The Foundations of Sales Effectiveness

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I recently recorded a second wide-ranging podcast on the foundations of sales effectiveness with Michael Webb of Sales Performance Consultants Inc.

We continued to develop the topics we had discussed in our initial podcast, and this time we turned our attention to the need to find ways of eliminating the avoidable errors that so often prevent sales people from achieving their full potential.

Inevitably, we turned to the structural and cultural foundations of successful sales organisations – and the reasons why (despite the huge sums of money invested) so many CRM implementations fail to deliver the hoped-for improvements in performance.

We also discussed some of the basic foundations of any scalable sales “process” – including the critical importance of recognising the common characteristics of our ideal customers. I hope you enjoy listening to our discussion…


Here’s an edited transcript of our conversation:

Michael Webb: Hello, this is Michael Webb. Some people focus on reaching decision makers and selling value, other people focus on gathering data, analysing cause and effect. In this podcast, we focus on both. On selling value and using data to tell us where the value is so that we can create wealth for customers, our companies, and ourselves.

This is the Sales Process Excellence Podcast, and I’m thrilled to have Bob Apollo with me again. Bob, thank you for coming.

Bob Apollo: Michael, thank you for inviting me again. I’m very glad to have joined you today.

Michael Webb: And just for those who might not have heard the first podcast we did; can you give us a 30-second overview of what you do?

Bob Apollo: I run a sales effectiveness consultancy company based here in the UK. But last year, our client footprint stretched from Salt Lake City to Mumbai. One of my goals this year is to make that footprint a little bit smaller. We help our clients to put together an integrated program combining training, systems, processes, and materials to help all of their salespeople do a more effective job of engaging with their customers.

Michael Webb: Super. So I, definitely, think from my research, you are in the leading edge consultancies in process effectiveness, sales effectiveness, because you’re connecting multiple factors. So when we had our first discussion, we kind of ended that discussion and you were making some observations about CRM software, and how it has changed over the years, and the need for, as you just pointed out, this integrated approach a variety of factors.

So we agreed to have another conversation and, this time, to focus especially on CRM, and software, and the role of software. So to kind of start this out, I have a sort of a strategic definition question to start us out just to make sure that we’ve defined our terms, and we’re talking about the same thing.

So there’s this group of customer-facing people in any company, they’re usually working really hard, they have various kinds of expertise in sales, and marketing, communications, relationship building, negotiation, training, and servicing customer, and so forth. Now if you’re the leader, and you’re responsible for the performance of the company and, specifically, for this sales marketing servicing team; so that’s the context.

Now, if you’re the leader of that company at the end of the day, ultimately, Bob tell me, what are you pursuing or wanting to maintain, gain, or improve, at least at a high level, kind of a results-oriented level? What are you trying to maintain, gain, or improve as a leader?

Bob Apollo: Both at the individual and collective level with a group of people with a range of sales responsibilities, I want to accomplish a really clear, and common understanding of who our best customers are, what the key problems we solve for them are, how we deliver solutions that enable them to achieve business advantage, and I want to ensure that this information is widely shared and disseminated within our organisation.



So in turn all of that important understanding and insight can be shared back with both our current and future customers. I think really that’s a matter of making sure that we create a learning environment, that we eliminate sources of waste and of error, and that we recognise that much of this information is actually in the heads and in the experience of our colleagues in the front line. And it’s only really by collecting and re-sharing that frontline experience that we can maximise our progress.

Michael Webb: All right, so I have a follow-up question, and then I’m going to ask you a clarification question. So the follow-up question is that same person, that leader, what do you wanting to avoid or decrease?

Bob Apollo: Well, I think it depends on where I’m starting from. But, certainly, I would want to be decreasing or eliminating the silos of information that commonly bedevil large organisations. I’d like to avoid any of the members of my team making repeatable, avoidable errors.

I’d probably be less concerned about the pursuit of perfection because I think that’s a particularly difficult challenge in any complex sales environment. But certainly I’d want us, collectively and progressively, to eliminate the predictable things we should be avoiding or not doing in order to get the best possible results both for ourselves and for our customers.

Michael Webb: Okay.

Bob Apollo: And you need data for that. You need to be able to identify patterns of performance and behaviour, and you need to be able to draw conclusions as to the relationship between different data points.

Michael Webb: Yeah, okay. So let me ask a clarifying question, and it’s going to sound like I’m pushing back a little bit, and I am, but I think you’ll agree with the reason why. Because you just said we need data and evidence to be able to figure out what to stop doing, right?

Bob Apollo: Mm-hmm (affirmative).

Michael Webb: And so the question is how do you know? How do you know that you need to decrease the silos? Why are you decreasing the silos? Why are you needing to avoid errors, just like why do you need to know better what customers want? Why do you need to take what’s in people’s head and synchronise it around the team?

I guess what I’m trying to say is that an organisation is a system, and it consumes resources, and it produces value. So you have input, and you have output, and at the end of the day, you’re trying to increase the value that it produces, and reduce the resources that it consumes. Would you agree with that?

Bob Apollo: Broadly speaking, I don’t think that’s the only objective, but certainly going to be one of the high-level objectives for an organisation.

Michael Webb: Okay, so we haven’t defined what value is. So what other objectives would there be besides that?

Bob Apollo: Well we might for example want to increase our share of our existing market, we might want to penetrate a new market, we might want to change the balance or the shape of our business. Now all of those, ultimately, point towards the creation or the destruction of value, but there are some specific ways in which we might choose to look at those goals.

Michael Webb: Yes, okay. So yes, I see why you said broadly speaking. So now, I mean at a high level then, the purpose is to increase the value, the profit, and reduce the cost, and the waste. And so if you get past that, then you get into, “Well, gee, this is the system, what are the elements or the factors that affect it, those outcomes that you desire?” So you mentioned some of them, I think. Is there like a framework that you repeatedly use when you’re thinking about those causes and effects that are in a sales and marketing organisation?

Bob Apollo: There are a number of indicators which can I think provide a framework. One of the things I’d look for in any client engagement is the clarity with which we understand our ideal customer profile. And that ideal customer profile is not just about we sell into this demographic, or that geography, or into that role; it’s more about the type of organisations we have managed to be most successful with.

And there’s a closer correlation, when you look at these things, between structural and cultural factors which I will acknowledge are harder to measure – but no less important for that – than there is a correlation between our focus on this or that industry. And that’s just one potentially foundational piece of information.

Michael Webb: Sure, so keep going, what are some of the other foundations?

Bob Apollo: Another one is what common issues we are choosing to try and solve for the customer. Now, this implies of course that we are a company whose mission is to deliver somewhat replicable solutions, and that we’re not trying to craft a brand new and unique solution for every individual customer.

If we’re an organisation that’s trying on a replicable and somewhat predictable basis to identify and address common customer problems, we need clarity about, “what issues did our customers come to us with, and what outcomes did we successfully enable them to achieve?” And to your point about value, of course, I think one of the key elements is the degree of value that they enable their customers to achieve as a consequence of their involvement.

Michael Webb: Okay. Anything else?

Bob Apollo: When it comes to processes, I’ve always found it more helpful to be able to diagnose where we succeed or fail in any customer engagement if I look at it through the lens of, “where’s the customer in their decision-making journey?”

Michael Webb: There we go, yeah.

Bob Apollo: And what have we done to facilitate that decision-making journey?

Michael Webb: Right.

Bob Apollo: And that is at odds with many conventional approaches to sales management, which tend to be sales activity or sales stage based. It’s also contrary to what you typically get if you opened up the virtual box of a CRM solution and looked at how it has been initially configured.

Michael Webb: I’m working with a client, right now, and that’s one of their fundamental complaints, is that the way that they’re managing sales right now is all about activities.

Bob Apollo: Yep.

Michael Webb: And so one of the sales managers sort of, surreptitiously, pulled some information from the database and made an analysis that the people who were the best at hitting those activity targets were, typically, not the ones who are the best at achieving the revenue goals, and customer satisfaction goals, and so forth.

Bob Apollo: Well, and I think one of the potential challenges is if the metrics are largely quantity based and are not quality based.

Michael Webb: Exactly.

Bob Apollo: If by “quality”, you mean play a real role in advancing the buying decision process, then you’re absolutely right. And in fact, I think it is a significant failure in many organisations that they think about activity as fundamentally a question of quantity and not of quality.

Michael Webb: And so I’ve often observed that within a B2B company, it’s very common for almost no one to really understand how sales are made. Have you seen that too?

Bob Apollo: Maybe I’m fortunate in that the clients I work with are somewhat more enlightened than the average. You mean outside of the sales management team?

Michael Webb: Yeah. Outside of sales management and the rest of the company. They don’t understand.

Bob Apollo: No, I think that is a bit of a issue and it’s actually an even broader problem than that. Because, of course, many of the clients I work with are in a scale-up or growth phase, and they’re looking for external growth investment.

One of my observations is that whilst the external investors are typically highly experienced when it comes to financial due diligence, but they are very often blindsided by what I’d characterise as “sales effectiveness” or “sales scalability” issues.

Michael Webb: Tell me more.

Bob Apollo: Well the financial due diligence measures are relatively easy to establish. But if I’m thinking about investing in an apparently promising business, then part of my investment hypothesis – whether I declare it openly or not – is my belief that the financial resources I inject will be invested in increasing capacity in well-identified parts of the sales process that have the effect of driving revenue and profit.

And unfortunately the influx of new investment often results in a round of hiring of new salespeople without a proven framework to induct them in. And those new salespeople are thrown into a context that they don’t really understand.

Michael Webb: Right.

Bob Apollo: But also the organisation recruiting them doesn’t properly understand. So they can’t give them the sort of guidance that would allow an otherwise well qualified new salesperson to become effective anything like as quickly as they could be.

Michael Webb: Well, and there’s even more. I’m reminded of a book, an old book, Managing Major Sales by Neil Rackham and Richard Ruff.

Bob Apollo: Yeah.

Michael Webb: From the 1990s or something. But there’s a story that Neil Rackham talks about in there of a company that was struggling to grow, so they hired a new sales manager. And when the sales manager observed that the salespeople were only making like two calls per day, immediately issued the edict, “Well you guys have to triple that. We need sales people making way more calls per day.”

Bob Apollo: Right.

Michael Webb: And there were objections, and there was resistance and, ultimately, there was turnover, and there were customers leaving, and it did not work at all. Because that sales manager had in his mind a different industry where he had grown up, and the way to succeed in that industry was higher call volume activity.

Bob Apollo: Sure.

Michael Webb: And nobody really could articulate the qualities that could tell you whether a salesperson was doing a good job or a customer was really a good prospect.

Bob Apollo: And it’s more about outcomes achieved than activities completed. But that takes a slightly different mindset – if I might suggest a somewhat more sophisticated mindset. Because it’s pretty convenient, isn’t it, to just think in terms of an easily measurable activity. But of course the purpose of any activity in the sales process – I would suggest – is to achieve a desired outcome. And that’s really where the focus needs to be.

Michael Webb: And the outcome, ultimately, some people think the outcome is a sale. But I heard you say something that more advanced companies, and I agree with this, I think you’re saying that the outcome is a customer who’s more profitable because of you. Because that way, they’re reference-able, and they’ll be loyal.

Bob Apollo: Sure, that’s one version of a long term outcome, but I’d also suggest to you that the short term outcome might be the recognition, sooner rather than later, that the opportunity you’re pursuing is actually unlikely to be successful either for you or for the customer. And so one of the desirable outcomes is the willingness to walk away from bad business, or bad potential business.

Michael Webb: Right, right, to be able to identify it-

Bob Apollo: Yeah.

Michael Webb: And then to have the license to walk away from it. That can be difficult for those organisations to get used to.

Bob Apollo: Well and to your point about data, again, we’ve discussed why activity levels are not necessarily particularly good metrics if they’re out of context. Raw pipeline value isn’t a particularly good measure. And in fact, what I’ve observed is those organisations who have an obsession about building pipeline value without proper regard for the quality of the pipeline, very often they create an environment where salespeople are discouraged from qualifying out bad opportunities. And that’s a really dysfunctional way of running a sales organisation.

Michael Webb: Yeah, absolutely. So your point is that we have to be able to identify quality?

Bob Apollo: Yep.

Michael Webb: How do we do that?

Bob Apollo: I’m sure some examples might be helpful. I work with many clients who are pioneering new market segments or attempting to sort of re-engineer existing markets.

And it takes a certain type of potential customer to be open to that sort of thing. A customer that is open to innovation, has a track record of buying best of breed solutions, rather than always falling back on the safe established brands.



And you might not be able to determine that just by looking at LinkedIn. You might get some inkling of it in the annual report, but you really make that judgment as a result of having informed conversations with the customer – but of course you need to know what to ask.

Michael Webb: And so how do you know if a salesperson is doing a good job?

Bob Apollo: You need to start by understanding what outcomes those salespeople are expected accomplish. And that depends on how you’re measuring the outcome. It is much easier to do that in an environment where you have implemented qualification criteria that the salespeople buy into and see value in, where you’ve implemented a pipeline definition that reflects with reasonable accuracy where the customer is in their buying journey.

In my experience, the difference between success and failure can often be found in no more than a handful of key things that need to be accomplished during the sales process – and perhaps the most important to those is the discovery and qualification exercise.

I think if you’re a sales leader you would want to satisfy yourself that your salesperson had done their due diligence and discovery before deciding to aggressively invest the company’s resources in pursuing the opportunity.

Michael Webb: Okay. So when we were talking before, you made some points I thought were really quite valid that the history of CRMs that started out, unfortunately-

Bob Apollo: Yep.

Michael Webb: As being kind of administration oriented. And from what you said, I was taking it to also mean that that included gathering data and storing the data, if I’m not mistaken.

Bob Apollo: Yeah, by the way, I don’t want any of this to imply that I’m anti-data. I just think that many of the initial CRM systems didn’t actually collect particularly useful data.

Michael Webb: Right, yeah so I’m in agreement with you there. And then you also said that rather than have a data orientation, you said it’s easier to have a behaviour orientation-

Bob Apollo: Well then-

Michael Webb: And bring it back into the data. So explain here what your philosophy is.

Bob Apollo: Well, behaviour or process. So as per our earlier interview, I’ve got a slightly ambivalent attitude to how people use the word ‘process’. But if you have a data-centric approach to CRM you tend to think that it’s all about what’s in the activity record, what’s in the contact record, what’s in the account record and so on.

Whereas I think if you take a behavioural or process orientation, your primary concern is how do we guide salespeople into doing things that are likely to result in valuable outcomes, and what data do we need to support them in their mission to generate valuable outcomes? So you’re kind of reversing it in a way. The data needs to be supportive of the outcomes that you’ve recognised you want to accomplish.

Michael Webb: Right, and so how do you know those things? How do you know that certain behaviours will create the outcomes that you want?

Bob Apollo: Well if you’ve chosen to instrument whatever CRM you’ve chosen in a way that allows you to gather the data you will, of course, be able build up increasingly useful analysis of the underlying patterns of success and failure.

But before you have that data built up, one of the really illuminating exercises is to conduct proper independent win/loss analysis that doesn’t just consider why did we win or lose.

That’s an end-of-sales cycle perspective, but I’m much more concerned about what were the key stages the buyer went through in their decision-making journey, and how well we managed to facilitate it. What where the moments of truth and the moments of frustration, and what can we do as a result of that learning to encourage more of the right behaviours on the part of the salesperson?

Michael Webb: Right can you put a concrete example of that? Can you tell us about a situation that’s simple enough but it’s real?

Bob Apollo: I’ve been undertaking an exercise with one of my clients. We wanted to identify the patterns of success and failure. They are a highly innovative software vendor, and one of the hidden patterns was that they were far more successful in selling to customers that had a “best of breed approach” to implementing solutions, than they were into more conservative customers that always tended to stick with the big established brands.

Michael Webb: Is that an observation, or is that a judgment, or how do you know that?

Bob Apollo: When we were conducting the loss analysis very often the champions of the project would say, “we hadn’t anticipated that our corporate strategy was going to come down so hard in favour of the established vendors.” That insight can then allow us to make sure that we ask the right question about how potential new customers have made previous decisions.

Michael Webb: Good. Okay. All right, so keep going.

Bob Apollo: I think the other clear pattern was that the salespeople who were more successful were the ones that had the confidence to really stick with the discovery process for significantly longer than the more boisterous colleagues who would rush to pitch the solution too early.

Michael Webb: Yeah.

Bob Apollo: And that was a pivotal observation. Investing in discovery improves the chances of success and allows salespeople to qualify bad deals out early. Recommendation number one was to target early-adopter organisations who are predisposed to buy your sort of solution from your sort of company. Recommendation number two was to focus first level sales leaders on insisting that their salespeople really do deep discovery.

And when those sales leaders were conducting opportunity reviews, they insisted that their salespeople did not just make hopeful assumptions about a deal but qualified effectively based on evidence. We distilled that into a handful of formalised qualification criteria.

Michael Webb: Mm-hmm (affirmative).

Bob Apollo: We also insisted that the sales people applied simple and clearly-defined “green-amber-red” criteria for each qualification factor. We encouraged them to acknowledge what they didn’t know, and to take steps to fill in the blanks in their knowledge. And – this was very important – we asked them to come with a simple one-line explanation of how they came to their conclusion. 

We also positioned the exercise as being for their benefit, and not ours. We explained that our primary goal was to ensure that they thought about each opportunity in the right way, and to ensure that they didn’t miss anything they could have known or done that would have improved their chances of success.

Michael Webb: Yeah, and something that’s what’s in it for the salesperson?

Bob Apollo: Yeah. My general observations are CRM projects are much more successful when the organisation implementing them whole-heartedly involves the salespeople in their definition, in their rollout and in their subsequent refinement. If these systems are imposed centrally, the chances of success are very significantly reduced.

Michael Webb: Okay, so is there more … You had said to me, “It’s easier to start with a behavioural mindset-”

Bob Apollo: Yeah.

Michael Webb: And then look at what data is required to change behaviours.”

Bob Apollo: Or to measure the ideas. I think it depends on how we’re defining behaviour. If by behaviour we mean things that salespeople ought to know and do, then we can establish data which helps us recognise patterns of effective and ineffective performance.

But behaviours are also about mindset, and it really helps if you’ve got a bunch of salespeople who’ve got the right mindsets to start with. When you make new hires, your focus must be about attitude and aptitude and potential capability, and not just about the past experience that they claim to bring to the party.

Michael Webb: Yeah, one fellow I talked with a few years ago had a great way to capture that. He said, “Some organisations try to hire salespeople and expect them to prove how good they are. But better sales organisations hire salespeople and then expect them to improve how good they are.”

Bob Apollo: Well, yeah-

Michael Webb: Difference in mindset there.

Bob Apollo: And I think you’ve actually implied a very, very fundamental point here. Because in our discussions, we might have been implying that it’s the organisation for whom the salesperson works that sort of bears the brunt of sales effectiveness initiatives.

But I think really what we’re looking for is to recruit a team of sales people who are prepared to collaborate with each other and are not just focused on their personal success.

We need to look for salespeople who have accepted a personal responsibility for self-improvement – who are curious, who read sales books, who attend events, who would never ever get to a point where they either think or imply that they’ve learned it all.

People who are still seeing themselves on an upward learning trajectory. I think that’s just so, so important and it’s extremely dangerous if either by accident or design we end up recruiting people who have peaked, who have no further to go-

Michael Webb: Right.

Bob Apollo: In terms of their desire, or their willingness, or their ability to improve themselves.

Michael Webb: Okay so sort of a wrap-up question here then. In this context, which I think has been fascinating and very well-articulated, this role of CRM software, something has changed from the early years to now.

Bob Apollo: Yeah.

Michael Webb: What is it that the CRM software enables you to do that you couldn’t do before?

Bob Apollo: Well, of course, you have to choose the right platform. And I would suggest for anybody who’s looking at CRM today, to look for a platform (like Membrain) that recognises the importance of guiding the right behaviours in the salespeople.

What we can do today – a way that was hard to achieve before – is to incorporate situational guidance in our CRM. For example, if I’m selling into finance, how can I be equipped to have really constructive conversations with finance companies at this stage in the process?

One of the things that a really effective CRM system can do is to guide the salespeople in accumulated best practice – and of course is evolving all the time. One of the things one of my clients does is regularly run sessions with their salespeople saying, “So what are the new objections you’re hearing.” And then we role-play them, so that everybody in the sales organisation can be exposed to, “So how could I deal with this?” So that’s one thing.

I think the other thing to look for – whether it’s integrated directly into the CRM or whether it’s a third-party specialist add on – is that all of the CRM data is exposed and can be viewed and acted upon through an easy-to-use sales analytics function that identifies opportunities for improvement. There’s a bunch of other things but-

Michael Webb: Yeah.

Bob Apollo: I would suggest that those two are particularly important.

Michael Webb: I remember a lengthy conversation I had, pardon me, with a product manager of a … let’s put it this way, the largest, if not one of the largest, CRM software companies, and admitted to me on the phone that his system out of the box is not capable of calculating or tracking the conversion rates that actually take place-

Bob Apollo: Right.

Michael Webb: From stage one, to stage two, to stage three, stage four. But it does so many other good things, it’s a really, really good system. And I’m thinking to myself, “Oh my God, oh my God.”

Bob Apollo: Well that did a couple of things, though. One, it opened the door to third-party analytics vendors, and I know the company you’re thinking of. And one of its virtues, actually, is if you know where to look, you can find all of that information.

Michael Webb: It just costs extra, right? Extra to pull that information out, and customise the program, and put add-ons.



Bob Apollo: Yeah.

Michael Webb: And all that.

Bob Apollo: So at least they opened the door to a bunch of third-party analytics vendors who just do an outstanding job of helping sales leaders to detect patterns.

And it also opened the door for a new generation of CRM solutions that if they had built around the idea of guiding and analysing sales performance and which embedded analytics at the core of what they do.

Michael Webb: Right, that’s right. And the truth is, those systems were built to fulfil the need perceived by the managements of the time.

Bob Apollo: Yeah.

Michael Webb: And it’s a shame, but most managements don’t understand how you can use data to change and improve the sales process; they think it’s about more activity, better salespeople, work harder, more proposals. And as long as senior leaders think that’s just the way it is in sales, there’s not going to be much demand.

Bob Apollo: Well-

Michael Webb: In improving it.

Bob Apollo: Old fashioned behaviours may still exist amongst a certain proportion of the sales leadership population. But I tend not to come across them, because anybody who looks at my philosophy and buys into it by definition fits into the more enlightened category.

There are a growing group of sales leaders who have already recognised the value of data. Everything from very simple things like time in stage, conversion by stage, how those things differ between net new business, and installed base, and up-sells, and recognising that you can’t apply a one size fits all. I’m encouraged. I believe even if they’re yet not in the majority, there’s a growing group of sales leaders who are becoming far more data literate.

Michael Webb: Yes, I agree with you. So Bob, once again, great conversation. Thank you very much for agreeing to be on the podcast and speaking so openly, and in putting up with my sort of analytical questions; I appreciate it. If someone in the audience wants to learn more about you, how do they find you?

Bob Apollo: Well I certainly hope they do. And if they choose to want to find out more, you can find me on my website at www.inflexion-point.com. I’d encourage visitors to take a look at a couple of areas in particular. One of the obvious ones is the blog, and I’ve got also what I hope they will find a useful resources area, where there’s a number of videos downloads, etc., that I hope they will find informative and maybe even stimulating.

Michael Webb: Super, well thank you very much, we’ll have to do this again soon.

Bob Apollo: I look forward to it.

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