A Complete Business Development Machine
The Purpose of Sales is to “Get the business.”
Marketing has placed a prospect in front of a salesperson with the belief that the person may be an “A” Customer/Client who wants and needs what we are selling, and they have the ability to pay for it.
It is difficult, or even impossible, to sell something to someone who does not want it. Bear in mind, the decision to buy has more to do with emotion than logic; although a buyer will use logic to justify a purchase. It does you good to assume that you are responsible for determining and respecting the prospect’s needs. You must present what you are selling in a manner that satisfies the want(s) of the prospect, but you must do your best to ensure that it is also what they need. The better you do at both, the better and stronger the relationship.
A Selling System
There are many selling systems in existence today. I’ve compiled one from portions of others that I have studied and used. The ideas for this system have come primarily from my own experiences, David Sandler (Sander Selling Methodology) and Robert Jolles (Customer Centered Selling). The wording and even the stages (or steps) are frequently refined by each sales manager. Something to recognize early is that selling is a process consisting of definite “Stages.” These stages naturally exist and must be performed in order to obtain an order. Some or all of the stages may be done unintentionally and subconsciously, or they may be done intentionally, but most, if not all, are completed, or there is no sale. I will attempt to demonstrate that the more aware you are at any given point in time within the sales process (or what stage you’re at), the more strategically you will think about what you should do next and how to go about doing it, and the more successful your efforts will be.
Note that each of the 11 Stages in the table above identified with a letter and a number. The first 5 are functions of Marketing and are the topic of Chapter 4 above. Stage 6 is the passing of the baton from Marketing to Sales, and the final 5 Stages are the responsibility of Sales.
We’ll now take a closer look at each stage and note how they may smoothly link as one flows into the other.
M01 Organization Identified (a potential “A” customer/client)
We must first be aware of a potential company that fits our “A” profile before we can seek out an individual within it. This process of gaining awareness can happen in various ways: we may have been aware of the company’s existence and never taken the time to follow up, we may get a suggestion or even an introduction from someone we know, we may purchase one of the many databases and mine them, we may have access to this information through our industry associations, or one of the many other methods not mentioned in this list.
M02 Sub-Sponsor Identified (somebody that knows somebody in a prospect’s organization)
It may be that someone you know has a contact within an organization that you believe might be an “A” customer. They may not be able to introduce you to a decision maker, but they may be able to help you meet someone who can lead you to a decision maker. This person is valuable because they can get you into a door that you’ve not been able to enter on your own.
M03 Sponsor Identified (somebody that knows a decision maker)
An individual who knows the decision maker has been identified. You are getting close to the right person.
M04 Sponsor has agreed to meet with Salesperson
At this point, a good deal has been accomplished. Someone who is able to influence the decision maker is willing to risk making an introduction.
M05 Corporate Need & Value believed to be understood by the Sales Person
After this stage is complete marketing’s task is almost over. They have obtained from the sponsor (influencer) what they believe the decision-maker (who may be the sponsor’s boss) needs. They are now ready to introduce the salesperson to the decision maker and provide them with some idea of the needs of the person with the authority to make a purchase decision.
M-S06 Salesperson has access to Decision Maker
The baton is being passed. The Salesperson is now in a position to do their job, close the deal. There are many cases where deals are closed where it may appear that these steps were not necessary or even appropriate. This is generally the case where a relationship already exists, and in these cases, it is likely that all these steps were completed in the past, sometimes, years in the past, but still took place in some form.
S07 Need admitted by Decision Maker
If things are to be done properly the level of difficulty begins to increase substantially during the next two stages. Now we need to obtain the real want(s) and need(s) of the person who makes the final decision. This requires them to disclose things that they may not wish to share, but the more you are able to understand, both, what is required and desired the better you are able to (1)provide the most valuable solution: doing the (2)best possible job for your customer, (3)close the deal efficiently, (4)maximizing the profit for your organization, and (5)your own commission. Note, there are five goals here; the greater your tendency to sacrifice (1) thru (4) for number (5), the less likely you are to develop a good relationship with your customer and even your own organization, and another order from “the” customer; who may now, not be “your” customer, may not be forthcoming.
S08 Decision Maker has shared their Vision & Corresponding Value
On the surface, it may seem like an impossible task to get the prospect to do this, but again, the closer you get to accomplishing it the more valuable the deal may be to the customer and you, as well as the future relationship. The customer’s specific need and the vision they may be able to realize should you solve their problem, although related, are not the same thing. The need fulfilled is a requirement for the realized vision, but not the vision itself. The prospect may even have these two things confused, and the better you are at defining them, the more good you can do.
Depending on the product or service you provide this may or may not have any application, but over the past 35 years, I have found that in a great many cases it does. It is almost certain unless the salesperson is conscience of the need to even consider the concept, they will not try, and if there is no attempt, there is no knowledge gained and a potentially enormous opportunity is passed. The real tragedy is that the salesperson might have been completely clueless through the entire selling process, not serving the customer as well as they should have been served, leaving money on the table, and passing an opportunity to strengthen a relationship; possibly losing a future order and missing a referral.
The process has some risk, but if a brainstorming session occurs and the salesperson, once understanding the customer’s goal(s), may be able to offer suggestions the customer had not even considered, the salesperson may become a consultant while selling a commodity. It has happened.
S09 Proposal Submitted
The more thoroughly all the steps above are done, the easier this one is. The proposal should simply put in writing all that the prospect wants and needs. The meeting of the minds was complete in step S08. The proposal demonstrates that the salesperson has listened and paid attention to the prospect. Reading the proposal should, “make them smile”, and sign it. The thing that could be said while delivering the proposal may be something like, ” Can we review this together? Let’s see if I paid attention.” Note, the delivery can be made in person or virtually, but it should not be emailed or mailed and reviewed by the prospect/customer without your involvement. The potential for a misunderstanding with you not present is substantial, and the lack of immediate development of a mutually agreed upon ‘next step’ is generally a costly mistake.
S10 Contract Negotiations in Progress
The amount of negotiation required is a precise measure of the success or failure of step S08. This may be the result of the salesperson’s lack of willingness or understanding, lack of transparency on the part of the prospect, some combination of the two, or something else entirely, but if we find ourselves negotiating, it is an indicator that the proposal does not reflect the prospect desires and needs.
S10 Signed Order (Commissions are paid 15 business days after receipt of payment)
This keeps the salesperson interested in collecting money, improving cash flow, and reducing the overhead burden at the same time.
$Valuing the stages
This tool assists in several areas of the business by providing a clear understanding of the value of each stage, individually and combined.
Upon Completion, it serves as a basis for many relationships that might involve compensation or consideration for the part a person plays in the marketing and sales effort.
A partial list:
- Commission for a salesperson
- Commission for a manufacturer’s or outside rep.
- Commission for the various individuals inside your organization that participate in the sales process (these people are typically not recognized and you may think that doing so would be good for the business.
- A mechanism to assist in the valuation and financing of a business in an acquisition or sale
The important thing is everyone is compensated for the part they play, and it becomes easier to determine, “who is doing what”.
Placing a value on each step helps everyone involved in the Marketing and Sales process to recognize, and hopefully appreciate a little more about the amount of work required to ultimately make a sale as well as the value of the work. It may be worth mentioning again that most, if not all, these steps take place in some form in every sale. How they are done, the amount of time each step requires, and the time between steps, may vary dramatically. The entire process may take minutes, months, or even years.
There are many cases where steps M.01 through S.11 are all done by one person, but it may be more often true that multiple people are involved. A close look at who’s doing what may encourage some fresh thought regarding the compensation of those involved, making some changes and thereby motivating a greater and more creative attitude toward their sales related work. Compensating people for the value they add is a good business practice. There is evidence indicating that when a person’s value add is recognized by a combination of both a genuine compliment and money, morale and productivity tend to increase and stay healthy.
Customer Relationship Management, Client Relationship Management, Contact Relationship Management are a few of the more common names behind the acronym CRM. There are many on the market today, some are sold individually and some may be a module of larger Enterprise Resource Planning system, (ERP). A CRM program is almost a must if an individual salesperson is to optimally manage their sales efforts. It is a bold statement to make, but I believe it is a must for a Sales Manager to manage and coach even one individual. The necessity grows with the size of the sales team. Most CRM systems work well for the purposes outlined above. They should be able to be customized so that the selling stages and the value of each step fit your business. The most basic aspects of CRM can be obtained from a disicplined use of Microsoft’s or Google’s (email, calander, & contact records). These three elements are at the core of CRM.
CRM is a marvelous tool. It serves many uses; below is a short list:
- First and maybe the most important is that it is a tool for a salesperson. When understood and properly used it is ideal for monitoring, and being mindful, of where a salesperson is in the selling process. This knowledge helps to plan the next step; when “next steps” are done strategically they are done better; the close ratio, margins, relationships all improve.
- When understood and properly used by all, a sales manager is able:
- to provide better assistance and direction to their team, the “sales funnel” or “Pipeline” reports (a couple of names for essentially the same set of reports) provide easy access to knowledge regarding where each person is on each deal and provides various summaries which show totals by whatever grouping you need.
- provide meaningful information to management for planning and organizational resource allocation
- CRM can also contribute to:
- The valuation of a business for a purchase or a sale (regardless of the side of the transaction you may be on, and at different times you may find yourself on either side)
- A financing discussion regarding a sale or acquisition
Let’s not forget, “Nothing happens until something is sold.”
We will now move into another section of our Business Development Machine, it is this section that provides the mechanism, structure, and control of the entire organization, ensuring the growth and increased value of the business.