Business development culture
Businesses are being hit by a series of challenges; an almost unlimited supply of free knowledge, automation of previously technically challenging tasks and most worryingly for service firms, by the fact that buyers are increasingly willing to sacrifice some “feelings of quality for a reduced price.
The combination of easy access to knowledge, automation, globalization, open pricing and a willingness of the buyer to sacrifice some quality for a lower price means that professional service firms are, for the first time, facing the same commercial pressures as other industries, such as retail, leisure, travel and telecom.
Adapting to change is the new normal
The speed of change causes two challenges: market-based challenges, that are driven by customer demands, such as what they want to buy and the way they want to buy it; the core culture of an organization, moving from current culture to the one driven by customer demands.
The challenges of changing market
The drivers of commoditization, globalization, automation, reintermediation and disintermediation are now omnipresent.
The four pillars of value are:
- Knowledge: I know how to do things you do not.
- Application: I know how to apply my knowledge to your specific situation.
- Peace of mind: My service gives you the reassurance you need that the right thing has been done at the right time.
- Inertia against change: My clients know me and trust me so they will not leave me.
The internet has democratized knowledge and how we buy products and services.
There are some key disruptors that have affected the value of ‘applied or executed’ knowledge:
- Technology: with automation being the main disruptor. The challenge for leaders is to imagine which parts of their business will be automated.
- Alternative services.
Someone has to really see value in face-to-face interaction if they are going to commit the time and pay the premium associated with it.
If buyer has a supplier and they are happy with the service they are providing, then they are unlikely to proactively seek other solutions. However, this standpoint is being undermined by three marketplace changes: regulation, rise of procurement and dehumanization.
In the rise of procurement, there are multiple stakeholders involved in the buying decision. In dehumanization companies are increasingly having to do what the supermarkets do and redefine their core service offering are and which type of customers they need to target.
Some companies are being proactive and creating more clarity around their service offering for both staff and customers:
- Reworking existing business practices or automating services to allow a lower price delivery model.
- Creating additional service lines to supplement reduced profitability of traditional high margin activities.
- Working to add elements to their service that increase the perceived in the mind of the client.
- Meeting customer needs and ensuring a good customer experience to encourage them to spend more and be more loyal.
- Boosting marketing and branding activity.
- Adapting a proactive approach to winning new clients and retaining and expanding existing clients.
The challenge of cultural change
The challenge that all leaders face is ‘How do I bring individuals in the company along with where the company needs to be?’
Traditionally, an organization’s culture has been defined by the organization’s goals. This means that organizations have not placed nearly enough emphasis on execution and getting the culture bit right.
Agility happens in organizations where the workforce has a voice and where insights can and are shared easily around the company.
An organization’s culture is defined by three things:
- How motivated employees are to help the organization hit its goals.
- The organization’s belief in how its services benefit customers.
- How an organization chooses to treat its people.
Instead of talking about employee engagement, I like to talk about discretionary effort. Discretionary effort is a term that was first coined by the public opinion analyst and social scientist, Daniel Yankelovich. Audrey Daniels, describes discretionary effort as the level of effort people could give if they wanted to, but above and beyond the minimum required.
For a lot of organizations, proactive business development, activity has been a discretionary activity that is performed when the fee pipeline looks light. This can lead to companies being trapped in a feast and famine billing cycle, which is bad for business and emotional for the individual and the business.
In many business development focused teams, there is a conflict between traditional sales professionals and digital sales professionals (marketing). The challenge is to integrate the new and the old approaches into a coherent client development approach. Part of the challenge is for companies to deconstruct their service and allow customers to buy the bits they really want.
Building a customer focus into your team
By serving customer needs and wider societal needs, organizations are more able to engage and motivate their staff, while still delivering the financial results the business needs.
As business buyers become consumer-oriented in their mindset, how a company delivers its service is as important as what it delivers.
Building the case for change
One of the biggest challenges for organizations is to effectively communicate where their target market lies. Many companies fall into trap of continuing to target their whole market, rather than specific segments that match the organization’s strengths, even when market conditions change.
Ongoing commoditization within all market sectors means the churn of customer is likely to increase. One of the biggest drivers of customer churn is complacency.
The overarching principle is that if you hire smart people, you need to treat them as if they are smart by explaining why you are doing what you are doing and giving them a chance to contribute their own expertise. Don’t hire smart people and then treat them like idiots.
Do your teams understand your customers
The only opinions and feelings that really matter in the current marketplace are those of your customers. There are two challenges for sales leaders. The first is summarized by the two questions: ‘How well do you know what your customers want from your service?’ and equally important ‘How well do you know what they like about your competitors’ services?’. The second challenge is ‘Who are your indirect customers?’
In many companies there is a disconnect between what sales and marketing see as s ‘target customer’.
Mike Morrison from RapidBI suggests that there are four aspects of feedback that are needed. They are:
- Stop. What are the things we need to stop doing because it affects…?
- Start. What things should we start doing to improve…?
- Continue. What is working at the moment that we should keep doing to help…?
- Change. What is working to some extent but needs to change if we are to help…?
As a leader, your role is not only to build confidence that gaining client knowledge (both good and bad) is a good thing, but also to have mechanisms in place so you can track this knowledge and use it to craft better solutions/products and to support future marketing strategy.
Persona mapping and/or buyer profiling is the process most marketing teams go through when building a marketing strategy.
Creating a compelling, company-wide value proposition
Building a value proposition is much more than just a well-crafted statement. It is about the organization understanding how its product or service meets the customer need, making them feel that it is of value.
While retail, FMCG and leisure sectors are used to rapidly changing consumer tastes, many traditional industries are not.
Main challenge is to balance the service delivered with the price a customer is willing to pay.
Value proposition is credited to Michael Lanning and Edward Michaels from McKinsey. They introduced it in their article in 1988, A Business Is a Value Delivery System. In 2017 Huthwaite wrote: “Like beauty, value is in the eye of the beholder.”
When I work with teams, I tend to break how customers perceive value into two components: value builders, things about your service or price that add to a customer’s perceived value of your service; value detractors, those aspects of your product or service that lower a customer’s opinion of the value of your service.
Perceived value = sum of value builders less sum of value detractors
The four main drivers behind a customer’s perception of value are:
- Functional benefits: how does the product or service help customer achieve their desired aim?
- Customer satisfaction: how does the delivery of the service fell to the customer?
- Customer brand affinity: does the customer have affinity towards the company’s brand?
- Price: how does the customer feel about the price they paid in exchange for the solution and service they received?
Customer Value is Benefits – Cost (CV=B-C)
For most companies in today’s marketplace, what makes them different from their competitors is not ‘what’ they do, but ‘how’ they do what they do.
In today’s market the challenges companies face is that high visibility of pricing between different providers means that sales professionals need to be more willing to openly discuss pricing and the different physical and intangible components that go towards supporting their price.
NFAB statement: need, feature, advantage and benefits.
Streamlining the buying process throughout your business
Sales process is no longer about a sale being made, but about helping customers to buy.
When you meet a customer, your job is to:
- Find out what they want and why they want it.
- Show them things that will give them what they want.
- Ask them what they think.
- Go silent.
Has your sales process adopted to help your potential clients self-serve themselves through your sales process?
A modern sales process is showing a significant overlap between the role of the sales and marketing teams. This area of overlap has been called ‘smarketing’ by Hubspot. The reality for many sales professionals today is that they spend more time on marketing-based activities, building credibility and trust with potential client, than they do actually pitching for specific deals.
In all likelihood, the sales professional has to track a potential opportunity over a longer period of time as a client first tries to work through the problem by doing nothing, then by using internal resources or different external providers before considering other options.
Sales and marketing teams now must change their approach from being ‘the solution’ to being ‘a solution that can help if what you are doing at the moment does not work’.
Marketing teams are strong on content and messaging, but they can struggle to personalize messages to individual client needs. Sales teams are strong on building relationships but can struggle with a varied approach to being ‘close but not too close’ to the client as they work through the options.
There are two exercises that you can do that can help break down the silos between teams. The first is creating a common language and the second selling the value of data.
A sales process of pushing needs to change. The key is that a sales process mirrors the buying process a potential customer goes through, rather than the process the sales team want to push them through.
Aligning company and personal goals
There are lots of potential reasons behind the strategy execution gaps. Three of them are:
- Employees have little or no awareness of their company’s strategy or goals.
- Leadership awareness of goals is often limited to what needs to be achieved in their function.
- Managers fail to connect what an individual will gain personally if the company hits its goals.
Do you know what your employees want
In some ways, the easy ‘why’ is the company ‘why’. The difficult ‘why’ to define is the ‘why’ for each person in your team.
Elton Mayo did research on factors influencing productivity in Western Electric Hawthorne plant. He found out, that if nothing else changed and the workers were only explained people how the changes will impact each one personally, the productivity will increase. This is now called The Hawthorne effect.
A common paradox is that while sales leaders have built a career on understanding client needs and offering solutions to help with those needs, they forget all about the foundational principle of selling (which is to understand your client’s needs) when in a position of leadership.
You need to sell people on doing their job, particularly if they are to keep working how you want them to work when your back it turned.
Dan Pink’s book Drive talks about key aspects of the motivational theory of self-determination, the key principles being that each person has three intrinsic (inner) motivators. These are Autonomy, Mastery and Purpose. Autonomy is the desire to make our own decisions, Mastery is our need to be better and better at what we do and Purpose is our desire to achieve something that is bigger than ourselves.
When the manager takes the mindset of a career custodian, it is easier to open conversations regarding behaviors and the impact it will have on achieving and individual’s goals.
Sometimes, employees are not consciously aware of what motivates them or they don’t have solid goals they are looking to achieve. In these instances, the manager has a responsibility to help develop that individual’s capability to understand their own motivators and to then create goals.
Prioritizing the alignment of company and employee goals
It’s not good announcing a new strategy or change in direction and expecting employees to blindly follow and change.
In UK, the ‘engaged’ cohort of employee accounts for just 17 per cent of the overall workforce, according to 2016 Gallup research. Engagement is better in the US – 32 per cent, but worse globally – 15 per cent.
I like OKR approach for number of reasons:
I regularly ask individuals I spend time with as a trainer or coach: “Why does doing (task/behavior) help you be successful?”
- Desired outcome
Whether individuals are working to achieve a target your have set or a goal they are striving towards, everyone needs a plan.
A good approach is if you tell a person to make their own plan. A manager acts like investor. Each week manager and employee review employees plan and it the manager thinks the plan is not executed as agreed, he can withdraw the funding.
Example plan for a B2B sales consultant:
- Part 1: Goals and purposes
- What do I want to earn
- Why do I want to earn
- What do I bill to reach target
- What I am billing now
- By how much I need to increase billing
- Part 2: Network nurture and lead generation
- Improving sales process
- Sourcing new prospects and new contacts
- Nurturing existing
- Working on target lists
- What skills do I need
- Volume or effectiveness
- Improving sales process
- Part 3: Lead conversion
- Improving sales process
- Qualification and prioritization
- Nurturing and conversion
- What skills
- Volume or effectiveness
- Improving sales process
- Part 4: Client retention and expansion
- Improving sales process
- Feedback on service delivery
- Adding value to existing clients
- Increasing range of service and revenue
- What skills
- Volume or effectiveness
- Improving sales process
Avoid the smart dumb paradox
The smart dumb paradox: companies hire smart people, but too often treat them as if they are dumb.
There are two reasons why top-down approach to change is problematic. First, there is abundance of knowledge in today’s world. Individuals have access to the same knowledge as leaders and they are smart. Second, the speed of change is so fast, many sales leaders are running sales processes, that are outside their comfort. Sales processes supported by technology.
What are some indicators of smart dumb paradox. Regular flow of experienced talent leaving the business. Leadership team is not actively listening to challenges that sales, marketing and operations teams are experiencing.
Some approaches that can help leaders: be interested in what employees have to say, acknowledge awareness of the issues they have, be authentic around why decisions are made and think about change like building a car.
At simple level, there are three parts to building a car:
- Setting parameters of the car and what market segment it is targeted at.
- The car designers are given the parameters.
- The customer gets the chance to adapt the car so that they feel they are getting exactly what they want.
Whether you choose OKR or the building a car approach, the goal is that every team and person gets the freedom to set their own objectives and measures to help the organization hit its own goals (financial and operational).
Leaders need to be able to communicate what their organization’s place will be in the future marketplace.
Sometimes leaders need to make decision based on what the numbers show, rather than how they feel.
In most organizations, the people fulfilling a function on the ground are best placed to know about the inefficiencies that exist within the organization.
Creating a mutually productive work environment
Disparities between the sales team’s established values and the values of the wider organization can create friction between different teams.
The three core values for this part are collaboration, confidence and capability, and performance expectation.
Why collaboration is key to integrating sales culture
Aristotle said: “The whole is greater than the sum of its parts.”
Times are changing and there are five key reasons why collaboration between the sales teams and the wider organization is increasingly important:
- The sales process – sales and marketing are becoming a single integrated process.
- Knowledge is data.
- Lead generation – since world is becoming increasingly networked, anybody in organization can come across potential prospect.
- Pitch process – sales professionals must rely on different specialist to provide the best possible pitch.
- Account expansion – many sales professionals are protective of their client relationship; this is often at the expense of the wider organization’s sales growth.
Traditional approaches to encouraging sales collaboration tend to involve competition, compensation and recognition.
The best way to improve collaboration between teams and individuals is to focus on building confidence, credibility and trust between all parts of the business development and delivery process.
You could assume that sales teams and those supporting the sales teams are fully aware of each other’s needs and this assumption may well hold at the top level. However, when it comes to the little details of knowledge or activity that teams need from each other every day, it may well prove otherwise.
Teams often dismiss information as irrelevant but which is, in fact, valuable to another team.
Doing a job of someone you depend on; you will better understand the challenges they face and appreciate the role you play in helping them do it.
How to build confidence and capability
Aligning customer, company and individual purpose.
The key challenge for organizations is how they sustain high levels of motivation in their sales team when what has always been a challenging job is getting even more challenging.
The greatest loss for business is not when new sales consultants leave after three months, but when consultants switch careers or take a career break after 12 to 15 months.
Write down the things people needed to be able to do to succeed. Whether or not you call them competencies or capabilities, you can’t knock the argument that having clarity on what individuals in your team need to do to succeed is key to having a successful sales team, whether you are executing or supporting the sales process.
I find that capabilities are likely to be statements defining a person’s ability to achieve a desired outcome from a situation or activity.
The competency frameworks are great at telling you what you need to do but they are not so great at explaining ‘why’ this capability is important to success.
What is it that causes the disconnect between desired action and actual action? One answer is that companies do not promote ‘why’ things are done enough. Another reason is that the link between the sales process and what sales consultants are asked to do every day is not explicit enough which could be creating inefficiencies.
Sales managers now have to be both performance and performance managers.
The main difference between a sales conversation and a GROW coaching conversation is who drives the conversation.
The Conscious Competence Learning Model was developed by Gordon Training International employee Noel Burch in 1970. We go through four stages as we learn:
- Unconscious incompetence: we do not know why we are bad at something.
- Conscious incompetence: I know why I am bad at this thing.
- Conscious competence: I know that if I do this then this happens and I get the outcome I want.
- Unconscious competence: I do what works without thinking.
In my experience this process operates as a cycle.
Skill/Will matric by May Landberg.
- High will and high skill: these individuals are called stars.
- High skill and low will: these are often the stars of the past of ex-performers who the manager knows can do better.
- High will and low skill: this is often the sales rookie who is looking to make their mark.
- Low skill and low will: this is the individual who is not very capable and, more frustratingly, not worked hard enough to improve their chances of success.
The SBI feedback models was developed by the Center for Creative Leadership: Situation – behavior – impact. In practice the S is intended to focus the mind of the person to the specific point in time. The B focuses on highlighting the action or behavior and the I provides the feedback.
TED questioning is used for investigative questioning. Tell me, explain to me, describe to me.
Albert Gray: “If you do not deliberately form good habits, then unconsciously you will form bad ones.”
Successful performance management in a business development context
The challenge companies face is how to balance the need to hit revenue targets with how they treat their employees and customers.
“Fear is like fire: if you manage it right it will keep your house warm all winter; let is get out of control it will burn your house down.”
At the heart of motivational performance management is individuals believing your intent is true.
The difference between goals and targets is who owns them. Goals are statements of personal aspiration and engage a higher level off commitment from an individual. Successful managers know that the best results come from helping someone want to do a task rather than making them do it.
One of the common frustrations with review meetings is that they only serve the agenda of the manager; rather than the individual’s agenda. We should also move focus of the meeting from the past to the future.
FAST framework for the meeting:
Companies need to change how they approach their sales process. There are three pillars that leaders need to address: building a customer focus in your team; aligning company goals with those of the individuals in the company, and lastly building an environment that supports both individuals and the company no achieve their goals.
 In the book on page 64
 In the book on page 194