Pat’s Blog

“Don’t hire people based on your instincts. Have a process in place to research and test applicants thoroughly” — Peter Drucker

At financial firms large and small, I hear from managers who are struggling with how to increase individual production on their sales teams. This may seem like a development issue but the heart of the problem often lies in hiring decisions. The hard truth is: All sales candidates are not created equal. Research holds that only 1 in 4 candidates possess the raw sales talent to excel in consultative selling. Managers who want to hire better quality salespeople need to have a process in place to objectively determine whether candidates have natural sales talent.

“The ability to connect and thus, to raise the yield of existing knowledge is learnable.” — Peter Drucker

For managers, the pressure to push sales teams to achieve optimum performance has never been greater than right now. While it’s tempting to look for a “magic bullet” to correct performance problems, the most effective approach is less glamorous: “back to the basics.”

Smart managers know that one of the best ways to achieve better sales results is to revisit and reinforce basic sales skills. How much does the sales person know about prospecting? How about closing? Every individual sales person has strengths and weaknesses. Improving sales knowledge where deficiencies exist can move sales performance from good to great. The key to success? Measuring the sales person’s knowledge and customizing training to what the individual needs to know.

“What does the customer consider value?” — Peter Drucker

Value creation in marketing and sales is a fundamental issue that companies must address for long-term success. From what I’ve observed in my consulting practice, marketing and sales are typically separate silos. The all-too-common debate between the two boils down to this: Marketing argues for more investment in the brand, while sales wants more feet on the street. When there is no reliable way to tell which party is right, the one with the most clout wins the debate or the part of the business the CEO comes from is the deciding factor. An ideal solution to this problem is a process approach because it examines all the activities that produce a certain result—namely, winning a customer.
Marketing and sales people are challenged to see that the things they do and their respective inputs and outputs depend on one another.

Discovering what the customer values means answering questions, such as: What is it that the customer really wants from our product or service? Often times, companies seem to confuse customer satisfaction with customer value. They forget that people drop services they are satisfied with all the time if they find something of greater value. What do your customers value about your business?

“Specialized knowledge by itself produces nothing.” — Peter Drucker

During interviews, one of my clients asks sales candidates if they communicate with customers via a blog, Twitter or other social media. This can be important but not for the reason you might think. Technology by its very nature is always evolving so being technologically savvy is not the issue. What it does indicate is a sales person who is willing to adapt to changing customer behavior. The best sales people possess an unrelenting drive to better serve their customers which in this case, means using the latest technology to get their message out.

“All organizations must be capable of change.” — Peter Drucker

In my travels, a number of people have been talking about how many more prospects they need today to result in a successful transaction. For example, in the past, if it took 10 prospects to achieve a certain conversion rate, now it requires five times that amount to hit the same rate. While there are a number of factors at play here, the simple fact is: What worked yesterday will not necessarily work today. Companies and sales professionals need to be willing to make adjustments if they want different results.

The quality of the sales staff can make a difference. High achievers are constantly prospecting and more readily adjust to marketplace changes while average producers tend to keep doing the same things. It’s not about working harder but smarter.

“Establish specific numerical criteria and goals to measure results.” — Peter Drucker

In today’s business climate, it is more important than ever for managers to understand their costs and sources of profitability. One common mistake managers make is analyzing marketing and selling costs only at the gross levels.

When aggregating at a gross level, management teams can’t tell which marketing and sales activities produced which results. As a result, ROI on specific activities is unknown. Without a loan level analysis, it is impossible to determine how much of your marketing and sales activity produces little or no results. Likewise, what activities produce the biggest bang for the buck is not known either.

To obtain an accurate financial snapshot, marketing and selling costs must be examined at the asset level or loan level. Only then can you determine the true value and costs of your firm’s lead generation.

“The test of an innovation is whether it creates value.” — Peter Drucker

Managers who want to improve their sales results often look at the sales funnel first. The problem with this approach is that a sales funnel is not precise enough for an analysis and improvement process. Only a sales process can be managed and improved.

Because it encompasses a world of potential buyers, a sales funnel focuses inward and involves companies asking “What can we do for the potential customer given his or her position in the funnel?” This is the wrong question to be asking. The better question is to focus outward and ask, “How can we help the customer get what they want at this point in the buying process?” This is a subtle difference but when companies focus outward, it enables the company to add value both for the prospects and their customers in measurable ways.

“The organization’s function is to put knowledge to work.” — Peter Drucker

There is no doubt that ongoing training is essential for better sales performance but how and when sales training is implemented can make a difference in the final results. In my travels, I still see companies using a one-size-fits-all approach and throwing away valuable training dollars in the process. The problem? The information salespeople most need to know varies by individual. The solution? First, test the sales person on his or her sales knowledge and then provide customized training that targets any area that needs to be improved.

One more factor that can impact results: Training must be easily accessible to all participants. Gone are the days when companies hosted lengthy sales training sessions off-site. Web-based custom training that provides 24/7 access to the material is a more cost-efficient method with higher compliance.

“Take steps to expose your people to the best ideas and see to it that they are trained in how to apply them.” — Peter Drucker

In today’s limited-resource economy, managers are challenged to get more production from fewer sales professionals. Training can help a company instill change but two important factors must be taken into account if training is truly going to pay off.

First, companies need to have the right talent in place. The reason? If an individual is not matched for the position, no amount of training will transform that person into a top producer.

Second, once the right talent is onboard, it is important to customize training for the individual sales person. A mass approach to training can be a wasted effort as sales staff already knowledgeable about the material tend to tune out. Customized training enables every sales person to achieve optimum results.

“Know the strengths of each person you hire.” — Peter Drucker

One hot topic among financial companies is how to use technology (such as CRM systems) to achieve a “deeper dive” relationship with the customer. The truth is: If the initial face-to-face or phone contact with the sales person isn’t a “Wowing” experience, the best technology in the world will do nothing to help you connect with that customer.

In today’s marketplace, logging “good” interactions with customers is not enough. Every customer interaction must be great if the company is going to capture referral business. The key to creating great customer experiences is hiring sales people who are well-matched for consultative selling. How skilled is your sales staff at building customer relationships?