November 26, 2012 at 7:00 AM
In 2012 our consultants attended 438 live sales calls. Two weeks ago, we participated in the worst sales call of the year. I thought I would share this story with you. I hope to help you avoid some mistakes.
The story begins with the EVP of Sales of a large technology company. He hired our firm. The purpose of the engagement was to understand why The Challenger Sale was not working. In 2011, this company replaced its Solution Selling methodology with The Challenger Sales approach. Why? The performance delta between its top performers and average performers had grown too large. The belief was if all the reps became “Challengers” the revenue per rep would jump.
We asked the EVP which rep best represented the model. He told us that “Erick” was a true Challenger. He produced the output of an online test “Erick” took, proving he is a Challenger. His quota attainment figures are outstanding.
Erick is our test case.
Erick met our consultant at the Marriott Marquis Times Square. Over coffee, Erick described the agenda for the day. We were going to meet an existing account in the morning. The accounts software subscription was up for renewal in 5 months. The goal of the call was to grow the account by expanding the use of the software.
During the cab ride, our consultant probed Erick to understand these Challenger behaviors. For example, Erick’s test results revealed he had a “deep understanding of the customer’s business”. In addition, the test suggested he “teaches the customers something new”. Lastly, Erick’s test results say he “understands the customer’s economic drivers”.
Erick’s answers to our questions were surprising. As we approach the location of the call Erick told us the account:
- Was a bank
- Made money by loaning money
- Was moving everything into the cloud
It took 25 minutes to make it through lobby security. We are off to a bad start by being late. Sally, the EA to “Joe”- SVP of IT for the Investment Banking Division, greets us. Up the elevator we go. We get off on floor 42. Joe shows up, everyone shakes hands, and the call begins.
Joe: “I am glad to see you guys today. I have a few things I need from you. But before we get to that, your email said you have something for me?”
Erick: “Joe, I have an idea on how you can improve your business. Our banking customers are using our technology to reduce the time it takes to approve commercial real estate loans. Our research shows that real estate developers chose who to bank with based on how long it takes for loans to get approved. If we get the loan officers using the app, we can shrink your loan approval time by 30%”.
Joe:” Erick, I work for the Investment Banking Division. We don’t make real estate loans. We raise capital and provide M&A advice for our clients. What are your iBanking customers doing?”
An average rep would be pretty embarrassed at this point, but not Erick. He is a Challenger. He lets this credibility damaging mistake roll off his back.
Erick: “Sure. 90% of the financial services companies in the US are our customers. Let me tell you about how we helped State Farm Federal Credit Union.” I could not make this up if I tried. This was like watching a car accident in slow motion.
Joe interrupts him, “Did you say State Farm Federal Credit Union? Hearing how you helped a credit union is of zero interest to me. That is like comparing Apple to a Cisco. Both are in the telecom space but give me a break.
Listen, I have 45 minutes left. I don’t have time to teach you about my business. I have some questions I need you to answer.”
Joe was right out of central casting - a pure New Yorker.
He continues, “My problem is I have to deliver a 360 degree view of the customer. Your product is one piece of the puzzle. What else do I need to buy, and from whom, to make this happen?”
Erick’s body language suggests he is done challenging Joe today.
He is supposed to have a “deep understanding of the business”. He must be able to “teach the customer something new”. Erick responds with:
“Joe, I am not sure I understand the question. Can you explain what you mean?”
Joe takes a gulp of coffee from a nasty Styrofoam cup. It is as if he is taking a shot of tequila from a Senor Frog’s shot glass. He wipes his chin with his oversized fist. He responds, “Do you E-V-E-N know what a 360 degree view of the customer is?”
Erick: “Sure I do.” This is what we in the business call a Sammy Davis Jr. This is when a rep tap dances around a question.
Joe: “Oh yeah. Give me some examples of data elements I would need to capture to provide this to the LOB.”
Erick: “Ok. Email address, telephone number, physical address, Twitter handle, LinkedIn profile, and so on”.
Joe, scoffing: “You forgot the transactional data, credit score, NPS, payment history, and about a thousand other things. This meeting is a waste of time. You guys walk in here telling me you can solve my problem and you cannot. You can solve a piece of my problem. And when I ask for help with the other pieces, you cannot help me. You only care about selling your piece. Where does that leave me? Shit out of luck. It means I have to spend time, which I don’t have, figuring it out on my own. You guys are beautiful. All sizzle and no steak.
I am going to hire an SI. I will let you know who we go with, probably Accenture or Deloitte. You can deal with them.” Yelling through his office door, Joe screams “Sally, take these guys downstairs for me.”
Yikes. Into the cold autumn air we went.
Here are three lessons we shared with Erick and his company from this experience:
- Categorizing reps into profiles by having them take an online test does not work. Humans are far too complex for some simple tool like this. Understanding talent is far too important. Do it right.
- If you are going to “challenge” your customers you better be up for it. Your customers know their business better than you ever will. “Insight Selling” better be, well, insightful.
- Understand success depends on execution above all else. The new approach might look great in a power point deck. But how will the field do the work? Focus less on the new approach and more on driving its correct use.
We advocate using a common sales methodology / process / approach. The Challenger approach is worth considering, as are others. Be careful. Success requires a lot more than reading a book and attending some workshops.
Posted by Greg Alexander