Sales Training for Entrepreneurs

My father always told me that every job is a sales job. That’s at least a little bit true, but in my experience, most entrepreneurs are a little disconnected from their inner

Harvard Business Review offered a special issue on Sales in 2006 (Vol 84, Issue 7/8) that included a number of articles that offers a number of quick reads that should at least help you purge whatever negative image you might have of sales and begin replacing it with an appropriate understanding of where it fits operationally across the life-cycle of an enterprise and as am integral part of the Sales and Marketing continuum.

Psychologist and Anthropologist G. Clotaire Rapaille is interviewed in a piece that presents a concise discription of the sales person archetype as Happy Loser, someone as motivated by the hunt as the kill.  Usually entrepreneurs need to develop rejection coping skills, but they don’t enjoy rejection. Sales people love it…according to Clotaire anyway.

For entrepreneurs, I suggest you learn a few solid basics:

  1. Focus on zebras – Even though your business plan says you are targeting a huge market, chances are your initial offerings will only really appeal to a small portion of the market in a particular place in their life-cycle (there are lots of horses, but you only want the zebras). In marketing, we might develop a persona of the most likely customer so that the sales team can ask just a few qualifying questions to can help determine if they are talking to the right people at the right time.  Remember each sales activity has a cost and spend your budget wisely. You’ll still face rejection for reasons you may not understand, but you can optimize your closure rate and minimize your funnel by maintaining focus.
  2. Mostly listen – The shape of your products and services and the way they are priced should evolve with your understanding of the customer. Listening to the way customers think about your product, what their expectations are, and what created the situation where they are considering your offering are invaluable as market research, engaging as a business development practice, and a time-tested means of closing a sale.
  3. Respond – Remember that “time kills all sales.” Respond in a timely fashion – think about the service you expect in a restaurant, except the tips you’ll get as an entrepreneur will likely be in the form of a positive referral.

It would be helpful for you to have an objective sense of where you are on your sales skills. I love the very affordable assessments available from the managment psychologists at Pradco. For $50 you get an assessment of your skills and attitudes and a prescription for improvement.

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Redesigning Product

If things are still slow for you, it’s probably a good time to rethink how you define product.

I spend a lot of time with clients outlining the space between how they define their products and how their customers define their products.  Sometimes this has to do with real or perceived benefits. Sometimes this has to do with where the edges of the product are – the arc of the product experience. Sometimes this has to do with the transaction.

I recently gave away some advice to a potential client that is an excellent case study in this.

This client sells to a particularly downtrodden market (lots of those right now). They have a product offering that is very successful at driving efficiency – real, realizable savings – 150% ROI within the first 18 month. The problem is in initial purchase. There is a significant up-front cost.

No matter how good the ROI is on something right now, it is very difficult to find extra funds, either from funders or from cash flow.  I suggested  to this would-be client, let’s call them StartUpCo,  that, faced with no sales, they try to close some deals with a pseudo-lease deal that spreads out the risk. Real capital items might be able to be financed by a leasing company, the service costs and profits probably have to be financed by StartUpCo.

I’d probably start by trying to partner with a leasing company and setting up a payment schedule that gets your hard costs off your balance sheet within a quarter or two. I’ve done deals like this myself and included a reward for meeting certain performance criteria. If you can structure it as a percentage of realized savings, clients are usually happy to share the wealth.

For StartUpCo, the product was their software, hardware, and integration service. For the customer, the product was the improved work-flow and cost efficiencies. By including financing in the product, they bridge the gap between the two views, aligning value and cost for the customer.

Farewell to a Great Entrepreneur: John Patrick ‘Packy’ Hyland, Sr.

A goodbye to Packy Hyland, Sr

Entrepreneurship is the art form of organization development. All art forms are about synthesizing or transforming or juxtaposing objects from one realm and infusing them with the life forces of talent, vision, and craft to create something new and quite different from anything that has existed before – something with a life of it’s own beyond one’s self. Paint becomes Picture. Sounds becomes Symphony. Ideas become Industries.

Packy Hyland, Sr. was a great artist. He passed this week, but leaves behind a body of work that should distinguish him as a truly great entrepreneur. His most easily recognizable creation, Hyland Software, stands as one of very few unqualified success stories in Cleveland of recent.

While Mr. Hyland has achieved the success that most associate with great entrepreneurs – profit and growth – his greatest accomplishments are harder to recognize. I write this to honor those accomplishments so that they not be lost to the data that tends to define history.

Packy believed in his son and the power of his ideas, ingenuity, and diligence when no one else did. Even as many economies were being transformed by profit margins and efficiency gains that only software could bring, I know that Cleveland remained committed to more tangible industries. Aside from the struggles that all entrepreneurs face, Hyland had to operate within a culture that was not supportive. What’ s more, he was able to generate trust and enthusiasm, against the odds, and craft a uniquely winning culture in a community where it had few compatriots. In his quiet and friendly way, he was as much a revolutionary as an entrepreneur.

I remember the speech Packy Jr. gave to the entrepreneur’s club at John Carrol where he gave out copies of Rhinoceros Success. It was apparent to me by the dazed and confused expressions in the audience, that Hyland was an important revolution that needed to succeed if Cleveland was to survive, but Packy Jr.’s enthusiasm would have long ago been crushed under the weight of the predominant culture and the realities of company-building if not for the specific gifts of Packy Sr. and his ability to almost trick you into being inspired.

Add to this, that once he was successful, he held no grudges against those who doubted him or the city that made his path that much more difficult to tread. He continued to support and encourage Cleveland’s entrepreneurs in the most gracious and generous of ways long past the point where most of us, myself included, have turned away in frustration.

I will always remember my lunch with Packy, Jay Yoo, and Jay’s father at Larchmere Tavern. Jay and I represented an entrepreneurial dream in crisis of both spirit and cash flow. We were the younger generation and we had made some mistakes. The elders at the table bought lunch, imparted wisdom and wrote checks. I have worked in close proximity to dozens of good ideas and good people in search of that one break that will make all the difference when what is really called for is the calm, confident strides towards tomorrow, both cautious and quick. To date, I have never been in the presence of such honest and boundless love and compassion around a business deal as what Packy brought to the table that day. Everything was as it should be. Mentors providing support, guidance and knowledgeable, forthright encouragement that every dreamer needs to make something of real value. I remain in awe of his unique gifts.

It is a magical blend of passion, goodness, and community that always, always, always, sustains the just and their causes. There is no more powerful or beautiful force in the universe and Packy Hyland was one of it’s great practitioners.

Maestro, you will be missed. We will tell your story well and for as long as we live.

How to hire a small staff

Jim Collins has offered me no end of simple ways to describe complex issues to my consulting clients.  His book are full of solid wisdom. I’m sure his next book will be no different, but for the moment I’m all about this article in the NYT about his methods.  Genius – especially his hiring protocol.

Spend more time finding and selecting people. Learn about what makes someone successful in your organization. Get to the point where you can write it down and revise as needed.

90% of management is in the hire.

Predictably Irrational

I find research in human behavior fascinating and constantly applicable to both the BizDevGuy consulting business but also to how I advise our clients.  Marketing, business planning and human resources are complex, if not tricky, because our models and understanding of human motivations and behaviors are, for the most part too simple or sometimes dead wrong.

This article is a quick read about the work of Dan Ariely who is equally genius in business and cognitive psychology.

Manage your energy for a 20% benefit

As a long-time reader of Harvard Business Review, I have come to appreciate the wide range of material and approaches the editors present.  This recent article outlining a controlled experiment at Wachovia Bank provides great insight into the ways that traditional business practices can be combined with physical and mental health practices to achieve real, measurable improvements to organizational output.  Manage Your Energy Not Your Time will become a classic article sited for years to come. At BizDevGuy we stress a holistic approach to all things, not slowing progress to ponder endlessly, but constantly expanding the areas that are considered as inputs to decision making and discipline. This article provides the most holistic approach I have witnessed to personal and organizational optimization.

A must read.

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Let’s learn again the Laggards Lose Out

Municipal WiFi was a good idea in 2000 and should have been approached as infrastructure to enable business as opposed to a business itself. This is an example of how capitalism impedes progress and development. If government had stepped in at the right time we would have been fully wired already with lots of opportunity for small players to play.

Back in 2000 I spent considerable time trapsing about Cleveland trying to get people excited about a Muni WiFi project that Peter May had suggested to me, using the light rail system in Cleveland as a right-of-way for distributing wireless connectivity to major points on the transit system. Using line-of-sight technology of the time as the backbone and 802.11B (all we had) for the end points. We figured out that for less than $1M we could have most of the city core blanketed in Wi-Fi in 3 months. That would have been 1) great PR for Cleveland, 2) a great scenario for that time in determining the types of apps that could be enabled by such an infrastructure and 3) an opportunity to sprint ahead to a business model not unlike what exists for many electrical utilities where government supsidizes certain build-outs that are then operated and supported (including billing and customer support) to individual concerns.
None of that happened, of course. What happended instead is that a brilliant technologist named Lev Gonick put together a deal to reuse dark fiber already under the city and create OneCommunity [http://www.onecommunity.org/]. If you’re looking for model for Muni-connectivity that works, try this one.

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The Crash of ’29 Redux

There are two factors that I think parallel the present economic crisis with the crash of 1929: credit directed at zero-sum gains and delusional leadership.

Business and markets are not wise.  Both the strategic and daily decisions of businesses and individuals are about the marginal utility of a small set of transactions, on the whole.  As a community, either global or more local, we can decide whether some processes for money making are good for the whole and under what conditions. It’s easy to see in retrospect that loose lending practices, whether for homes, hedge funds, or corp buy-outs, are a dangerous element in maintaining a society directed at enabling individual prosperity.  Only some measure of centralized control can have both the visibility and the leverage to affect the situation. 

It isn’t the job of businesses to determine the effect they have on society on the whole.  As a business leader, you should make every attempt to understand the impact of your decisions of the welfare of your stakeholders and the community in which you operate.  It is imperative that your success, over the long term, doesn’t degrade the context in which you operate. Ultimately, business interests that align their success strategically with the success of stakeholders, customers, and everyone around them will find their efforts supported widely, their success more easily won and multiplicatively more sustainable. As you build your business model, I always suggest that you keep this in mind.  Build a model that makes it easy, if not enjoyable, to support you.

However, we should be content to hope that business leaders are so enlightened.  Clearly, we have plenty of examples to the contrary and sub-prime lending is a solid example.  This crisis was entirely predictable.  Shame on these businesses for driving themselves, and obviously, all of us to this point and shame on us for allowing it.

The inability of the present governmental leadership to recognize areas where rational controls could ultimately benefit all business and therefore society makes matters much worse.  Now all the President can do is speak hopefully about a clearly damaged market and throw money at the situation.

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No Talent Shortage, Just Talent Recognition Shortage

I predict the next revolution in business productivity will bein the HR department. Very few coompanies that I’ve touched over the years (and it’s a lot) do an even resonable job of understanding what they really want or need in a hire and then finding it. “who you know” is still, by far the most high-impact aspect of hiring. That is, very often, a bad thing.

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