E1C07 02/04/2010 Page 183 value. In Deliver, we simply turn back to these metrics, measure them against the actual results, and report our findingstothecustomeratvariousstagesduringimple- mentation and use of the solution. If the expected outcomes have not been achieved, we prove our value and professionalism to the custome r once again by diagnosing the obstacles that are hold ing them back and then designing new solutions. If the expected out- comes are being achieved, it is critical to document the re- sults and leverage them to open new business opportunities with the customer. Salespeople should undertake the work of m easuring and reporting customer results for the following three compelling reasons: 1. It ensures that the promised outcomes and associated value have been achieved. We may be able to succeed in the short term by closing sales and moving o n to new customers, but to succeed over the long term, we must deliver on our promises. 2. It provides the basis for re-engaging in the Prime Pro- cess. I call my sales methodology a process, but it is also a cycle. When our customers achieve or exceed the outcomes they envisioned for the solution, we can continue the Prime Process by using their results to move back into the diagnostic mode, uncovering new risks that can undermine their success or new opportu- nities that can enhance it. Then we can design new so- lutions that are capable of providing improved results. 3. It allows us to establish our position as one of our customer’s preferred resources, which maximizes the long-term profitability of the cu stomer relationship and erects impenetrable barriers to our competitors. Measuring and Reporting Results—Value Achieved 183 E1C07 02/04/2010 Page 184 The ultimate goal is to be come business advisors and our customer’s Prime Resource for the solutions we bring to market. In the customer’s mind, this relationship sets us apart from the competition and positions us in an ongoing role as a source of business advantage and a contributor to the customer’s success. Thefollowingarefivecharacteristics of a Prime Resource: 1. A Prime Resource is an active participant in his or her customers’ businesses. These sales professionals un- derstand their customers’ businessrequirementsand performance measurements and take an active role in their success. 2. A Prime Resource is committed to long-term growth relationships with customers. These sales profession- als allocate the time and energy required to work with customers on a regu lar basis. 3. A Prime Resource bases recommendations on mea- surable problems and outcomes. These sales profes- sionals are always working from the reality of the customer’s world. 4. A Prime Resource acts as an early warning system for customers. These sales professionals uncover un- exposed problems and notify customers of changes in products, technolog ies, and markets that may i mpact their businesses. 5. A Prime Resource stays close. These sales profession- als know that two-thirds of customers stop doing busi- ness with companies because they feel unappreciated , neglected, or treated indifferently. 2 If it sounds as though there is a good deal of work in- volved in becoming a Prime Resource, there is. At least, thereismoreworkthantheconventional salesperson 184 DELIVER THE VALUE E1C07 02/04/2010 Page 185 typically dedicates to their customers’ success, but the re- wards are exponentially higher. In the ‘‘you snooze, you lose’’ world o f business, a Prime Resource is always awake and alert to significant changes in the environment. His or her customers learn to depend on this alertness and become loyal, long-term customers. Further, your best customer is always your compet- itor’s best prospect. The customers of a Prime professional, however, have a much higher resistance level than the aver- age customer. Customers know the v alue that they de rive from a Prime relationship. So when competitors call and say, ‘‘We can give you the same thing for 10 to 20 percent less,’’ Prime customers don’t get lured away. They know the right questions to ask and the traps to avoid. They are also well aware of all of the decisions that go into choosing a high-qualit y solution —after all, that is exactly what you have taught them in the Prime Process. Measuring and Reporting Results—Value Achieved 185 E1C07 02/04/2010 Page 186 E1C08 02/03/2010 Page 187 III Driving Predictable and Profitable Organic Growth: Building a Diagnostic Business Development Capability E1C08 02/03/2010 Page 188 E1C08 02/03/2010 Page 189 8 Building a Value-Driven Sales Organization Getting Paid for the Value You Create E1C08 02/03/2010 Page 190 E1C08 02/03/2010 Page 191 D iagnostic Business Development is the best way to align the sales organization with the conditions and customer demands of Era 3. In Parts One and Two of this book, I described how its systems, skills, and disciplines can become a springboard to success for individual sales professionals. Now I’d like to address how sales leaders can leverage Diagnostic Business Development into a functional capability that can improve performance across the sales organization. Sales executives and managers are charged with pro- ducing superlative sales results on a consistent basis in every kind of economic environment. They are expected to accurately forecast sales revenue and create organic growth by meeting the sales targets that these forecasts yield. They are responsible for managing and maintaining the primary interface between their companies and t heir customers. They have very challenging and high-pressure jobs. Sales leaders can only achieve these tasks through their sales organization. Sales organizations have a lot in common with professional sports teams. Many of them have enjoyed short-term runs o f success. May be a dream team comes together or the competition falls apart or perhaps the planets line up just right for a season or two. However, teams that win over the long term—in profes- sional sports and sales—are much less common. When you examine sports teams that win consistently from se ason to season, you often find legendary leaders— individuals such as Vince Lombardi and Don Shula in football, Phil Jackson in basketball, and Roger Penske and Ross Brawn i n a uto r acing. These leaders don’t rely o n l uck. As Joe Gibbs, the first person to ever lead champion- ship teams in both professional football and NASCAR auto 191 E1C08 02/03/2010 Page 192 racing, explains, ‘‘A win at any track doesn’t just happen by accident. We don’t simply fill our cars with gas, crank them up, and hope we can drive faster or outlast our opponents. Every detail of the race is thought through, including con- tingency plans and backup parts. We have a game plan for the race and we attempt to follow it as closely as possible.’’ 1 In other words, sports teams that win consistently have an effective strategy and they execute it as flawlessly as possi- ble. Their leaders build sports dynasties by adopting and implementin g such systems, managing and refining them, and recruiting, training, and coaching players who are capable of executing them with exceptional discipline da y in and day out. They literally institutionalize the ability to win, raising it to the level of a capability. The best sales leaders seek to achieve exactly the same thing. Beyond the Black Box The sales function has always been something of a black box o n the organizational chart. The fact that so many o r- ganizations accept such a wide range of performance in a major function suggests that what goes on w ithin the black box continues to be a great mystery. No company would tolerate such performance variation in a manufacturing line. There are several reasons why the sales function is so poorly understood. First, although the sales organization is the primary generator of revenue in most companies, it is toooftentreatedasanon-value-added ‘‘distributor’’ of goods and services. This view harkens back to a less com- petitive, less complex business era, when companies pro- duced goods and services, and salespeople simply presented them to customers who were happy to get them. Even the great management thinker Peter Drucker felt confident enough to declare that sales was a ‘‘superfluous’’ function. 192 BUILDING A VALUE-DRIVEN SALES ORGANIZATION [...]... teaching and equipping them to have higher-level conversations This is how we ensure that the ‘‘right questions’’ are asked in the ‘‘right sequence.’’ The design team must create a number of other tools, especially the measurement tools that salespeople need if they are to quantify value These include tools to quantify the cost of the problem, the value of the solution, and appropriate investment in the. .. of salespeople to identify the right people within the customer’s company and ask them the right questions in the right sequence In stage 1 of developing a Diagnostic Business Development capability, the design team needs to consider how the sales organization will learn how to do this, and it needs to create the tools that will support these tasks The ‘‘right people’’ component of the skills equation... amount to the impact your value has with a number that the customer agrees with? 5 Have you been able to identify all the constraints that your customers face in trying to optimize the value they can receive from your solution? 6 Have you provided your customer with the ability to address those constraints and manage the changes they need to make? 7 Are you able to measure the value you have delivered and. .. it based on the realities of working with actual customers (During this stage, the sales teams engage with customers in a transparent way; in other words, they explain to the customer that they are conducting a pilot program with the intent of testing a model aimed at ensuring that the customer receives the greatest value potential from the relationship.) Stage 3: Extend the Platform to the Entire Sales... business -to- business sector are suffering from ROI and value fatigue: they have been bombarded with generic value propositions and ROI calculators to the point that they no longer consider it credible when salespeople talk about ROI and value To clarify the value of solutions, we enlist the help of a small set of leaders who are familiar with various aspects of the complete value picture They understand how. .. understand how the solution is designed to create value and they understand how value is actually achieved within the customer’s business These leaders are usually drawn from several functions within the company, such as R&D, engineering, manufacturing, marketing, and service We ask this team to describe the value that their solutions are capable of delivering and how that value manifests in the customer’s... will always follow the same pattern as the Prime Process It must include the Discover, Diagnose, Design, and Deliver phases and in each phase, guide the customer through key decisions and produce the outcomes needed to move the customer to the next higher stage of the Value Life Cycle in the pursuit of value achievement The degree of effort required to design such a system will vary by how well-suited... results The best sales leaders reject the traditional view of their function (see Figure 8.1) They strive to make the sales function transparent and accountable, and to enhance sales results and predictability If they aren’t generating the 194 BUILDING A VALUE-DRIVEN SALES ORGANIZATION FIGURE 8.1 The Top Five Excuses for Sales as Usual performance results they need, they don’t simply step on the gas,... maps—similar to the decision trees that doctors use to determine the health of the patient and diagnose diseases and other health issues—for each member of the cast of characters that cover the customer’s entire decision process Questioning and listening skills have been taught to salespeople for decades, and they’ve been equipped with long lists of generic questions Now we need to take an evolutionary leap and. .. will be integrated and aligned with existing systems and processes within the sales function In most cases, this will require changes that will improve the outcomes of these systems and processes For example, what is the basis for your current forecasts? Usually, they are based on the best guesses of individual salespeople as to how ‘‘interested’’ their customers are and how soon they might sign a deal . percent less,’’ Prime customers don’t get lured away. They know the right questions to ask and the traps to avoid. They are also well aware of all of the decisions that go into choosing a high- qualit y. Deliver phases and in each phase, guide the customer through key deci- sions and produce the outcomes needed to move the customer to the next higher stage of the Value L ife Cycle in the pursuit. who are f amiliar with various aspects of the complete v alue picture. They understand how the solu- tion is designed to create value and they understand how value is actually achieved within the