Archive for the ‘Motivating Salespeople’ Category

Sales Competencies

Recently I was asked for my thoughts on the competencies that every capital equipment salesperson should have. The following are what I consider most important:

  1. An understanding of the importance of profit
    In my mind, the number one priority for salespeople is to bring profitable business to their employer. Salespeople should know how their employer makes money; how prices affect margins (including how dramatically even a 1% difference in price affects net profit); and how profitability influences stock prices, bonuses, salaries, career growth, and available resources.
  2. Hardware, service, spare parts and product upgrades knowledge
    Salespeople should know the key competitive advantages and value propositions of every product and service they’re required to sell (marketing should develop these advantages so they’re clear, straightforward, and impossible-to-misunderstand). In addition, salespeople should know specifically how their products and processes help customers to achieve their objectives.
  3. Writing and presentation skills
    Every salesperson should be able to write a concise, coherent email or letter to a customer or a fellow employee. The salesperson should also be able to give a “why should I buy” presentation to a customer on relevant products, processes, services, spare parts, and system upgrades. The salesperson should also be able to clearly position (in the mind of the customer) his or her employers offerings relative to competitors’ offerings.
  4. How to successfully negotiate with aggressive, professionally-trained buyers who use PICOS and other profit-transfer methods.
    This competency should include more than how to conduct face-to-face negotiations. It should also cover the how, where and why aggressive tactics such as PICOS and its’ variations began; how customers are trained in its’ uses; what to expect in terms of customer behavior; how to develop a sales plan when approaching and conducting negotiations; how to keep the customers’ senior management informed of progress, delays and any misbehavior on the part of Purchasing people; and how to work successfully with individuals who employ these methods, without damaging relationships. 
  5. In-depth knowledge of the customers’ and competitors’ environment (and how to acquire that knowledge)
    This should include training salespeople on what to look for in publications like annual and quarterly reports;  how to find out about key changes in management; how to uncover the customers’ top priorities; current capacity utilization and potential changes in that utilization; customer profitability drivers; the process the customer uses to decide which products and services to buy, along with the people who make those decisions; and any specific pressures the decision makers are under from their customers, management, and investors. 
  6. How to establish and build relationships with customers
    The best salespeople in the company should train the rest in how to provide day-to-day support and superior execution on behalf of customers, over and above what competitors’ salespeople are providing, so that customers actually prefer to give your company more and more business.
  7. Sales and order process knowledge
    Salespeople should know how to establish exactly what the customer wants, and how to translate customer requirements into language, forms, etc. that the supplier understands and can work with; how to follow up to ensure that the product or service is moving through the manufacturing process on schedule; and how to prepare the customer if things don’t go according to plan.  
  8. How to manage sales time
    There will never be enough time to handle every demand on a salesperson, and certainly not enough time to do handle those demands equally well. Salespeople need to know how to rank the to-do’s on their plate; how to handle email and other dailies so they don’t become the “all dailies”; how to schedule and make regular progress on long-term initiatives; how to determine when “good enough” is; and how to decide what to do first thing on Monday morning.
  9. How to sell services
    Selling services (where typically no explicit need exists, resistance from the customer is common and demand has to be built carefully) is very different from selling hardware (where demand usually exists and the objective is to position your product favorably against one or more competitors).Many capital equipment salespeople (including me when I first started in sales) tend to view service as an afterthought. But with system margins under constant pressure, suppliers need to take every advantage of their ability to improve the performance of a customers’ installed base, and get paid well for doing it.
  10. Consultative and interpersonal skills
    Sales people need to know how to develop trust with people, and how to use that trust to deliver value to the customer through their knowledge of the business, products and services. They should know how to ask the right questions and discover real needs; how to work with customers as opposed to working for them; how to make customers feel comfortable; and how to offer and deliver real, provable value that solves real customer problems.

If you have questions, or would like to discuss these competencies further, please feel free to contact us at 650-862-0688 or at www.mahermarketing.com.

Thank you.

Posted by Don Maher in Achieving Sales Goals, capital equipment sales, Motivating Salespeople, Profitability, Sales Tags:

PICOS: what it is, how to deal with it

Are you familiar with PICOS? While you may not recognize the acronym, you probably would recognize PICOS in practice, especially if you regularly deal with aggressive and well-trained purchasing department representatives.

PICOS stands for Program for the Improvement and Cost Optimization of Suppliers. It’s a supply chain management process that was developed at General Motors in the late 1980’s with the goal of dramatically reducing suppliers’ product and service prices, transferring as much supplier profitability to the buyer as possible.

PICOS-trained buyers develop and use well-orchestrated, company-wide plans to convince sellers that their offerings are no different or better than those of their competitors, and that getting a low price is the overwhelming factor in the customers’ purchasing decision.

PICOS-trained buyers repeatedly bring up price during negotiations, and frequently resort to threats to end negotiations, buy from a competitor, or complain to supplier executives when salespeople try to hold the line on discounts and giveaways. You may be thinking “most of our customers use these tactics; how is PICOS different?” It’s different because PICOS training materials specify the use of exaggerations and outright lies as acceptable means to a desired end.

While there is a lot more to understanding PICOS, there are some tactics that sellers can use to successfully combat it. Following are three of them:

  1. Know your offerings and their value relative to your competitors, the customer and the situation. Unless you know what your products and services are worth to the customer in terms of the additional profit your customer can earn using your products vs. those of your competitors, you won’t be able to convince yourself or the customer that your offerings are special and deserve a higher price. When Purchasing responds to your claims of superiorityby saying something like “competitor X can deliver the same results”, your response needs to be along the lines of “no, they can’t; we’re the only company that has proven it in the marketplace at customers A, B and C.”
  2. Never negotiate one item at a time; always think in terms of final context and package. At the beginning of a negotiation, an agreement to provide 80/20 payment terms instead of your standard 90/10 terms may seem like a small concession to make. However, that concession won’t seem insignificant at the end of a negotiation when it’s combined with other concessions such as lower prices, giveaways, additional field support, and tighter specifications. When the customer says “I need better payment terms”, your response should be “that’s certainly possible if you’re willing to agree to the price we’ve quoted”, or you can say “we’ll need to know and consider all of the concessions you’re looking for before we commit to any specifics.”The takeaway: you can give as many estimates as you want, but don’t make firm commitments on pricing, delivery, specifications, terms, field support, spare parts, or software until you know what’s really most important to the customer.
  3. Keep in touch with the real decision makers and the ultimate users of your products. Once a week, send a well-written, fact-filled email to all the key people involved in the negotiation, including customer executives, users of your products, and your own management, documenting any agreements and commitments made by both sides during the previous week. You might also include any threats made by purchasing representatives. If purchasing people object, and they will, you can simply say that your management insists that you document the proceedings in detail and keep everyone informed of the status of the negotiation. Doing this will also incentivize everyone involved to be more civil and honest, and to keep the rhetoric to a minimum.

For more on how you can work successfully with PICOS-trained customers, contact us here.

Posted by Don Maher in Achieving Sales Goals, Motivating Salespeople, Profitability, Sales

Eleven tips for a more captivating presentation

sleepy crowdGot an upcoming presentation on your calendar? Here’s how to make sure your audience stays interested and engaged. The next time you’re tasked with developing and giving a presentation to colleagues, customers, or investors, try the following tips:

  1. Determine what you want to accomplish. What do you want the audience to remember and do as a result of your presentation? Whether it’s selling, buying, investing, or behaving differently, develop an interesting and simple story line that clearly highlights the key points you want the audience to remember.  If there is a “call to action”, make that crystal clear as well.
  2. Make your points memorable. If you plan to use PowerPoint, use pictures when you can, and less-and- larger rather than more-and-smaller text. We’ve all heard presenters say “this is an eye chart” when introducing a slide that no one, including the presenter can read. Please don’t say those words and don’t use anything that even resembles an eye chart. If you have very detailed information to deliver, put it in a handout to be distributed after the presentation.
  3. Limit the number of slides. Don’t use more than 10 slides per half hour of presentation time. Your message may be lost if you show and talk about more than that. And plan for some time to answer questions during and after the presentation.
  4. Have a “no slides” version. Projectors break or don’t show up, bulbs burn out and some people don’t like PowerPoint and would rather just talk with you. Make sure you can deliver an effective presentation without using slides.
  5. Practice and rehearse the presentation. I’ve seen people give presentations they’ve been handed at the last minute, and the results are pretty much what you’d expect; they stutter and stammer their way through them. Don’t try to give an important presentation without first rehearsing and getting critiqued by people who know what your audience will look for. Have a private, friendly and knowledgeable audience ask the tough questions in a rehearsal, before you have to answer them in public. Also, work on your ad lib skills, as no presentation goes exactly according to plan.
  6. Introduce yourself to your audience. (If you’re Oprah Winfrey or someone equally well known, you can probably skip this step).  I’ve seen quite a few people start right into a presentation without introducing themselves; don’t be one of them. In addition to the introduction, mention something relevant about yourself and explain why you’re there. If others from your team are with you, introduce each of them as well.
  7. Clarify the purpose of your presentation. If you’re presenting to a customer or investor, see if they agree on the purpose and if they have anything else they’d like you to address.
  8. Confirm how much time you have for the presentation. Be ready to deliver an abbreviated but effective presentation if you have to (as opposed to a high-speed version of the original that many people try and jam into the smaller time slot).
  9. Specifics are powerful, fluffy adjectives are not. Under no circumstances should you use the terms “paradigm shift”, “on a going-forward basis”, or ‘no-brainer”. Someone in the audience will cringe if you do (if I’m in the audience, I’ll cringe). Instead, use numbers, data, specifics, evidence, and real-world examples to show how what you’re talking about (a product, a service, a business) can help the audience. For example, if you’re presenting to a customer, show them how your product or service can help them earn or save money, and if possible, how much money. If that’s not possible, cite other customers who have earned or saved money using your product or service. And if you don’t have any customers yet, simply say so and why, and what you’re doing about it.
  10. Listen closely and answer questions directly. If you purposely give an evasive answer, or an answer that doesn’t make sense, your audience will know it and you will immediately lose credibility. Think about how you feel when a politician avoids answering direct questions and you’ll have an idea of how your audience will react if you do the same. No matter what, do not stretch the truth or say anything that you can’t back up, prove or at the very least, have a good reason to believe.
  11. Follow up quickly and completely. It’s ok if you don’t have a ready answer to an obscure question or the materials on hand to satisfy every request for more detailed information. It’s not ok to neglect to provide them within a few days. Capture every open question and request from your audience, send them an email that shows everything you captured, and then close the items on the list in a timely manner.

We’ve all sat through and sometimes delivered presentations that were less than captivating and that failed to get the hoped-for response from the audience.  We’ve all looked out at a sea of weary, yawning faces and knew that they wanted to be anywhere other than sitting or standing in front of us. But it doesn’t have to be that way. Use the tips I’ve suggested here, and if you like the results, please pass this blog along to the people in your world who really need help. You know who they are, don’t you?

Posted by Don Maher in Achieving Sales Goals, Marketing, Motivating Salespeople, Presentations, Sales Tags: , ,