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Rejected proposal

Sales Proposals

…why, when and how?

Rejected proposalThe presentation of a proposal often leads to what has become a common problem; the supplier believes significant progress is being made and they expect a response but the prospect becomes un-contactable and/or previously discussed actions and timescales are forgotten.

Proposal: “a plan or suggestion, especially a formal or written one, put forward for consideration by others.”

Three points jumped out at me when I read this definition which might explain this misunderstanding:

Plan or suggestion. Many of the proposals that I review fail to put forward a plan but lots do make suggestions or try to commence a discussion.  For a proposal to stand the very best chance of producing a successful outcome it must present a plan for the delivery of what has already been discussed and agreed between the supplier and buyer. Using a proposal to “make suggestions” or have a discussion is a recipe for failure.  Documenting suggestions before a meeting may be a useful part of the process but this document is NOT a proposal.

Selling tip: Do not provide a proposal until every aspect of the problem, and your solution, has been discussed thoroughly and all points of contention have been resolved. The proposal documents what is already agreed.

For consideration by others. This raises the next big issue that contributes to proposals becoming interminably stalled or failing altogether.  If your proposal is going to be reviewed by people you have never met the chances of that proposal failing increase significantly.  Your proposal can only be based on what you have been told by the people you have met and while they can give you an impression of what might matter to others who will review your proposal those impressions can never provide a complete picture.  How many times have sellers been told “sorry, I liked the proposal but the FD didn’t”?

Selling tip: Take the time to find out the name and position of everyone that will be involved in reviewing the proposal and do everything you can to meet them or at least speak to them on the telephone. If you do end up with decision makers or influencers where you have had no direct contact you will need to work hard on your contacts to ensure you know as much as possible about their decision making criteria.  One of the most important parts of a proposal is the Executive Summary .

Formal or Written.  Written documents, paper based or electronic, are still the most common format for proposals and in many cases they are the appropriate format to summarise and document an agreed offer.  Note the word agreed; the proposal should contain nothing that would be unexpected or new to the prospect. The cardinal rule of proposals is NO SURPRISES!

An alternative approach that we have found to be very effective is to present your proposed solution in a workshop with all the stakeholders who will be involved in the decision. Using this interactive format does permit you to; make suggestion, float ideas, try out alternatives and the end result is a consensus as to what the solution should look like. Following the workshop you will simply need to confirm what is now agreed and for a simple case that can be in an e-mail and for more complex situations you will present a plan including a schedule of activities and the timetable for delivering them.

Selling tip: At an early stage in the engagement cycle with a prospect agree the process, format and timing for the creation and presentation of the proposal. It’s all tied to their buying process.

OK, so why, when and how:

Why produce a proposal?  Most business sectors, industries and markets come with a set of this is how it is done behaviours and habits.  For many B-2-B environments the habits will include formal, probably written, proposals.

Business tip: have a rigorous, proportionate process in place to review all opportunities ensuring the deal is something the business; wants, can deliver and stands a reasonable chance of winning.  Such reviews should be conducted at key milestones from first contact with the prospect through to a final review before committing the effort to produce a proposal.   

Why not consider breaking the mould; the supplier should ask the prospect how they would like to proceed and whether a written proposal is what they want.  If it is agreed that a proposal will be done the supplier should produce it with the sole purpose of documenting and confirming what has already been agreed and accepted during conversations with all stakeholders in the prospect’s decision making unit.  The proposal is then useful to both parties as it functions as a common understanding of what will be done, by when and for how much. It defines the obligations on both parties thus avoiding many of the potential causes of conflict once the project is underway.

For larger opportunities prospects may have a formal process including a number of steps such as; Request for Information, Request for Proposal or questionnaire type tender documents. If this really is the way the prospect wants to proceed, the supplier will have to play to the rules, but there is always scope to provide a compliant response whilst also taking the opportunity to present an option that differentiates you as a supplier.  This technique is at its most powerful in situations where the tender request demonstrates that the prospect is ill informed on some aspects of the problem or alternative solutions.

When?  The proposal should come after all points of discussion and negotiation have been resolved.  It is also important not to present the proposal too early in the decision cycle; it should be the only thing left to do before the prospect is ready to make their decision.  There is a sound argument for presenting a proposal in two steps; the first describing the solution you are proposing and why it might be the best and then separately, once the prospect has accepted your solution, you confirm (you will have already discussed it) your quotation for providing the solution.

Just to be clear; a quotation is NOT a proposal unless you are quoting for something with a recognised publicly available specification or something the prospect has bought from you before.  A true proposal effectively represents a specification for a bespoke solution.

How?  The only answer to this question that really matters is; as agreed between the supplier and buyer.  If the market or business sector has accepted ways of doing things this may be the way forward but challenging the norm may produce a better result for all concerned. For the supplier, challenging the norm with a better idea will help to differentiate them from their competition.

Further reading; timing of a proposal or  proposal production or getting your proposal due consideration

Proposal production through teamwork

Working with “sales support” when producing a proposal.

It is common, especially where a company provides complex or custom solutions that the sales people will need to work with colleagues from different disciplines to produce a proposal.  Common scenarios include working with:

  • Technical people who use their skills to specify and configure the correct solution for the individual need.
  • Estimating specialists who can work out how much time, material and other resources may be required to deliver a particular solution.
  • Manufacturing and logistics functions that will make and deliver the solution.
  • Health and safety, HR or legal specialist.
  • External suppliers who may be required to contribute to the make-up of the complete solution.
  • The project or programme manager, who will be responsible for delivering the solution, to ensure the estimates and delivery schedules are realistic. If any part of the brief cannot be achieved it is important to let the sales person know as soon as possible giving them the opportunity to re-set the prospect’s expectations.

In many cases, especially where just a few proposals need support, this will be done informally with the sales person making the decision on a case-by-case basis; deciding who to involve and when.  In larger companies or where every proposal requires support this will normally be done in a formal manner by, for example; sales support, bid support or by a recent manifestation, the sales enablement function.

If there are circumstances where a sales person is going to require the support of colleagues, even on a few occasions, it will serve the company well to put in the effort to create a formal process for such eventualities.  Arguably, it is even more important to have formal processes established in these cases as this will help everyone to quickly step from their day job into their support role without having to re-invent the wheel.

  • The sales person is nominally the owner of the requirement and will be responsible for briefing everyone involved in supporting the production of the proposal. It is important not only to brief on the requirement but also to establish the timetable including specific milestones when things need to be delivered.
  • If there is a formal bid function, they will normally be responsible for the physical production of the proposal document but if support is less formal this responsibility will usually fall to the sales person. The key is to leave no doubt – decide all roles and responsibilities during the initial briefing including who does which sections of the writing.
  • If the document is to be written by several people it is important to ensure consistency of style and language and this is best done by someone not directly involved in the writing.
  • If there is a need to involve external suppliers, briefing them and gaining their agreement to meet your timescales is crucial.
  • The vehicle for briefing everyone involved in producing the proposal should be the proposal summary. This summary contains the sales persons’ complete understanding of; the requirement, the solution, how they plan to convince the prospect of its worth, timing, financial parameters and key differentiators the sales person wants to be able to demonstrate.
  • It is important for the bid team to work towards a date when the proposal will be completed that is a few days before the sales person is due to present it to the prospect. This allows time for final editing and physical production avoiding the need for anyone to “burn the midnight oil”.
  • If the sales person is following the process of a trial presentation to the prospect, which will lead to amendments prior to final presentation, time to achieve this edit step needs to be scheduled into the bid team’s diaries.
  • When the proposal will be delivered in the form of an interactive workshop, rather than a written document, it is even more important that the sales person has ready access to all the specialists who can help provide the facts to support the sales arguments they will present.

A lot of time and effort can go into working with a prospect getting them into a position where they want to hear about a solution to their problem.  To avoid spoiling the ship for a ha’p’orth of tar it is very important that the production and presentation of a proposal is taken seriously and that it is accepted as part of the day job by the specialists who will contribute their knowledge.

Proposals – first impressions count

In times past the sales person would engage with a number of people in the prospect’s organisation but would rarely get to meet the senior executives who would be involved in the decision. This lead to the provision of a short, easy to read, section that those executive decision makers could use to gain an understanding of the key points of the proposal without the need to read the whole document. It has become common practice with written proposals that the first section is an Executive Summary; but is it still good practice?

Regardless of whether, as previously recommended, you have met all decision makers before submitting a proposal, there is still an important role for an executive summary as everyone is time poor these days so providing a concise overview of the key points of your proposed solution for all readers makes perfect sense. But, should it be an “Executive Summary”? We recommend Proposal Overview or Solution Summary.

The summary should always be created before the rest of the proposal; yes before!  I am always horrified when I hear that a proposal has been written by a number of people in the supplier’s business then passed to the sales person to top and tail; to add the summary and financials.  The sales person should own the solution being proposed and the way to make this happen is that they describe that solution in the summary before any other work is done on the proposal.  The summary is then used by the sales person to brief everyone else that will be involved in creating the proposal.

When the proposal is presented to the prospect, some people will read just the summary, others will read the summary and the sections that cover their area of interest and others will read the whole document. So, the content needs to be structured to ensure whichever approach is used, the reader will understand fully what you are proposing and the implications for them.

Here are some tips on creating and presenting a good proposal summary:

  • The sales person should by now have a clear picture of the problem the prospect needs to solve and an equally clear idea of what they need to do to win the business – the win strategy.
  • Having established that a formal written proposal is what the prospect wants to see, agree what the proposal will cover and whether the prospect has a preferred structure.
  • The sales person should now create the proposal summary that will address the following:
    • An overview of the problem the prospect needs to solve and their vision of the desired outcome
    • An overview of the supplier’s understanding of that problem which will include their experience of solving similar problems
    • All the key selling messages that will be expanded upon throughout the document.
    • The key points that differentiate your solution
    • A summary of the financial offer
    • Embedded navigation aids to help people find further detail in the rest of the document.

The sales person can now use the summary to walk through their proposed approach with their key contacts and coaches in the prospect and take the opportunity to:

  • Identify any points which may be contentious and test them; if they are uncomfortable agree how you will re-word or re-present the point.
  • Leverage their knowledge of the other people who will read the proposal to ensure everything you are saying will be well received.
  • Take the opportunity to conduct a trial close – effectively asking the question “based on this summary how likely are you to go ahead and award us the business?
  • Agree a date and time when you will present the final document.

The sales person now has all the guidance they need to complete the document ready for that presentation deadline.

One final thought

If the prospect doesn’t want a written proposal, perhaps preferring our recommended approach of an interactive workshop as the vehicle to present your solution, how can you provide a proposal summary?

Basically nothing changes.  The sales person should still summarise the proposed solution and use it to brief colleagues, they should still walk through what they will be saying with the main contact in the prospect and finalise it ready for the interactive workshop.  The workshop will be built around a number of presentation slides, one for each main section, commencing with the summary.  Following the workshop the sales person is in a position to write and present the final proposal based on the original plus modifications agreed during the workshop.

Timing is Crucial

Time may be of the essence …

… but timing is crucial when selling!

Other than with the most-simple proposition, selling will involve the sales person in multiple touches or points of contact with a number of different people in the prospect’s organisation. Touches could involve, for example; phone calls, e-mail, texts, social media messaging, meetings, demonstrations or presentations.

Which people you speak to and the sequence and timing of the steps is crucial to achieving a successful outcome within an optimum timescale.

This is partly about increasing your chances of success but also about shortening the elapsed time taken to get to the point of decision. This is somewhat of a virtuous circle as getting to the decision point quickly usually increases your chances of winning as you wrong foot the competition.

Here are a few simple techniques to ensure an engagement cycle with a prospect stands the very best chance of producing a successful outcome; successful both for the prospect and the hopeful supplier.

  • Keep in mind your own ideal engagement process that you have created to give you the best chance of winning deals the; events & actions, steps & milestones, timing for each, and overall elapsed time required to get to the decision point.
    Aenea&Micah on the trapeze

    Customer-Supplier process handshake

    • As soon as you start meetings with the prospect test your engagement process to see if it works for them and if it doesn’t, agree to an amended process and timetable that works for both of you.
    • If the prospect wants to skip steps that are important to you negotiate; seek their agreement to include the events and activities you really need in the process.

Be flexible in your process; one size may not be the appropriate fit in all circumstances. The philosophy revolves around risk management and required outcomes.

  • Continually be mindful of the stage you are at and behave appropriately. A simple example; if you are calling someone to arrange the first meeting, focus purely on that objective; don’t try selling them anything other than the meeting.
  • Allow time for the two separate functions of relationship building and opportunity identification & pursuit.
    • Plan time to nurture each separate contact and don’t assume because you know one person well the good karma will automatically transfer to others; account engagement is actually a series of new business encounters.
    • Be clear in your mind as to what you want to achieve at each touch point and focus on that.
    • Be sincere; don’t pretend you are trying to become best buddies when all parties know your sole objective is to secure a deal for your company. No one minds this but what people don’t like is pretence.
  • Identify or create requirements? If the prospect says “I need/want ….” then of course you respond to that in a positive manner but there could be hidden opportunities that the prospect may not have recognised.
    • When talking about a stated requirement always look for opportunities to upsell or cross sell.
    • Be ready to be pushed back; explore the objection politely and positively and if the prospect is adamant then revert to dealing with the requirement as stated, but don’t forget, the additional opportunity you spotted is something for the future.

If you consider applying just one new technique to your own engagement approach then make it this one.

  • NEVER consider a step in your agreed engagement process to be complete until you have agreed a date and time for the next step; don’t leave a meeting having agreed to produce a proposal without putting a date in the prospect’s diary for the meeting when you present your proposal.

This is all about keeping things simple; I see a lot of situations where the tendency is to over-complicate the processes of customer engagement and opportunity pursuit.  This often leads to protracted timescales and an increased risk that the prospect will do nothing or they will go ahead with a supplier who is willing and able to move quickly.  Make sure it’s you that moves quickly and you will win more business.

First published on  LinkedIn Pulse

mouse in maze hunting cheese

New year, new challenges?

As you start a new year, and reflect on the old; does your business feel the same?

When we last looked at this topic we asked “Did someone move your cheese?

The question was inspired by a book; Who Moved My Cheese, written by Dr. Spencer Johnson first published in 1999.
mouse in maze hunting cheese
In our earlier article we explored two areas where many businesses are suffering imposed change; the way they define and present their propositions and the way they take those propositions to market. While both issues are still very important as they continue to cause problems for many businesses this article explores some additional “cheese moving” forces that are impacting on business performance and productivity.

In the book, the mice handle the unexpected change in different ways and basically two of them stubbornly keep returning to the same place hoping the cheese will be there while the other two, aptly named sniff and scurry, immediately go looking elsewhere.

Problems cannot be solved with the same mind-set that created them

Albert Einsten

The message for any business; you must be in a permanent state of anticipation, ready and willing to adapt and ready to quickly embrace change as soon as the need is foreseen.

Let us assume your proposition and the way you take it market is working well but performance is still below expectations e.g. fewer new customers, less repeat or add-on business, longer sales cycles, or completely stalled decisions. Two key areas that are often found to contribute to these problems are your sales & selling processes and the way the sales pipeline is populated and managed. It can be difficult to spot these issues especially if your processes and pipeline management approach have been in place for a while and they used to serve you well. If change is slow, like the trees in a wood, it can be difficult to spot when you are inside the wood.

It is also the case that the change is often externally driven; someone has moved your customers’ cheese, which again makes it difficult to spot unless you employ a rigorous account management approach which focuses on the relationship as well as the work you are doing for the customer. This is a topic in itself that we will look at in a later newsletter.

Sales & Selling Processes

The question I am usually asked is; what is the difference between sales and selling in this context? Basically, the sales process is used to create and build a relationship with a prospect or customer while the supplier deploys the selling process when pursuing individual deals with a prospect or customer.

Here are a few pointers on what makes for good sales and selling processes.

Selling process:

Many would typically expect this to come after the sales process, but maybe if you first look at how you are going to close deals based on how your customers will buy, might that provide better information for designing your sales process?

“Begin with the end in mind”

Stephen Covey

  • The essence of a successful selling process is that it aligns with or better still mirrors the buying processes used by prospects and customers. There are two aspects to this; the generic buying processes used in your industry and by the sort of companies that become your customers and then the specific buying process used by each individual customer. As an example of generic buying process, consider how an owner managed business with 10 employees might go about it compared to the approach that a multi-million pound turnover global enterprise might approach it.
  • The selling process must be flexible enough to work with the whole gamut of customers and customer types you want to trade with.
  • The selling process is sometimes characterised as being a series of techniques and even tricks. If this is an indication of how sales people behave then it is easy to see why some get such a bad press. Executed properly a selling process is like any other professional discipline being built from a series of connected steps with rules that govern the progress across the steps leading to a predictable outcome.

Sales process:

  • Needs to be completely joined up enabling the evolution of a customer relationship to proceed smoothly. This is especially important where different departments are involved; web design & digital marketing, PR, marcomms, tele-marketing, sales enablement, etc. There was a time when these functions would have been under a single manager but this is often not the case which can lead to a silo mentality when what is required is absolute cooperation. The need for cooperation and joined up thinking becomes even more important when some of the functions are undertaken by external companies or contractors.
  • Needs to be fully integrated with other functions that are not directly associated with the sales process, but do have a contribution to make, such as; finance, logistics or technical support. All elements of the extended sales team need to have the same level of information and understanding of the strategic objectives so they can “sing from the same hymn sheet.”
  • Needs to be fully integrated with the selling process. One of the most common complaints that we hear is “they don’t understand what we need/do” and this is made by marketing people about sales people and also the other way around. If , for example, a decision is made to attend a trade show all too often marketing see this as their project which can mean they do not involve the sales staff until the 11th hour when it is realised they will need to follow up on people who visit the company stand at the show.

All elements of the sales and selling processes should seamlessly mesh into the business, with someone given responsibility for ensuring it all works as a single entity – the trouble spots are often at the interfaces so this would be the starting point for exploring performance weaknesses.

Pipeline – population and management

The sales pipeline should provide a reliable and accurate indicator of two key things; how many suitable prospects and opportunities you have moving through your sales funnel and how many of them you convert in a timely manner into profitable business.

This enables you to fine tune your targeting such that the pipeline can provide the essential source of reliable forecasting information enabling you to predict future revenues. If the prediction shows revenue below target for the next quarter you have time to look for additional business to fill the hole. Knowing with reasonable confidence what revenue will be each week, month and quarter facilitates more cost effective resource planning; cash, people, materials, external partners, etc.

Unreliable pipeline information is the most common complaint we have been hearing from our prospects over recent years and here are a few clues as to the cause of the problem and also a few suggestions to start fixing it:

  • The information in the pipeline should be in a consistent format, based on consistent objective criteria used by all sales people. Sounds simple but few do this well.
  • The information in the pipeline should be supported by; details of the product or service quoted for, the quote calculation, the competitive position, the decision date and criteria, and the win strategy. None of this should be down to gut feel; any assumptions need to be challenged.
  • We suggest a process of quantification is used as the basis of the formula used to calculate probability. What this marks is a move from the qualitative information used when developing a contact relationship to the factual information required to generate a reliable forecast.
  • All items in the pipeline should be the subject of regular scrutiny in a one-to-one review between the sales person and the sales manager. If there are doubts e.g. as to the decision date, the sales person should be tasked to confirm with the prospect; in the knowledge that the sales manager may reserve the right to also contact the prospect to discuss the opportunity. All too often decision dates are put as the last day of the month which typically means the sales person hasn’t done the work to really know. The decision date must be linked to a specific event, such as a board meeting, not to the sales person’s hopes.
  • A useful quick way to test an item in the pipeline is to ask three questions; Why, why now and why you. Good sales people ask these questions of themselves and their prospects but the sales manager should ask them as well.
    • Why; do they have the need or want, what is the problem they are trying to avoid or solve, and what benefits and value do they want to gain from making the purchase?
    • Why now; is there a sufficiently compelling reason for them to definitely make the purchase now? One of the most common reasons for stalled deals in sales pipelines is that the prospect does not have an imperative to make a decision; the pain isn’t bad enough so it feels less risky to do nothing.
    • Why you; can they fix it themselves, is there an incumbent supplier in place, who are your other competitors, and do you have something special or at least different which matters?

Everything in the pipeline should stand up to the rigour of an evaluation against the SMART formula (Specific, Measurable, Agreed, Realistic and Time-based); of these Agreed is the most important.

Summary

To ensure you can recognise when the cheese has been moved (for you or your customers), you need to periodically review the way you are monitoring your business, your market and your customers. You must ensure your sales & selling processes and pipeline management system provide you with pertinent leading indicators; it is much less painful to dodge the pothole than to repair the tyre after you’ve hit it.

The entire sales and selling operation should be systematically focused on business as usual and in particular delivering on the business plan for the current period. This enables identification and assessment of minor and major changes required to deliver on the current and future business plan.

Two final points to take into consideration:

  1. Keep it simple! You will all have seen horror stories of sales people who spend just 20% of their time actually selling and while I think 20% is very much the exception I frequently observe 60% to 70% which means three sales people are as productive as two would be with better designed systems and processes.
  2. I haven’t mentioned; CRM, ERP or any other computer based systems. While such tools can make an invaluable contribution they often exacerbate a bad situation. The introduction of such tools should be applied to existing processes that actually work in order to make them more effective and efficient. But, all too often, the introduction of a CRM does little more than computerise an inadequate set of generic processes.
    Similarly, using the introduction of a CRM as a means to impose sales and selling processes rarely works; shoehorning an artificial view rather than reflecting the way the sales operation actually functions. This leads to the oft observed situation where sales people see the CRM as an unhelpful administration burden on top of a very busy day or week doing the real job.

If you would like a high level view of how your sales and selling operation is performing try our free assessment.

A rolling snowball gathers more snow
holly-sprig

Brain-food for a New Year

holly-sprigHere’s wishing you a happy and healthy festive break and a successful 2017.

As you will soon be thinking about winding down for a well-earned break at Christmas we thought we would provide some food for thought some of which might help you hit the ground running as soon as the new business year starts.

Following are a range of business tips, many focused on sales and marketing, which we hope might help you and your business.  Some are based on topics we have previously covered while others will be expanded in future newsletters throughout 2017.

Read in sequence or click the button of interest:

dec1  dec17 dec4dec24
dec10dec8dec20dec7
dec15dec18dec23 dec9
dec11 dec3 dec14 dec16
dec13 dec12 dec22 dec5
dec21 dec2dec6 dec19

Most businesses are doing well these days but it is unusual to find one that doesn’t want to do even better.  If this is you, why not do something different or try doing the same thing differently?  Try something counter intuitive; what is there to lose if what you have been doing isn’t working as well as it did …

to keep doing it hoping for a different outcome was defined by Albert Einstein as insanity.

Has someone “moved your cheese”?

The question relates to the idea put forward in Dr Spencer Johnson’s book “Who Moved My Cheese?” that the source of whatever feeds you (in business; customers and new opportunities) may dry up at some point.  The book draws a parallel between the fruitlessness of continually returning to the now shrinking source and the alternative proactive approach of going out and looking for new sources.  If you have all the business you need to grow to plan don’t give this a second thought, but if new business has been tight in 2016 perhaps you need to look somewhere new.  Read more here

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Why wouldn’t you respond to RFI/RFPs?

If they come from/via a known source, a prospect you have been working with for some time or an established customer, you might choose to respond as you have enough information to assess the risk of losing.  But, if it has come from a company that you barely know the received wisdom suggests your chance of winning is 1:20 or even worse so I recommend you invest your time elsewhere.

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Do you have customers or clients – does it matter?

Many businesses use the word client in the misguided belief that it adds some sort of professional gloss to their image through an implied association with the real professions such as the law. The problem is that client relationships are typically infrequent or transactional being built around specific event(s).  In our view using the term client may say the wrong thing about your brand image and what your business stands for.

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How do your Account Managers stack up as Hunters?

A common model these days is account managers who manage and “farm” established customers while hunters take care of new business; a good model that I have seen work well in many companies but there is one potential big weakness.  Your customer is, in the eyes of your competitors, a new business opportunity so their hunters will be trying to steal “your” customer.  The risk for you is that if your account managers use a “passive/re-active” style to manage the customer they are matched against a hunter who will be assertive/pro-active.  This is not a fair fight so you need to ensure your farmers also know how to hunt. Read more

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Empathy

We all understand this word but not everyone considers it when planning how to engage with a prospect or to maintain a continuing relationship with a customer.  Simplistically; you must communicate with your prospects and customers in a manner they can understand. Discover more here

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Cold is not the same as unsolicited

There is a lot of negative chat these days about cold calling and while some of it is justified it is a mistake to confuse cold and unsolicited.  Every time you approach someone for the first time it is unsolicited – fact!  I see a dangerous trend these days that people are so fearful of being seen as one of those horrible cold callers or spammers they have backed off completely from all forms of proactive one-to-one communication with prospective customers.  So how are you going to find new customers? The key is to ensure your unsolicited communications are warm not cold. More on cold calling here

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Warm up your calls and other first touch points

How do you feel when you receive a call from someone you don’t know, offering something you either don’t need or have already got?  To earn time for a conversation why not use the wealth of data publicly available to learn about your prospect, their business, the problems they may have, the problems in their business sector, etc., etc.  Take that data, process it into useful information and use that to empower your contact strategy – ask pertinent questions so you can talk about the benefits and value they will gain from the solution, rather than the products and services you provide.

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How reliable is your sales pipeline as a source of forecasting information?

If 2016 has been littered with delayed decisions and prospects disappearing off the radar you may gain value from reading this article.  The key message is that you need to put in the work to qualify your prospects and to quantify the opportunities before you can use the sales pipeline as a source of reliable forecasting information.

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AIDA – attention, interest, desire, action

The oldest documented sales and selling philosophy but as true today as it was when first published almost 120 years ago.  The sequence is key and all too often these days’ sales people assume because they are in a meeting with a suspect that they have achieved AID so they focus on action; shall I do a proposal, would you like a quote or demonstration?  The sales person may be ready to do these things, and the other party will probably agree as it is free information for them, but until the suspect has been developed into a true prospect free consultancy such as proposals will almost certainly be a waste of effort as you may have their Attention but you are mistaking courtesy for Interest and Desire.

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Sales proposals – a good or bad thing?

Assuming you have arrived at the right point in the cycle and there is genuine interest and desire then a proposal may be a good thing provided you use it in the right way.  A proposal should only ever document and confirm what has already been discussed and ideally acknowledged and accepted by the prospect. A proposal can be a very dangerous thing if it contains information, conditions, costs, etc., that the prospect was previously unaware of.  Think about it; you inform the prospect there is a delivery and installation charge calculated at 10% of the selling price, but you are not there to see the response, justify the extra cost or deal with the inevitable objection!

Read more …

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RAF

No not our wonderful air force but a mnemonic for the way sales engagement should be pursued – Ready, Aim, Fire.  Sadly, all too often what I observe is; fire, aim, ready.  The sales person feels good because they are doing something but doing the wrong thing or in the wrong order is worse than doing nothing at all.

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Questions – our most powerful communication tool

Many sales people think it is their role to talk so they can tell the prospect how great their product or service is.  Problem is, while you are talking you are not learning and the most important thing for you is to learn about; your prospect, their challenges and above all what you need to offer them in a solution that they will buy.

    1. Ask open questions, listen carefully and empathetically, ask your next question based on what you heard not what you had written down before the meeting or call and continue the cycle until you have all the information you need.
    2. Ensure you ask questions appropriate to the engagement stage.  While it is perfectly reasonable to ask, for example, about the performance impact the prospect is suffering due to using old equipment, it may be seen as impertinent if you ask this at the first meeting.  Questions should be structured and layered so you build up a complete picture over successive conversations.
    3. Asking the right sort of questions is a demonstration of your knowledge, e.g. “How often do you have to close the warehouse to allow maintenance of the high bay lights?”  This says you understand a small part of their world and when they answer you can assume you have moved a little closer to them trusting and respecting you.
    4. Don’t answer unasked questions. “Your price is too high” is frequently heard but it is not a question so don’t answer it and definitely don’t defend or justify your position.   Instead ask a question – “How much of an issue is that for you” and once answered “Will this stop you doing business with us?” For more on this take a look at this article.
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Polite persistence

A term used in the film Door to Door which is one of the greatest lessons in effective sales and account management techniques I have ever seen.  It is common that suspects and prospects will say no or, just ignore you, innumerable times so how can you keep calling without offending?  Two things; make every attempt to connect different from the last so the prospect keeps seeing/hearing something new, and always be positive and polite hiding your impatience or disappointment.

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Process matters

Being systematic is the best way to gain a predictable outcome.  I have often heard it said that sales people won’t follow a process; they are free ranging, creative people who want to do their own thing. Don’t kid yourself, the best sales people have their own process running in their heads like a background computer program and if they refuse to follow the company process it is because theirs is better.  Find out how your most successful people work and build that into your process for all to follow.

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Never finish a step in your process without agreeing at least one more with your prospect

When a sales person tells me about the great meeting they had with a prospect that then becomes un-contactable, it triggers two thoughts:

    1. They think they have a prospect but the other party probably doesn’t see themselves that way so they have no reason to respond to the sales person.
    2. At the end of the meeting the sales person should have agreed explicitly with the prospect what will happen next and ensure the prospect puts this in their calendar.  At this point some will decline to agree the next event date which is a good indication that they are not a real prospect. This is an example of a technique known as the trial close.

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The trial close

A very effective classic sales technique that is little used these days. Simplistically the technique involves asking the prospect, at logical points in the engagement cycle, whether they are ready to go ahead and purchase from you.  If they say no then it triggers “why not?” and the answer will give you early insight to the reasons or objections the prospect might have that will stop them buying from you. Knowing early enables you to more effectively deal with the objections and a better chance of winning the deal. Give it a go; what can you lose?

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Get your competitors to help your prospecting

In the majority of cases your prospects are someone else’s customers so part of your prospecting run must involve exploring why your prospect may be dissatisfied with what they are already getting, what they might like in addition and what needs to happen for them to change supplier.  So, rather than knock your competition, ensure you highlight all of your strengths and in particular those that trump the incumbent suppliers weaknesses.  All is fair in love and war!

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Product, Service or solution?

Whether what you are selling is a product, a service or a blend of the two you need to present it in terms of the solution it delivers.  You need to help the prospect or customer visualise what they will gain from trading with you. Read more here.

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People

The crucial component in all aspects of business performance and in particular customer facing roles such as sales and account management.  Here is a very brief introduction to four crucial aspects of people performance.  We have written much about this in the past so there is plenty more for you to read if you wish.

    1. Recruitment.  Recruit only the people that meet the criteria for the job. Do not take the best of the bunch as if they are not really right for you, you are simply storing up a problem you will have to solve further down the line. Making this mistake in sales can be very costly both in direct expenditure and worse still lost opportunity.
    2. On-boarding and induction.  You have put in the effort and recruited the right person but they are still “raw material” for your business and unless you invest time helping them to get established it could take them months to get on top of everything they need to do the job effectively.  Each case will be different but they need to understand exactly how you do things; methods, processes and who to ask for help.  Just like recruiting the wrong person failure to induct properly is another great way to waste time and money.
    3. Training.  Sorry you are still not finished. Unless you were extremely lucky and managed to recruit someone who knows how to sell in exactly the way you want it done you will have to train them in your sales and selling techniques and this needs to be done in the context of your methods and processes so you should consider in-house or bespoke training in preference to a public course.
    4. Coaching.  Nope, still not finished.  There is a body of evidence that to perform at consistent peak levels most sales people need regular coaching and this is a primary responsibility for whoever manages the sales people.  The good news is this is one of those things where a relatively small investment produces a very high return. If a sales person produces say 85% of their target they have already covered all their costs and delivered a contribution to the bottom line and anything above that 85% will be very profitable as the CoS is effectively zero.

sales people who receive as little as four hours regular structured coaching per month outperform those who do not by 17% on their sales targetssource: Sales Excellence Council 2007

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Technology enables sales people to be more effective

Possibly but; it is a mistake to make the assumption that deploying technology will automatically deliver effectiveness or even efficiency.  If the sales people spend a day a week populating the CRM is that really a good use of time?  Do they actually sell 20% more by spending a day a week in this way?

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Price, cost and value

News just came in that the Malaysian F1 Grand Prix is to cease in 2018 due to poor attendances (40% of capacity) and the reason cited is ticket prices but as they were pretty much the lowest of the 21 races in 2016 and had been stable for a couple of years is that really the reason?  Many of us who follow the sport are becoming disillusioned by what is now very poor entertainment.  So; is it not the price that turned Malaysian fans off or is it the value, or lack of, they gain from the experience?  The price is what you pay, the cost is the price plus all other expenses required to use the purchase and the value is what you get – make sure your customers are VERY clear on the value they will gain by buying from you.

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Managing Objections

The typical approach to objections is to wait until they happen and then react which generally puts the seller on the back-foot. Managing objections is about being pro-active and pre-emptive; raising the issues, before the prospect does, by answering the questions they have yet to ask.  All businesses have a set of common objections so you should use these to build standard rebuttals that the sales people can use pre-emptively.

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Social media and its role in sales engagement

Many claims are made for the role of social media in sales and I even see the term “social selling” being used.  I will make just two observations on this and leave you to mull over whether your use of social media in sales is likely to work.  Firstly, while social media is clearly a useful marketing tool, can it really be considered to be a selling tool?  Secondly, because of the nature of social media is it possible your sales people have slipped into the mode of broadcasting a message then sitting back waiting for the answer – this is what we call a passive reactor approach and it is dangerous as your competitors who are proactive hunters will have eaten your lunch before you even knew a meal was being served.  There is a time and place to broadcast a message but this can only ever be a marketing activity not selling.

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Cut your cloth … (to suit your ideal customers and your individual customers)

When promoting or selling what you do it is important to address the question the potential buyer will have in the back of their mind “what is in it for me?”  There is no point telling them about your features as that just tells them about you; you need to tailor your messages for their ears so they can fully understand the value they will gain if they buy from you.

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Are you producing the results you need?

Is your sales operation as productive as you need it to be?

I spend my time working with businesses helping them to become more successful and the starting point is always to look at the way they take their proposition to market. Simplistically, how they approach; marketing, sales and selling. Of the many issues that can have an impact on success, I find the most common is the productivity of the marketing and sales operation(s).

In considering productivity I refer to a dictionary definition “the effectiveness of productive effort as measured in terms of the rate of output, or the yield, per unit of input”. Immediately I can see a clue as to where the root of the problem may be found as the definition says productivity is about effectiveness whereas most businesses that I know are focused on efficiency. So while productivity is based on undertaking activities that will produce the desired results efficiency focuses only on minimising things such as time and cost.

First do the right things; only then focus on doing those things right.

While efficiency and effectiveness are not mutually exclusive making efficiency the primary objective usually stifles the very things that would make the business more effective. To gain competitive advantage the aim should always be to work smarter not harder although there is merit in maintaining an appropriate blend of the two.

Why might you want to spend time, and possibly money, making your marketing and sales operation more effective? There are many reasons but by way of a simple illustration; if you employ five sales people and you help them all to become 20% more productive you have in effect gained another whole sales person without having to spend money on; recruitment, induction, training, managing and of course paying them.

Where is the evidence?

It isn’t just me talking to businesses providing anecdotal impressions, the quantitative evidence that there is a crisis in sales performance is clear to see; the data is everywhere.
At the beginning of October during Dreamforce 16, the annual sales conference of Salesforce.com, there was much discussion about “time available for selling” I think this must be an exaggeration but it was reported that in many cases the time available for selling had plummeted to less than 30%. This feels wrong to me but I have observed plenty of situations where the sales people are only engaged in actual sales and selling activities for 50% – 60% of their time.

Other evidence that there is a real problem can be found in research data from CEB (also reported at Dreamforce 16) which shows that the cause of a lot of stalled/lost deals is due to internal organizational complexity rather than action or inaction by the prospect. This chimes when I hear sales people say getting the customer to say yes is the easy part; getting things done internally is when it gets tough.

A few more examples from the research included; less than 50% of sales people achieve their target, high staff churn (voluntary and involuntary), the average tenure for a sales leader is less than 18 months and the average sales person tenure is around 22 months.

Extracts from research undertaken by Accenture, show 59% of sales reps believe they are required to use too many sales tools, while 55% feel that their CRM is more of a hindrance than a help. It is of course well observed that sales people don’t like what they see as admin and many have a personality biased towards freedom of expression so these results are not surprising. However, from my own observations I see many CRM systems that collect low level meaningless data that provides little of value either to the sales people or their managers. I also tend to agree with the observation about sales tools and in particular the lack of integration leading to situations, such as that observed on a recent customer project, where sales people had to look at three separate systems to understand the complete picture about the products and services being used at the clients they managed.

There are also impacts on the quality of life for many sales employees including; working longer hours, being constantly tied to technology sending emails and other messages and being contactable 24 hours a day. I see a lot of dissatisfaction as people struggle to keep up with work while feeling pressured by their managers to do even more.

This brings me back to the point about efficiency and effectiveness. All too often the sales managers’ answer to every ill is do more and do it faster; a perfect example of efficiency (working in a well-organized and competent way) but without regard to the effectiveness of the activity.

If current activity isn’t producing the desired result, then why should more of the same be any different?

Consider a different approach; doing less but doing it better will usually be more effective as it will produce more of what you really want – more customers and deals.

Is there a solution?

It seems ironic that today, when technology can deliver an endless supply of sales and marketing tools, all intended to make people more productive, that the trend is in the opposite direction. It is often the misused technology that is the great thief of time and sapper of innovation.

There has never been more advice available to people through; books, videos, conferences and networking groups (on and off line), but still the trend is for people to be less effective and therefore less successful.

So, it is important to explore whether technology is the solution to, or perhaps the cause of, the problems. Working on a recent customer project I observed the sales people spending at least one hour per day (14% of their time) entering data into the CRM system. The only thing they got in return was e-mails from the boss saying “do more”. What was being recorded in the CRM was very low level activity such as “a call was made” which meant the system provided the boss with nothing that would help him identify issues the sales people might be having as a basis for performance coaching. You cannot manage people by e-mail and spreadsheet!

Technology enables sales and marketing people to access huge amounts of data both internally and also externally about prospective customers and their markets. However, we see cases where sales people are literally swamped by data that swirls around like a fog making it difficult to see the actual target. This presents an opportunity for Marketing to provide concise insights and pointers based on analysis of the market/industry and also for Finance to provide sales ready insights based on a prospect’s annual accounts – or at least a tailored guide to help the sales people spot relevant opportunities within financial figures.

It is also the case that before making a call a sales person uses technology to check; CRM, LinkedIn, Social Media, Google, the customer’s website, credit rating agencies, maybe Companies House, plus they will typically access internal documents such as support call logs and sales visit reports. After the call they send a meeting invite, populate the calendar, send a confirmation e-mail, prepare some material for the meeting (perhaps a PowerPoint), check with marketing for case studies and other sales enablement material, and so it goes in a never ending cycle. Some of this is necessary and useful but not all of it every time!

All of this activity looks like work but the ultimate test is whether it makes the sales people more productive or just busy; are they getting a better yield from effort expended?.

So, yes there is a solution!

Here are a few things to consider:

  • Choose the right people to be your sales people. Recruit and select carefully, understanding that there is currently a limited supply of skilled sales people so you will need to invest in training and on-going development if you want the best for your specific business.
  • Consider the sales and selling methodology you use and whether it helps or hinders your sales people. Some of the methodologies that have emerged in recent years are very complicated and are probably only appropriate for very complex long life-cycle sales situations – sledgehammer to crack nut comes to mind.
  • Use technology sparingly to empower sales people to make better calls and conduct better meetings but ensure the proportions are right. As a start point I would suggest sales people should be spending 80% on/with prospects and customers; research & planning around specific prospects, calling, meeting, e-mailing them and preparing proposals, quotes and presentations. 20% is more than enough for administration, updating the CRM, reporting and attending sales meetings.
  • Ensure there is perfect alignment between what the sales function wants, driven by customer need, and what marketing is delivering to support it. All too often sales people have to spend time re-working collateral produced by marketing to make them a suitable selling aid.
  • Ask yourself if you have made the life of your sales people more complex than it needs to be.
    • A recent fashion has seen the emergence of a function called “Sales Enablement” which basically combines some marketing functions with sales and/or technical support. All too often this new function adds little of value but it does add another layer that the sales person has to work through to get the support they need.
    • Sales enablement often focuses heavily on product knowledge and marketing material when a real enabler would combine it with; process, methodology, skills training and regular performance coaching.
    • Many sales people have limited business acumen, struggling to understand the world they sell into, which leads to them selling the features of their product rather than the solution it will deliver. To entice a prospect to consider their product or solution a sales person must be able to see the world from the prospect’s perspective – asking “If I was the prospect would I buy this from that company and that sales person?

So for the outputs from sales enablement to be of real use they need to be delivered within the context of the business issue(s) they are intended to address; this is where coaching and mentoring from an experienced manager will really deliver great value.

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trending

What’s trending?

 Find out and do something different

I know the world of social media uses as one of its main platforms the idea of trending as an indicator of what someone should follow.  However, this means that a few will have set the trend while many others will simply be hanging onto their coat tails.  I am reminded of the quote from James Goldsmith

“if you see a bandwagon it’s already too late!”

I have always considered benchmarking to come with similar problems to trending.  You look around to see what other companies are doing, use this to create a performance benchmark and adopt it as your own approach.  The problem then is that most companies are doing similar things in similar ways which feels like a gentle progression towards mediocrity.

By all means look at the trends and also benchmark what others are doing but the clever thing is then to do something different, even consider doing the opposite.  I saw a post on LinkedIn recently suggesting in-bound marketing has lost its advantage due to overuse and too much poor quality content – is anyone surprised by this?  The post included a question as to whether outbound direct might be the way forward – again the person asking the question is looking at the dust from a bandwagon – some of us have always done it this way and may be reaping the benefits of fewer competitors.

When choosing which fashion to follow, assess the risks, not just the benefits

When choosing which fashion to follow, assess the risks, not just the benefits

When choosing which fashion to follow, assess the risks, not just the benefits

I once met Stanley Kalms, when he was still chairman of Curry’s, and he explained his “contradictory management” philosophy.  Basically, he would observe how managers were doing their jobs and as soon as a pattern emerged he would issue an instruction to do things in a different way. His view was that it stopped people getting into a rut and forced them to regularly have fresh thoughts.  A similar philosophy was used by someone I once worked for whose advice was to clean house regularly; suppliers, customers, markets, products and sometimes even our people.

So give this some thought.

  • If you have been doing the same things in the same way for say 24 months, take a hard look to see if you are ahead of the pack or in a rut
  • Look at what you do and how you are doing it and if most others are doing it the same way consider a change – revolution not evolution
  • If you look at trends do so with a critical eye looking for a different edge for yourself
  • If you benchmark do so with a critical eye looking at the weaknesses rather than envying the perceived strengths
  • Decide on the five, six, ten things that really matter to the business; the true critical success factors, and take a regular hard look at each of them to see if they are still as effective as you thought they were.  If these things are critical, it is critical they are done right.

The bottom line is; if you really want to differentiate yourself from your competitors you need to be doing different things or the same things differently, but whichever way, they need to be done well.  Just ask your customers; they are a great source as they have the only opinion that really matters.

Happy hunting!

First published on LinkedIn Pulse

stand-out above the rest

Is yours a stand-out business?

… and does it matter if you don’t stand out?

What makes stand-out businesses stand out?

For me what makes a stand-out business is that it delights me in some way that is actually useful in my dealings with that business which in turn makes me happy to not only keep using the business but also to recommend it to others.  So, in judging whether you have a stand-out business start by asking yourself “do customers like using our business, keep coming back for more and willingly recommend us to others?”  This can be done informally but will probably provide more useful information if you do it formally through a well-constructed** customer satisfaction survey.
**open to input of true feedback, not worded to elicit only the answers you want.

Other perspectives can be achieved through the eyes of employees and suppliers and along with customers these are the three major commercial stakeholders in any business.  The other main stakeholder is the shareholders who will typically want to see the value of their holding grow over time and many will want to feel their investment is in safe hands.  In most cases getting the position with the customers, employees and suppliers right will automatically give the shareholders what they want.

Surveys can be used with employees and suppliers to establish how you are doing but another indicator will come from looking at churn; how easily you can recruit and retain people and how readily suppliers work with you.

Making sure customers, employees and suppliers are happy to be a part of the wider business should present itself as a virtuous circle; unfortunately it is sometimes the case that what is good for one maybe bad for the other.  For example; if you have customers who are only interested in the lowest price then this puts pressure on what you can pay your suppliers and also the salaries and employment benefits you can afford.  In this case the circle is somewhat out of balance as the needs of one party outweigh the needs of the others so other mechanisms may be required.  With staff this could be, for example, allowing flexible working and with suppliers guaranteeing them a defined amount of regular business.

stand-out above the restFor me one of the things that makes a business stand out is when I get excellent service from people that go the extra mile to make my life easier and point out things that could be useful to me that I had not thought to ask about. These staff are not even being paid a king’s ransom for what they do, but they are creating a competitive advantage for their employers.

In summary; what makes a business outstanding is creating competitive advantage through either being different, or being better at being the same and both are comparative positions against the norms of the market and the behaviour of your competitors.

Does it matter if you don’t stand out?

There was a time when there were probably more “me too” businesses than those that stood out in some way but life is much more challenging these days so I think it does matter.  If there aren’t some aspects of your business that make it memorable you will struggle to grow and relative to the growth in the economy you may even shrink.

A familiar line from consultants advising companies on growth is “to think outside the box”.  It is generally thought that this term was coined by one of the big name consultancies and it stemmed from one of those puzzles in common use in the 1970s and 1980s where the participants were asked to join a matrix of nine dots, organised in a square, without lifting the pencil from the paper.  To achieve this you have to take some of the lines outside the box and hence the saying.

I find a more useful application of the idea of “thinking outside” the box can be found in the concept known as the Ansoff Matrix.

Ansoff Matrix

As you can see from the diagram, the matrix positions existing (known) and new (future) markets against known and future products.

The majority (some 88%) of business won by established companies falls into the known product sold to known market category. To stand out among their competitors here, they have to add real value to their offering, e.g.  through product quality, responsive customer service, being smarter in what they do.

Could it be that those who truly are stand-out businesses, actively seek out and bring about change by looking for growth and expansion outside the box?

Returning to an earlier argument; if you are struggling to make a decent margin, putting pressure on employee rewards, in your traditional market then looking for a more lucrative market, outside the box, might make a lot of sense.

I have observed a number of examples where food suppliers have eventually found it impossible to run a sensible balanced business while supplying large supermarkets so they have re-invented themselves as suppliers to small independent shops and/or grow an on-line business.

Other than the known/known box there are three other boxes and moving to each carries different levels of risk.  New product to known market carries the lowest risk followed by known product to new market and finally new product to new market.  If you are going to consider a proactive process of moving your business to a different quadrant risk assessment is important; knowing the risks helps you plan to handle them.

Considering new products and new markets will certainly keep your suppliers on their toes while also providing employees with new and interesting challenges.  So, it could be argued that an Ansoff Matrix approach to business planning could help to maintain the virtuous circle of customer, employee and supplier satisfaction while also delivering what the shareholders need from the business.

One other thing.  Today’s new box is tomorrow’s known/known box so rather than a one-off exercise you should consider an Ansoff  review of the business as a part of the strategic planning process perhaps formally re-visiting the topic according to the volatility of your markets.  This should be backed up by informal monitoring through measures such as revenue, margin and market share growth.  This evolutionary approach to business planning is sometimes labelled as agile; an approach to software developed that first appeared in the 1990s.  I think in our rapidly changing world being agile makes a lot of sense and if the Ansoff approach helps such thinking all to the good.

It is common that at the beginning of many of the sales performance transformation assignments that we undertake for our customers the start point is a disciplined review of the proposition the customer takes to market and the markets they target and where their competitive advantage resides.  Using tools such as the Ansoff helps us to facilitate the creative process with a cross section of people from sales, marketing, production and the executive team.  The outcome may be a recommendation to remain with the current proposition being sold to the current market but often it is other quadrants in the Ansoff Matrix that show where the future lies.

A few thoughts  

  • Be aware of how your current business is operating.  Consider customers, employees and suppliers not just shareholders.  Use formal survey techniques as well as informal measures of satisfaction
  • When change is presented explore and investigate it and if it can help your business then welcome and embrace it.
  • Make change happen.  Use techniques such as the Ansoff Matrix to structure your business planning processes and to trigger creative thinking.
  • Involve employees and suppliers in your planning process “many hands make light work” but you also need their hearts, minds and brains.
  • Foster a change culture; create an environment to allow experimentation where mistakes can be made without fear of personal consequences.
  • Equip your people with the skills they need to operate with a continual improvement mind-set.  You also need to ensure leaders and managers have the skills and time to mentor and coach to support colleagues.
  • Think outside the box of your product and market; can you gain inspiration from other industries which will allow you to create that all important competitive advantage?

Remember; if you keep doing what you have always done you will typically get what you always got.  Your only real option is to engender a regime and process of exploration and forward motion focused on continual improvement.