“Closing”, Another “Bad Word” In Sales?

Recently, in a conversation with a colleague, I used the word “closing”, relative to Sales. This person, literally, cringed, in response to my use of the word. I’ve had that sort of reaction numerous times before. Maybe you have too. Every time it happens, I silently wish that I could do something to have this topic viewed in a more favorable light.

It seems that there are negative connotations that go along with the word “closing” that are similar to what I addressed in an earlier posting entitled “The Pride and Prejudice of Sales“. That article dealt with a commonly found bias in our culture, equating the title “Sales Person” with the label “Huckster”. With those who hold that view, I suppose they envision “closing” as the time when “the Huckster springs his or her trap.”

One publication I’ve found, that does a good job of tackling this issue is “10 Steps To Sales Success“, by Tim Breithaupt. Here, the ideal Sales process is described as “… a mutual journey of honesty, trust and respect as you and your Customer work in harmony …”. In this context, the Author presents “closing” as “… confirming the sale using a non-manipulative, straightforward approach and presenting a practical, value-added solution.” I think that is an excellent way of expressing what I’ve longed to be able to do in the situation I mentioned earlier when I said, ”I silently wish that I could do something to have this topic viewed in a more favorable light.”

Since Breithaupt does a good and thorough job on this theme, I won’t bore you with a rehash here. However, I do want to add a bit to one facet of the matter that Breithaupt touches on. Its where he says, “You need to be engineering commitment throughout the entire sales call because anything you do or say, at any step, will either erode or enhance the sale.” I agree with that and I just want to emphasize that this doesn’t apply to just an individual sales call. Though that’s not what Breithaupt is saying, I think this point can be overlooked. Failing to see this leads to another of the biggest misconceptions about “closing” – i.e., that it is the terminus, the final act of a sale. However, “closing” shouldn’t be regarded as a finishing point. Rather, the “engineering commitment” should be taking place throughout the entire Sales process. The best definition I’ve learned for “closing”, in this respect is “a commitment to positive action” on the part of both parties. In other words, a “quid pro quo”. In the early phases of a Sale it might be something like, “If I’ll put together a 30 minute presentation showing how we can help your company save X cost over your current method, will you set aside that much time on your Calendar and have your CFO attend with you?” Unlike “springing a trap”, these sort of calls for “commitment to positive action” on the part of both parties is really just a way to determine if and how the Sales process is ready to move forward. This, too, hearkens back to what I spoke to in “The Pride and Prejudice of Sales” – i.e., “There is a legitimacy to the Sales function in business. It isn’t ‘palming off.’ That is hucksterism. “

So, as always, let me ask you, what are your views on this topic? What have you read that you think does a better and/or more thorough job of discussing this issue? Please share any and all input. The goal here is to share the richness of our experience for the mutual benefit of the group.

The “Highly-Leveraged” Pay-Plan. A Right-Fit For The Tough Economy?

It seems that current economic conditions are resulting in more companies considering a more “highly-leveraged” pay-plan for their Sales force. Generally, this means a lowering of Base pay for a Sales person and an increase in the percentage of their potential Commission. As thoughts along these lines have been presented to me, they’ve often been accompanied by comments like, “A Sales person should eat what they kill, right?” That sort of argument can seem logical, at a gut-level, but it may not be the right approach for every circumstance and it certainly merits more thorough examination.

In order to give this topic a more complete look, I think it should be viewed in context – i.e., where does it fit in with the overall design of the pay-plan/commission-plan that’s right for your company? Of course, the “right design” for a commission-plan is going to vary from company to company. So, in order to do this “more thorough examination”, its necessary to come up with a “yardstick’ that’s good for general application. One that I came across some time ago, which I think suits this purpose as well as any, was an article in BNET called “Design a commission plan that drives sales – Sales Commissions”. This article begins with a “Ground Rule” which seems like a great “yardstick” to start with on this topic. It says:

‘* Start with the outcomes and behaviors you want to foster;”

Generally, as this topic has been raised with me, the only “outcome” receiving any attention is increasing revenues while reducing upfront investment. In one case, I met with a business owner who was targeting a 50% increase in annual revenues while planning to reduce the base pay of his Sales people by more than 50%. Of course, this is a pretty extreme example and it may just be a reflection of that company’s financial position. However, this company’s approach on this topic is similar to others I’ve encountered recently in as much as it only focuses on one desired “outcome” and it ignores desired “behaviors”. Ironically, in most cases where this is coming up, its coming from business people who tend to view “typical Sales people” in the way I described in ‘The Pride and Prejudice of Sales”- i.e., “a huckster” who is skilled at “palming off” some product or service. The true irony in this is that those very business people are adamant about not having that sort of behavior as a part of their company. It seems to me that their myopic perspective on this is more likely to produce behaviors they don’t want while being unlikely to produce the revenue outcome they do want, at least not consistently and not in the long-term.

This isn’t to say that there’s no place for the “highly-leveraged” pay-plan/commission-plan. But, as with any commission-plan, it should be designed considering ALL the “outcomes and behaviors you want to foster.” I think most Sales people also have the gut-level reaction to the statement, “A Sales person should eat what they kill, right?”, that it seems logical. However, that’s only going to hold up, if they feel a part of an organization where everyone “has some skin in the game.” In the case of the business owner I mentioned who was targeting a 50% increase in annual revenues while planning to reduce the base pay of his Sales people by more than 50%, this was a complete disconnect with the company’s pricing structure. That pricing structure is pretty standard … a Customer is told what they’ll get and at what price … the Customer isn’t allowed to pay more or less, depending on how they like what they end up with. Of course, any incentivized Sales compensation-plan won’t completely map to that sort of pricing structure either. But, if I was on the receiving end of the pay-plan the business owner in question is contemplating, the gap between how I was getting paid and the way the business owner is getting paid would most certainly have a negative impact on my behavior, especially in terms of my feeling a part of that company.

So, what are your views on this? As always, we welcome you sharing your related views and experience for the benefit of others.

New Year’s Resolutions for the Aspiring Sales Person – Part Three

This is the final chapter in my three-part overview, aimed at being “… a good way to share lessons I’ve learned on how I could’ve done things differently and better in developing my career, as a Sales Professional.”  In Part One, I discussed the general recommendation, to “BE INTENTIONAL ABOUT IT!”  From there, I went on to make the specific suggestion to “HAVE A MENTOR!” In Part Two, I offered a more detailed proposal to “Have A Proper Formal Education, As A Foundation!”

Of course, its difficult to be complete on the sort of topic this three-part series is meant to address. Probably with anyone who’s in a position to look back over the decades of a a career, there are many changes you’d make, if you could go back to do so. And, changes in one area can easily lead to changes in other areas. However, in keeping with the theme I’ve set, to deal with just a few foundational issues, I’ll conclude with just one more:

Have A Structured Continuing Development Plan!

In a way, this is an extension of my topic in Part Two, ”Have A Proper Formal Education, As A Foundation!” And, once again, it may be helpful to examine my beginnings in this regard:

My first Sales job was with a company offering document management systems. I was hired by a VP, whose background was in Engineering and I reported to a Branch Manager, whose background was in Finance … neither of them were Sales Professionals. I guess the fact that I was able to land the job in the first place is an indication that I was gifted with some Sales instincts. However, just a few months into that job, the Branch Manager was replaced by a guy with a successful Sales background. In working with the new guy, several startling realities became very clear in fairly short order. These were: (1) I was accomplishing as much as could be expected, with my gifted skills. (2) I wasn’t meeting Quota. (3) I had no clue what to do about it. At that point, my new boss made a decision that was truly a watershed event for my working life. If he had decided differently, its likely that I’d be writing this blog on something other than Sales. But his decision was to send me off to a Fortune 500 company’s Training Center, to take their course in Professional Selling Skills.

I’m thankful for my old boss’ decision to enroll me in that “PSS 101″ course. Likewise, I’m thankful that, since then, I’ve been blessed with Sales education including Miller Heiman, Zig Ziglar, Strategic Selling, Selling to VITO, etc. as well as Fortune 500 employer’s internal selling curricula. Along with this, I’ve gained from learning provided by employers and professional associations in Leadership, Management, Relationships, etc. Just recently, though, a prospective Client asked me a question that reminded me of an ongoing flaw I have in this area. The question was, simply, “What business book have you read recently?” I’m a little embarrassed to admit that I was stumped, momentarily. After stopping to consider this for a moment, I realized that the business book I was currently reading was just under the notepad I was using. Its entitled, “Biz Blog Marketing”. Then, I turned to look at the bookshelves in my home-office and saw the two books I’d recently finished, “How Did You Do It Truett?” (The story of the Founder of Chick-Fil-A) and “Becoming A Coaching Leader”. And, as I looked back to my PC monitor, I thought of the significant volume of reading I do daily, on-line, just to keep up with my business and to support the three blogs I write. So, why the embarrassment and where is the flaw? Its in the very same place that I mentioned in Part One of this series … “My becoming a Sales Professional, in fact, was pretty serendipitous. Much like Harriet Beecher Stowe’s character Topsy, to a great degree and especially early on, “I just growed.” In other words, I wasn’t very “intentional” . And, with this, there’s still room for improvement. With this in mind, I want to make these concluding recommendations:

1. Lay out your own plan for the business-related courses you want to take over the next several years. Perhaps an employer or a professional association will provide these for you but you should have your own plan for a curriculum that you think will best serve your interests and attaining your goals. When its time to take the next course on your list, see to it that you complete it, regardless of who will provide it.
2. Keep a record of the courses you’ve completed. In most cases, you’ll get some sort of certificate. Its easy enough to keep these in a 3 ring binder. Don’t let yourself fall into the trap I’ve fallen into where I’m looking at my resume and saying, “Oh, yeah. I remember, going to San Francisco, when I worked for Minolta, to take that AMA course in “Dealing With Challenging Personalities”.
3. Have a formal reading plan for each year- i.e. Specific titles you will read, with specific completion dates assigned to each title. Back in the days prior to laptop PCs, when I used to do a lot of air travel, I relied on that “downtime” to keep my reading caught up. Those circumstances changed. So, I recommend laying out a plan that you will carry out regardless of changing circumstances.
4. Keep a record of the reading you’ve done too. Its not practical for me to note every article I read on-line but, if I had prepared the sort of reading plan detailed above, it would be fairly simple to use it to note the actual completion dates. At the end of the year, that completed plan could be stashed away in the same 3 ring binder used to store the certificates from the business courses I’d completed.

So, that pretty much wraps up this year-end exercise in somewhat baring by business soul. But, as always, you’re welcome to add to it. If, like me, you’re an “old hand”, please add your experience and your views by leaving a Comment. And, especially if you’re in the early stages of a Sales career, I’d welcome hearing from you. As I say on the “About Gary Wiram” page of this blog: “My hope is that this blog will be beneficial to other Sales and Sales Management Professionals.” That is my central purpose – i.e., I don’t get paid for this. So, I hope you’ll know that I’m most sincere, with that page going on to say, “I welcome hearing from you, via your Comments. If you’d like to hear more from me, contact me today, via this blog’s Email link!”