Why do we see so little HR managers in executive committees?
By Pascal Persyn on December 17, 2009 @ 14:21
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Tags: , change management, HR policies, Leadership, value chain alignment, walk the talk
I regularly hear HR managers complain about the lack of impact they have on corporate decisions. That they’re not taken seriously. Being informed way too late of decisions to act pro-actively. That they should be part of the executive committee because people are the most important assets of the company. Could it be that HR is stuck in his own theories and all together are enclosed in their own HR living environment?
I see 3 reasons which I will support by real life examples:
- Many lack the necessary business insight to serve as a sounding board for line management. Therefore they behave as “prescribers” to questions from line management. Yey these questions are usually too symptomatic due to the daily ins and outs involvement of managers. A good example is a sales manager asking for closing skills training because of a too low hit-rate and/or decision dates continuously shifting over time. Result a closing skills training is being organized. Yet a lack of closing skills is in less then 5% the real cause of the mentioned problems. The solution should have been HR offering to analyze the root cause and to propose solutions with a lasting impact. This of course is only viable if HR is taken seriously thanks to their business insights.
- Secondly, I see HR departments with new, good in itself, theories and plans that are too heavy and difficult to be implemented on top of the daily work that unfortunately does not stop because of a change process. This in turn leads to frustration in HR departments because they get too little involvement of line management to implement the necessary changes. These projects are usually not enough adapted and pragmatic to the real world which leads to quite large resistance. This in turn leads to a too low adoption rate and results quickly fading out. A good example is some of the competence and growth/evaluation practices and programs put in place. Heavy bureaucratic processes with formalized timing and reporting from managers to HR. Automated in user unfriendly intranets. Seldom based on simple deliverables and a common language which improves day to day communication between manager and employee. Let alone creating an environment stimulating people to give the best of themselves in order to create a chain of actions leading to optimized business results.
- HR does too little effort to understand and create insights on management level in cross departmental issues and linkages. Their distance to the daily ins and outs puts them in the ideal position for those insights and to share these with their colleagues. Of course, they simultaneously need to propose pragmatic solutions. A good example is a solution consisting of building sales ready deliverables combined with sales training, coaching and upgrading sales meetings to becoming an experience sharing platform. This solution require budgets from 3 departments in a lot of large organizations. Training from the HR budget, deliverables from marketing and coaching/consulting from the sales budget. I’ve seen very few HR people who took internal actions to launch such a project, let alone understanding the business need and internally sell such an integrated approach.
The above shows in a painfully obvious way that a lack of operational knowledge and insights on the one hand, and implementation focus on the other hand forms the basis of the problem.
Some possible actions which can resolve the problem:
Start by breaking down the HR walls. Translate theory into pragmatic solutions feasible even if it sounds like a bad idea from the theoretical point of view. This means that the broad and deep use of the skills and tools must get the upper hand on the theoretical appropriateness of the solution.
Focus on gaining more business insights through more time to spend in the workplace. Divide your time outside the company premises by not only networking and studying in HR circles but also spending a lot of time in broad management environments such as the vMA (management association in Flanders) to name only one. It will allow you improve your operational knowledge as well as being able to toss of your ideas and experience with line managers from other companies.
Only then will HR:
- sufficiently understand what really lives on the floor;
- get broad support from the staff and get surprised by the acceptance of their projects;
- asked to be part of the executive management team;
- and create lasting impact thanks to their efforts.
How to improve your forecast accuracy?
By Pascal Persyn on November 28, 2009 @ 12:16
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Tags: , buying clock, buying funnel, forecast accuracy, forecast visibility, funnel management, sales funnel, Sales-Process
How to questions from readers and customers prompted me to write an add-on to my previous post on funnel management.
The first thing that has to be said is that few companies have changed their sales approach in an appreciable way over the last few decades. Yet buyers are seeking to buy and not to be sold to for over a decade.
I still see sales trainings and managers telling their sales and to look at the sales cycle and behave in an way that is inward looking. Sales force automation (SFA) and customer relation management systems (CRM) haven’t really helped to convert the front-line in an outward looking mode and helping people to buy from them instead of being sold to.
I was pleasantly surprised to see one of the outcomes of the 2009 sales conference in Miami where the buying cycle emerged as the new standard for funnel management. I trust this to be a stimulus for all the Perpetos customers bringing this into practice since 2005. But their is still a long way to go. It is indeed the best way to get subjectivity out of your funnel, yet it demands a mind-shift of the whole sales organisation and another way for management to coach and interact with their sales team. They all must learn to ask way more questions and ‘really’ try to understand what the customer is saying.
The principle is simple: Ask the customer questions which allows you to know the readiness to buy of each individual in the decision making unit (DMU), align them all so that they move through the buying cycle in a synchronised way and adapt your actions to it.
A couple of tips to improve your funnel management:
- Stop tracking and discussing sales steps and process. Start using readiness to buy phases based on reactions and answers to questions from each individual involved in the buying process. Ideally start using the Buying Clock. Using the time on the clock is an easy way for implementing a, consistent used, common language.
- Are we asking for and tracking the next step or are we engaging the sales rep to first decide on the next objective to facilitate the buying process on a project level before deciding what the next step should be, when and with whom? Do we track this in our funnel?
- Track the pain level of the customer by also knowing the impact of the challenges on the customer. Is their a compelling reason or an urgent need?
- Has your sales rep access to the decision maker? Is he continuously involved in the process and kept up to date by the sales rep?
- Is the go-live date the most important date we discuss with the customer? Is it a fixed date and why or can it easily be postponed? Do we know and are we tracking the go-live date?
- Has the customer actually confirmed your solution fit and did we postpone drafting the proposal until that moment?
- Split the weight % in 2 distinct ones: project%=what is the probability of the customer actually buying and win% = the probability of you winning the deal.
- Are you tracking the most important mandatory buying criteria and what is the perceived scoring of the customer compared to the competition? Do you discuss ways to influence these buying criteria?
Finally:
- Convert your weighted funnel in a scenario based funnel on which you coach the sales rep.
- Engage in vivid 1:1 discusions with sales to set a continuous improvement process in motion.
Your benefit and result: An accurate forecast with a highly improved visibility.
Funnel management: admitting a pain doesn’t mean buying
By Pascal Persyn on October 23, 2009 @ 16:50
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Tags: , customer focused organisation, funnel management, hit-rate and cost of sales improvement, pipeline management, sales performance
The basis of a good quality funnel is one which is based on prospect readiness to buy!
The most often used funnels nowadays are still based on subjective input from sales. It’s amazing to see how many managers are using such a funnel to predict revenue and use it as the basis for budget exercises. This is the funnel that most people use yet it is a very outdated model. This type of funnel is an artificial invention taking the eye away from the prospect and puts the focus on sales actions.
The fact that doing something is putting the opportunity on a given point in the funnel is a totally wrong assumption. The thinking is flood. You can give company and product presentations, demo’s, send proposals even when asked, etc without achieving anything. The question is am I doing something which corresponds with the readiness to buy?
Here are the biggest funnel mistakes:
- input based on subjective sales rep input. The gut feeling of sales people in terms of funnel management are seldom correct because:
- they are to closely involved to have an overall view
- most sales are to much influenced by the opinion of their ’sponsor’ and/or last sales action
- they have too little visibility on what’s happening at decision level
- not enough, if at all, contact with the ‘real’ decision makers
- individual forecast building by using a percentage win-rate on each of the opportunities. Most funnels at sales rep level and even on corporate level have to little opportunities at the same stage with too much variation in size
- defined by selling activities: performing activities is not necessarily moving the opportunity closer to a decision
- lack of common definitions
- imposed as a reporting tool and not as a day to day self-coaching tool: The funnel will never be up to date or based on careful thinking if it is not in a format, and incorporated in the way of working, which influences the agenda and behavior of the sales rep
- tracking and reviews based on must win deals resulting in starved pipelines and pushing salespeople to do the right things at the wrong time.
Helping management and the VP sales to more accurately predict the revenue is to convert the funnel into a buying funnel which tracks the readiness to buy of the opportunity. This is even more true in more complex sales with quit an amount of people involved in the decision taking. Because each of the involved people have their own agenda and readiness to buy which must be synchronized in order to move the opportunity closer to a decision in the quickest way possible.
The mental stages a buyer is going through:
These phases are universal and cultural independent.
- execution of existing solution and not interested in any information or offering in that area
- executuion and interested: something triggered the person to want to know more about something
- Field of Tension: Starts with an admitted pain which evolves over time into an urgent need. This results in the decision to buy something
- Market Research: The prospect goes out to the market to search for potential solutions and vendors
- Hesitation: This phase starts when the prospect thinks to be convinced to buy what from whom. At his point the focus shifts from looking to the benefits and advantages of acquiring the solution to all what can go wrong after having bought.
- Implementation: This is the period during which the solution is being implemented.
- Execution: The solution is in full use until the cycle starts all over again.
Perpetos has converted these phases into a 24 hour buying clock™.
Some of the reported results you acquire by this system are:
- a true shift towards customer focused thinking and acting
- an objective pipeline with a much better accuracy
- improved internal communication based on the hours of the clock
- lower cost of sales (i.e. less multiple people meetings because sales and pre-sales exactly determine when their presence is needed)
- improved hit rate
- more balanced pipeline
Let my know your experiences!
Tips to get access to the real decision makers
By Pascal Persyn on September 01, 2009 @ 08:54
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Tags: , buyer-aligned messaging, funnel managment, know your customer, Sales effectiveness, Sales management, sales skills, sales tactics, solution selling
I’ve seen and heard it over and over again. It’s difficult to get access to real decision makers. It’s even more difficult to keep them in the loop.
Entering late in the buying cycle is probably the single most important reason. A project manager is taking the lead once an opportunity is in the closed minded phase (in some businesses when the RFQ/RFP has been send out). This means that all requirements have been gathered and translated into buying criteria. Therefore real decision makers and those faced with the business problem are no longer involved in the market research phase. They will of course come back into the loop at decision time but that’s way to late to build a meaningful relationship for this opportunity.
5 tips to help overcome the main obstacles:
- Research the power structure and contact the highest ranked person faced with the business problem:Marketing should influence all decision makers faced with business problems you can solve. See: how to influence key decision makers And the one with the biggest impact should be contacted by sales to make an appointment based on a value proposition adapted to the business problem you want to discuss. They will only accept an appointment if their ‘readiness to buy’ is far enough developed but not yet to the state that they’re already convinced to know the buying criteria the solution must meet.
- Speak their language: Sales people are often pushed down or don’t get access to them because they’re unable to have a value add business conversation. Decision makers are not interested in a product or technology pitch. Nor are they interested in knowing more about your company. Remember: Decision-makers believe they know the destination but they have a problem getting there.
- Understand the psychology: Your contact will probably have cold feet of introducing you higher up in the organisation. They’re not sales people and therefore be reluctant to sell the idea to their boss. Afraid of the impact in case of a wrong judgement or setting up an appointment with a sales rep that doesn’t speak the right language.
- Get agreement on value chain impact: Showing that the business pain has an important impact on other key people in the organisation will help you to get access even higher in the organisation. the reasons are:
- You helped your contact to build the needed story to sell the appointment
- You proofed that you understand and have experience dealing with the business problem
- You proofed that you speak the right language.
- Negotiate access: You have to negotiate access if all of above has been insufficient to get access. Remember to check the status of the opportunity in terms of readiness to buy. All of above will probably fail if you came in via the project manger or buyer because the opportunity is already too far down the buying cycle. So if you came in at the right time you will get access when agreeing on certain work or commitments from your side that are of value to your contact in exchange for that meeting.
Closing tip: Be careful with your forecast if you put in opportunities without having access to the real decision makers. These opportunities will drag on and on in your pipeline. Quit normal of course since you have very little insight and control over the ‘real decision’.
How to be a topnotch B2B marketer part II
By Pascal Persyn on August 19, 2009 @ 16:12
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Tags: , innovation, lead generation, market readiness, marketing and sales alignment, product management, value chain alignment
- Build an experience sharing platform: It’s amazing to see how much information and experience stays underutilized and leaves the company with former employees. An experience sharing platform, ideally, managed my marketing is pivotal to leverage, study and optimize the best practices. Sales-marketing alignment is the immediate result. The platform consists of a small set of sales-ready deliverables which are kept up to date per segment and key-contact in the buying process of prospects and customers. Regular sales meetings with best practice sharing and assisted by marketing are the starting point. Ask your sales to send a blackberry style email with the summary of meetings (especially on pains, challenges and capabilities) and make sure marketing has access to that information in order to keep the best practice up to date.
- Facilitate market ready innovation: The information gathered during the visits by marketing (see post with must do’s 1-5) and aforementioned internal meetings will deliver a wealth of information to help inform and educate R&D and product management on market needs and what they should be capable of doing. I’m still surprised to see how R&D, product- marketing and management are limited in their view and understanding of the market because sales is translating customer needs in features themselves leading to the battle of prioritizing development on the product roadmap. On the contrary of what they think at a first glance, R&D and product marketing/management will be able to be creative and innovative to an unprecedented level because they will understand the native customer environment.
- Educate your internal customers: Increase the value of the marketing department by playing a pivotal role in all communication from and to the market. Keep the following up to date:
- win/loss reasons by calling key decision makers per deal yourself a couple of weeks after a decision has been taken. Assemble those winning and losing buying criteria per supplier;
- best practice per segment and key-contact and use it as a base platform to streamline interdepartmental communication;
- prioritised market pain/capability area’s for which the product should be upgraded.
- This will enable you to monitor proposed product upgrades and new versions in terms of competitiveness and hit-rate thanks to a better coverage of market needs.
- It will also enable you to focus your external market education to a group of prospects who are seeking your leadership.
- Implement a lead nurturing program: You main mission next to the management of the experience sharing platform deliverables and educating internal customers is to deliver ‘real’ sales ready leads. The only ROI based approach is to start communicating with your targeted market on a continuous basis with ‘role-based’ messaging. Meaning language adapted to the specific role in the company of each of the different contacts involved in the decision making process. also see: necessity of lead nurturing
- Measure and communicate: Make sure you can measure most if not all of the marketing activities. It will help you to communicate progress on all these area’s. Some of the mentioned points might be quit heavy change projects and thus will take time, patience and continuous improvement. This is the best way to ensure a large enough budget to accomplish all of the 10 must do’s.
Have fun implemeting the 10 rules to be a topnotch B2B marketer and keep me posted on experience and/or challenges.
