Joining me on this episode of Accelerate! is my guest Frank Cespedes, Senior Lecturer at Harvard Business School, and author of the book Aligning Strategy and Sales: The Choices, Systems, and Behaviors that Drive Effective Selling, as well as numerous articles on the Harvard Business Review about sales.
[:53] Frank was a business school professor, researching marketing and sales. Then he ran a tech firm for 12 years, sold it, and returned to Harvard to teach strategy.
[4:57] Frank mentions a McKinsey study on the effects of the 2008 recession. Companies cut the costs of goods sold, but selling & general administrative (SG&A) expenses, as a percentage of sales, have risen.
[6:30] Companies have done a good job of cutting operations costs, but have done less well with efficiencies in going to market. Productivity studies are now focusing on those costs.
[7:20] The availability of more accessible data shows clearly what it means to be a sales leader in the 21st Century. The CFO and C-suite can see easily what is happening for the enormous amount of money spent on sales.
[8:34] There is a misplaced focus on the number of activities, which means thinking about quantity, rather than quality. Activity is not outcome. Sales is about outcomes. Closed sales count.
[10:58] Andy refers to Absolute Value: What Really Influences Customers in the Age of (Nearly) Perfect Information, by Itamar Simonson and Emanuel Rosen, who say buyers are adept at capturing and understanding the information they need.
[14:31] In the business value chain, from sourcing to service, sales is the most specialized factor. In any industry, what works in sales at Company A, may not work selling at Company B, but sales is the factor most seen as generalized.
[17:28] The SaaS sales model took off in 2008, when it was mandatory to cut back on go-to-market costs. Any successful model is about the entire process. New models constantly disrupt mature models.
[22:28] Every generation relearns basic truisms. Putting new names on old processes can work, if it moves the meter in the right direction.
[24:58] Frank says studies support that 80% or more of sales come from 20% of salespeople. Performance variance in sales is greater than in many other areas of business.
[28:29] Frank’s tips to improve sales outcomes: improve hiring practices, including behavioral assessments; hold regular real performance reviews; use training and development, tracked.
What’s your most powerful sales attribute?
I knew what I was talking about, with the product, and customer issues it solved.
Who is your sales role model?
It was a number of people I had seen, admired, and respected, and I said, I can do that.
What’s one book that every salesperson should read?
Neil Rackham’s book SPIN Selling: Situation Problem Implication Need-Payoff.
What music is on your playlist right now?
I am a big fan of Jazz music. Pianist Bill Charlap and his trio.