So What?

We often write about Differentiating Value (i.e. DV) as it is fundamental to any strong selling system. You will hear it called value proposition, unique selling proposition, differentiation, and son on. We have an entire process to help companies define and refine their DV which will affect the entire selling process.

But let’s talk about a quick, simple approach you can use on your own to start refining your DV. Take a look at your present DV and ask yourself, “So what?”

The approach sounds indignant, but it works. The goal is to refine, or distill, your DV down to its essence because that is the point where it has the most power.

Existing DV: “We provide excellent service to our customers.”

So what?

“Our customers know we will take care of them if they have a problem.”

So what?

“If our equipment breaks down in the middle of a production run, we will have techs on-site fast.”

So what?

“We provide the fasted response times in our industry which allows our customers to know they will hit their production goals.”

Once you distill the topic down to the point where asking “So what?” sounds flippant, you have reached the essence of that particular DV. Now, you might find that it is not a compelling DV which may lead you to constructing a new DV all together.

Try this exercise as you work on your next DV messaging. As frustrating as it may get, in the end you will have a tight, impactful message. If you need assistance, we can help.

DV Week Part 3-DV Depth and Premium Pricing

Photo by rawpixel on Unsplash

Let's review 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.

Did you catch that?  No DV means no premium pricing.  Actually, it means your salespeople are probably in a discounting war with far too many (all?) prospects.  You understand when we say DV is the foundation of all successful selling, this is why.

Now that your are into your DV process, it is crucial to refine and translate your DV.  You need to boil it down to its essence to make it powerful.  Think of this fact, it takes 10 GALLONS of maple sap to make 1 QUART of maple syrup.  It takes hours of boiling to reduce the sap (depending on sugar content).  You get the point - it is an arduous process that yields a valuable end product.  DV creation is analogous to the maple syrup process.

These DV questions must be addressed to make sure you get paid what you are worth:

• What value do you bring to your customers? (Real value - no fluff)
• How does the absence of your value show up in the prospect's world?
• Where does it show up?
• Who does it affect?

When your DV successfully answers these 4 questions, you are well on your way to handling these 2 sales objectives:

Bridging the communication gap with the prospect's world

Doing it in a way that will shorten the overall sales cycle

If you need help with any of these processes, we are always welcome to assist you.

How To Keep Your Forecast On Track

Everybody wants a sure thing. They want to kick back and let the money roll in.

But sure as Lucy is going to pull that football away when Charlie Brown comes running, your “prospects” are going to come back with reasons not to buy your product or service. It’s time to put an end to that.

If you’re experiencing fluctuating quarterly revenues, your business may have landed itself a seat on the revenue rollercoaster. Structure is your key to success here. You know that well-run production boils down to thoroughly developed and managed systems; it works the same way with revenue. Accurately predict and generate revenue by operating under the four interrelated core processes that constitute a complete revenue system.

But before we discuss the four core processes, let’s clear the air on prospects…

It’s great when your sales team envisions endless prospects as they gaze upon the world of business. Don’t ever let them lose that sense of the market being theirs to win. But help them keep their feet on the ground while they’re reaching upward. There are ways to identify a lead as a true prospect, or a potential waste of time. Your salespeople should be shaking the money trees, not chasing down tumbleweeds.  Teach them to focus on the Differentiating Value that your offering brings, and to also ask Critical Qualifying Questions (CQQs) to uncover problems, frustrations, gaps, losses, and challenges that the potential prospect is experiencing.

Once you’ve got your people going after the true prospects, set them up to lock in realistic sales forecasts. Here’s a quick rundown of the four interrelated core processes:

5 M’s Sales Process:  Message, Motivation, Money, Methodology and Market

It’s likely that you already give major consideration to the power behind these words. When all five are achieved, you have the foundation for an objective, measurable sales process. Put them to work for you based on your business today – not hypothetical models.

Bankable Forecast Process: Build your forecast objectively, rather than as a conglomeration of the unique forecasts created by your reps, using the four qualifying elements of the 5Ms above: Motivation, Money, Methodology and Market. These are called the Four Aces, and should be incorporated into your forecast math. If your selling system is well defined and connected to a direct audit trail, you will be able to extract the objective data to report and determine accurately where you are in the qualifying/sales process for each revenue opportunity.

Results-Driven Incentive Process:

If the incentive system isn’t structured correctly, companies typically wind up losing their strongest performers. Focus on improving these seven aspects of your incentive process.

1. Structure your incentives. It is important to keep your company strong and growing, and new business is the best way to accomplish this. So why would you offer the same incentive for both new and existing accounts?

2. Remove the caps. If your salespeople bring value and profits to your company, why shouldn’t they be appropriately compensated for it? If you put a cap on your salespeople’s earnings, you put a cap on your company’s earnings, and may ultimately lose your best salespeople along the way.

3. Create an incentive based on your company’s desired sales outcome. If you want your team to sell to volume, make sure they’re incentivized toward it.

4. Define your sales cycle. Having an understanding of how long a piece of business takes to go from an initial contact to payment for goods/services delivered is critical for both business planning and incentive structuring.

5. Integrate the incentive plan into the business model; don’t allow it to be designed by other groups, such as finance. It’s important that the incentive process supports and rewards a salesperson’s measurable level of contribution.

6. Make incentive payments at customer payment, not based on orders written.  Clarify that incentives are earned only upon timely payment of the complete transaction amount. You can pay incentives at any time, but waiting until the payment has been received can save your company money, and legal risk.

7. Help out the low and non-performing reps. Address their performance issues and create a plan for their revival. Leave top leads for high performers to help ensure the business can be closed.

Skills-Based Staffing Process:

If you hire people who fit your core sales force profile, you have better odds for success. The skills and characteristics that best fit your sales positions will be defined by selling process, forecast process, and incentive process metrics.

Not every hire will be successful, but the odds are significantly better when an objective, more structured process is in place.

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Once you have built these processes into your business structure, forecasting will move from hazy and hopeful guesswork to a clear component of your operation. And remember to update your revenue forecast with changes on a quarterly, if not monthly, basis. Your forecast is a living document that should be constantly reviewed and updated to reflect the changes in your business. Set it up correctly and it will serve your business’ success.

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.

The 5 Must-Have Components for Revenue as a System in 2018

After 6+ years of hosting monthly roundtable meetings with revenue leaders from a diversified combination of businesses, it’s clear there is a core list of components CRO’s need to have in hand at the start of the year for maximizing success and driving revenue growth. 

The core components of Revenue as a System:

1)  Lead generation system – Differentiating Value (DV) is defined by target segments and campaigns are loaded for launch through all media channels.  It is never about what you say, it is more about what the prospect remembers about you.  The DV messages are 100% translated into the prospect’s world.   Response systems operate under time-is-of-the-essence priorities so nothing goes past a couple hours, worst case, without a direct engagement (not an auto-responder).  The goal is always a response time in minutes to connect in the prospect’s “window of interest.

2)  Revenue team roles – The right mix is a combination of inside and outside resources with the new business development goals assigned to specific hunters and not diluted across everyone’s goal sheets.  The hunters have line of sight vision to the targets and the tools to pursue them.  The right talent means trained and ready to handle all levels of communication - especially qualifying.

3)  Structured sales process based on your Differentiating Value – Selling is a communication process and your Differentiating Value (DV) is why prospects decide to do business with you.  As such, a CRO cannot invest the time to learn the unique qualifying approach of every sales rep in their organization.  I have tried it – it doesn’t work and the individual process I was exposed to were totally ineffective.  Qualifying is all about asking the right questions.  Every sale typically consists of 4-6 Critical Qualifying Questions (CQQ’s) that objectively determine if, how and when the deal comes together.  Sales reps never want to get a “no,” but the reality is getting more no’s than yes’s is the way it works.  It is far better to get the no before you invest a lot of resources into deals where you are not even on the list for consideration.

4)  Structured forecast process – Forecast accuracy is the report card of your qualifying system.  Sales reps know it is always better to be optimistic vs. realistic when forecasting.  Due to that approach, management does not know exactly what’s in their pipeline.  This is a common survival technique to buy more time without going under a formal “get-well” plan.  A bankable forecast process can be achieved - the challenge lies with your qualifying execution.  The key is to hold your salespeople accountable to qualifying suspects for motivation, money, methodology and market before moving prospects on/through the forecast.

5)  Properly-aligned incentive systems – Incentives are the most underutilized tool in the CRO’s arsenal.  The days of one-size-fits-all spreadsheet plans never really worked…and they still don’t.   It is important for plans to both recognize behaviors and reward results.  Incentive plans can include a variety of components – forecast accuracy, mix of sales performance by product and/or accounts, new logo accounts, etc.  No two businesses are identical so no two plans have the same focus.  It starts with understanding your specific sales model and building the incentive plan around key performance thresholds.  In the end, much of successful selling comes down to doing the right behaviors consistently.  Your incentive plan should creatively incent those behaviors.

This is just one of the revenue-focused topics we discuss at the RoundTable.  If you would like to learn more about the executive peer group, register to attend one of our upcoming briefings in the Twin Cities or Chicago.  Visit our Executive Briefings page here.