CRO Rule #10 - Use Interviews as Simulations

CRO Success Rule #10:
Candidate interviews need to be a simulation of the sale you expect them to conduct.

We have arrived at our final CRO Success rule and it is an important one.  Bad sales hiring happens for many reasons, but there are “free moves” you can use to enhance your hiring success.  One of them is the interview.  Too often we see hiring managers who simply want to have a discussion about a candidate’s resume along with telling them about the position, the company, the benefit plan, etc.   Bad move.

The better approach is to mirror your typical sale in the initial interview.  Sales interviews do not need to be comfortable, easy-going discussions.  Instead, match the parameters of your typical sale.  Have multiple people in the interview if they will have to sell to a group.  Be somewhat short and curt with them if your prospects are typically in a hurry and not eager to talk to a salesperson.  Interrupt the candidate, drill down on their answers, ask for deeper clarification…all of these moves are free.  You would be wise to incorporate them into your hiring process so you can see the candidates in action.

CRO Rule #9 - Hire Stronger

CRO Success Rule #9
Every time there is an open sales position, the next new hire needs to be at least as strong as the best sales person you currently have or have ever employed.

Every CRO, and I mean every CRO, has a sales hiring horror story.  I contend that hiring salespeople is the toughest hire any company faces.  The simple reason is this – even “bad” salespeople can fake it long enough to get through the traditional sales hiring process.

The solution?  Don’t use a traditional sales hiring process.

We have developed a complete, unique sales hiring process that screens out the cute puppy to borrow a turn of phrase from my book.  Bad sales hires are extremely expensive to any company with not only hard costs but with the greater loss of opportunity costs.

To build a world-class sales team, you have to hire stronger salespeople.

CRO Rule #8 - The Most Underutilized Tool

CRO Success Rule #8
Incentives are the most underutilized tool available to Chief Revenue Officers in terms of meeting their performance objectives.

Truly, there are certain things I encounter, when working with CROs, that are as consistent as an underutilized incentive plan (and strategy).  Salespeople are motivated by money in most instances.  That motivation will drive behaviors.  If you incent the motivation, you will elicit the behaviors you want.

That is a bit simplistic, but you get my point.  One thing all sales incentive programs should contain is that new business should pay out at a higher commission rate than existing (customer) business.  There are variations and adjustments needed to fit your plan, but this basic structure should always be followed.

I discuss margin incentives, threshold incentives, team incentives and more in the book if you are interested in learning more.

CRO Rule #7 - No Subsidies

CRO Rule #7
Reward the strong and effective; don’t subsidize the marginal performers.

Incentives are one of the most under-utilized tools available to the CRO today.  Strong salespeople are almost always motivated by a return on investment which speaks to money.  Yet, there are certain mistakes I have encountered over my career that I have listed in my book.

Here they are (with more details available in the book):

Incentive Mistake #1:
All business (new and existing accounts) earns the same incentive.

Incentive Mistake #2:
Putting a cap on a salesperson’s earnings.

Incentive Mistake #3:
Not creating an incentive based on desired outcomes.

Incentive Mistake #4:
Not having a defined sales cycle.

Incentive Mistake #5:
Letting Finance design the incentive plan.

Incentive Mistake #6:
Paying incentives on orders versus customer payment.

Incentive Mistake #7:
Assigning more sales leads to the reps that are NOT doing well to help them crack the incentive column.

CRO Rule #6 - Prospect Motivation

CRO Success Rule #6
A prospect can never have too much Motivation regarding your Differentiating Value.

We’ve written frequently about Differentiating Value (DV) which is foundational to all successful selling.  The key to DV is translating it into your prospect’s world.  What do they give up in the absence of your DV?  A critical question for sure.

However, usually the consequences of life without your solution aren’t horrible, they are just unknown.  Therefore, when you can translate the consequences of not being your customer into your prospects’ worlds, they can start envisioning their own perceptions of new possibilities.  The more their perceptions become compelling, the more traction your DV has in their decision process.

CRO Rule #5 - Differentiating Value = Premium Price

CRO Success Rule #5
The breadth and depth of your Differentiating Value platform determines the amount of traction your product or service has in target market segments.  It also determines the level of premium pricing you can achieve.  If you have zero Differentiating Value, it means you are selling only on price.

In case you haven’t notice, Differentiating Value (DV) is a bedrock of all successful selling.  The more DV you have, the more valuable your solution is in the marketplace.  Here are 3 keys to refining your DV:

• Define what matters to the customer – There is no point in highlighting benefits a customer doesn’t care about.
• Be unique or demonstrably better – If the competition offers the same item, whatever that feature/service/product is, then that item is not your competitive advantage.
• Be specific and measurable – Get rid of the fluff.  If you can’t be specific and/or measurable, you sound like every other competitor.

CRO Rule #4 - Find the "Emotional" Decision Maker

CRO Rule #4
For a shorter sell cycle, your Differentiating Value message(s) should be directed toward the emotional decision maker, describing what he/she will lose without you.

People make decisions emotionally and later justify them intellectually.  This fact is critical to understanding the purpose of finding the emotional decision maker in any potential deal.  I explain how this principle works in my book, but for brevity let me offer this excerpt:

The emotional decision maker can be described as the one who suffers the consequences of life without you.

…

Emotional decision makers are usually harder to find, easier to close, not as price sensitive, and can typically tell the technical buyer what to do.

This fact is paramount as you develop, refine and implement your Differentiating Value.

CRO Rule #3 - No Decision IS a Decision

CRO Rule #3
If a prospect decides not to do business with your company and there is no impact in his/her world as a result of that decision, the person made a good business decision.  As such, your Message objective is to make sure prospects understand what they will give up (lose) if they decide not to do business with you.

Last week we talked about Differentiating Value (DV) which is a fundamental component of successful selling.  This week we are going to apply DV to your messaging.

DV is what sets your solution apart from your competition.  The key is that the value cannot be tied to quality, service or support.  Those 3 bromides are the backbone of many marketing messages…and an ineffective approach.  The reason is these 3 traits are assumed by prospects and claimed by competitors.  They are the opening ante to enter the game and therefore are difficult topics in which to differentiate your solution.

The key in applying your DV to your message is this – in today’s market you have to clearly express what sets you apart from your competitors and your prospects must find this valuable.  I’m not talking about traditional features and benefits, rather the value you bring that differentiates your solution from your competitor’s.  When there is differentiation, then there is loss for not choosing your solution.  This fact is the key to your message.

CRO Rule #2 - Are You Worth More?

CRO Rule #2
If you’re not clear about what makes you worth more, you will always compete on price.

We call it Differentiating Value (DV) and it is a foundational truth to any and all successful selling.  In essence, it is the key to what makes you worth more.  No DV, no deal…outside of having the lowest price.  The reason why?  From the Chief Revenue Officer! book:

1. Prospects do not invest the time required to fully understand all of your products or service “brilliance,” and even if they try, they frequently map your promoted feature/benefit data points into their world incorrectly.

Because of that fact…

2. Prospects make better decisions when you translate your unique product or service capabilities into their world for them.

CRO Rule #1 - Why Sales Training Doesn't Work

CRO Rule #1
If all four tires on  a car are flat, putting some air in one tire does not remedy the situation.  That is why companies know sales training alone doesn’t work, and it won’t until they implement the three remaining core processes of a closed-loop Revenue System.

I grant you it is a simple analogy, but you see the wisdom in it.  Revenue development has many components of which sales training is a singular piece to a larger puzzle.  Here is a graphic representation of a CRO’s role:

These are the activities that lead to a closed-loop, Revenue-as-a-System engine that drives department-wide success.  The 5M’s Sales Process is a key component, but it is only 1 “tire” on the car.