My Best Practices

Getting To Yes! A Negotiation Framework That Works.

  This is an unimpressive book, really. So small, and so thin that you cannot imagine when you get it in your hands for the first time that it could be a live changing book. This is why you should know about it.

I read this book in 1990. I was then building the Training Curriculum for Sun Microsystems European Sales Force. One of the goals was to get rid of the traditional “push boxes and bargain on price” approach, and embrace a more consultative and strategic selling one, based on added value and solution. Negotiation was at the core of it. With the objective to complete an evaluation, I attended a negotiation training based on the “win/win” approach described in this book written Roger Fisher, William L. Ury.

Until then, I had been struggling finding a negotiation model that worked. Of course I had got all the possible recipes from “Start high” to “Know your goals and objectives” to “Get ready to break the deal”, but no comprehensive model that fully embraces the negotiation process.

This training and the book it was based on were a revelation. Like it is often the case, this was both brilliant and simple.

The 5 simple principles are the following (simple to understand, not always to execute);

1-      Separate the People from the Problem.

This is indeed one of the most polluting mistake people do when negotiating. The human side and the emotions get mixed up with the real problem. The factual issue that has to be solved is distorted behind bad feelings or old stories that prevent stakeholders to properly address it. So forget about the people you are dealing with and focus only of the facts. What is the real problem you want to solve?

2-      Focus on Interests, not Positions

The second biggest mistake is starting the negotiation with a position and to defend it regardless of anything else. There is a lot of pride involved in not moving or moving as little as possible. When this strategy is applied on both sides, you have endless and useless discussions… and sometimes war.  The new angle offered in “Getting to Yes” is to discover both parties’ interests, asking the magic question, “Why?”

To take a trivial example, people might say “We want 50% discount”. This is a position, a strong statement. If you ask the question “Why?” you could get something like this “We don’t have free cash flow at the moment” or “My team is judged on the average discount vs. public pricing we can get.” Those are the real interests you should focus on, not the 50% discount, and this is the only way to find the best solution for both parties.

3-      Invent Options for Mutual Gains

When you have a clear understanding of your own interests and the other party’s interests, you have to be creative to find out how they overlap and to create original options to satisfy everybody.

To come back to the previous example, the cash flow issue may require a financing solution that protects your own margin at the same time. The second example requires more creativity such as adding totally free (100% discount) items to protect the margin on the ones on which you don’t have this flexibility, while giving the highest frontal discount as possible.

4-      Use Objectives Criteria

Sometimes it is very challenging for both parties to evaluate the proposed common solution. A lack of data or knowledge could transform a great solution to an apparently bad one. In this case, even if you have the appropriate expertise on your side, it is better to refer to recognized experts who will have the credibility, and will establish the factual benefits of the solution.

5-      Develop your Best Alternative to a Negotiated Agreement.

Whatever you do, you should be ready for the worst scenario. A win/win game based on addressing the real problem, focusing on mutual interests and using objective criteria could fail anyway if you are the only player. Sometimes people just don’t want to play win/win. They have a position, they keep it for unknown reasons and they don’t want to use any kind of objectivity. In this very case, you should develop your best alternative to a negotiated agreement (BATNA). Is it finding another party to negotiate with? Calling to a higher level? Dropping your price to a pre-defined limit? Whatever it is, you should think about it before the negotiation; that will make you stronger.

This 5-steps approach is extremely effective and I used it in a lot of circumstances, negotiating $M contracts with large companies, resolving internal conflicts within my team or negotiating annual budget with other departments. That simply works very well and creates such a positive momentum, it could be addictive!

You have to know that this method was used to negotiate the Camp David Accords signed by Egyptian President Anwar El Sadat and Israeli Prime Minister Menachem Begin on September 17, 1978, following twelve days of secret negotiations at Camp David. Easy to understand but sometimes very difficult to implement…

Which method have you been using? Which one would you recommend?

Open Wins, Close Loses!

I recently heard somebody stating:" With this tough economy, you’d better not share what you know to keep your job." This statement definitely shocked me because so much opposed to everything I have been doing and believing in.  I think everybody should do the exact opposite: if you want to keep your job, share as much as you can!

In 1988 I joined Sun Microsystems. The 800 hundred pound gorillas were named DEC, IBM, HP. Sun from the beginning, and later HP and IBM, committed to Unix, a new  and open Operating System (20 years ago!). There were differences between the few flavors of Unix, but the core was the same making software portable from one computer to the other across suppliers. No more proprietary applications binding your customers to your product line for ever. DEC had a proprietary Operating System, VMS, and most likely way better than Unix.

Who won? Unix! DEC is dead. Staying closed and not sharing with the community was a strategic and fatal mistake. Today Unix is challenged by the next step of the same trend, Linux, totally open source, so that any developer can contribute to directly evolving and improving the code. In our connected and mobile world, open wins, close loses.

What is true for Operating Systems is true for you and me as a person and a professional. Open wins, close loses. If you don't share, you socially die.

There are 3 reasons to share your knowledge instead of protecting it.

• Whoever you are, you would not be where you are today without people helping you on our way up. From your teachers to the university faculty, from maybe your first boss to some off your colleagues, a lot of people actually gave you a hand to become who you are today. Everything you have learned has been shared by somebody or at least has been learned thanks to somebody. The minimum you can do it to give back.

• Keeping what you know for yourself is the best way to do what you are currently doing… forever! To go to the next level, somebody has to take your job! My personal preoccupation (since 1992 when I really got it) has been to find, hire and develop people who could replace me, and literally take my job. It is challenging, pushing you up, but it gives you the opportunity and the freedom to move to the next job or the next company without seeing everything you have built falling apart.

• The third reason is a little more philosophical. You are not here forever, that is a fact. So the question is: what are you going to leave behind you. Not that I believe that any of my contributions will make history. Let’s stay humble; they were drops in the ocean. But they might have been perceived and received as a bottle of fresh water by people who were really thirsty of learning. Giving to the others will push them to give too. Millions of anonymous contributions altogether make the human kind better and smarter, one step after the other, and day in and day out. It is not to make history; it is to be part of the history, a link in the human chain, anonymously.

Social Media is a great way to share, and we will talk about it in a future post. What did you share recently from what you know? What did you give from what you have? Think about it for a little while and post a comment to share your sharing experiences.

Working Hard Is Not Enough!

Sale people are sometimes just dreamers. They dream of getting this big commission check, buying this fancy car, offering a better life for their family, and sometimes being given their moment of fame by assessing the President Club, 5 days in Hawaii with the CEO of their company. Dreaming in good and keep them moving, but if you ask them what they really do to make it happen, they usually answer “I work hard”. The bad news is that “Working hard is not enough”.

Take a reality check!  Look at your numbers and stop fooling your-self.  Let’s say you have to sign $6M a year, or $500K a month. To do simple math based on my 20 years of sales experience, that means you should have about $1500K in advanced phases in your sales funnel, and you should identify $4M of new opportunities every month. Your global funnel should be around $10.5M. (I will explain the math in another post).

If you are no there yet, what can you do to actually make your numbers. There are only 5 solutions (that is the good news; you know what you can do!).

• Increase the overall value of your funnel
• Focus on larger deals
• Cut your sales cycle
• Keep your margin high
• Improve your hit ratio

Let's go more in depth.

• Increase the overall value of your funnel. 

Selling is a number game. If you consistently sign 30% of your deals, the more you have the better! Instead of putting $4M of new opportunities in your funnel every month, put $6M or $8M.You will mechanically sign more business. How to do it?  Raise your activity level, go to networking events, launch email campaigns, organize seminars or develop local channels and partners that will bring you more leads.The bigger your funnel, the better.

• Focus on larger deals. 

The sales effort is often pretty much the same to sign a $200K than to sign a $1M one. Target large accounts in which the initial deal will be bigger and the chance to have repeat business is higher. Select the targeted accounts you want to penetrate this year per market segment, and wisely use all the ways to open the door: Google, Zoominfo, LinkedIn and why not Facebook or Twitter. Identify the key players, learn who they are, contact them directly or via your network with a sound customized value proposition. The time where you have to sleep in your car on their parking lot to grab them first thing is the morning is over. You can learn a lot about them seating at your desk and open the (back) door with a good hook. Be smart!

• Cut your sales cycle.

Keep it moving, maintain a high momentum. Put yourself in the “end of the quarter” spirit every single day. Be creative and close your business faster: don’t wait they call you back, do it yourself! Don’t wait 2 weeks to send your proposal, send it today! Don’t lose 3 days before returning a call, do it now! Reducing the sales cycle from a 6 to 4 month average will bring you 33% more business at the end of the year!

• Keep your margin high.

Unless your sell commodity products, resist to jumping into a price war. One way to improve your top line is to sell with a higher price (less discount = higher margin). How can you do it? By selling the value, by explaining to your customer what his payback (ROI) will be and by focusing his attention on the benefits he will get rather than just the features you are offering. Tell him he is not going to live with a discount but with a company (yours), its services and its solutions. Getting satisfied on the long run is worth a premium, and this is thanks to this premium that your company makes such an outstanding job in customer satisfaction

• Improve  your hit ratio.

The average I have noticed over the year is 27%. Make it 40%, 45%! How? First by selecting and focusing on the accounts with the best odd to need your product (demographics and psychographics). Then by leveraging active references. Your customers are the best sales people ever! Finally by developing a strategic approach in these targeted accounts, challenging your positioning vs. your competitors, understanding what people need and also what people want, leveraging your strengths, mitigating your weaknesses, blocking your competition, developing sponsors and finally helping your customers (not the company but the people you meet) to win. This is all from “Strategic Selling”, the best sales program I attended and also delivered as a trainer.

Now it is time for you to do the math, take a look at the tough numbers, removed from your funnel all the deals that you have kept over there for months to “feel good” but that are deadly stuck (you know you are not going to close them any time soon, aren't you?). Yes, it is time to be scared by its emptiness and change your game, push it and keep it to the next level, the only one that can make you successful. Work harder, yes, but now work smarter than before.

What Is Your Odd To Win?

 Your boss just asked you this question again: "So John, do you think we are going to win this deal?".

This is precisely the question you hate answering to...because you have no "real" idea. Want some help?

Of course you wish to get it and you do your best every-single-day, but articulating why you think you will get it (or not) is just embarrassing. There are more than one model to help you 'mapping' the situation and establishing facts that lead to a realistic percentage to win a deal. Let's review today a simple but very powerful one.

The key is to understand what the customer's expectations and requirements are and how he perceives your solution vs. the competition's. There are basically two different situations.

Pusher

The customer wants the "MOST of something".

That could be the "highest discount", the "best price", the "highest level of security', the "highest number of day of free consulting" or "the feature to do something within the shortest time".The baseline is that "More is Better". No matter if your solution can deliver everything he wants, he will pick the provider that will offer him the MOST of what he wants.

This kind of criteria is called a Pusher because the customer is pushing to get the most of something.

This is a margin killer when price is a pusher, and the deal will go to the company with the lower price; that is particularly true for commodity product for which they are very little technical differentiators.

Blocker

The other situation is very different. The customer wants now "A LEAST A CERTAIN LEVEL of something". There is a threshold that should be reached in order to be part of the game.

For example your solution should have a 99.999% availability ratio (99,998% won't give you any chance to win), your should have at least  5 references in a given vertical (your have only 4, you're dead, but having 5, 10 or 15 doesn't make any difference), your software should have an open API (again, not having an API would be a killer) or you should be able to execute  program in less than 5 seconds (5.1 sec and you are out, but no incentive to do it in 3 sec vs. 4).

This kind of criteria is named a Blocker, because you are blocked if you don't reach the threshold. But there is no interest being better than the others or even being the best. As long as you have passed the threshold, you are good.

What to do with this? Well, you can establish a simple map of your sale situation. Let's say you have identified 3 buying criteria, 2 of which are Pushers, and the fourth one being a Blocker. You have two competitors. Here are two typical situations:

• You win!

Competitor A is out because is doesn't reach the threshold on Criteria 3.

Although Competitor B is way better than  you are on Criteria 3, you are good enough (Blocker). But you are better than B on the first two criteria (Pusher)

You should win this deal.

• You lose!

This time Competitor A has passed the threshold on Criteria 3 (Blocker) and he is still better than you are on Criteria 1 and 2 that are both Pushers.

Competitor B is out. He is the  weakest on Criteria 1 and 2 although being the best on 3 (which is useless: blocker).

A will get the deal.

Conclusion

You see, it is easy and quite powerful. From there you can even create a winning strategy such as turning one of your unique differentiators as a Blocker in the customer's mind (making him seeing the world with your eyes and creating a "Must Have" with a "Threshold" that you will be the only one able to fulfill).

If he wants it and you are the only one able to provide it, you are good...and your  boss will love your explanation!

No Way To Buy Lost Time Back!

 There is one resource that you can easily lose and never buy back, time. Time has been an existential question for human being for ever, as we cannot control it, stop it, rewind it and slow it down. Human kind has got control over pretty much everything, but time is still out of reach. Einstein's theories don't change anything to the fact, the clock is ticking whatever we do. Tic-Tac!

For an executive usually overwhelmed and under pressure, that means that time is not his friend. He cannot control time, but he have to control how he uses his time. That is a must have and one of the corner stones of success. Controlling time, easy to say but hard to do! What are the key principles of managing your time?

The key word is priority. Yes, quite simple, you just have to establish your priorities... Okay, but how to do it right? It is exactly what is not easy to do if you don't ask your-self the right questions.

A priority is based it-self on two criteria: urgency and importance.

Combining those two criteria together, you get a matrix with four quadrants:

1- What is both urgent and important
2- What is important but not urgent
3- What is urgent but not important
4- What is neither urgent, nor important

The question is then, what should be done first, second... in order to be as effective as possible?

This answer is close to common sense with a little tweak.

1- Obviously what is both important and urgent comes first. Big stack and no much time to do it, rather start now!

2- This one is counter intuitive for most people and it is why they fail achieving at the executive level. The pressure comes from what is urgent, and it is not unusual that people push hard on you to get it done, including your boss! Just resist! Learn to say "NO!". Why? If you waste your resource time on what is urgent, what is important is going to pretty quickly become blood red in the top right quadrant. Not only important, but now urgent! It is why your second priority is what is important, not what is urgent.

3- So then you have to expedite what is only urgent.

4- And simply drop what is neither important nor urgent.

But remember, be careful non confusing two notions: priority and time allocation. The solution to deliver on results while keeping your stress level to a minimum is actually a little more complex.

It is not because something is "important" that you have to allocate 100% of your remaining time (after having completed what is both "urgent and important") to it! You have to allocate the right amount of time (number of hours) at the right time in your schedule (when are your going to work on it).

Everybody is different, certain people can only focus in the morning and lose their attention in the afternoon. Others like to get up early or at the contrary go to bed late. A few prefer to work from home to get stuffs done while others need their office environment to really be productive. Based on your own bio-rhythm and your preferences, you have to make the right decision.

A good tip to acquire the discipline and the skills to properly manage your time is the following approach:

1- Create 3 task lists: "Urgent & Important", "Important", and "Urgent", or 1, 2 and 3 (no need to create a list for a fourth category, you are not going to do it!)

2- Sort and note everything your have to do in one of the lists along the course of your day.

3- Every single day in the morning or in the evening to get ready for the next day, review your lists. Challenge your rating and balance them against each other (new priorities might fundamentally change the landscape).

4-Then consider your schedule and the time available between meetings and appointments that are mandatory (challenging the value to attend a meeting is a very good technique to save time; too many meetings are too long and useless. You often can just stop by, give directions at the beginning or come for the conclusion and review the action plan, or both). Plug some formal time in your schedule to work on the topics you want to work on, keeping buffer for managing emails and unexpected interruptions.

5- When working on a given high priority, close your door. You are in a meeting with your-self, not available. Your team will learn to rule.

If you practice this method for a while, you will see a dramatic improvement in your productivity and a spectacular drop of your stress level. At the end of the day you can check what you have achieved vs. what you had decided to do today (not "everything you have to do"... this list is still long!). But this is a significant change vs. looking at your endless lists and thinking that you have not done much and more importantly, not the stuff that are high priority. Over the time you will get better and better in forecasting the time you need to get stuff done.

That's it. Now you are managing how you spend your time. Big difference on your results and your life balance with just a few smart decisions and easy to use tools. From getting frustrated not getting anything done to controlling the use your most important resource.

We will discuss in another post what are the tools that can help you to do it. A while ago, I was doing it with hand written lists, but we have now a new generation of online applications that you should know and use!

Is Selling An Art, Or Is Selling A Science?

Some people are so extroverted, outgoing, and convincing that we immediately think that selling is their temperament. Selling is flowing in their veins, selling is their blood and their air, selling is their fortune! We sometimes hear that "this guy could sell some bread to a baker or oil to Saudi Arabia", meaning "he was born salesman". The idea embedded here is that selling skill is a gift, and if you're not so naturally talented, that whatever you might do to improve your own skill will not put you at the top ever. Is it a fair statement? Is selling an Art that is only given to a few or a Science that everyone can learn with the appropriate amount of work?

I always have been pretty talented for public speaking, joking and arguing. My grand-mother was used to say that I would end being a priest or a politician! Even though both ideas crossed my mind, doing business and managing people simply appeared to be my path. What was my surprise when I took my first job at Texas Instruments to be asked to attend a selling class! I felt I could easily sell some bread in Saudi Arabia or oil to the baker at the corner of the street ;-) Was that a kind of hazing?

So I went to my first selling training (selling was not taught in French engineering school, and I doubt it was even taught in business school. Not sure it is today neither in France nor in the US). The focus was really on the basic sales skills known as the Xerox Selling. It was actually SPIN SELLING based on the method developed by Neil Rackham (The SPIN SELLING Fieldbook). It was not about complex selling or negotiation skills that we will cover later, just about a clearly defined path to raise the odds to sell your product.

I have to admit that even though basic, it works quite well and it is a real fundamental of any sales. The technique is articulated in four major steps easy to remember with this acronym, SPIN:

1. SITUATION: finding out the fact about the buyer's current situation
2. PROBLEM: discovering the buyer's problems and dissatisfactions
3. IMPLICATION: exploring the consequences of the buyer's problems and dissatisfactions
4. NEED-PAYOFF: establishing the value and the usefulness of a solution

Most of the method consists in asking a lot of right questions at every single step.

1. SITUATION QUESTIONS: focused on facts and background
2. PROBLEM QUESTIONS: focused on problems, difficulties, and dissatisfactions. People buy only when they have needs and the objective here is to discover implied needs. Clarify any identified problem with additional questions: what exactly, who, when, how, how often, why...
3. IMPLICATION QUESTIONS: focused on consequences, effects and implications of the problems. The idea here is to link a problem with a desire for a solution.
4. NEED-PAYOFF QUESTIONS: focused on value, importance and usefulness of a solution, in order to later make your solution as much attractive as solution. Basically you have to identify explicit needs, to clarify  and specify them as much as possible.

When you have a clear understanding of the Situation, the Problems, the Implications and the explicit Needs-Payoffs, you can position your solution describing the Features, the Advantages and finally the Benefits for the buyer. You have to manage and overcome objections until you have the buyer's agreement of the fact that your solution/product is the one he really needs.

Bottom line, some people are certainly much more talented than others to communicate and establish positive relationships, and everything about sales is people related. People buys from people they like! But selling per se could be learned, that is a fact. And it was new to me! Since I have taken countless sales and negotiation training classes. All are different, but all converge to pretty much the same basics. Xerox sales training even though very basic contains the essence of what I have discovered later in much more complex selling models. This basic was worth to be reminded.   

Overview

 Look around you! Most of the objects we rely on on a daily basis have four legs: table, chair, bed, car...  What is built on a quadratic base is usually hard to turn upside down [;-) Don't ask this little girl!] . The number four, represented by a square, is the symbol of stability and completeness.

So what's my point here?

Running a company or developing business worldwide is quite a challenge. There are a bunch of political, financial, economical, technical and organizational conditions that could impact the outcome whatever you might do. But when considering what it takes to be successful as a business executive in such an environment, I usually end up with four main talents that guarantee a strong foundation to build on and drive to success. Let's go through each of them one by one.

First of all, you need business management skills. That sounds obvious, doesn't it? That encompasses the ability to properly market and sell a product or service, to smartly position and forcefully communicate its value proposition while integrating geographical and cultural differences and finally to rigorously manage a P&L. Although a given individual's talents can make a significant difference, most of what you need here is knowledge-based and taught in good business schools. I will cover in future posts what business schools don't really teach you because you only can learn it from your own practice and experience.

Then, you have to be an expert in a second domain, people management. Having a unique product with a strong value proposition, the right positioning, an attractive price and a proven ROI is certainly good but not good enough. You need a team and a great one! You need to organize it and establish processes in order it to be efficient and scalable. You need to manage it by motivating, delegating, empowering... and sometime firing. Finally you absolutely need to create KPI (Key performance Indicator) to measure progress and take appropriate and result-driven actions. You had concepts and materials created by marketing as well as good sales and negotiation techniques acquired over the time, but you have now to execute, to create momentum, to fix goals, to solve problem, to follow-up and at the end of the day to make it happen!

Next you have to consider your team is a living being. While market is changing (fast), competition is improving (fast), technology is evolving (fast), your own team has to get adjusted in real time. The only constant thing is change and so you have to perpetually fine tune your team's skills, knowledge and behavior. That means training, coaching, developing and mentoring the members of your team for them to give their best in a fast changing world and to grow up both as professionals and as persons. Keep in mind that even if your team was very successful at a given time, doing nothing to keep it at the edge is a recipe for failure on the long run.

The fourth and last required talent you need is leadership. Leadership should give an overall sense to your action. Taking roots in strong ethics and values, leadership is the ability to articulate with passion and conviction a vision that resonates at your team's level. It is also the ability to make decision within uncertainty, to challenge the way stuffs are usually done and to think out of the box.

So let's summarize. In order to succeed in our fast changing very competitive world as a sales and marketing executive, you need the four following talents:

1. Outstanding business management skills enabling you to accurately position a product or service, establish its unique value proposition, create forcefully presentation to communicate it in a simple way, to negotiate at the C-level focusing on high level strategic issues, and finally manage a P&L to improve both top and bottom lines.
2. Unmatchable people management skills to build an effective team, establish organization and processes that enable simultanously nimbleness and scalability, solve problem and drive every single day toward results.
3. Strong coaching capabilities to train, mentor and develop your team on a constant basis as the world is changing fast. That requires outstanding listening and adjusting capability as well as the ability to provide new perspectives on existing issues.
4. Finally demonstrating leadership based on  strong ethics and values, the will to share your beliefs with passion and conviction in order to articualte a vision that makes sense for your people, and the ability to surprinsigly think out the box.

   

Here is a graphical representation of the described model.

In the next posts, I will explore each one of the squares in more details and explain you how to make it happen.                                                                        

Introduction: Blog Launch

Hello all,

I recently grew and led to a financially very attractive exit a software start-up company providing service assurance and business intelligence solutions to telecommunication wire-line and wireless operators. Previously I created a SaaS/SFA start-up. Earlier I also worked at large international companies such as Texas Instruments, Sun Microsystems or Sybase. I thought my background and experience could be of interest.

That said, I am not the only one having a broad and interesting experience!! ;-)

This is exactly what triggered the idea of creating a blog about this very topic: international sales, marketing and management best practices. I am not a guru and I have no will to be one, but I would be glad to share my experiences, my beliefs, and my learning from successes or failures (we usually learn more from those last ones!) with people looking for guidances. In another hand I would be delighted to get feed back from around the world and to receive your own examples of best practices. Stuffs that work and that I might use!

I want to keep it very simple, very concrete and very usable. I don't have yet a precise idea of what I am going to cover in the very detail, but I'd like to address the four following topics that represent for me the essence of any success in this area:

1. Business management
2. People management
3. Coaching
4. Leadership

The idea to put toghether ideas and experiences to give birth to a worldwide virtual discussion on those topics is really exciting and promising. This is a small brick in a the broad wall of knowledge sharing transcending borders, races, religions and political preferences. That is a little contribution but thanks to the technology a fascinating one!

At this point, if you think that makes sense, let me know! That will be stimulating!We'll get started very soon!

Gabriel Blanc-Laine