He quickly recognizes the person as the outgoing CEO that he is replacing. There is an awkward silence, followed by a handshake greeting. The outgoing CEO said; Sorry, just clearing out the last of my personal stuff. I wanted to wish you the best of luck in the job. I left you three (3) envelopes in the corner desk drawer.

They are advice letters from CEO to CEO. Please don’t feel obligated to read them. They are there simply in case you feel like you’re experiencing some leadership challenges and could use some advice from someone who has been there. Again, I wish you all the best! The new CEO replied with a perfunctory thank you and a final handshake.

The new CEO met with all of his key lieutenants and received reports on what to expect from a performance perspective for the next several quarters. The CEO met with the Board to set lower performance expectations short term. He also presented a new strategy and plan to turn the company around. The Board enthusiastically blessed his new plan.

The new CEO and his CFO met with key analysts from Wall Street and lowered the financial results expectations short term and presented their new plan for turning around the business. The Wall Street analysts were impressed by the CEO’s candor and new business plan for growth. The company’s stock price still got pummeled after the news was publicly released.

The first quarter onboard was a blur for the new CEO. Ninety days seemed like nine days to the CEO. He worked tirelessly and traveled all over the world attempting to reassure employees, customers, partners and shareholders that their new business plan would be successful. He was optimistic that he had convinced the key constituents to not give up on the company.

The CEO’s first quarter onboard turned out to be an unmitigated disaster. Several of his key lieutenants resigned and left the company abruptly. Two huge orders from long time customers were canceled with no advance notice at the very end of the quarter. The new CEO was stressing out. What do I say to the Board? How do I manage this to Wall Street? Am I going to get fired after one quarter?

Then he remembered the three envelopes the outgoing CEO had left in his corner desk drawer. He opened the drawer and frantically opened envelope#1 and pulled out the single sheet of paper. It said; Blame me for the poor performance! Tell the Board that you had no idea how bad things really were and the state the company was in when you took over as CEO. It was my fault and I should have been fired a lot earlier.

The new CEO took this narrative to the Board, to employees, partners, shareholders and the Wall Street analysts. He engendered some sympathy from all and promised them that he now knew where all the skeletons were buried and what he needed to do to turn the business around. His mantra to all was; No more surprises… I have this under control.

The second quarter was even more of a blur for the CEO. He worked seven days a week with his key lieutenants to implement and execute the new new business plan. He was optimistic that his new business plan was starting to work. He was utterly exhausted as the quarter ended and he was bullish on what their financial numbers would look like.

His CFO called him and gravely informed him that their financial numbers were really, really bad. They had lost a key supplier during the quarter that severely impacted their production capabilities. They ended up at 70% of their lowered revenue expectations number. Their stock was pummeled even further.

The new CEO had never faced pressure like this before in his career. What should he do? Then he remembered the three envelopes (now two envelopes) that his predecessor had left him. He quickly opened envelope#2 and read; Blame the macro economic environment for poor performance! Surely you can’t be responsible for inflation spiraling out of control. OPEC is holding the world hostage by cutting Oil production with corresponding huge gas price increases. The stock market took a huge hit (30%) based on all of the bleak economic news and financial forecasts.

The new CEO took this narrative to the Board, to employees, partners, shareholders and the Wall Street analysts. He asked for patience and promised them that they were doing what they needed to do to turn the business around. His mantra to all was; Patience… we just need a little more time to turn this around.

The third quarter was deflating for the new CEO. His new business plan was not working. He was demoralized as the quarter ended. He was seriously concerned about his job and future as a CEO. Their financial numbers were even worse than the prior quarter.
The new CEO was in an existential position. What should he do? Then he remembered the three envelopes (now one envelope) that his predecessor had left him. He quickly opened envelope #3 and read; Start preparing three (3) envelopes…

The moral of the story: Accountability is a key trait/attribute for all successful Leaders. Excuses, finger pointing and the blame game never works long term.

The post The CEO Three Envelopes Story first appeared on True Sales Results.

So what has transpired over the past 14 months since I wrote that blog post? The herd mentality was in full force. The vast majority of Sales Leaders were simply gutless. If very few folks are hiring sales people… then I certainly shouldn’t be hiring new sales people now. Covid effectively paralyzed the Complex B2B Sales hiring market for too long. My commentary here is certainly a generalization. Not all Complex B2B Sales Leaders froze in their tracks and acted like lemmings. There were some outlier Sales Leaders who had the presence of mind and the conviction to upgrade their sales team talent during the past year when really good sales people were being laid off by cowardly companies.

Fast forward to present day… every CEO and CRO I talk to are saying the exact same thing. This is the most competitive Complex B2B Sales hiring market ever. In my 32 years of Complex B2B Sales, I have personally never seen a hiring market that it is so hard to find good people at all levels. From Sales Development Reps (SDRs) all the way up to CROs, there is simply a dearth of good sales talent available. The current sales candidate pipeline metaphor that comes to mind is a barren wasteland with arid tumbleweeds blowing across a cracked landscape due to extreme dryness.

How has this affected sales compensation plans? As you might expect, this is a supply and demand equation. And presently, the demand far outweighs the supply… therefore the cost has gone up dramatically. I’m seeing Complex B2B sales rep, sales engineer and SDR compensation plans that are significantly higher than even one year ago. There is a corollary effect in how long it takes on average to fill an open sales position. That in turn affects your business plan and revenue model. In short, it’s basically a shit show out there these days!

Now for all those reading this that know me, I’m not one that is generally inclined to gloat or to say “I told you so”. But when only 16% of Sales Leaders said they had the necessary sales talent on their bench to succeed just 14 short months ago and sat around and did nothing to fix that until it was too late. What were you thinking?

The post How Does Your Complex B2B Sales Hiring Candidate Pipeline Look? first appeared on True Sales Results.

Open disclaimer: I’m a research nerd. Absolutely love it and always have. I consider myself to be a perpetual student of “the game”. In my case, “the game” is complex B2B technology sales. At the risk of dating myself, we use to refer to it as good old fashioned enterprise selling. Selling high priced software solutions to a group of stakeholders or a buying committee in a large enterprise company.

What is the intersection of my love for research and learning, with the fact that anyone can publish anything at anytime from anywhere? Simply put, there is a new class of lecturers out there on the internet and Social Media. Millions, if not tens of millions of them. And it’s growing every day. They are the self-proclaimed thought leaders. They heap unwarranted praise on each other and refer to themselves as “rock stars”.

They tag scores of their rock star friends in every post and invite their opinions. They hash tag the shit out of Silicon Valley’s obnoxious acronym and buzzword vernacular. But that’s not what annoys me the most, that’s just mildly irritating. What actually pisses me off is that they are factually wrong. The insights, advice and research findings they are sharing are actually subjective opinions. They are an unproven hypothesis. And more often than not, they are simply wrong.

Going back to my college days at Northeastern University in Boston, Massachusetts where I learned Statistics I and Statistics II under the great leadership of Professor Chakraborty. I’m not quite sure how he did this, but Professor Chakraborty made learning Statistics fun. He used to tell us that for any research study findings to be considered statistically significant, it had to pass specific mathematical criteria.

For those inclined to geek out on this, it’s called statistical hypothesis testing. It’s defined as follows: Statistical hypothesis testing is used to determine whether the result of a data set is statistically significant. This test provides a p-value, representing the probability that random chance could explain the result. In general, a p-value of 5% or lower is considered to be statistically significant.

The sample size and target population used in the research has a direct correlation on whether or not your findings are statistically relevant or not (just a hypothesis). That was a long winded way of getting to the crux of what I mean when I refer to a “flawed lecturer”. A flawed lecturer does not understand the math behind statistics or simply ignores it and publishes their hypotheses as facts.

And whenever there is an underlying error in your math formula, any answer that comes out of that formula is inherently wrong or flawed. My admonition to everyone is to challenge the underlying math in any research study findings that are published on the web or Social Media. Question the author and validate that they used proper math in determining their sample size and target population to conduct research against their hypothesis.

I worked for a Marketing Research firm in Boston for a couple of years while in college. We ran extensive focus groups and conducted large research studies for big corporations that sold to consumers. What I learned is that it is quite easy to reverse engineer a survey result or outcome that your customer wants to see. In fact, it is quite common. When you see a TV commercial saying that 4 out 5 dentists recommend a particular brand of toothpaste, do you ask yourself how many dentists were surveyed? Do you ask yourself if the dentists surveyed were given free samples to give out to their patients by that particular toothpaste brand manufacturer? I could go on all day here, but you probably get the point by now.

I’m don’t believe in “trolling” or publicly shaming anyone. Either in person or hiding like a coward through anonymous web trolling. Allow me to share a generic example of flawed lecturers. There are a number of sales technology tool companies out there that cite “data findings” from their platform as factual. One such blog post author cites the fact that “sales discovery” can be counter-productive in certain situations. It went on to say that based on hundreds of thousands of sales calls analyzed, there was an optimal number of discovery questions asked that resulted in a successful sales call outcome. There was additional color commentary that stated as a fact that unsuccessful sales call outcomes asked twice as many discovery questions as the successful sales calls did.

Where is the proverbial fly in the ointment here? No one is challenging the sample size or sample population. Due to the scale (hundreds of thousands of call) of the data, people are simply accepting the findings as facts. Now let me pick apart this flawed hypothesis. The fact is that their tool is almost exclusively used by very inexperienced sales reps (junior inside sales reps). In fact, many of their users are brand new to sales (Sales Development Reps (SDRs) or Business Development Reps (BDRs)).

People that are new to sales or very inexperienced to sales have not had much sales training by definition. Inexperienced sales reps commonly struggle in formulating and asking good discovery questions. As a result of this, they also tend to overcompensate by asking too many sales discovery questions. Or they simply ask bad discovery questions that lead to unsuccessful sales call outcomes. It’s easy to turn off a customer by asking what they consider to be a stupid question.

Customers become offended when they realize through your discovery questioning that you didn’t do your research prior to the sales call. This inherently correlates to asking too many sales discovery questions which in turn reveals to the customer that the sales rep did not even bother to research the customer’s web site to learn what they do and ends up as an unsuccessful sales call outcome.

Are you sensing a trend here? All of their data findings presented as facts can be attributed to other inherent factors in their sample population. The hypothesis should be what are the right sales discovery questions to ask, not the right number. What is the correlation to the research and preparation the sales rep does prior to the call have on the number of sales discovery questions they ask and the corresponding outcome? What is the correlation to the experience and sales training the sales rep has had to the number of discovery questions they ask and the outcome of the call?

Remember, given the newness to sales that this companies users typically are…a good portion of these folks will fail and were never meant to be in sales in the first place. The root causes that should be looked at are:

• Why did we hire these folks who fail in the first place?
• What can we do from a sales training and sales coaching perspective to prevent them from failing?
• How can we teach newer sales reps to ask smarter and more effective sales discovery questions?
• How can we help newer sales reps learn the importance of doing their research and preparation prior to a sales call so you don’t struggle and ask either the wrong discovery questions, too many discovery questions or offend the customer?
• How can we help newer sales reps learn the importance of deeply understanding the different stakeholder types we sell to and how to tailor their discovery questions to be relevant to each type?

In closing, just because a flawed lecturer cites hundreds of thousands or millions of data points in their research findings, it does not mean it’s the right data set or that they have drawn factual conclusions from the data.

The post Flawed Lecturers (aka: Beware the Charlatan) first appeared on True Sales Results.

Ironically, the focus within sales performance research always tends to fall on sales performance at the individual sales rep level.  Most of the stats you read talk about individual sales rep quota attainment rates, sales rep attrition rates, sales reps ramp up cycles but there is little to no mention of the sales manager’s impact on all of those things.

Let’s examine a typical high tech software (B2B) company first line sales manager.  He or she probably has somewhere between 5-7 sales reps working for them.  They may or may not have responsibility for the sales engineers or the sales development reps depending on the way the team is organized.  An average annual sales rep quota ranges from $1.5-$2.5M, so let’s estimate that the sales manager is responsible for $10M in annual quota for his or her team.

Invariably there will be different levels of sales rep performers on each team.  Each team probably has new sales reps (due to either replacement or expansion) that need to get ramped up and fully productive.  How does the front line manager invest their time to optimize their team revenue?  What a lot of sales managers do is invest most of their time with the high performers on their team or the high profile opportunities.  While other sales reps on their team are left to struggle and figure things out on their own.

They can’t afford to teach by doing which is what far too many first line sales managers attempt to do.  They were usually high individual sales rep performers which led to them getting promoted into sales management.  But just because you can effectively sell a solution, doesn’t mean you can teach someone else how to effectively sell that same solution.   Far too often we see first line sales managers basically acting like the sales rep on deals.  This doesn’t scale because you can’t be in 5 important sales meetings at the same time and the sales reps on the team aren’t learning how to sell more effectively when you take the wheel.

Rather some will get frustrated because they aren’t learning and they don’t have a sales coach who can coach well, so they leave the company in search of a better sales coach in a new company.  The most common reason why sales reps resign from companies is due to their perception of sales management.  Anecdotally I hear this all the time from sales reps that have worked for me over the years as the primary cause of leaving a job for a new one.   They may not tell HR that as they don’t want to burn any bridges, so the company doesn’t identify the problem.   How many times do you find top performing sales reps that were promoted into sales management that struggle and eventually go back into indiviudal sales rep jobs because they were not good coaches/managers?

We are brought in to companies that have problems ramping up new sales team members effectively or are not engaging and selling as effectively as they believe they should.  During our discovery phase with new prospects, they are generally very well versed on the aforementioned individual sales rep stats.  In fact, they can regale you with specific numbers, percentages and failure points at the individual sales rep level but typically struggle with honestly answering questions about their sales manager’s impact on their sales performance.

We emphasize that any effective sales enablement program is only as good as the sales management team that should be reinforcing it in the field with their sales reps.  If you are only focusing your sales enablement efforts at the individual sales team member level, then you will simply never achieve the same levels of performance that companies do who help teach and reward their sales managers on how to be an effective coach.

The post Can your sales coaches coach? first appeared on True Sales Results.

While sales management wants to make the job appealing and doesn’t want to harp on what is considered to be the drudgery of territory development/prospecting by the sales rep. The problem is then perpetuated when the newly hired sales rep is “ramping up” (a future blog post) their territory and pipeline without a clear delineation of territory development/pipeline building accountability. Most companies will assign an annual sales quota but don’t provide more granular guidance around what the expectations are for the first 90-120 days on the job. This is precisely why a territory development plan and methodology is vitally important. During the recruiting process, the hiring sales manager needs to actively look for evidence that the sales candidate possesses the territory development and prospecting traits necessary for the position. The hiring sales manager also needs to clearly communicate what the sales rep’s responsibility is with respect to territory development and building the pipeline.

The sales rep should plan on presenting to sales management within the first 30 days on board a territory development plan that delineates the activities that they will undertake to build their territory. How will they leverage partnerships or alliances? What professional groups do they belong to or do they need to join? What are the best conferences to participate in to meet industry thought leaders and influencers for your particular solution or products? How many introductory calls and meetings per week and what are the corresponding conversion ratios (i.e., discovery, demos, POCs, proposals, and ultimately closed customers)? What are the pipeline rules of engagement? What does the pipeline need to look like at various intervals-30 days, 90 days, 120 days, etc.? How is sales management checking to ensure that the territory is being developed incrementally and properly? What are the feedback mechanisms?

What isn’t measured doesn’t get done in the business world. Measure early and often the territory development efforts of your sales people. Provide immediate feedback when you identify a pipeline shortfall before it is too late. Sales rep attrition is incredibly costly to companies and there are some simple things that you can do as a sales manager to reduce your sales rep turnover.

The post Why is territory development a challenge for most sales people? first appeared on True Sales Results.