Tuesday, June 27, 2017

Everybody is Selling!

Imagine a company spending millions of dollars to research, develop and produce a valuable and well-respected product, then spending millions more to market it, and then putting the entire customer relationship in the hands of a 12-year-old on a bike.

Sounds like a pretty stupid way to do business, doesn’t it? Well, that’s how the billion dollar newspaper industry worked for decades. The newspaper’s relationship with its customers was through untrained young kids flinging the paper onto subscribers’ porches/lawns/bushes. And if the kid didn’t do a good job, there was no “governance” process where they sat down with the customer and explained why they failed their service delivery commitment. The customer simply canceled their subscription and went to the competition.

A lot of technology companies today are not too far removed from that short-sightedness. They spend millions pursuing work with their clients. When they land a huge systems integration engagement or managed services contract, they send in a delivery team untrained in how to handle a customer relationship. I am not talking about the account executive or the project manager; I mean the developers facing off with the client day in and day out.

Years ago, when I was a newspaper editor, I recognized the absurdity of how the industry cut costs in delivery. The lesson I took from that into my role in sales has been a powerful tool in winning business: when you work for a services company, there is not a “sales department.” Everybody is selling! From the CEO who appears on the financial talk shows to the first-line developer who works in a cube alongside the client, every interaction is a sales discussion. Each one builds on your company’s reputation for reliability. If my first-line delivery team is with the client enthusiastically solving problems every day, my job is so much easier. The praises of the quality of my team echoes through the halls to the C-suite and the conference room where I am pitching my proposal.

Investing in sales and relationship management training for the people who actually deliver what you sell pays tremendous dividends: better referrals, better overall customer satisfaction, easier to sell new business, easier to resolve conflicts. Sure, you can save some money by just training your people how to throw the newspaper on the lawn. But when your product lands in a mud puddle, don’t be surprised when your client switches to the competition.

Monday, May 8, 2017

Ryan Gosling Stole My Wife

Last Friday night, my wife and I decided to go out to dinner. I came downstairs in jeans and a t-shirt with plans to get a pizza. I didn’t even shave. After all, we’ve been married for over 30 years. How much effort do I need to make? It’s the same woman I see every day!

My wife, on the other hand, looked beautiful, as she always does.

Outside, a car horn honked. In the driveway was a red Ferrari and Ryan Gosling was behind the wheel. He knocked on the door. My wife opened it and Ryan Gosling handed her a bouquet of flowers. Ryan Gosling offered to take her to a 5-star French restaurant.

Off she went.

Thirty years of marriage and, in one day, Ryan Gosling stole my wife.

Fortunately, not a true story. (I’d be heartbroken!) But it can happen to you with your clients.

You have a relationship for 3, 7 maybe 10 years and it’s gotten comfortable. You’re on autopilot. The work gets done, maybe not with the same zest and sizzle as in the first year or two. But no one’s complaining. Suddenly, the competition knocks on the door. The competition gets a meeting. The competition starts whispering sweet nothings in the client’s ear, such as “data analytics,” “robotic processing automation,” or “lower cost of ownership.”

Next thing you know, the competition has your client in the passenger seat and they’re driving away.

Incumbency is one of the two hardest things to sell against. (I’d be interested in comments on what you think the second is.) And complacency is the Achilles heel of the incumbent service provider.

Remember: if you don’t treat your old client like a new client, they soon will be an old client.

How you handle dates with your significant other is up to you. Just watch out for Ryan Gosling!

Friday, April 14, 2017

No More Threes

I never expected a professional basketball player to be the inspiration for a lesson in client service.

In business there’s an old adage: you get what you measure. For example, if a company is measuring how many days it has gone without a safety incident, efficiency may suffer. Workers may do things more slowly or with undue care because moving quickly and having an accident would ruin the company’s safety record. So the company measures safety and it gets safety; but at the expense of efficiency.

When negotiating contracts with clients, I see this challenge arise when we are developing the service level agreement. This is the part of the contract that lays out how the parties will measure the performance of the services, such as system uptime; how fast we respond to issues; or number of transactions processed per day.

I take a great deal of care discussing service levels with clients because sometimes what the client asks to measure will not reflect how well the delivery team is doing. The client may complain that the services are inefficient, and that may be because we’re measuring safety! So I strive to focus the measurements on what matters most to the client’s desired business outcomes.

This week I smiled when I read a story about a decision NBA player Moe Harkless made in the last days of the season. Harkless plays for the Portland Trailblazers and has a contract with certain performance incentives. One of them is a payment of $500,000 if his 3-point shooting percentage is at least 35% for the season. On April 4, Harkless decided: No more threes. Why? His percentage for the season stood at 35.05%. One missed 3-pointer would take his average below 35% and cost him a half-million dollars. That’s an expensive brick!

Consider that Harkless was not being measured on number of games won. So the Trailblazers could lose a game without consequence to Harkless because that’s not how he’s measured. Once he hit 35% he’s met his service level. And the owners got what they measured, 35% 3-point accuracy, even though what they really want is wins! The 3-point clause did not make Harkless less competitive, however. He switched to driving to the basket. He was still going to take shots; just no more threes.

So before you and the client leverage some form contract or previous deal to measure delivery performance, have a conversation. What matters to the employees? What matters to leadership? What determines business success? Measure those things that will help your client feel like they are “winning” in their business. Because they’ll get what they measure.

Wednesday, March 1, 2017

I'm Not Gonna Say Anything!

Warren Beatty was in a quandary.

At the Academy Awards ceremony last Sunday night Beatty, the Oscar-winning actor/director/producer, was on live TV giving out the biggest award at the biggest event for the industry he has been a part of for over 50 years.

And he didn’t want to do the wrong thing.

By now what happened with the Best Picture award is old news. (If you’ve been asleep since Saturday, Beatty and his “Bonnie and Clyde” co-star, Faye Dunaway, announced the wrong movie to win the Oscar.) What’s interesting to look at from a business perspective is how his split-second decision changed the way the mess unfolded.

Beatty knew something was wrong from the moment he read the card in the envelope. In fact, he looked to see if, perhaps, there was another card. Then he paused and contemplated how to handle the situation.

I don’t know what I would have done under the same circumstances (do any of us?); but we do know how his decision took what could have been an uncomfortable moment for him and a few people backstage, and turned it into an epic blunder impacting him, the production teams of “La La Land” and “Moonlight” and causing cringes throughout the entire audience, including millions of people watching on TV.

Think about it: he knew the card was wrong. It had Emma Stone’s name on it, not the name of the producers. Why would Beatty know that’s wrong? He has one of those cards! He won Best Picture as producer of “Reds” in 1982.

What could he have done differently? In the moment he could have said, “I’m sorry, this is confusing. The name on this card doesn’t seem right.”

Someone would have come out from backstage, maybe the now much-maligned accountant who handed him the card, and said, “Sorry, wrong card.” Then the right name would be announced. The right people would have come on stage. The right people would have dealt with the mishap. And Beatty would be viewed as a hero for stopping what would become the greatest embarrassment in movie award history. (I’d say “award history” in general, but Kanye West coming on stage to challenge Taylor Swift and Beck is still pretty high up there.)

However, rather than raising his hand and potentially looking foolish doing something that no one at the Academy Awards has ever done (that is, stop the ceremony and say, “I think there is something wrong here…”), he decided, in that moment, “I’m not gonna say anything!” He punted. He showed the card to Faye Dunaway, who gleefully announced “La La Land” as the winner.

The rest is awkward television history.

Interestingly, Beatty still gets the blame, though Dunaway actually announced the winner. As well he should. He saw a mistake and chose not to say anything. And it became a bigger mistake.

A valuable lesson in decision making to make us better business people in serving our clients: If you see something wrong, say something right. Bad news doesn’t get better with time, and mistakes don’t get solved by passing the problem on to someone else.

Thursday, January 19, 2017

Shut Up and Wait

Too often, sales people don’t know when to stop selling. There is an old adage for this (as there often is for practical advice): “If you’re still talking after the client says ‘yes,’ you’re buying it back.” The idea is that once the client agrees to move forward, there is no need to keep explaining why they should move forward! In fact, you might undo their decision.

I have found a related behavior among sales people, and that is the desire to get to a final answer in the room. While working on an important issue, we try to persuade the client to consider our point of view and the client disagrees. Our perspective is so obvious we can’t believe the client is not agreeing! We try again and again to persuade, and the client holds firm.

If the answer to the problem is that obvious, and the client is a rational business person, the client will eventually agree.

They just want to agree in private.

If a client puts a point of view on the table, and is suddenly asked to take it back, often there is a fear of losing face. Especially if they are so clearly wrong. The next step for the salesperson is to design a way for the client to back off their position and not hurt their standing or status. In sales, this is called “building a golden bridge” to allow the client a glorious retreat.

If you don’t know how to build a golden bridge, here’s some simple advice: make your point, and then shut up and wait.

Often the client will go into a caucus with the team, come back and agree with you. The time alone allows the client to rationalize a change in position. Perhaps they will seek other changes in the deal to balance their decision and give legitimacy to the change.

This occurs in personal relationships as well. A discussion can get emotional and people lock in on positions. Once the situation cools down, and everyone can think rationally, the answer becomes clear. The key is to make it easy for people to agree with you and solve the issue. If we focus on being “right” or “winning the argument” a client (or significant other) will remember our behavior solving the issue more then they will remember the solution.

Don’t strive to be the smartest person in the room; strive to be the best problem solver in the room.

Thursday, December 15, 2016

Beware of False Prophets

Sometimes the salesperson gets sold.

It happens slowly, beginning with a “great meeting” with a senior executive at the client. This executive shows genuine excitement with the opportunity you present. He is the “industry guru” for this function: the “pharma data” guru,” the “logistics” guru or the “government compliance” guru. If he gets behind this deal, it will become an “industry utility,” a potential joint venture, a billion dollar business. He tells you he can “get it done.”

You rush back to your leadership and breathlessly tell them about this deal that will change the industry! “Mr. Big at XYZ Co. says he can push it through the company! He can’t wait to get started!”

In your excitement, you don’t do your due diligence around Commitment and fail to dig into the key questions to qualify the deal:

  • Does he have the authority to say “yes” for this level of financial commitment? (Come on! He’s a senior executive! He just needs to bring the CFO up to speed about what it means for the company.)
  • Has he addressed all internal approvals? (Don’t worry! Mr. Big said he has the authority to push this through.)
  • Does he own operations and/or the P&L? (Are you kidding? This is a cost saving opportunity the COO will jump at!)
  • Has he followed the company’s typical buying process, including procurement? (No problem! He can handle procurement! No need for a competitive bid! He’s buddies with the CEO.)

Beware of the False Prophet.

The False Prophet is the seemingly “plugged-in” executive at the company who, usually with good intentions, personally gets involved with the deal and seems to have a power to make lower-level executives (who speak of him with reverence) jump because of his authority. The False Prophet will have you spending money on “pilots” and get you to set expectations within your own company of a huge deal coming “in the next 30 days.” And those 30 days never seem to end as delays and new stakeholders and new questions arise.

By the time you realize that your deal is a pipe dream, you’ll have spent your whole business development budget, have no agreement on pricing or scope, and have your management asking you, “Tell me again how you thought you would get this deal done?”

Here’s a quick piece of guidance: New executives can’t make old companies take big risks in new ways.

What that means is this: established companies have a process on how they buy goods and services. Your job, as a salesperson, is to know that process and who controls it. If you don’t know how your client buys you won’t know how to sell. And if a new client executive gets excited about your market-making idea and says he can get it done on his own authority without following the process, it’s time to do your homework on him. In fact, you may be able to add value by educating him about his own company’s policies and procedures, and you will make a trusted ally. More importantly, you will avoid allowing a False Prophet to lead you astray of your sales plan.

Thursday, November 10, 2016

Something is Wrong

Years ago I heard a story about my grandfather, Henry Dieffenbach, and how he handled a dispute between my aunts, Helen and Eleanor.

Helen and Eleanor were teenagers at the time and they were fighting over whose turn it was to do the dishes. Again.

My grandfather, who was a piano player for silent movies in New York City in the 1920s, was on his way out to work for the evening show. He had heard them fight before, many times. This would, in fact, be the framework of their relationship for their whole lives.

Henry listened to Helen and Eleanor bickering. Then he made a decision. He reached over, lifted the dishes out of the sink, walked to the basement doorway and threw the dishes down the stairs.

“Now no one has to do the dishes,” he said. That got their attention. And then he went to work.

Tuesday night I watched the election results with surprise, like most everyone else. We had been told by the experts what we should expect and the outcome was exactly the opposite. What happened?

Half the country threw the dishes down the stairs.

The easy answer is for one side to say the other side doesn’t know what they voted for. They got conned. But tens of millions of intelligent, well-informed people voted Tuesday and half of those well-informed people had something to say: No one is listening to our concerns. No one is addressing our problems. We want to be heard.

So rather than one side dismissing the outcome as the result of a bunch of ignorant "deplorables" surging on our electoral process, maybe we should acknowledge: Something is wrong.

I’ve been a part of and settled many disputes in my career and what always fascinates me is how blind one party can be to its own faults while blaming the other side. That drives the other party crazy. People usually behave in a rational fashion to fulfill their own self-interests. In the case of the election, no one voted to make America worse. They voted to make America better… for themselves. What we now have is the result of 59 million people saying, “No one is paying attention to me, so I am voting for change.”

Set aside the news highlights of the bad behavior, comments and t-shirts from some of the rallies. Those highlights don't tell everyone's story. And don’t ascribe all voters’ decisions to the worst things a candidate said. Interviews I watched with voters Wednesday showed normal, caring, middle-class and working-class people who said, “We’re tired of struggling for decent jobs, paying high taxes and not being able to afford a better life for our children.” One 65-year-old former factory worker said, “I didn’t like the choice I had to make, but I wanted to send a message.” He was not alone in his sentiments, and that message came crashing down on us all on Tuesday. Now it’s up to all of us to get to work and answer that request for help.