recognized as one of the truly great moments in American history. This imagery is improved by the fact that we did successfully rise up and prevail.

At times I think we are again under siege by a tyranny just as dangerous as the revolutionist faced. This time it is more psychological than physical. We are under siege from bad economic news, unemployment news, and uncertainty in how our country will impact these events, all blaring from the six o'clock news daily. Those that have jobs live in uncertainty at worst and declining income or overwork at best, and they are the lucky ones. Many would like the privilege of being overworked. Depression is growing at an alarming rate.

Let's take a page out of the life of Patrick Henry. Every morning we are given a choice. The choice is simple, you are about to live this day, you can live it to the most or you can chose to not participate. We need to make the courageous decision to not only participate, but to attack the day. We need to set goals and then drive toward those goals. Just the act of pursuing will ultimately improve the chances of success even if results of your activity don't seem evident.

It's about action, a call to arms. To help fight off worry, have a plan and work that plan every day. In the movie "What about Bob?" remember it's about "baby steps". You have to get up; you might as well make something of it. A journey of a thousand miles starts with a single step. Don't try to eat the elephant in a single bite… should I go on?

In case you haven't noticed I'm kind of big on personal responsibility. But no one can do it all by themselves. Everyone needs help once in a while. If you feel you can't do it alone don't be afraid to reach out. There are a lot of people out there that genuinely care. They just might not know your situation.

Worry is about uncertainty. Making a plan and then following that plan removes some of the uncertainty. It gives us a sense of hope. It also keeps our minds busy. Waiting for events to improve is a fool's game.

Mathew 6:25 "Who of you by worrying can add a single hour to his life"