Change or Die: Transforming Your Sales Organization to Meet the Challenges of an Uncertain Economy

By Walter Rogers
President and CEO
Baker Communication

The signs of economic uncertainty are everywhere:

• The US GDP has essentially flatlined
• Unemployment is still sky high. While the official unemployment rate is 9.6%, once you add back individuals that have given up looking for work some estimate the unemployment rate is as high as 18%
• Corporate spending is constrained
• Consumer spending is tentative at best
• Economic indicators are still sending confusing signals
   

All of which is contributing to:

• Longer sales cycles
• Stronger pushback from procurement representatives
• Fierce competition for every deal
• Inevitable concessions and discounts just to compete
   

In the face of all these discouraging facts, may sales organizations have resigned themselves to low or no growth and lower revenues, positioning themselves to "ride it out" and hope the economy comes back soon. On the surface, this strategy might seem prudent, especially to conservative, risk averse executives. However, this is no ordinary economic downturn, and organizations who take a wait and see attitude are ultimately going to see their productivity collapse, their margins evaporate, and their organization fade into obscurity and irrelevance; just another one of those companies that failed to adapt and paid the price.

The truth is that the challenges of this economy aren‘t related to a lack of business opportunities; there are plenty of opportunities for sales organizations who understand what it takes to uncover and develop them. Customers haven‘t stopped buying; they have only changed what they are buying and how they are approaching the procurement process. The challenge for sales organizations, then, is to develop effective strategies and tools for getting out into the market place to uncover and win that business. This challenge can be summarized in one word:

Prospecting

Once upon a time sales and prospecting were almost synonymous; it was just assumed that anyone in sales was expected to dedicate a great deal of time to identifying and developing new opportunities. However, a decade of comparative prosperity has lulled many sales professionals into thinking that prospecting was more of an afterthought than a priority. After all, as the economy soared, it seemed like customers were lining up to buy whatever was on offer. Between taking orders and managing the run-rate business, most sales professionals had their hands full, and the reward was pretty good. Sure, most organizations still had some prospecting requirements, but it was pretty easy to take care of by making a few phone calls on Friday afternoon.

The bottom line is that after years of watching business roll in, too many sales organizations became flabby and out of shape; their prospecting muscle is weak and rubbery. Now, when prospecting is possibly their only option for survival, they are nowhere near ready to go the distance. The only answer is to start working out, working hard, and working smart to transform the organization from one that has been passively coasting to one that is aggressively pursuing new opportunities, new markets, and new solutions before it is too late.

The 80-20 Rule that drives the prospecting vision

Here is a very important principle to help you understand the revenue generating potential of prospecting: It is called the 80/20 principle prospecting, and it goes like this:

Let‘s assume that 100% represents ALL of the potential customers in existence that could benefit from your products and services.

In this situation, the 80/20 rule says that only 20% of those potential customers are even aware that they have a pain or a problem that you could solve and are actively searching for a solution.

The remaining 80% of the market doesn‘t understand their situation or your products well enough to 1) realize that they have a serious problem that could be solved and 2) that your company offers solutions that could provide significant benefits to help them solve it. This untapped 80% is your key to dramatic future growth, if you could only break into it.

Obviously, you want to focus first on the 20% that are aware they have a problem and are searching for a solution. But what do you do after that?

Prospecting is the key to unlocking the additional 80% and igniting your business growth.

Four Stages to Achieve Transformation

The words "easier said than done" were probably originally said about the challenge of transforming sales organizations. Achieving change of any kind is never easy, but sales organizations – comprised of a unique combination of personalities ranging from methodical managers to loose cannon sales reps and everything in between – present unique problems for the transformation process. To achieve lasting transformation, any organization has to successfully navigate through a four-stage process:

1. Pain – all change begins with some kind of pain that provides the motivation for even thinking about change; after all, if you aren‘t experiencing pain, there is rarely enough motivation to change. The pain might be lagging sales, shrinking margins, losing market share – all of which translates to frustration in executives and anxiety in everyone else. Something has to be done.

2. More Pain – this is the reason that organizations stay at Stage One for so long; the pain of change appears harder to deal with than the pain of staying where you are. Change may require anything from letting people go to rebranding the entire organization, and along the way there may be expensive investments in consultants, training, and CRM, - not to mention uncomfortable behavior transformation from the Executive suite to the mail room. Until the Stage One pain becomes more unbearable than the Stage Two pain, organizations are likely to stand pat and simply tolerate the dysfunctions and the disappointment of their current situation. As an alternative to real transformation, these organizations often decide to keep doing what they have always done, and just doing it harder, longer and faster. As we all know, this is the definition of insanity.

3. New Strategies Produce Initial Success, (BUT) – Once an organization becomes committed to the transformation process and pays the price to begin to change, they will inevitably achieve some level of success. The organization becomes more efficient, new opportunities are discovered and closed, the sales numbers go up and everyone feels the organization has turned a corner. However, this is still a very risky time for the organization. The early stages of transformation often represent no real transformation at all. Instead, everyone is caught up in the enthusiasm of the moment, pulling together to achieve a goal and even sacrificing for the sake of success. Then, once success has been achieved and the new initiative becomes routine, everyone gradually begins to slip back into the old behaviors and attitudes. Six months later, the numbers are as bad as ever.

4. Reinforce the Transformation Every Day – The only way transformation truly occurs is for the organization to relentlessly pursue it every day, reinforce it every day, and coach to it every day. From the Executive suite on down, the attitude that drove the initial transformation – and the actions that supported it – must become a completely new culture that is so pervasive that no one in the organization can even remember when they used to think and act a differently. Put this way, transformation can take a long time to implement, and even then, you are only a few months of careless inattention from being right back where you started.

Ignite and Sustain a Prospecting Culture

In the weeks ahead we are going to hear from some of the world‘s most successful sales professionals and sales executives as they reveal the secrets of transformation that can produce a dynamic and highly successful prospecting culture for your organization. We will look at how this transformation process impacts executives, sales managers, sales professionals and what it takes for it to permeate the culture of the entire organization. We will learn what must be done every day to put an organization on the path to transformation and keep it there. It is possible to beat the competition and grow your business, if you are willing to change now, and never look back.

Action Items:

• How much time do your sales professionals spend on actively, aggressively prospecting for new business? No, seriously, not how much time are they supposed to be prospecting, but how much time are they really applying themselves to prospecting activities? How do you track and evaluate the quality of these activities now?
• How much training and coaching do you provide your teams to help them improve their prospecting skills?
• Do the top executives in your company place a high value on prospecting activities and communicate this expectation across the entire organization?
   

Walter Rogers is the President and CEO of Baker Communications. Baker Communications is a sales training and development company specializing in helping client companies increase their sales and management effectiveness. He can be reached at 713-627-7700.

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