It happens to all of us. We need to make our number. Quarter end is approaching, we need a deal to close to make our numbers.
Recently, I was doing a deal review with a sales person needing a specific deal to make her quarter happen. She’s a great sales person, and as with great sales people very goal driven.
We started the deal review with her statement, “I need to make this deal happen this quarter….” Naturally, her manager and I agreed. But as we did the deal review, the focus on her needs became really distracting.
All the strategies focused on her need to get the number—“What if I offer them this? What about that? I really don’t want to discount, but we have a little room in our pricing, what if I offered a discount if they buy by quarter end?…..”
Finally, I asked, “What does the customer need?”
The conversation stopped, she replied, “This is their need to buy, this is the business justification, here’s what happens if they choose to do nothing…..” She had done a good job in helping the customer understand and commit to the change.
I rephrased my question, “Why does the customer need to commit to this by quarter end?”
The conversation paused as she thought about the answer to this question, “I’m not sure……” (I loved the honesty of her response.)
“Well if there is no reason for them to buy this by quarter end, why do you think any of the ‘deals’ will cause them to buy? All the things you are talking about really focus on your need to close the business, but they don’t and shouldn’t care.”
This is something every sales person faces. We have a high need to make our monthly, quarterly, annual numbers. We want deals to close when we want deals to close, not necessarily when the customer wants deals to close.
It’s not the customer’s job to help you make your numbers! Strategies we develop to accelerate the sale to meet our needs detract from the value we create with our customers. These strategies almost always fail or cause us to get realize less value than we could. These strategies waste our time and the customers’ time by distracting us from their issues and what they want to achieve.
Yeah, I know some of you are still saying, “But Dave, all of that’s nice, but I really need to make my numbers, how do I accelerate the customer’s decision-making?”
A few ideas and a caution. The caution first, whatever you do has to be all about the customer. The moment it isn’t, you are changing from being that trusted advisor to just another self interested sales person. We know what customers think about this: they resent it, they don’t care, and they shouldn’t. You making your goals is not the customer’s job.
The key issue in getting the customer to consider accelerating their decision making process is opportunity cost. What are they losing for every day, week, month they defer a decision.
These could be opportunities that pass them by, things they can never capture unless they act now. These could be higher levels of expenses or spending that could be eliminated, driving profitability improvements. These could be lost revenue–opportunities they can’t pursue, opportunities they are losing, or revenue streams that are being deferred.
These could be increases in risk that adversely impact them. For example, there may be compliance exposures. They might be risks around customer satisfaction/customer retention/customer loyalty. They could be risks associated with failure and the impact of that failure on the department, function, or even corporate level.
Opportunity costs might be deeply personal–goals the customer (individual) might have.
If we can’t help the customer understand the compelling reasons to make a decision now, in terms meaningful to them, we will never get them to accelerate their decision making process.
This approach has to be the basis of every deal we pursue, not just the deals we want to close this month, this quarter, this year. Focusing the customer on the consequence of doing nothing, the opportunity cost of deferring a decision, the incremental opportunity realized by accelerating the decision-making process.
It’s not the customer’s job to help you make your numbers. The only way you make your numbers is helping the customer solve their problems. Everything you do has to be done in the context of what the customer achieves through taking action.
You may be wondering about the sales person, she quickly realized the need to refocus her approach. We discussed the opportunity costs the customer faced by deferring their decision, we quickly developed a compelling case for the customer to act now. It didn’t involve and “deal making” or incentives, but focused only on what the customer wanted and needed to achieve.
Ah, this old chestnut!!
It hangs around like a bad smell! Why? Because sales organisations give it good reason to!
What do I mean? Well, if the sales organisation threatens to fire sales people who don’t make some target number, then of course the majority of sales people will focus on their number to the exclusion of all else. And let’s not forget, sales managers often set arbitrary targets, driven I suspect by their number, handed to them arbitrarily perhaps, by senior management and so on.
Also, the individually commissioned environment is another major driver of these unwanted behaviours.
All of this is pretty toxic to the establishment & adoption of a sales process, its continuous improvement, and the training & coaching of sales people over time.
Imagine if an airline operated that way…!! It would be out of busines long before all the pilots killed themselves through poor skills and judgement, but not before some had killed themselves and their passengers… people don’t fly with airlines that keep crashing…
Finally, the hiring and firing practices contribute – hiring aggressive hard charger lone wolf types, and not firing them when they go rogue and do their own thing because ‘they hit the numbers’.
Sales managers, through the environments they set up and perpetuate, are the single biggest cause of the problems they have and complain about.
I have my pop corn to hand, and am waiting now for the tirade of responses from agrieved sales managers…
Cheers
Martin
😉