This Podcast is about the inspirational journey of Jamie Shanks, the CEO of Sales for life who has trained over 100 thousand personnel across various verticals in sales. He provided training in six continents in organizations such as Microsoft, Oracle, American Airlines, and many more! He has also authored highly acclaimed books such as Spear Selling-Account Based Selling for Modern Digital Professional.
Over the last month or so, I’ve been hearing from our customers, my key contacts, and board of advisor members, that—in contrast to the last 10 years of economic growth—all signs are pointing to an economic slowdown.
Many people have been in the workforce for less than 10 years, so this will be the first time that many sales leaders will be managing a situation like this. What are they going to do? The last slowdown was in 2008-09. Are they going to try to dust off a playbook from 10 years ago? If you’re a leader who has never experienced this, how are you going to maintain the most vital leading indicator to your sales department, which is centered around sales pipeline?
Let’s dig into this question. In most organizations, during economic slowdowns your CFO will normally look at cutting three things:
2. Tools—because of the cost per seller.
3. Soft skills.
But aggressive companies—and those that came out of the 2008 financial meltdown that did well—bucked the trend and doubled their marketing budgets. They didn’t look at the market and see it as a necessary evil to retract; they saw it as a competitive advantage to double down and enhance the brand.
In a potential economic slowdown, your own deals will get tightened. Margins will get cut, and sales people will have trouble meeting their targets. In the 2008 recession, by doubling down on their marketing spend, despite it feeling risky, those companies that succeeded received more exposure.
That said, it’s a fact that CFO’s might not be willing to let you add to your headcount during a difficult economy. So how are you going to increase more yield and throughput with the sellers you have? If the CFO decides to reduce or stabilize headcount, or reduce things like tools per seller, how will you give them the skills to win in a tougher economy?
Looking at soft skills
I highly recommend looking at soft skills. If we use a sports analogy, your team isn’t adding anymore free agents or doing anymore trades—so as the coach, you need to create more opportunities for the team you have.
My advice is to prepare your sales force NOW in preparation for this economic slowdown, and think through these three questions:
1. Do I have the right teammates on the bus to prospect?
2. What percentage of my sales force will be self-sufficient, and which are too reliant on outside lead generation, such as channel partners or marketing?
3. What specific skills does my team need to learn to mitigate this risk? Find creative ways to be able to address those changes now, before your CFO suddenly won’t release funds for this.
The key is to acquire budget to invest in your team before these changes happen.
I’ve just returned from a successful business trip to Dubai, and while I was there I met up with one of our customers, Arzoo Edroos. Arzoo is an account-based seller for Refinitiv and Thomson Reuters, and we’ve been working with her for the last seven years.
Like millions of people in the MENA/GCC region, Arzoo has embraced social selling. She primarily uses LinkedIn—and has achieved incredible results! If you have a sales team in the MENA/GCC region, Arzoo’s story talks about how social selling generated 70% of her sales pipeline. If your team sells into the MENA/GCC market, get ready to be empowered.
Arzoo started out as a prospector, and her job was to generate lead opportunities. At that time, she mainly used traditional sales methods. Seven years ago, she was introduced to social selling through Sales For Life’s training program. She began to use LinkedIn, and when she analyzed the conversation rate on the opportunities she had generated, she found that 70-75% of her sales that closed were purely through LinkedIn and social selling! That number is astounding! It’s a testament to how important it is for sales teams to implement LinkedIn and social selling to generate pipeline.
Not only that, but her results through social selling have taken her career to the next level. The sales she was closing with LinkedIn helped her make a case to her manager as to why she should be promoted to Account Manager.
“The leads I had generated, the sales I had closed, it was all thanks to LinkedIn and social selling, and the Sales For Life classes,” she says.
Arzoo uses LinkedIn for more than selling, though. She says LinkedIn is a valuable tool that she uses to resolve issues with products or services that she has purchased. When she has any issues, she will reach out to customer service departments via LinkedIn, and gets a quick response.
Bottom line: There are 21 million people on LinkedIn in the MENA/GCC region. And if you’re not using LinkedIn to generate pipeline, you’re missing out on a great opportunity. Regional excuses are no longer valid. By reverse engineering your finance, and risk, you’ll be able to target key accounts in a bold and different way—and like Arzoo, you too can have a large percentage of your pipeline come from social selling.
For more of Arzoo’s story, check out the LinkedIn post:
Since the year 2000, we’ve witnessed the rapid evolution of new technologies, government policies and global economies that have had a serious impact on how companies do business today. The stats are in and it’s clear that B2B buyers have changed the way they do business in this rapid change but have you or your sales team adapted to this constant change?
My evolution since 2000 looked like this. In the early 2000s I worked at Dun & Bradstreet, selling sales and marketing databases. In 2004, I got bit by the entrepreneurial bug and started Sales for Life to help the sales community solve some of its problems. From 2004-2012, Sales for Life was focused almost exclusively on sales recruiting. From 2012 to present — in partnership with Jamie Shanks we decided to dig deeper into the modern sales issues faced by the sales community so they don’t fall behind today’s buyers.
One of the big challenges that has hit the sales community since 2014 has been the “New Privacy Era”. The changes first started with Canada’s CASL law, then Europe made big changes with its GDPR law, and likely soon the US will be implementing various privacy policies that affect sales reps, and how they communicate with buyers. How are you adapting to these changes?
In this blog, We’ll look back over the past 19 years to help you look forward to the next couple of years. It’s time to review the trends and make sure you are ready for the future that is changing at a pace that many sales leaders are not able to keep up with.
2000-2005: Transformation Era:
2000 – Marketing automation was in its infancy (Eloqua – now Oracle – was only founded in 1999), so generating leads by email wasn’t as strong as it was today.
2000 – The recruiting world was in major flux – Monster.com was created in 1999 through the merger of The Monster Board and Online Career Center, and began amalgamation of the online recruiting world.
Late 1990s to early 2000s – Polycom played a large role in the evolution of video conferencing with systems such as the ViewStation® in 1998, which put Polycom at $1 billion in sales for the year, and their desktop solution, Via Video, which debuted in 2000.
2003 – LinkedIn launched in May 2003, and it quickly became known as a place to find jobs and/or find candidates. It was the recruiter’s dream, and years later became a major disrupter.
2004 – Facebook launched in February 2004. This was only the beginning of the social networking craze we now know.
Effects on Sales:
The Transformation era of the late 1990s to early 2000s had a few ideas that would dramatically change the sales community forever. In the late 1990s and early 2000s, reps were heavily required to pick up the phone and cold call (no research, no value) prospects, as marketing leads were not very targeted or qualified. Sales reps were either required to travel all around the world to meet clients, or your sales coverage model needed to be very wide-reaching, making it more expensive to sell in new markets.
If I look back to my early recruiting days, one of the nice-to-have requests sales leaders had for me as a recruiter was to hire reps with a so called “Rolodex” – AKA database (Millennials, see Rolodex image below). The challenge I had with finding reps with a “Rolodex” was they were typically veterans with several years of experience who were strong face-to-face networkers at industry events, socials, etc. They collected business cards, and they had strong networks of people that they new and who knew them.
This meant that these reps were typically very expensive to hire, and the good ones were far-and-few between, as it typically took several years for a rep to develop such strong networks. In most cases, companies needed to hire people without strong networks, and invest in them until they developed such skills and networks, and that usually took several years. Even with the launch of Facebook and LinkedIn in 2003 and 2004, this had virtually zero impact on the sales community yet!
The Rolodex was invented in 1956, by the Danish engineer Hildaur Neilsen, the chief engineer of Arnold Neustadter‘s company Zephyr American, a stationery manufacturer in New York.
2006-2014: The Portable Sales Era
2006 – BlackBerry was known as ‘CrackBerry’ in slang, precisely due to its addictiveness. Most mobile phones were still used by business people.
2007 – The landscape changed completely with the first iPhone, and then the beginning of mass adoption by more than just business people.
2008 – The first LinkedIn talent solutions product launches – Recruiter Job Slots.
2009 – LinkedIn launches in its talent solutions – Career Pages, Recruitment Ads, Recruiter for staffing agencies.
Effects on Sales:
The beginning of the portable sales reps started to happen with video conferencing hitting mass adoption and sales reps having access to all information with their mobile phones. The early adopter companies had an advantage, as reps were able to communicate with clients anytime and anywhere by phone or by video (which were starting to replace face-to-face meetings). By this time, LinkedIn was a major disrupter in the marketplace, and every rep knew that they needed to be on LinkedIn if they wanted recruiters and future employers to find them.
2014-present: The New Privacy Era
2014 – LinkedIn launched Sales Navigator, which gave the sales community contact management solutions similar to those that the recruiting community had come to love and enjoy.
2014 – Canada’s anti-spam legislation (CASL) came into effect on July 1, 2014—virtually handcuffing how sales and marketing could cold-outreach to new prospects.
2018 – Europe introduced the world’s strongest data protection rules. The General Data Protection Regulation (GDPR) came into force in May 2018, and was designed to modernize laws that protect individuals’ personal information.
2020 – The California Consumer Privacy Act (CCPA), passed in June 2018 in response to the Cambridge Analytica scandal, is slated to become the most comprehensive data privacy law in the US. The Act goes into effect on January 1, 2020, and like the GDPR, provides consumers certain rights, including the “Right to Know,” “Right to Access,” “Right to Opt-Out,” and “Right to Deletion.
Effects on Sales:
During The New Privacy Era, the world started tightening the rules on how companies and salespeople can communicate in a one-to-one and a one-to-many basis. In Canada and Europe, gone are the days that sales reps can find a person’s email address on the web and send a cold email outreach to that ideal prospect. In these two countries, you would be BREAKING THE LAW! Simultaneously, in this era of sales, LinkedIn finally started to see how they had become much more than a resume database and came out with a sales solution that would help sales reps directly access the world’s largest business network (Rolodex – baby boomer reference). In the last 8-10 years, with the use of LinkedIn, I have witnessed subject matter experts and massive personal networks grow 10X greater and faster than that hard-to-find sales experts from the early 2000s. LinkedIn allowed sales reps to build their networks to that level in one year, rather than the decade it took the Rolodex-Era sales reps to build.
What are you doing about it?
This blog doesn’t cover all the sexy sales topics like Artificial Intelligence (AI), but I have purposely left out the flash to focus on what I believe is a major oversight by many sales leaders in equipping sales reps with the proper mindset, skillset, and toolsets (yes – in that order) to communicate with today’s digital-savvy buyers. Let’s think about this for a minute. If we are in the middle of a restrictive communication privacy era, how does that affect sales peoples’ abilities to reach out to new prospects and buyers? What do you think will happen when the US federal government finally puts its revised version of its privacy act in place?
Yeah, I know it may take a couple of years from now, but don’t kid yourself, it’s going to happen! Look at all the top 10 data breaches that happened in the world just in 2018. Just sit and watch a few YouTube videos of Mark Zuckerberg’s sessions with Congress defending Facebook’s privacy policies due to its major data breaches, to see how serious Congress is about this topic.
As we know, American politicians like to go BIG when they take action – so what will happen when they look at the restrictive privacy legislation examples in Canada, Europe, and California to build the ultra US policy? Where will your reps be then? It’s always baffled me, why have companies not invested in their sales reps’ ability to build and grow their personal business brands, networks and expert personas? This is a major missed opportunity! It seems almost backwards that a company would invest so many marketing dollars on the company’s online brand (macro marketing), but have stopped short of making sure their frontline sales professionals are equipped with an online expansive expert brand (micro-marketing).
Sales reps who don’t build a strong online network and brand will fall behind!
This is literally the easiest time in the history of selling that individual sales reps can virtually become online experts with a massive industry following by just investing in the process. So, I ask again, what are you doing about developing the right mindset, skillsets, and toolsets when it comes to your sales reps online professional networks?
Over the last two weeks, two prospective customers have approached me with different ideas they had for their businesses.
The first company wanted to hire a Director of Social Selling who could develop their social selling skills inside the business—almost like a train-the-trainer model, who could sell social selling to their team.
The second company told us they were struggling to understand how a multi-week training program (which could be a virtual, instructor-led training program with e-learning assignments) can actually transform a sales organization.
Both prospective customers were missing a key ingredient with their above ideas: that missing ingredient was frontline managers.
I’m here to tell you that frontline managers are critical to social selling success. In fact, 51% of the success of a modern, digital sales force is determined by the coaching and accountability driven by frontline sales managers.
“51% of the success of a modern, digital sales force sits inside the coaching and accountability driven by frontline sales managers” – Jamie Shanks.
The reality is that without frontline sales managers, no marketing department, sales enablement department or sales operations department has the competency or can drive the right accountability to ensure that the shift to modern, digital skills are learned and absorbed and transformed into real behavioural change—and ultimately into sales action.
Let’s look at the example of our prospective client who wanted to understand how a multi-week training program could transform a sales organization.
What they didn’t understand was that a multi-week program isn’t in and of itself the value driver – instead, the multi-week program is the kick-starter to injecting learning into the minds of the sales organization so they can start the motion of behavioural change.
Behavioural change only comes with coaching, and this is the role of the frontline sales manager.
The infographic below illustrates some ways the frontline sales manager can coach sales reps using the sphere of influence to segment accounts.
The key is to increase the skills of frontline sales managers so they will ask the right questions, look for red flags and green flags, and help the seller understand where they’re they going wrong and what next steps and actions they should take to highly influence sales objectives.
3 Steps You Can Take to Ensure Success
Buy-in. You must get buy-in from your frontline sales managers. Without frontline sales managers believing that change is necessary, it doesn’t matter what tools, skills, and competencies you provide. If they believe the plays they’re running today are the only plays they should be running, you’ve got a completely different problem you need to solve. They need to get the team to buy in that change is good and healthy, and adopt the mindset of what are the things that we can do to highly influence sales objectives? They need to be bought in to whatever idea you have that is going to align with their sales objectives.
Train frontline sales managers. There is a definite lack of learning and development in the global sales performance space for frontline sales managers. They’re typically converted ex-sales people. They work with accountability coaches. So using the infographic above, they need to understand:
1) What is the sales play that will highly influence their sales objective?
2) What should they be looking for as an activity that is aligning or misaligning to that sales objective?
3) What are they going to do about it? How can they alter the course of that behaviour?
Accountability. The frontline sales manager will often report to secondary sales managers or leaders—they are often divisional presidents, chief revenue officers, SVP of a continent or country. These individuals need to hold the front line sales managers responsible for 1) running weekly one-to-ones; 2) injecting sales plays; and 3) giving feedback to the sales leaders (Chief Revenue Officers). They need to give feedback as to which sellers are applying the right behaviour, and which sellers aren’t.
All of these steps mean the difference between success or failure. They’re not multi-week e-learning programs, or a bunch of virtual instructor-led training sessions, or having one person develop this skill (like my first customer who wanted to hire a social selling director). None of those plays are strong enough to make change in the business without skilling up your frontline sales managers.
Over the last couple of weeks, we’ve been working with customers whose projects were large in scope—and a big investment for these companies. A Chief Revenue Officer and Vice President of Field Operations at these companies were wondering how they could acquire funds from the CFO.
Here’s my advice: The most important piece when acquiring funds from the CFO is to put yourself in the mind of the investor: meaning capital allocation.
What does this mean? When I put a dollar into something, it will have a compounded annual return rate greater than alternative costs and opportunity costs.
When your company’s CFO deploys capital, they want a rate of return—and they want a business case that showcases that rate of return.
However, many sales leaders and sales enablement leaders are fixated on what they can control and what they’re used to: pipeline creation, working the big deal, and filling in open head count. Essentially, they’re working in the business, but not necessarily on the business. That’s the difference between them and the CFO.
As a sales leader, one of the best tactics you can use is to build a business case around the opportunity cost of the most logical capital deployment strategy.
CFO’s know that sales leaders typically require funds for three main reasons:
1) Increase headcount.
2) Increase sales and throughput per seller.
3) Acquire new product or markets.
The easiest of these reasons for a sales leader to talk to the CFO about is the one they have the most historical record of being a part of: increasing headcount.
The biggest operational expense in the sales department is always human capital, and your opportunity here is to learn how to have a structured conversation around opportunity cost.
If you want to deploy a sales performance project like training—and this is where we help companies with social selling and creating pipeline–you need to build the following business case.
Building a business case
1). What is the current capital allocation strategy? – You may have an open head count in a certain geography, or perhaps you’re about to attack a new vertical, or open up a new department for a new type of seller such as inside sales or SDR’s. These are all great, but there’s a cost to a full stack seller. There’s the cost of recruiting, onboarding, salary, commissions, and tech stack, plus other operational expenses like healthcare, benefits, gym memberships, etc. This strategy means hiring those people in open headcount.
2). Model the rate of return of the capital of that seller – Let’s do some calculations. If a seller costs you $100,000 in salary, plus another $100,000 in commissions, and another $100,000 in other expenses (benefits, office space, etc.), that equals $300,000 of expense to a company.
What you need to do to build a business case is to model their return to the company on a 1, 2, or 3-year horizon. For many account executives, let’s say they make $500,000 in revenue for the business in year 1, $1 million in year 2, and $1.5 million in year 3 – that’s the amount of money that a $300,000 investment can make you in three years.
3). Compare the cost of sales performance improvement (sales training). Now you’re using the same model – but you’re deploying the capital, and you’re multiplying it by increasing it times 100 sellers – that means $1,000 per seller.
If each seller were to create one new opportunity every quarter for one year, then two opportunities, then three – and if they won 25% of those deals—what is the return of investment based on the average price of $50,000? Now the rate of return is in the millions. Increasing the pipeline by 20-25%, and then increasing the win range by 5% times 100 people, the capital allocation strategy is far greater.
The CFO will argue that this model has less experience, so you need to build some buffer into your model. But this is how a sales leader thinks as an investor of a capital allocation model.
They will think that $100,000 will create much greater investment over the entire planet of sellers in all markets, rather than filling the void in one open market. They believe the best bet is to trade the opportunity cost of headcount for other programs.
That is typically the best argument you can make to acquire funds from a CFO.
CFO’s already know they need to allocate capital, but you’re just giving them an alternative strategy. Yes, the strategy has some unknowns and some risk, but it has a much greater upside per compounding growth of seller.