What is Lean sales? – Identify your internal customers!

Continuing from my earlier blogs:

What is Lean sales?
Identify your external customers!

This is where I believe we all assume too much. Most people in an organization have their own networks and routines for communicating within the organization. This has been developed during a long period of time and is handed over from person to person as people change position in the company and as the company grows. It has not been put in place, it has just happened…how do you know that this is the best way to perform the tasks in your company?

Understanding is better than believing, so find out who in your organization you as a sales group hand over information to. Is there a secondary party within your organization that receives information that comes from your group? Should this information not be passed on directly?

“Any fool can know. The point is to understand.” ― Albert Einstein

Is there a white spot on the map? Is there a group within your organization that is seeking information that you could be providing, but you are not?

I heard a great example of a white spot. In a company working with industrial installations in the 80’s. In some cases the customer provided engines that were supposed to be used in the final product. Normally the purchase department was responsible for all the incoming goods and when they placed the orders, goods management was already planned and article numbers were in place. The customer unique engines would turn up out of the blue, the team handling the receiving would call the purchase department and ask about them, but since the purchasing department had nothing to do with these engines they had no information to provide. The result was that the engines would be stashed somewhere and many where lost on their way to production costing a bundle of money and irritated customers. If the sales department had seen the goods receiving department as a customer and understood their responsibility they would have set up a routine with the receiving group and communicated to the customer how engines need to be labeled and shipped in order for their company to manage them.

These days Big Data is widely discussed. The requirements to enter information are constantly increasing. A lot is probably rubbish, but some will definitely bring value to you or to some other part of your organization who is a customer of this information. Look through your entire business process and organization scheme and truly define who is a receiver from your sales department. It is better to do a few things well rather than trying do a lot and making a mess of it all…so find out where your input will have the biggest impact.


What is Lean sales? – Identify your external customers!

Continuing from my last blog

By “External Customers” I mean customers outside the boundaries of your own organization. In sales this is who you define as your lead/opportunity/customer.

I admit that this area is out of my depth, all I have is the theory about haow to define a market, but I know what you need to use this for, so the requirements are not a problem to define. You need to have a clear aim on what types of customers you will be targeting, what the markets that will supply you with leads are. This is probably not something you do very often and I brought it up because of the importance this step has for the rest of the work.

When working at IKEA I was part of the teams in development of new products. My role was to assist with the forecast information regarding the potential of the new product and gather knowledge about the product so that I could make a plan for how the forecast for the new product and other products in the range will change once we launched.

This was about understanding who our customers are and how they would react (e.g. cannibalization on other products). This was also about understanding what customers we did not have, how the offer potentially would create a new customer base and how we could reach as many potential customers as we could.

I don’t see that B2B sales can be any different. If you have a clear idea of who you are targeting, the rest of the work becomes so much easier.

Usually when I talk to people about the problems they are facing at work I can hear that the client base is so diverse you wonder how they managed to find the deals and if any of the deals made any money. “Selling all we can to everyone…” is not being fair on your organization.

Once you have decided on who your customers are you should write down your assumptions. You have assumed that this group is correct for your company because… (fill in the blank). If you write down your assumptions it will make it easier to see what you might have missed over time.

This customer description needs to be communicated throughout your organization. Everyone needs to be in line with who your customer is. Now there may be parts of your organization that views the customer different e.g. Customer Service, because they deal with another part of the customers organization, but marketing, product development, project teams, production, logistics, and so on, need to have a collective idea of who you talk about when you  “the customer”.

“Know what your customers want most and what your company does best. Focus on where those two meet.” ~ Kevin Stirtz

In the next step you will need to create a Sales Plan in order to reach these customers, so you need to put some real effort into getting this right, because if we get all the other steps right, it will be a waste of time if we don’t target the right customers. The perfect execution of a misdirected plan is not something you would want…

First, let us get look at your internal customers.

//The picture is from my infochart over Lean Sales

What is Lean sales?

To get to a Lean sales organization requires a few changes in how you as a manager view the role of sales and the roles your sales people have in your organization.

First off, this is as much culture as it is management. This is the really big uphill climb. Changing culture is not the easiest thing to do and it is not something you do very often. The culture you need to truly succeed in Lean is the idea that change comes from the people. It is the voice of your employees that needs to be the source of your future development. It is about teaching your employees to voice any activity that does not function within their area of expertise.

The second thing is that Lean is about money. Either you save money by cutting out an unnecessary expense or you gain money by removing time spent on something meaningless and using it to make money.

The third thing is that Lean is customer driven. You might think “We’ll duh, I work with sales, no one in the company understands the customers as well as I do. We live for our customers.” You might be right, but to be Lean you cannot try to push leads thru your pipe, hoping to transform them into customers. Lean is about working with the Leads that are partly on their way, Leads that you can turn into a profitable customer. You need to be good at giving your customers the tools they need to walk towards your sales pitch on their own, you need to make sure you are targeting the right markets and you need to have correct criteria for your qualification procedure (and NEVER deviate). Part of this goes back to how you market and communicate your brand, so get your Marketing department on board!

To make this possible you need to define in what area people work and what they do. You need a clear description of how the job is to be done in order for someone to flag if it is not working as intended or if there is a way of doing things better.

I know that in sales you have your key performers the lead sales person, the one that lands more deals than any other sales person and that they can sell manure as chocolate bars. You forgive them for all their eccentricities because they bring home the bacon.

“There are no heroes!”

There are no heroes in Lean, this is a team effort. You cannot be dependent on individual players and if you allow rogue behavior, how can you motivate the rest of the tem to follow routines and guidelines? Besides, top sellers can give feedback on how to improve the routines (share some of their magic) and use their creativity and drive to support the team improvement, move from being “I” focused to “we” focused. As far as team effort is concerned, let me put it this way. If you have 5 sales people and one of them is the top seller scoring 30% over the average group revenue, if you can increase the other 4 with 10% your top performing sales person can drop 20% and the team is still making more revenue than before. If the top performer quits because they miss their hero status and you hire another average Joe working according to your routines, you are still making more revenue. The time it takes to get Joe into the job has also been reduced do to clear routines and structure.

“Do not tolerate brilliant jerks. The cost of teamwork is too high” – Reed Hastings, CEO Netflix

As I understand most sales people are a bit competitive to say the least, so this is a bit tricky. As a manager it is important to have clear measurements and goals to be able to stimulate these thoroughbreds, directing their individual competitiveness to achieve the common goals. I understand if this is intimidating, it’s OK to be a little scared, but rise to the challenge!

With this way of working anyone within the same roll can do any other persons job within the group. This makes your job so much easier when someone quits or goes on vacation. You can still lift your individual players, good work should always be recognized. If you as sales person meet your goals, follow routines and find new and better ways of working, you should be rewarded. Just do not put the individual in a cape and lift them up on a pedestal…

Another important fact about standardization is that if you simplify a lot of the everyday work, there is more room for thinking and creativity that can be used for making your process even better and more efficient. Time that can be used to research your leads better in order target the right leads, make a better case or to present a better deal.

You also need to have a clear understanding of who your customer is. Not only externally but also within your company. External customers should be found by managing well targeted leads and correctly qualified opportunities. Internal customers can be any department your team delivers information to like forecasts, specifications, time lines for projects, administrative work and so on.

In the blogs that follow I intend to give my thoughts on how you can create a structured approach to a Lean way of working in your sales organization. This Infochart is my map. There will still be alot of valid points, even if you do not make your sales organization Lean, so if you are not convinced don’t stop reading, our journey has just begun…

// Featured image from http://www.almir.biz/lean-business/

Lead profiling – here’s a thought…

Continuing from my last blog..

I was at a lecture on content management and how to drive traffic and I got a concrete tip how to make content into context. You need to create profiles of all the types of people you are trying to communicate to and test the content on them. So the speaker presented Bill (45 year old male who is conservative and believes things when he sees it), Susan (30 year old female who is a straight arrow and calls things on the spot), and so on. Extensive personalities where presented, a total of 10 I think. Every new content was then run against each profile and scored. Based on the scores the company could decide if the where to publish, or change the content. It was very efficient.

This exists in companies that work with internet based sales. Here I find a lot of models, and it is quite clear that this is common here because these clients have made it easy by surrendering their information by beeing on the web and logging on to the company sites sharing age, gender, geographic intel, and so on. So much has happened in internet based sales in such a short time and “traditional” sales need to learn a thing or two…

Sales should have a good idea of what the ideal prospect looks like, what is the best case? By putting together a profile of these prospects, sales can break down what characterizes of the different prospects. What are their pains? How far are they from taking a decision? What level of awareness do they have? What industry segment do they belong to? Did they contact your company? Have they purchased the product/service before? Do they have a contract with a competitor? How price sensitive are they? And the list goes on…the trick is to collect intel.

I found a site with a great example of a way of profiling that makes the profiles feel real and how to present relavent information at the zuyderblog

Then there needs to be a discussion with Marketing around the profiles on how these different profiles will be reached thru different Marketing activities. There might be a profile that your market analysts can see that Sales have never worked with, then Sales need to bring this into their strategy and find a way to sell towards this profile.

Matrix view

The red figures are the profiles created by Sales/marketing and they are placed to show the areas they cover on the market.

Segments with lead profile spread

Each market activity  (A1-A4 in the example below) needs to be matched against the profiles, the score converted into how many % of the profile match the campaign goals and content, and if there is gap the group (Sales and Marketing) can decide that this activity does not have to reach this profile, or the plan might need to be changed to include this profile. I have talked about Demand Shaping before and this will definitely give you means to attempt to shape your demand.

Campaigns mapped against segments and Lead Profiles, pies

Profile diagrams

Another way to do this is to focus on the profiles, set the market asside, breaking them down to 10 key factors:

  1. Buyer maturity, how close are they from taking a descision
  2. Buyer knowledge, from expert to inexperienced
  3. Buyer influence, does the person you are in contact with have the authority to take the descision, from top executive to agents
  4. Company size, is this a big or small company
  5. Product complexity, are the requesting a simple or complicated product/soloution
  6. Level of interest, is the buyers communication frequent, do they respond prompltly
  7. Availability, is the buer easy to reach
  8. Price sencitivty, two what degree is this client pricesensitive
  9. Level of Competition, likelyhood we can land the deal over our competitors
  10. Purchase history, times we got won vs lost opportunities for this company.

The optimal score is 1 on all of these. To describe the perfect prospect: A buyer who is ready to make a purchase and who can take this descision. The buyer has a high level of knowledge and works for a large company, price is not the main issue. This buyer is interested, has reached out and is available to discuss buisness. This deal is not subject to competition, the specifications are standard and the buyer is already a client.

Probably not that common…

By creating profiles with specific target scores you can set  a score on a campaign on what areas it is supposed to target and get a comparison between the profile and the campaign. In this example I have two profiles compared to a campaign:

Campaign Webgraph

In this example I would draw the conclusion that the campaign will be good for Profile 1 in improving knowledge, bringing the descision makers into the purchase process and raise the importance  of our item to ensure good responce rates, For Profile 2 it will bring the small companies  and raise the level of importance of the item. The element in the campaign that intends to raise the interest in the companies is waisten on these profiles as the already have this quality, but there may be some effect.

Collaborate with Operations

This collaboration can easily stretch to include Operations. If there is chaos here, there is a high cost in both Sales and Operations.

Getting companies to see the entire picture is my calling, I hope this can lead to a productive discussion. Looking forward to your opinion.

Leadcycle, improved

Starting in the right end – marketing and sales collaboration

As usual I have been reading up on what is going on and I came across this blog post: Marketing Bingo – You Might Be Playing And Not Even Know It. I have never been part of working within Marketing, so there might be something I’m missing, but for me Kyle makes a good point. Work from the outside in…

I started to think about how I percieve marketing, wich is more inside out: Who are we selling to? Is this changing? Can we see any trends? What precision can we expect in the conversion from Lead to Opportunity? How do we segment the market? How do we process the leads when they come in (different approaches based on segmentation)?

From a B2B sales perspective, the marketing actions need to create leads or make the lead creation possible. In order to give the sales organization a fair chance to sell, the leads need to be half decent or the customers need to be interested. There needs to be a common approach on the pipeline effeciency, in my view this is Gross Margin, taking all costs in account.

I made a model (probably exists but I could not find it anywhere) I would like to get some feedback on:

Sales, Marketing, Market mix

If Sales and Marketing create a plan that does not reach the intended market they have an “Ineffective Strategy”. If Marketing reaches the market, but these recipients never come in contact with sales, then we get “Uncaptured Lead”. If Sales work the Market in order to reach the quota and land prospects without the support of the Marketing we have a “Lead Deficit”. When Sales and market work the market in the same area we hit the “Sweet spot”.

Companies need to find a way increase the collaboration between sales and marketing to get better at targeting the sweet spot. First of all you need to have a common picture of what market looks like, what you want to achieve and how this transforms into customers.

An example

If we look at how this can be done, let’s start with a segmentation of our customer:


Let’s say that S1 is Low price/Low complexity, S2 is Low Price/High Complexity, S3 is High price/Low complexity and S4 is High price/ High complexity.

If we study our customers purchase behavior the last 12 months we find that we have a strong tendency to land in the S4 segment:

Segments with customer spread

Looking the Marketing we are targeting the following area:

Segments with customer and marketing spread

Looking at this picture it is easy to see that there is untapped potential. What needs to be cleared out is if Marketing I over reaching / targeting the wrong market, or if Sales are missing out on Prospects because they have the wrong approach to the market. Wouldn’t you like to know why and correct the situation?

My thought is to try and move the circles by increasing the collaboration and  achieving a higher efficiency in the sweet spot = more results with less work:

Changing the Sales, Marketing strategy

Stay tuned…a blog comming up on the topic of “Lead Profiling”, how to increase the “sweet spot”…

Why KPI’s both matter and don’t matter.

I can see that there is a lot written in the areas around measuring performance and that this cripples a companies’ creativity, that this can suffocate a company.

Two blogs i recently enjoyed reading on the subject are Barefoot Sales Process and Look Past the Measurements.

The purpose of a KPI usually comes with good intentions, but as they say…

The road to hell is paved with good intentions

We cannot ignore the fact that KPI’s are extemely powerfull, used in the right way with the right measurement.

I am a runner, as my VP Stefan is. We both have set the goal of running Lidingöloppet (30k in tough terrain). We discuss running a lot, we have totally different approaches to running. Stefan runs with his gut, if it feels good, he is content and as a goal for the race his ambition is to keep a good pace, but to leave some energy for the last 10k. He has no program, he will run as often as he can and run as far as he feels like at that time. I have a different approach, a set target for this race, a time I want to achieve, so I have put together a training program based on last year’s training program. I have a goal and a plan.

My strategy is to train hard without getting injured. My vision is to feel good, to feel fit. This is where Stefan and I agree.

My plan is ambitious. To achieve the goal, I need to train in tougher terrain this year compared to last year. I have two KPI’s for operational measurements, two for tactical, and one for reaching my goal.

For each training in the plan there is a purpose of how it will influence my physique. So as operational KPI’s I have heartrate and pace as a feedback every 5 minutes. This helps me pace my training to reach the development it intends to provide. After each training I try to reflect on the general feel of my health, to see if I am in tune with my strategy.

Every week I look at the summery and how it compares to the other weeks. My KPI’s are average pace, to see if I’m moving in the direction, and distance, because I need to reach a certain level of endurance. The distance is a measurement that needs to be in line with my plan. If I don’t reach the distance I could change the plan for the week to follow.

To reach my goal I have one KPI and this is my best pace, this needs to go down to a certain minutes per km and then stay below this level.

Now all I have to do is stick to my plan, no matter what the weather is or if I don’t feel like running.

There is no right or wrong in the different approaches, but in Stefan’s case it would be a waste of time to use my KPI’s, even if we were to have the same goal.

This is where the confusion begins
The tricky part is if we are asked to pass on our experience, or if we are supposed to report our progress to a coach. Once again, the right KPI’s are of value, but not without presenting the correct arguments. You need to sell the KPI to the people providing the information. There needs to be a clear understanding of:
1. The purpose of the KPI (WHY)
2. When is the result presented, what frequency (WHEN)
3. How to report, how to read the result (HOW)
4. Who takes part of the report (WHO)

If you get a buy in on all points there is no problem, if you don’t, well you might have your work cut out for you…

Sales People Are Heroes. How Can We Help Them?

Think of a Super Hero – free of choice: Batman, Superman, Spiderman – or why not Bruce Willis as Super-Cop John McClane in the first Die Hard movie from 1988. They challenge the evil and saves the world from disaster. They overcome dire straits, get into serious trouble, but at the end leaves the rest of us with peace and an astonishing admiration. Many times The Hero him/herself sneaks away, without notice from the crowd. 

In Sales, our Super Hero is the sales rep. How many times haven’t I heard those stories about how this man or woman literally saved the whole company. How the Big Order was brought home, regardless of what hurdles there were to pass.

I remember many years ago when the largest company in my hometown (at that time) was struggling to survive. Over 1,000 jobs were at stake. The company was selling large pulp drying systems and it was needed to fill the order books. Luckily, there was a RFP from Indonesia out to go for and the negotiations were to be held on site. It was extremely hot whether and three sales teams on the short list; the Americans, the Germans and our team from Sweden.

The potential customer turned to the sales teams in order, but kept going around with the teams without giving any clues which team that was in pole position for the order. If there would be an order at all. Customer didn’t say much at all. Everything was uncertain. And it was awfully hot. Meetings were fifteen hours per day, the questions were few. Still murdering hot. 

The team from German went home after one month – thought nothing would happen anyway. And on site there was less happening than ever before. The heat was really sucking. The American team gave up after one month further – there will never be a contract anyway, better to come back later?

For more than three months the Swedish team stayed before they got the signature on the contract. Back home, the sales manager was interviewed by the local newspaper:

– Congratulations recieving a new order, Mr Sales Manager!

– Orders are not recieved. They are taken.

How many of us are just expecting the same from our sales reps or sales managers? Orders should be recieved, regardless of market conditions, competition, product fit, or timing. Do we really know – in all aspects – what it takes to take – or almost “steal” – orders in extremely though circumstances? I’ve got a long experience as a  sales rep by myself, but I think there is not any salesman that is equal.

The role being a Super Hero is highly individual. But there are some key features that remains the same for all:

– Extremely high creativity skills

– Very interested in customer needs

– Huge skills doing “matchmaking” between that need and the products or services that would be delivered (with several twists of course).

Still, I believe we may be able to help him or her. We should be right by their side when they have questions. We should be positive to hear what he/she has going on, leaving encouraging comments, promoting somewhat “crazy” ideas. Nevertheless, those ideas are the next customer need to fulfill. Either we do it or it will be fulfilled by our worst competitior. It’s valuable information for the entire company.

But the best support we can give, are our expert advices, our mentorship. That’s the most valuable for our Super Heros. Would you like to provide that?

Best Regards