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Archive Archive for June, 2008

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Strategy

The Myth of Goal Setting

Posted by

Ian Brodie on June 26th, 2008.

One of the most often repeated stories to back up the importance of setting clear goals and targets is the “Yale 1953 Goals Study”.

The story takes many forms – but essentially says that in 1953, researchers surveyed Yale's graduating seniors to determine how many of them had specific, written goals for their future. Twenty years later, the researchers checked with the surviving class members and found that the 3% who had written goals had accumulated more personal financial wealth than the other 97% combined.

It's a powerful story with a seductive message often told by consultants, coaches and self-help gurus. Unfortunately, it's just not true. No such study exists.

I seem to be spending much of my time debunking management myths nowadays (see Debunking the myths of non-verbal communication and Challenging the 80:20 rule).

This one has been brought back to my attention by a seminar I recently attended run by some business coaches from one of the world's largest coaching organisations.

In this case, the presenters even got the myth wrong – they said it was based on research at Harvard (a mistaken-retelling first done by Bill Phillips in his Body for Life book). They even went into great detail drawing pyramids and talking about how the researchers had gone back 10 years later again to confirm their findings.

Now I don't know if they were just making all this extra stuff up themselves, or if they themselves had been misled by their organisation – but either way, I was flabbergasted at how they were prepared to “educate” their seminar attendees so strongly on something which they hadn't bothered to check out.

Fast Company magazine, however, did check out the story.

They spoke to self-help guru after self-help guru – each passing them on to another guru as the source of their information – yet each happy to write and speak about the study as fact without checking it out. The original source was eventually tracked as far back as Zig Ziglar whose assistant told the magazine that Ziglar's source was hard to track down as he “reads a lot”.

Thankfully, the researchers were rather more conscientious. They followed up with the secretary of the class of 1953 and a research associate at Yale who told them that from personal experience and an exhaustive search of the archives: there was no such study.

Now this doesn't mean that written goals aren't important. Logic and much anecdotal evidence tells us that writing down your (or your company's) goals can be very helpful in “keeping you honest” and focusing on them. But they probably aren't as important as the story implies.

Worse: the story also implies that all that was needed to achieve great wealth was to write down goals. Nothing about the persistence and pain needed to stick to them – or the thought and creativity needed to make the goals happen.

For me it also acts as a huge Caveat Emptor for buyers of consulting, training and coaching services. If the people you are considering to be your advisors can't even take the time to check out whether one of their core assertions is actually true or not – how much can you trust their other advice?

And a message for fellow consultants and trainers: check your facts. You do our profession a great disservice by mindlessly repeating “facts” and advice that may not be true at all.

Ian

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Selling

3 Quick and Simple Steps to Improve Sales in Professional Services Firms

Posted by

Ian Brodie on June 18th, 2008.

3 quick and simple steps that professional service firms (lawyers, accountants and consultants) can take to hugely improve their sales:

Cut the marketing and advertising budget in half
Take the money you've saved from this and use it to reduce the billable hours targets of your partners and get them to focus on business development activities instead
Ensure that the business development activities are being carried out effectively

Typically professional services firms spend too much on ineffective “getting our name out there” marketing and advertising – and don't spend nearly enough money and more importantly time on more direct business development activities.

Professional services are complex, intanglible products. Before people can buy, they must know that you are credible and that they can trust you.

Activities which can build credibility and trust include: getting referrals from people your clients trust, speaking at client industry conferences, networking at client industry events, writing and publishing relevant articles (in publications your clients read), organising small-scale seminars, performing and publishing relevant research and face-to-face issue-led discussions with clients.

And, of course, having a content rich website.

They don't include generic corporate advertising and marketing.

Onward!

Ian

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Mindset

Ethics in Sales

Posted by

Ian Brodie on June 13th, 2008.

A recent post by Colin Wilson – Are You Lying Comfortably (now, sadly not available on the blogosphere) – got me thinking about ethics in sales.

It's something people new to, or outside of sales often worry about. How ethical is it to “manipulate” people with salesmanship to buy a particular product or service?

I think one of the toughest areas is in the choice of what you sell. By this, I don't mean choices over whether you sell cigarettes, alcohol or sex products (although your ethical stance there is important, of course). What I mean is selling something you know your customer doesn't really need.

There's really a scale here.

Ethics in Sales: To Sell or Not To Sell?

Selling something you know your customer doesn't need is, in my view, clearly unethical. A professional salesperson has a responsibility to ensure that he or she only sells what their customer will genuinely benefit from – or at the very least, if a customer is intent on buying something they don't really need then the salesperson should warn them of that.

At the other end of the scale, selling something that your customer really needs, where your product is clearly the best available solution for them is unquestionably ethical.

But there's a potentially grey area in between. What if the client needs your product, but you know of a competitors product which meets that need even better? Do you tell them about the competitors product that's a better fit – or keep quiet and just sell yours?

That's a tricky call. I know many salespeople who would say that as long as you “do no evil”, as long as the customer benefits from your product – then it's not your duty to tell them about the better product they could get. That isn't my view – but I'm OK with it. The customer still benefits – and really, it's their responsibility to find the very best product for themselves.

Personally though, If I believe a competitor has a better product, then I'll recommend my customer gives it a look over. I just don't feel right if I know there is a better solution out there but I withold that information.

In the end, I believe this stance actually helps me. As a consultant, one of the critical success factors for me to win and keep clients is to establish a deep trusting relationship. How can I hope to do that if I deliberately withold important information from my client? I believe that my honesty in this helps deepend the bonds of trust with clients – and helps win me further work.

But at the end of the day, holding strong to my position on ethics in sales, whether it benefits me or not, it just feels right. And that's perhaps the biggest benefit of all.

———
Update: I've written a more recent article on ethics in sales here. It gives a very practical and unexpected solution to the ethical conundrum.

Featured

Strategy

Positive Navel Gazing: Won Sales Analysis

Posted by

Ian Brodie on June 8th, 2008.

Review form Almost every company I've worked for has done regular “loss reviews” when they've failed to win big bids. It was almost a knee-jerk raction by management – “how can this possibly have happened?” – despite the fact that the sales team often knew well in advance that they weren't going to win.

What I see much less often are “win reviews”. Rather than just celebrating a win, analysing it to figure out why you really won, to see if you could repeat that success elsewhere.

In my experience,these win reviews are much more likely to produce future success than loss reviews.

The reason is simple. Loss reviews focus on trying to identify the reasons why you didn't win – “mistakes” – and change them for the next time. But in reality, the reasons why you don't win are usually much less likely to be fixable mistakes than they are to be inherent features of your products and your company. Things which are very difficult to change. Perhaps your culture didn't fit, or your high quality product line wasn't suitable for a low cost customer.

A win analysis however, tries to identify the factors that secured your victory. These factors are almost always things you can repeat. The important thing is to find more customers where these factors are valued.

The trick in both cases is not to try to change unchangeable things (of course, if you do find mistakes then fix them) – but instead to identify which types of customer value the factors you are strong on, and which don't. You can then use these factors as a way of identifying and/or screening potential new customers.

For example, one of my previous customers, an IT services company had a very strong consultative culture. They believed that by working with their client to help them take ownership of their problems and jointly developing the solutions (rather than just “telling them the answer”) they would have a much more sustainable result in the long term.

Like all firms, they won a number of bids, and they lost a number. On many of the bids they lost, the feedback they got from clients was that they didn't want to work collaboratively – they wanted to be told the answer. Often my client would interpret this as meaning they had to try to change their culture – to be more prescriptive in their approach. But whenever they tried this, apart from being culturally uncomfortable for the team, they would end up losing more bids than before.

What they needed was to counterbalance the feedback from their losses with feedback from their wins. They then began to hear of all the occasions where their consultative culture had helped them win projects. With this more balanced feedback they began to understand that instead of trying to win everything, they should focus their efforts on “winnable bids” – bids where their culture, skills and capabilities better matched what the clients were looking for.

They began to ask early qualification questions based on these criteria to allow them to see which bids they were likely to be a good fit for, and which ones the clients were looking for a different approach in. This focused approach allowed them to make major improvements in the number of bids they won – and decrease the effort spent on bids where they really stood no chance.

In similar vein, over at SHiFT Selling Craig Elias talks about the use of new customer reviews to identify the “window of dissatisfaction” where your product or service resonates with the buyer’s selective perception – and then looking for that same window elsewhere.

Meanwhile, Chris Whyatt talks about a great win review he did with ComputerLand a number of years ago which provided a real Eureka moment for him. According to the client, the main reason for their bid victory was that “the proposal felt like it was written for us”. Sadly, my experience has been that this is rarely the case – so a proposal which does so really stands out from the crowd and has a great chance of success.

Ian

Featured

Selling

On Passion

Posted by

Ian Brodie on June 5th, 2008.

The importance of passion for salespeople seems to have sparked the imagination of many bloggers recently – myself included. Reading the posts reminded me of my all time favourite Winston Churchill quote:

Before you can inspire with emotion, you must be swamped with it yourself. Before you can move their tears, your own must flow. To convince them, you must yourself believe.

I can't think of any more eloquent way of highlighting the criticality of passion and belief if you want to sell anything from a product to an idea.

My original “In Praise of Passion” article is here

Ian

Featured

Strategy

Do I really need a USP?

Posted by

Ian Brodie on June 4th, 2008.

Unique It's accepted wisdom in marketing and sales nowadays that every business needs a strong Unique Selling Point (USP).

“Differentiate or Die” has become the clarion call of consultants across the globe, urging their clients to (pay them to) develop clever positioning statements showing how unique and different they are to their competitors.

But does it work? Is a powerful, differentiated USP really critical for the success of every business?

Not in my experience.

The concept of a USP dates back to the 1940's and originated with consumer goods companies battling for advertising share-of-mind. And indeed today, for many consumer oriented products a strong USP is key to creating brand awareness.

But for many businesses – particularly service businesses and companies who serve a local customer base, the concept of a USP is not so important.

Think about it from the customer's perspective: when you're looking to hire an accountant, or you need a taxi, or you want a plumber to fix a leak – are you looking for someone who is unique and clearly differentiated from his competitors? Or are you instead looking for someone who you can trust to do a really good job at a fair price?

Differentiation is great to mark yourself out from the crowd – but in a great many businesses you already stand out from the crowd.

In my own consulting practice for example, I very rarely face direct competitors. My biggest competitor – as I pointed out in the post Beating Your #1 Competitor – is the status quo – the client doing nothing. And to beat that, I don't need a USP. I need to demonstrate compelling value to the client, not uniqueness.

Or take the taxi firm. What will make a potential customer call one taxi firm over another? Usually two factors: availability and perceived reliability. Most successful taxi businesses didn't become successes because they somehow offered something different or unique – they offered what every firm offers – available, reliable transport. The reason they get chosen is that they (are perceived) to be able to do it better than their competitors.

How about an accountant? Do you really want an accountant that does your books in a unique and different way? Probably not. Probably you want someone who does them well at a good price. The role of marketing for the accountant is not to communicate uniqueness, but to ensure the potential customer trusts that the accountant will do a good job.

I work with a lot of professional service firms – lawyers, accountants and consultants. And when we work together on clarifying their vision and goals I always introduce the concept from David Maister's classic book Managing the Professional Services Firm that all professional services firms have essentially the same mission: “To deliver outstanding client service, to provide fulfilling careers and professional satisfaction for our people, and to achieve financial success so we can reward ourselves and grow”.

The challenge for marketing and sales in professional services is not to create some clever, unique proposition – it is to take this great but common proposition of offering outstanding client service and to prove to clients that it's true.

To be continued…….

Ian