Salesperson's Base Salary Too High?

A client asks, "Several years ago I hired a salesperson with excellent references and an impressive history of consistently exceeding quota. Based on this history they negotiated a base salary that was much higher than I typically pay. They assured me that they would earn much more than that in commission and bonuses. Since being hired, they achieve their quota irregularly and have earned little in additional income. To my surprise, they seem quite content. I regret agreeing to this high base salary, but don't know what to do about it at this point."

Managers in this situation often feel embarrassed, duped and frustrated. Sometimes they think they are the only person who has ever made this mistake. They are not. Managers get talked into salary arrangements like this all too frequently.

There are several possibilities for the underperformance of this sales representative. Their track record of quota achievement could have been exaggerated, their references somewhat less than honest. Perhaps a lifestyle change of some kind has made them less money motivated. Though they may have earned more money before, this might be the first time they have had a base salary on which they can live comfortably. Rest assured that whatever the reason, you aren't stuck.

Research Industry Norms

If you don't know already, find out what the average base pay is for a sales representative in your industry and others that are similar. Call colleagues in other areas of the country and find out what they are paying, taking into consideration regional cost of living differences. Then write a new compensation plan that is competitive, within the norm for your industry, and standardizes the base salary that you pay all sales representatives.

Get the Facts

As I so often say in this newsletter, arm yourself with the facts before you sit down and speak with the sales representative in question. What is the actual difference between their sales quota and production? Are they regularly achieving their minimum productivity goals (number of prospecting calls, presentations, proposals)? Is their product knowledge where it should be at this point in their tenure? How long does it take the average sales representative at your organization to start producing? How long has it taken them? Be prepared to discuss these points.

Meet with the Sales Representative

When you meet, tell them that you will be putting a new compensation plan into effect that, among other changes, standardizes the base salary for the entire sales staff. Let them know that you understand this involves a salary reduction for them and that you are willing to gradually decrease their base over a period of three months so they can adjust.

Prepare for Objections

When they protest, tell you that they deserve this higher salary based on past performance, state firmly that they are not performing up to expectations and that if this continues you will be forced to put them on a performance improvement plan. If the discussion continues, start reviewing the particulars of their performance to date.

Impact on Others in the Sales Staff 

Because word always gets out, the other sales representatives undoubtedly know that the individual in question earns a higher base salary than they do and isn't really producing stellar sales results. You can be sure that they resent it. They will also find it demotivating because they feel less valued, and they will question your judgment as a manager. 

If this person had proven to be a superstar sales representative, you could easily justify the large base salary and use them as an example to inspire the rest of the sales staff. But that isn't the case. Before your staff becomes disgruntled or productivity is impacted, step-up and right this wrong. They will respect you for it. 

Obviously, the best way to avoid this problem is to never let it happen in the first place. Do not let a prospective candidate dictate the terms of their base salary ever again - no matter how talented they are or say they are. A truly money-motivated salesperson should be far more interested in commissions and overall earnings than they are in a base salary.

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Though my clients come from many different industries, the challenges they face are similar. In "Sales Management Tips," I regularly answer questions that have been posed to me by my clients. I hope the answers will help you to solve some of the sales dilemmas you face in your own sales organizations. If you would like to ask a question, please contact me. The identity and affiliation of those submitting questions will be kept confidential.

Salary Discussion

A client asks, "Just before completing a phone interview with a prospective hire, they asked me the following, 'Can I make six figures in this position? I'm interested in the job and your company, but if I can't make enough money, I don't even want to start the interview process.' They did not ask the question in a combative way, but I wasn't sure how to respond. Colleagues have told me that money shouldn't be discussed during the first interview."

This is a great question and it can be a very awkward situation for even the most seasoned interviewer.

Discussions of Money

Your colleagues are correct; you should not discuss money in great detail during the phone or first in-person interview. Certainly, you would not divulge any specifics about the compensation plan and here is why. Salespeople making a six-figure income have the experience, maturity, skills, drive and discipline that enable them to earn that kind of salary. Early in the interview process, the candidate should be demonstrating to you that they have those skills and can succeed at the job your company is offering.

However, discussing an income range with a prospective hire is an acceptable thing to do.

Don't Overpromise

If your sales staff has some strong producers on it, but not one of them earns more than $85,000 annually, bonuses and commissions included, your company is not the right fit for this candidate. Resist the temptation to say, "I am confident that a real superstar could make a six-figure income here!" Making inflated promises will result in their resigning after six months or less. Say something like, "the income range for this position is between $70,000 and $90,000. What are your thoughts on that?"

If Tenure is an Issue

Sometimes a company can have a sales staff in which many or most of the sales people are making six-figure incomes. However, few of them made that amount of money in their first year with the company. Whether it is a pipeline, sales cycle, or product knowledge issue, it just isn't possible to get enough traction in that first year. If this is the case, let the candidate know. Especially if they are switching industries, most potential hires will not be deterred if they have to wait a year. They just want to know that the potential is there and that there are many in the organization who are realizing the kind of income they want to make.

Say something like, "First year earnings are in the $70 - $90K range. Second year earnings exceed that amount. My plan is to discuss the compensation plan, in detail, with all candidates making it to the second interview. Have I answered your question to your satisfaction at this point?"

In general, I would look at the candidate's question about potential income in a positive light. They are obviously ambitious, and most companies are looking for money-motivated salespeople. Just keep the discussion about money general rather than specific and don't mislead a candidate about income potential at your company.

What is money motivation? Do you ever wonder whether the candidate you are interviewing is truly money motivated? Find out for sure. Ask them to complete a pre-employment assessment before the interview process begins. To find out more about pre-employment assessments, click here.

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Though my clients come from many different industries, the challenges they face are similar. In "Sales Management Tips," I regularly answer questions that have been posed to me by my clients. I hope the answers will help you to solve some of the sales dilemmas you face in your own sales organizations. If you would like to ask a question, please contact me. The identity and affiliation of those submitting questions will be kept confidential.

Asking Better Questions

"Do you have a budget in mind for this or have you not gotten that far yet?"

"Will this product meet you needs or would a different product be a better fit?"

"Is your company thinking of purchasing this product right away or later in the year?"

Sound familiar? I have spent many, many hours monitoring sales representatives' calls and one thing that I have consistently noticed is that most have a tendency to ask two questions at once. Trying to get information from a prospect in this manner leads to several problems.

How the Customer Will React

By asking the customer two questions at once, you are really offering them a choice. They will select one of the two options. Guess which one they usually pick? Typically, they select the response that either gets the sales representative off the phone or makes them look like a poor prospect. Why? It's human nature. It's the easy way out. People resist being sold to.

The Appearance It Creates 

Giving prospects one or two responses to choose from can make the salesperson look as if they are a poor listener or trying to hurry the sale. Sometimes it can make them come across as insecure, eager to please, afraid of rejection, manipulative or inexperienced. Once the prospect thinks any of this, they are unlikely to treat the salesperson seriously and enter into a meaningful conversation with them.

Ask Open Ended Questions Instead

The best way to avoid this situation is for the sales representative to learn how to phrase questions in an open-ended fashion. Zig Ziglar refers to those types of questions as "open door" questions. In his book Ziglar on Selling he says, "Open door questions allow the persons being questioned to go wherever they like with their responses."

Open-ended questions give the salesperson the chance to hear a prospect's answer in its entirety. It allows them to better bond with the prospective client and learn what they need to know to move the sale along. 

The questions above could be re-phrased this way:

Before: "Do you have a budget in mind for this or have you not gotten that far yet?" 

After: "Could you tell me about your budgeting process for a purchase of this nature?" 

or

"What are your thoughts on the budget for this purchase?"

Before: "Will this product meet your needs or would a different product be a better fit?" 

After: "From what you have seen so far, what are your impressions of our product?" 

or

"Based on what you know at this point, how might you see your organization using this product?"

Before: "Is your company thinking of purchasing this product right away or later in the year?"

After: "What are your thoughts on a time frame for this purchase?" 

or

"Where does the purchase of a product like this rank on your priority list right now?"

Asking a customer two questions at once impedes the communication process because the prospect is not left to their own devices in answering the question. So the salesperson doesn't get a thoughtful response. This can lead to a conversation that goes nowhere or causes difficulties later on in the sales process. 

Though asking two questions at once might work at certain points in the sale, it's better to learn how to ask one question at a time, especially during the information gathering stages of the sales process. The best questions will encourage the customer to provide more, not less, relevant information.

Though my clients come from many different industries, the challenges they face are similar. In "Sales Management Tips," I regularly answer questions that have been posed to me by my clients. I hope the answers will help you to solve some of the sales dilemmas you face in your own sales organizations. If you would like to ask a question, please contact me. The identity and affiliation of those submitting questions will be kept confidential.

Interview Responses Too Abrupt?

A client asks, "A candidate that my company is considering for a sales position had a strong score on a pre-employment sales assessment, was impressive during the phone interview, and had professional experience that would be a good match for our company. During the in-person interview, however, they gave such brief answers that it was difficult to gauge whether or not to bring them back for a second interview. What do you recommend in a situation like this?"

Though a candidate who gives brief answers can be a welcome respite from the candidate who gives long winded replies, too much brevity can leave you wondering about their fit for the position. You are right to feel hesitant. The purpose of a face-to-face interview is to see how the candidate presents themselves and interacts with others. Would this candidate give perfunctory responses to colleagues and customers who would have the right to expect acceptable answers to their inquiries?

A thoughtful, mature candidate should answer the question that is posed to them in a direct and forthright manner. Some answers will be briefer than others, but in all cases the answer should fully cover what the interviewer is trying to find out. An astute candidate will sometimes ask, "Did I answer that question to your satisfaction?"

Try this technique for handling this confusing situation:

During the interview, give them time to settle in to the process and don't judge them too harshly on the first few questions. Sometimes, out of nervousness, a well-meaning candidate can go on too long or be too brief with their answers. If, after 6 or 7 questions, they are not settling in and their answers are too short to be satisfactory, resist the urge to ask one probing question after another trying to elicit better responses. It is not your responsibility to pull information out of them.

Instead, I advise my clients to pause for a moment and then saying the following, "your answers to my questions are so brief that I am having a difficult time getting the information that I need to determine whether or not you are the right fit for our organization." Then pause again and see what they have to say. If they indicate that this is their interview style or feel that they have answered the questions appropriately, complete the remainder of the interview professionally. Do not ask them back.

If, on the other hand, they apologize and express a willingness to give more expansive answers, start the interview over from the beginning. Their answers should be noticeably longer and they should be asking whether or not you found their responses to be satisfactory.

A client of mine tried this technique and was told by the prospective candidate that his career counselor had told him to give very brief answers to the questions that he was asked. The candidate apologized for the difficulty this had caused and offered to answer any and all questions over again. My client thanked him for his candor, started the interview again and eventually made him an offer of employment.

Good salespeople are hard to find. If a candidate seems to have great potential, try this technique before you give up on them. They may be worth the effort, as one of my clients discovered.

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Though my clients come from many different industries, the challenges they face are similar. In "Sales Management Tips," I regularly answer questions that have been posed to me by my clients. I hope the answers will help you to solve some of the sales dilemmas you face in your own sales organizations. If you would like to ask a question, please contact me. The identity and affiliation of those submitting questions will be kept confidential.

What’s the Difference Between a Pipeline and a Forecast?

A client asks: “During sales meetings, our sales representatives review their pipelines and sales forecasts. But I think we are all defining these terms differently. Is there a big difference between the pipeline and the sales forecast? Does it matter what word they use?”

Yes there is a difference and yes it does matter. Your sales people may be using these words interchangeably without giving it a lot of thought, or they may have worked for other organizations that had differing definitions of these terms. Regardless, understanding what each means and using them correctly is important for a number of reasons.

The Pipeline

The sales pipeline consists of all prospects at all stages in the sales cycle, whether the sales person is in the beginning phase of introducing your company, discussing the product or service, qualifying a prospect, conducting a Webinar or product demonstration, or formally presenting a pricing proposal. Though all future sales begin as leads from some source (cold calling, referrals, or trade shows), no unqualified or uncontacted lead should be in the sales pipeline. All unclosed sales, however, belong in the sales pipeline.

The phrase “pipeline management” refers to the salesperson’s ability to juggle all of their prospects in differing points in the sales cycle. “Balancing” the sales pipeline refers to their ability to cold call, follow-up on existing leads and close sales simultaneously so that they have a continuous flow of opportunities and will not have huge period-to-period swings in closed sales.

The Sales Forecast

The sales forecast is the salesperson’s best estimate of which sales will close in a given time frame. Most companies produce 30-60-90 day forecasts: opportunities more than 90 days into the future are considered less reliable and are generally not forecast. The main difference between the pipeline and the sales forecast is that the prospective customer must meet certain pre-defined objective criteria to qualify for the sales forecast in the first place (e.g.: the proposal has been reviewed with the decision maker; the budget process is clearly understood; the prospect has made a verbal commitment to buy). Prospects in the sales forecast are not at various points in the sales cycle; they are nearing the end of it.

Another significant difference between the two is that the sales forecast is used to estimate a company’s short term revenue and cash flow. In other words, sales forecasts help a company determine whether or not they can pay their bills, pipelines do not.

The Long Range Sales Forecast

Prospects in the long range forecast have told the sales representative that they are budgeted for and will be purchasing a product or service at some point in the future. For the prospect, the reason that the purchase is being put off into the future usually involves an expiring contract or a purchase that needs to go through the formal budgeting process. Sales representatives use the long range forecast to keep track of prospects who will be buying anywhere from 4 months to 2 years from the time of their initial contact with them.

Once a prospect is on the long range forecast, the salesperson can put them on the company mailing list and keep them informed about new product developments and promotions. By giving the prospect a call from time to time, the sales representative will be in the know if they change their mind and decide to buy in 7 months instead of 1 year.

A wise sales manager looks out for the following scenarios:

• Salespeople with a full pipeline can turn in a weak sales forecast because of an inability to close sales.
• Those with a strong sales forecast can have a weak pipeline because they have put the bulk of their effort into getting sales closed, while neglecting to prospect or conduct enough product demonstrations.
• Salespeople with a strong pipeline and strong sales forecast may be spending little time with those prospects that might be purchasing many months in the future.

Sales is a balancing act and understanding the difference between a pipeline, a forecast, and a long range forecast as well as making sure that each is strong, is crucial to having consistent success in sales.

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Though my clients come from many different industries, the challenges they face are similar. In “Sales Management Tips,” I regularly answer questions that have been posed to me by my clients. I hope the answers will help you to solve some of the sales dilemmas you face in your own sales organizations. If you would like to ask a question, please contact me. The identity and affiliation of those submitting questions will be kept confidential.

Salesperson Should Focus on Selling, Not Website

A client asks, "One of my sales representatives is somewhat technologically savvy. To save money, I made them responsible our website, rather than outsourcing this to a professional. They created the website and manage the content and updates. Though we agreed that they would only spend a certain number of hours working on it, it seems as if they are always tinkering with it and their sales are suffering as a result. I am guilty, as well, of asking them to make changes to it with little advance notice. Am I doing the right thing?"

In an effort to economize, many small business executives give additional job responsibilities to sales representatives. It is rarely a good idea. Here are but a few of the many, many reasons why.

Proper Focus

Being a sales representative is a difficult job that takes a tremendous amount of discipline and focus. From time to time even the best salespeople look for an excuse not to meet with prospects or pick up the phone. By putting them in charge of the website, you are actually providing a safe haven from the hard work and accompanying rejection that is part of the sales process.

Motivation

Really good sales representatives are money motivated and typically resist getting too involved in activities that waste their time and take them away from their main objective – closing sales. Is this sales representative money motivated? If they are not, or if the compensation plan doesn't motivate them properly, their sales results will be mediocre and they will always welcome a distraction.

Professional Image

Though your salesperson may have created fun homepages for family and friends, they are not a trained professional. Does your company website really have the pulled together look that a dedicated marketer and web designer would provide? Put another way, would you take a web designer and make them a salesperson? Ask a few friends and trusted advisors to tell you what they honestly think of your web page. They may say it looks like it was done by an amateur.

Saving Money

Are you really saving money? If your website is somehow discouraging customers from calling your company, and the salesperson is taking valuable time from their selling day to work on it, how much have you really saved? Could it, in fact, be costing you money?

Objectivity

It's very difficult for any employee to be totally objective about website content. They are emotionally close to the topic and are often reluctant to disagree with ownership about what should and shouldn't be on the website. Not so with a professional. They know what works and what doesn't and aren't afraid to respectfully disagree with some of your ideas.

It is sometimes tempting to let a sales representative who has an interest in another field take over some of those responsibilities. The owner or company president often finds that the sales representative's job responsibilities become more and more murky. Let salespeople sell. It's what they are paid to do and what they should want to do. If not, you may have the wrong person in that position.

Managing Sales Efforts in Close Quarters

A client asks, "I am a sales manager at a small start-up company. Our office space is tight and we all sit in cubicles. No one has a private office. Because of this, there is a very casual style of communication. Virtually the entire office eats lunch together every day. I sometimes find it hard to feel like a sales manager or much of an authority figure at all. Any suggestions?"

You are wise to observe the problems that very small office accommodations can cause. Let's look at a few changes you can make to separate yourself a little bit from the people that you manage.

Hold Regular Meetings

Many of my clients who work in offices similar to the one that you describe forgo regular staff meetings because they don't have any place to hold them and "everyone hears what’s going on anyway." This leads to people misinterpreting what has been said or making their own rules. Either way, it isn't good.

Hold a regular weekly staff meeting with a formal agenda at a regular place and time. If there is no conference room, talk to your building manager and ask if there is a common conference room available for tenants or see if another company would let you borrow theirs for a nominal fee. If neither of these suggestions work, pull your chairs together in a corner. Somehow make it a separate and distinct event.

Find a Place for One-on-Ones

Similarly, there are many times a sales manager needs to have a one-on-one conversation with a salesperson. Find a location where you can have these talks when needed.

Curtail Cubicle Shouting

If someone shouts a question at you, resist the temptation to shout the answer back. Instead, ask them to come to your cubicle to discuss it. Say something like, "That's a great question. Come on over for a minute and let's chat about it." If possible, keep a chair or two by your desk to encourage this.

Set Policies and Procedures

Anxious to bring on new business and sometimes hesitant to foist too much of a stuffy corporate culture on the organization, many sales managers at start-ups resist having a policies and procedures manual for the sales organization. While a notebook-sized document may not be necessary, some guidelines are appropriate, especially when it comes to such topics as pricing, discounts, terms of payment, renewals, territories, leads, inbound calls, and commissions.

Having a "make it up as we go" culture undermines your authority by leading sales representatives to believe that if they present you with a compelling enough argument, anything can be negotiated.

Lunch

If you managed 7 or 8 sales representatives, had lunch with only 2 or 3 of them on a regular basis, and other salespeople felt excluded from this activity, you would be perceived as showing favoritism. However, if the whole office eats together, the atmosphere is fairly collegial and the topics of conversation are appropriate, I wouldn't worry too much about it.

Working in close physical proximity to the employees you are charged with managing can have its complications. By following these suggestions, you will feel like you have created a little space (figuratively) and have regained your authority.

Take a Sales Management Book to the Beach

A client asks, "I am always trying to improve my sales management skills. Can you recommend some good books on the topic?"

Yes, I can. Whether you manage salespeople directly or supervise someone who does, it's always beneficial to read a book on the topic. These four are books I frequently recommend to my clients.

Proactive Sales Management: How to Lead, Motivate, and Stay Ahead of the Game by William "Skip" Miller

Skip Miller brings a fresh perspective to the nuts and bolts of sales management including hiring, setting objectives, creating territories, and running sales meetings. He plays the role of the tough but kind boss. Though everyone knows the importance of turning in sales forecasts and spending the majority of your time with your top producers, Miller stresses why it benefits the manager. The chapters on putting a sales representative on written warning and/or terminating them should be required reading for all sales managers. His writing is succinct and enjoyable because he sees the humor in managing the characters that can comprise a sales force.

Sales Coaching: Making the Great Leap from Sales Manager to Sales Coach by Linda Richardson

Linda Richardson agrees that a sales manager needs to perform certain tasks such as giving annual reviews, holding staff meetings, reviewing sales forecasts, and conducting post-sales call debriefings. She also knows that how you handle these tasks can greatly impact how the salesperson feels and behaves after the interaction. Published in 1996, there is nothing dated about this book. Richardson provides practical advice for setting the tone and asking the right kind of questions during meetings so that salespeople become more energized, self-reliant, and motivated.

Don't Fire Them, Fire Them Up: Motivate Yourself and Your Team by Frank Pacetta

Frank Pacetta is transferred to Cleveland, Ohio to manage one of the worst performing Xerox sales divisions in the country. Yes, he too talks about all the responsibilities that a sales manager has to handle, but he does so in the form of a really interesting story. How he goes about turning his sales group into top performers is a great read. Along the way, he covers some very difficult subjects that are not often written about, such as terminating people you really like, managing people you don't care for, and moving mediocre performers out the door.

Fundamentals of Sales Management for the Newly Appointed Sales Manager by Matthew Schwartz

Matthew Schwartz tackles a topic that many people find difficult to explain: the differences between being a top performing sales representative and an effective, top producing sales manager. Schwartz explains why so many sales representatives struggle with the transition from sales to management. He covers the basics of the job very well. Neither entry level nor dumbed down, many seasoned sales managers have told me that they got a lot out of reading this book. It should be required reading, however, for any new sales manager and for anyone who has just promoted a former sales representative into a sales management position.

I recommend these books; they are full of valuable information as well as being interesting to read. I hope you enjoy them and welcome your comments on these or other sales books you have found useful. Have a great summer!

Review Accounts to Set Sales Priorities

I always advise my clients to run a report of their current accounts, sorted by the amount of sales revenue they represent. The largest clients should be at the top and the smallest clients at the bottom. These are the questions they frequently ask me about this activity.

What am I likely to find?

Most of my clients discover the following:

• Once they get past the top 10 or 20 accounts, the remaining accounts represent much less revenue than they thought. The dollar amount drops off fairly quickly.
• One or two accounts that they think are top accounts and have paid considerable attention to are not in the top 10 or 20.
• Several accounts spend a lot more money with their company than they realized and they do not spend any appreciable time with them.
• The account list is “top heavy” and “bottom heavy” with few accounts in the middle.
• Many accounts are stagnant. They spend the exact same amount of money every year and buy exactly the same type of product. There is no growth.

What should I do with this information?

Once you have established who your top customers are, determine what percentage of your allotted sales time should be spent with each one and on what type of activity. Some may just want to meet and discuss business; others might like to play golf.

• Figure what the top companies have in common as well how they are different from each other. Let the commonalities help you to identify the ideal customer.
• Let the differences serve as a guide to the type or size of company that might be missing from your account list. Create a sales and marketing plan to proactively add those types of companies to your account roster.
• Make sure that your salespeople understand who the very top accounts are, have the skills necessary to grow the accounts, and are spending the right amount of time with them.
• Learn about and get to know the second tier customers to determine which ones might have strong growth potential in the coming years.

What should I do about the large number of companies who do almost no business with my company?

Divide that group of companies up and have the salespeople call on them. Determine which ones have potential and which ones do not. After that activity is complete, there may be some companies that should move into inactive account status. You might consider dropping them from sales territories and marketing campaigns. Put your efforts into bringing on the type of accounts that you really want to do business with.

How often should I run this type of report?

Every other month. If you do this exercise on a regular basis, you will rarely be as surprised by what you see as you were the first time. But you will become more adept at spotting trends within your customer base and you will be more aware of how individual companies are performing.

There is one added bonus that my clients often overlook. Running a report like this makes you less dependent on your sales representatives “take” on how things are going with a certain account. You now know. It makes conversations with them more constructive and you won’t be caught off guard late in the year when a particular account is down by a significant percentage. You will have the account information at hand.

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Though my clients come from many different industries, the challenges they face are similar. In “Sales Management Tips,” I regularly answer questions that have been posed to me by my clients. I hope the answers will help you to solve some of the sales dilemmas you face in your own sales organizations. If you would like to ask a question, please contact me. The identity and affiliation of those submitting questions will be kept confidential.

One Conversation Isn't Enough to Alter Behavior

A client asks, "Recently I had a discussion with one of my salespeople about a habit of theirs that was impacting productivity and making others in the office uncomfortable. After our talk, which went very well, there was a noticeable improvement in their behavior. In the past several weeks, much to my surprise, they are back to their old ways. I was very prepared for this discussion. Why did this happen? What did I do wrong? What can I do about it?"

When they notice a problem with a salesperson, many managers spend considerable time thinking about the situation, documenting offenses, discussing the issue with others, receiving counsel from Human Resources, and maybe even doing a little role playing before speaking with the offending employee. They are often pleasantly surprised at how well the discussion goes, and based on this result alone feel the matter is closed. After some time has passed, they are discouraged to discover that the matter is right back on their to do list.

Let's look at that initial conversation as well as some strategies that will ensure a better result the next time around.

Be realistic

Naturally the discussion with the salesperson went well. You are their boss, you were thoroughly prepared for the meeting, and you were armed with the facts. Of course they agreed to stop doing whatever it is you asked them to stop doing; what choice did they have?

Be practical

They have probably been spoken to about this issue before by other employers or colleagues. They might be practiced in agreeing that this is something that cannot continue.

Be sensible

This is a bad habit so it's unlikely that they will stop it completely. Look to significantly curtail or decrease the incidents.

Be specific

Let them know how frequently they do this and when it is the most annoying. Talk about patterns of behavior and brainstorm with them to come up with solutions to mitigate this issue.

Be proactive

Schedule a weekly meeting with them for the next six weeks in a row to talk about the progress they are making. This will signal to them that you are serious about solving this problem.

Be honest

Tell them what might happen if they cannot keep this issue under control.

By setting the expectation, during the meeting, that this will be an ongoing conversation until the matter is resolved, you will increase your chances for success. It is more work, but you will not be lulled into a false sense of security that this problem has been solved after the first conversation.

The Whys and Hows of Sales Contests

If you haven't already done so, it's time to create a sales contest for your sales staff. The novelty of the new 2006 compensation plan has worn off and your sales representatives are in the "grind" of the year. They need a contest to remind them of their larger goals and keep them motivated. I will address, one by one, the questions my clients typically ask me about the creation and administration of sales contests.

Why do I have to create contests throughout the year?

Before a single dollar of business is closed, sales representatives must deal with tough gatekeepers, disinterested prospects, difficult objections, cancelled meetings, influencers who claim they are decision makers, presentations that go awry, and stalled decisions. Salespeople need their spirits bolstered all during the year to help them deal with these situations, and contests are a motivational and inexpensive way to do just that. Salespeople are also competitive by nature, and by constantly challenging them you will keep their competitive drive alive.

Does a contest always have to reward sales revenue?

Absolutely not. Many, many steps precede a closed sale and they are all critically important. Sales representatives have to research accounts, make prospecting calls, go on appointments, and give presentations. Sponsor a contest that involves successfully completing a certain number of these pre-sale activities during a specified period of time. For example, if the average sales representative makes 4 presentations a month, offer an incentive if they schedule and complete a fifth in a single month or 14 in a calendar quarter.

Why should I have sales contests in my company when my superstar always wins?

Sales contests are not compensation plans and, therefore, can be tailored to the individual. If your superstar typically schedules 10 meetings a month with potential new clients and your other sales representatives schedule only 5, create an incentive around each one of them beating their personal average. The sales representative who goes on 5 meetings a month should be given a goal of 6 and your superstar’s goal should be set at 11 or 12.

Should the reward for winning a contest be additional cash?

No, for two reasons. First, very few people have the self-discipline to hold the cash aside and spend it on something for themselves. Secondly, cash typically gets spent on the everyday mundane things such as the dry cleaning or allowance for the kids. It is better to give out gift certificates to favorite restaurants, movie theaters, or book stores. When they redeem their gift certificates, it reminds them of their accomplishments and makes them feel appreciated by their employer.

Should I hand out the rewards at a staff meeting or in person?

Wait and see. Depending on the contest rules, everyone may not earn their reward at the same pace or even in the same month. It could be more motivating to hand them out individually. Regardless, make it a special event. Present it to them in a fancy box or envelope, include a thank you note, shake their hand, and thank them for their efforts.

Yes, it is extra work to create and administer periodic sales contests. There are payoffs though. If a salesperson typically goes on 4 appointments a month and the contest motivates them to speak to enough people to schedule a fifth, they now see that they are capable of achieving this number on a regular basis. Twelve more meetings a year will result in more presentations which will result in more sales. Discuss this with them. Run the numbers and look at the extra revenue potential. This will result in a more highly compensated sales representative – and they are always more motivated.

Salesperson Spends Time on the Phone, But Not with Customers

A client asks, "One of my salespeople makes far too many personal calls. Some of what they discuss during these calls is personal in nature and though they don't speak loudly, it is not difficult to hear what is being discussed. They are an otherwise solid performer, at or above quota most of the time. How do I address this issue with them?"

What seems like an annoying problem, a sales representative making too many personal calls, can turn into a larger issue if it continues unchecked for a prolonged period of time. Your instincts are right, and by the way a similar issue exists if a salesperson is spending too much time at work on personal email or IM. Start a dialogue with them right away.

Track the calls

Analyze this salesperson's call report for a week. How many work-related calls are they making? Exactly how many of their calls are personal? What is the total amount and percentage of time being spent on these calls? Are they calling the same phone number repeatedly or are they calling a variety of different numbers? What is the average duration of the calls?

Discuss the situation

Set up a time to speak with the salesperson and restrict the conversation to this topic. Have the data on their phone calls handy, but only use it if they deny that this behavior is occurring. Instead, start off by saying something like, "I couldn’t help but observe that you have been making more personal calls than usual. Is everything alright?"

Many business owners and managers are surprised to discover, when they open the discussion with that question, that their sales representative is actually dealing with a difficult issue. It could be that they are buying or selling a home, solving a daycare or eldercare issue or going through a divorce. If it's the case that they are dealing with a temporary crisis, ask them what kind of assistance they need to solve the problem. Discuss the possibility of their taking a few vacation days or a short leave of absence. Try and help them come up with some potential solutions.

If it turns out that they have just been making a lot of random personal calls and they don't appear to be dealing with a crisis of any kind, ask them about their job. Are they still enjoying what they are doing? Is something / someone bothering them? Do they need a new challenge? If you have made any recent changes to their compensation plan or territory, could it be affecting them? Could they be job hunting? Be open to whatever they have to say.

The end result is the same

Whether they are in crisis or have just been abusing their telephone privileges, one thing needs to be clear at the end of the conversation. Their personal call volume is too high and the content of their calls is too personal for the workplace. This behavior is affecting their productivity, their income, and their relationship with their co-workers. Somehow, they need reduce the number of personal calls they are making and/or make their private calls offsite and during a lunch hour or break.

Failure to address the issue will lead other staff members to believe that making a lot of personal calls during the work day is acceptable. At best, the salesperson making all the calls will become fodder for office gossip. At worst, the other salespeople will be distracted by these calls and their own productivity will suffer. The sooner you have this conversation with the offending employee the better.

Questions to Ask in Formulating a Strategic Sales Plan

A client asks, "I would like to do an assessment and strategic plan for my sales organization. I have undertaken projects like this before with other departments, but never in sales. Can you suggest how I can get started?"

The beginning of the year is a great time for this type of activity and I applaud you for wanting to think strategically about sales. Before you start this project, here is a list of questions that you should be asking:

Compensation

• How old is my current compensation plan?
• Is it driving sales?
• Does it still motivate the sales representatives?
• Is it still aligned with company goals?
• How many salespeople max out on it?
• Should it be changed in any way?

Sales staff

• Which salespeople earned more this year than last?
• Which salespeople earned less this year than last?
• What are their collective sales challenges?
• What are their collective sales strengths?
• How will I go about finding this out?
• What kind of sales skills training is needed?
• Which organization can best provide that training?

Accounts

• Do I know who the top 10 accounts are for each representative?
• Is each account up or down compared to the previous year?
• Have I met with or spoken on the phone with these accounts in the last year?
• Holiday greetings aside, have I communicated with these accounts in any way?
• Do I have adequate staff to call on the number of accounts I want to do business with?
• If I need to increase my sales staff, how will I go about it?

Management

• Do I hold regular staff meetings?
• Are the meetings interactive and of benefit to all?
• Have I given all the sales representatives quarterly and annual reviews?
• Are they truly impartial and tied to revenue production?
• Am I tolerating mediocre performance?
• Should any of the salespeople be on written warning?
• Do the salespeople have what they need in terms of technology to stay ahead of the competition?
• Do the top performers understand how much I appreciate their efforts?

Performance standards

• What productivity requirements have I set?
• Do the sales representatives take them seriously?
• Have I held my salespeople accountable for those productivity goals?
• Are they regularly met or exceeded?
• Do I monitor them?
• Are they realistic for where the company is today?

Products

• Do the salespeople know our product line inside and out?
• Which products do they know really well?
• Which products are they unfamiliar with?
• Do they need product training?
• When did I last sponsor product training?
• Which product / service do they sell the most of? Why?
• Which product / service do they rarely sell any of? Why?

This list may seem daunting at first glance. If you answer the questions one by one, however, you will begin to see your sales plan come together. Good luck and make it the best year ever!

Competition Displaces Top Rep

A client asks, "For many years, I had only two salespeople on my sales staff. One of them significantly outperformed the other and was treated like a superstar. Recently I have doubled the size of the sales staff and one of the new hires is outperforming all three of the others. I am beginning to have some real trouble with my former star. Their productivity has dropped and, quite frankly, they are often surly with others during the work day. I do not want them to leave. What can I do?"

This often happens in small sales organizations and it can be a very uncomfortable situation for all concerned. You are right to want to address the issue, both to keep your long-time employee and to retain your newest employee as well. If some of the surliness is directed their way, they may decide to take their talents elsewhere; there will probably be no shortage of bidders.

Face the facts

It may be that your entire sales team, including the former superstar, has been underperforming for a long time and you just didn't realize it until the new hire came along. Your former star may have been the top performer in a below average sales staff.

Review the numbers

Take a look at the former superstar's productivity numbers. Are they making the number of calls that they used to? How many prospecting calls are they making? How many new accounts have they opened up recently? Have they been coasting in recent years or were they still working hard? Has their territory been realigned or did they lose any accounts to the new sales representative? Could any of these situations have impacted their performance?

Hold a meeting

Review the findings with your sales representative. If organizational changes have made it virtually impossible for them to reach their former sales goals, at least for the short-term, acknowledge this and take steps to correct it. Perhaps a temporary quota reduction or a territory expansion is in order.

If you can clearly see that the arrival of the new sales representatives has had little impact on their ability to surpass quota, tell them so. Let the numbers back you up. Perhaps they had stopped prospecting some time ago or had grown complacent with established accounts. Work with them to create a plan that enables them to step up their sales production.

Address their attitude

When the sales productivity part of the meeting is concluded, bring up the issue of their behavior. Using specific examples, talk about the detrimental impact their negative attitude has had on the organization; tell them it must stop immediately.

Consider a change in title

Is there a special way to recognize their contribution to your organization? Could they have acquired tremendous product knowledge over the years? Have they put together some amazing presentations? Did they write much of the content for your website? If so, think about enhancing their title to something like Senior Sales Representative or Product Specialist. This would acknowledge how much you value them and would give them some of the special attention they undoubtedly miss.

Though it may surprise you, your former star might be concerned about their future with your company, especially given their loss of prestige to your new superstar. A one-on-one meeting may help them to talk about their concerns and give you a chance to assure them that they are still a valued member of your organization.

Sales Superstar Going to the Competition?

A client asks, "One of the sales representatives on my staff is a superstar whose revenue generation far exceeds any of the other salespeople. While I appreciate their stellar performance, there is a downside: they periodically threaten to go to the competition. Do you have any suggestions on how to handle this situation?"

Having a sales superstar on staff has many advantages. They are able to open new accounts, substantially increase sales revenue within current accounts, and serve as motivation to others on the sales team. As many business executives have found out, however, their super-sized sales production often requires super-sized management. Here are some tips on managing the superstar more effectively.

Look for patterns

Think back to when most of the conversations about going to the competition have occurred. Do they take place at the end or beginning of the year, during slow periods, or right after they close a big sale? Could it be right after you hire a new sales representative or give them their annual review? Do they bring up any other subjects? Going through this exercise might help you to see some patterns.

Talk with them

Set up a time to speak with them during a relatively calm period in your company's business cycle and not when they have just threatened to go to the competition. Ask them what they need to be happier and more productive at your company. Make a list of their suggestions and requests. Take all of the requests seriously but do not make any promises or immediately say "no" to anything they ask for – no matter how outrageous something may seem. Read the requests back to them and ask them to rank those requests in the order of importance. Thank them for their candor and then schedule a follow-up meeting right then and there.

Categorize the requests

Divide their requests into two categories: monetary and non-monetary. To be sure, most of their requests will be monetary, but others may surprise you and not involve compensation. Are they upset about their title or the fact that you have vetoed their request, which they feel would bring in a lot of business, to golf on Wednesday afternoons? Would a special parking place make them happy? Do they want more or less involvement with the new sales representatives? Have you begun to take their stellar performance for granted and not given them the recognition they deserve?

Match revenue to requests

Rather than say "no" to the upgraded company car or the President's Club trip to Portugal outright, get out your calculator, determine the real costs, and see what you can do. If you consider their monetary requests outrageous, set some high-level goals for them. If they can increase sales to Company X by 25%, you might be only too happy to buy them a couple of plane tickets to Portugal. If they can convince Company Y to buy from you instead of the competition, the idea of leasing a Lexus for them might be a lot more attractive.

Treat the other reps fairly

Use the possibility of the other sales representatives coming to you and complaining about the superstar’s preferential treatment as an opportunity to set some high goals for them too. Have some fun with it. Tell them that if they were to achieve a 30% increase in their territory, you will be happy to send them on a trip to the Bahamas and will personally drive them to the airport to catch their flight!

Call their bluff

If you feel you have done everything to accommodate your superstar and they are still threatening to go to the competition, it’s time to get a little tougher. Ask them questions such as: "Have you formally met with the competition?" "How do they compare with us culturally?" "Have they in fact offered you a position?" "What appeals to you about their company?" "Will you be their top producer?" "What if things don’t work out?" A conversation like this should tell you how serious they are about leaving.

Speak with your attorney

Regardless of whether you have this conversation with your superstar, if the departure of key employees to the competition puts your business at risk, you should have your attorney draft a non-competition agreement to protect your business from such an eventuality. Then have all your key employees sign it.

Be ready

Superstars sometimes leave no matter what you do. Make sure that you are accompanying them on visits to their largest accounts on a regular basis (see "Meeting Customers is Critical for Executives," May 2005) and have a contingency plan in the event that they do resign. Think about who on your staff would be able and willing to handle their accounts.

Discussions with the staff superstar can be a nerve-wracking event for many people. Instead of avoiding them altogether, which may lead to an unnecessary resignation, prepare for them as you would a major presentation and they will be much more productive and much less stressful.

Friendship Impedes Decision-making

A client asks, "After a long period of poor sales performance, repeated discussions, and multiple attempts at helping him, I have decided to terminate the employment of one of my salespeople. The problem is that we are close personal friends, our wives are close friends, we socialize as couples, and our children know each other. My uncertainty about how to handle the friendship going forward is keeping me from following through on what I know to be the right decision for this salesperson and the company."

First, you seem to have done quite a lot for this individual to try and help him succeed on the job. For that you are to be commended. You also seem to realize the deleterious effect a poorly performing salesperson kept on the payroll will have on the rest of your sales staff. If you do not act, you relationship will be seen by the rest of the sales team as more important than the success of your business. Terminating your friend and colleague will be very difficult. Here are some suggestions for making this awkward situation a little more bearable.

Provide transitional support

Because this person is very important to you, provide the things that will genuinely help him through this painful transition period in his life. This could include: a generous severance package, health care coverage, commissions on unclosed business for a designated period, career counseling, and outplacement services.

Open your rolodex

If you know that this person is not appropriate for a sales position, don't risk your reputation or jeopardize his future by helping him to find another sales job. His stay at the next company will be brief and he will be out job hunting again. But do tell him that once he has some potential career paths in mind, perhaps after he has worked with a career counselor, that you will be happy to introduce him to anyone you know that can help him.

Take a break and then reach out

No matter how the person reacts to their termination, let some time pass before you initiate contact, but assure him that he should feel comfortable contacting you at any time. Once he's settled in to outplacement or you have heard that he is going on some interviews, give him a call. Be supportive and upbeat when you speak to him but don’t make social plans. Reiterate your offer to make introductions.

You might be surprised

Though some people struggle for quite some time to find themselves after a termination, many of my clients are shocked to find that their long-time employee immediately started a business they had been interested in for years or enthusiastically pursued a totally unrelated career path. They often wonder why this person didn't do it years before and realize that fear, inertia, or security kept him in a position that he was ill suited for.

Be prepared to say goodbye

Many people who form close friendships with colleagues are surprised to find that the relationships fade when they no longer work together. This happens even when they leave a job amicably under positive circumstances. Your friend may have formed a friendship with you to protect his job or the embarrassment of being let go may make it impossible for him to feel truly relaxed around you again. There is no way to predict what will happen.

Some of my clients find that once they no longer see the person daily, they have no interest in maintaining the friendship. Others find that they genuinely miss this individual and would like to resume the friendship. I advise them to have lunch with their former colleague and see if they really enjoy the other person’s company. If they do, they can start rebuilding the friendship. If it's strained, they can more easily accept that it is time to move on.

Counteracting a Summer Shortfall

A client asks, "This summer almost my entire sales staff requested vacation time in August. Normally, I try to stagger their time off but this year they needed to attend events like weddings and family reunions with inflexible dates. Because of this, August will be our worst sales month in years. How do I make up for this shortfall without having the staff feel as if I am penalizing them?"

Though situations like this often occur in the summer, there are many other times during the year when members of your sales staff all need time off during the same period. It can be deadly for sales revenue. Here are some tips for dealing with a skeletal sales crew and the resulting slow sales month.

Look at the Shortfall

Find out exactly how much revenue was lost during August. Were your expectations reasonable in the first place? Remember, customers take vacations too, and decision-making processes often stall as a result. Take a look at each individual and how August affected their sales. You'll probably notice that some salespeople are more impacted than others. In some cases, it might not have made much of a difference; with others there may be quite a shortfall.

Schedule Individual Meetings

Regardless of what transpired over the summer, the early fall is a great time to meet with salespeople and get them back on track. Discuss the August sales revenue directly, but don't be overly gloomy or intense about the situation, leaving the sales staff feeling guilty about taking vacation that was due them. Say something like, "Boy was it quiet around here in August. We didn't set any sales records!" Then discuss their overall sales performance and begin strategizing for the fall.

Hold a Group Meeting

After you have met with everyone individually, schedule a staff meeting and talk about the overall group numbers. Discuss year-to-date figures, take a look at both the strong and weaker months, and then talk about August specifically and objectively. Again, avoid being overly negative because it can backfire on you by making your staff feel that the year is already lost and there is no way to salvage it. Brainstorm as a group to come up with suggestions on how to increase revenue.

Pizza

For an inside sales force that calls into different time zones, offer to buy pizza for dinner once a week if they will put in a few extra hours calling their West Coast clients. For a field sales force, offer to do the same if they will stay late one day a week to try and catch some hard to reach decision makers at their desks. Sales representatives who alter their typical calling hours on occasion are often surprised to see that the effort yields some unexpected sales revenue.

Remember the Little Things

Put up posters that chart the progress being made. Make sure and "catch" everyone on the staff contributing to the success of the sales effort and acknowledge them in group e-mails and voicemails. Keep movie tickets or gift certificates on hand to surprise the sales representatives who make a big sale or speak with a hard to reach buyer.

Being short-staffed is every sales manager's nightmare and it happens to all of us despite our best efforts. The important thing is to remain calm and strategize your way out of the slow sales. Your staff will remember that you let them take an important vacation, even though it was inconvenient for the company, and that you led them to a successful sales year despite the summer slowdown.

Salesperson Doesn't Use CRM System

A client asks, "Every member of my sales staff is using our new Customer Relationship Management system (CRM) except one. I have made it clear that keeping account and prospect information in the CRM system is an important job responsibility. This person is an otherwise strong performer. What can I do about this situation?"

This is a frequent occurrence in sales organizations and you are right not to ignore the problem. But it's a tricky dilemma to solve because this person is doing the majority of their job well. The key to success in this case is creating a plan and following it through.

Discuss the Situation

Set up a one-on-one meeting with the salesperson to talk about their non-compliance with your policy. Let them know, in advance, what the meeting will be about and don't discuss other issues. Ask a lot of questions. Why aren't they using the CRM system? Why do they feel that way? Are they comfortable using the system? Which screens are the most difficult for them? Which do they find useful?

Re-train

If they acknowledge needing additional training, offer to provide it, but avoid repeating the previous training. Select an instruction method that matches their learning style, such as some one-on-one tutoring. Regardless of which training method you choose, put a plan in place to track their progress.

Sell the System

Explain your side of the issue at this meeting as well. Tell them why you invested in a CRM system to begin with, and reiterate why you chose this particular one. Show them some of the reports you are now able to run and share some of the insights they have provided about the business. Talk about successes the other sales representatives have realized by using the system and relate the stories to increases in income and/or account size. There may be a computer whiz on your sales staff they may feel they have to compete with, so stick to selling-related benefits.

Follow-up

During your talk, schedule a follow-up meeting for a week later and then keep a close watch on their use of the system. It may be that they just needed to know how serious you were about their using the CRM system and will start using it from this point forward. If this is the case, be sure and tell them how pleased you are with their progress during the follow-up meeting.

If they continue to avoid using the CRM system during that week, let them know how disappointed and confused you are by this. Then log on to the system and ask them to demonstrate their knowledge of it to you. Ask them to enter a new account or set a call- back date. If they are able to perform these tasks then you know they are simply refusing to use the CRM system. If they cannot, then you know for certain that you are dealing with a training issue and can plan accordingly.

Set Expectations

Let the sales representative who is refusing to use the system know that using it is a job requirement for everyone on the sales staff and all future hires. Remind them that their actions will exclude them from being considered for any promotions or greater responsibilities within the company. Ask them, should they ever decide to accept a position elsewhere, how many really good sales jobs would be available for someone unwilling to utilize this new technology. Give them a time frame in which to learn the system, meet with them periodically to monitor their progress, and tell them that failure to use the system will result in potential penalties.

Look at the Real Costs

If they are still not using the CRM system after a reasonable period of time, you need to hit them in the wallet and reduce payable commissions. Keep the following in mind: the other sales representatives are aware that you are not holding everyone accountable to the same standards and they will resent it. This will result in underperformance and unnecessary resignations. The sales representative who is not using the CRM system is not maximizing their sales territory and your competition probably is. These factors alone will reduce your profitability. If their refusal to use the CRM system is costing you money, it should cost the salesperson financially as well.

Adopting a CRM System

A client asks, "I am in the process of picking out a contact management system for my sales representatives. Peers of mine have told horror stories of investing quite a bit of money in systems that the sales representatives never use. How can I avoid this problem?"

First, you are on the right course. A standardized contact management system, or more generally a Customer Relationship Management (CRM) system, is essential for effectively sharing information among you and your team. However, if the system isn't set-up or rolled out correctly, it can wind up being an expensive and worthless undertaking. Remember, salespeople focus on maximizing their income, and the CRM system must be a means to that end rather than an impediment. Here are some tips that can help make the purchase and deployment of a CRM system successful.

Narrow the Field

Research and then select what you feel are the top 2 or 3 CRM choices for your sales organization. Be open to individual sales representatives suggesting programs they may have heard of or used in the past, but don't rely on the sales staff to initiate the search. It will only lead to time delays and charges of favoritism. Announce the finalists at a staff meeting and ask each salesperson to evaluate the systems and give their feedback to a selected sales representative. Make it clear that while you are very interested in their opinions, the final choice of CRM systems will be yours. Then meet with the sales representative, weigh the opinions, and make the selection.

Invest in Training

Sometimes the cost of the CRM system is so great that a company opts out of instructor-led training, leaving salespeople to fend for themselves with manuals and web-based modules. This often results in the more technical sales representatives jumping ahead and developing their own methodology, while the less technically inclined will lag behind or avoid using the system altogether. Formal training will ensure more consistent use of the software.

Most CRM's are intimidating at first. Decide which features you will use and then introduce the use of them to the sales representatives a few at a time. Make sure the features are fully understood before you move on the next set.

Input Data in Phases

Often salespeople are charged with the task of putting in all of the information for all of their accounts. This can prove to be overwhelming and is often when the first signs of push-back are seen. Break this task into smaller segments by having the sales representatives divide their accounts into groups labeled "A," "B," "C," and "D," with "A" being their best accounts. Tell them that all "A" accounts must be in the system by a certain date and then the "B" accounts, etc. Have the lists spot checked to make sure the accounts have been entered.

Identify Mandatory Fields

Decide which fields are an absolute must for the sales representatives to populate. Then work with the CRM's customer support department to flag the fields so that the sales representatives cannot proceed in the program until they have been filled in. When you start running reports from the system, your data will be much more consistent.

Use the Terminology

Most CRM's have their own unique terms and phrases for such things as sales forecasts or cold calls and it can be difficult for everyone in the organization to make the switch. This is an example of something that needs to start at the top. Once you have selected the system, you must lead by example and start using the terminology.

Use It Yourself

Finally, show the sales representatives that you are serious about the use of the system by using it yourself. For example, if you have one-on-ones with your sales staff, review their pipeline using the CRM before your meetings and/or run a pipeline report to review with them.

Introducing a new CRM can be stressful and intimidating for the sales staff. Some may have a preference for another system they have used in the past while others are satisfied to use something like Excel. It takes time, planning, and patience to make a new system part of the sales organization but it can be done and the benefits are many.

Next month I will write about the sales representative that, despite all your best efforts, will not use the system.

Meeting Customers is Critical for Executives

A client asks, "I'm the president of a small company. It's been suggested to me by peers and business advisors that I get out and meet my customers on a regular basis. I feel awkward at these meetings, worry that I'm wasting the customer's time, and don't see the value of it. Does it really do any good?"

It's critically important to the growth of any business that the person in charge not lose touch with the very people who help make their company a success. Making periodic customer visits is the very best way to do that. Why?

Peer to Peer

Company presidents like to meet other company presidents. It's as simple as that. No matter what the industry, executives share common issues and appreciate being able to talk to peers.

Show Appreciation

Taking the time to visit someone in their place of business shows them that they are a valued customer like no phone call or holiday card ever could. Nothing replaces being personally thanked for their business by the company president.

Share a Vision

Paying a visit allows you to talk about your company's plans for the future in a way a salesperson could not, and allows your customer to talk about their plans in a way they might not with the salesperson. Hearing about the customer's future plans enables you to think long-term about your business relationship with this particular company.

Take a Tour

I have never met a company president that did not enjoy giving a tour of their facility. It's usually very interesting and you will come away with a better understanding of how their organization really operates.

Networking

When two company presidents meet, they often think of several people they know that they think the other should contact. This usually doesn't happen, though, unless the two presidents are face to face. They may even offer to make an introduction to someone that you have always wanted to speak with but haven't felt comfortable contacting for one reason or another. Prior to the visit, you may want to think about who, in your network, they might like to meet.

Observe the Salesperson

How does your salesperson really interact with the customer? What do they actually say? What might they be neglecting to mention? Though company presidents often interact with their sales staff on a regular basis and may even manage them, they are often in the dark about how they conduct customer calls. Accompanying them is a great way to observe your sales staff first hand.

Proactive Beats Reactive

Some company presidents visit accounts only when the customer is extremely unhappy and may take their business elsewhere or to help close a large deal. Seeing accounts only in these two extremes makes executives hesitant about paying an ordinary visit. Use these visits to get to know your customer better so that when something does go wrong, or your assistance is needed in selling, you will be in a position to be even more helpful.

Get Energized

Most company presidents that I work with make the same comments after coming back from a client visit. They say they feel "relaxed," "re-energized" or "more focused." Many say they have a renewed appreciation for the jobs their salespeople do. They always, always learn something that they wouldn't have if they hadn't visited an account in person.

So get out there and visit those valued accounts. Start slowly. Make sure the first few visits are to accounts where you feel relatively secure. Once you're comfortable, schedule visits on a regular basis. You will be glad that you did.