CHAPTER 1

Time for Change

The Moment of Clarity

You have built a beautiful business. But lately, waves of change are slowly eroding its base. Until now you have held back the damage by reinforcing the foundation. Then one day the realization hits you: you must move the whole structure, or it will be swept away, like a sandcastle on the beach.

For so many of us, that is precisely how it feels when the market for what our company sells stops growing. Or when a newly emerged competitor (who seemed like an irrelevant gnat just a year ago) releases an offering that is beginning to transform the marketplace. Advances in technology are making new products possible or making it cheaper to produce the old products.

Sometimes the trouble occurs because our customers are changing. The customers may be confronting a shock in their own market (e.g., contractions in electronics retailing, fluctuating oil prices) and are less able to make their traditional purchases. Or the customers’ buying behaviors are changing. Often what is changing is who is doing the buying within each customer organization. New buyers bring different purchasing criteria with them.

The drivers of change can also be positive. A new, more attractive segment of customers might be emerging. Our colleagues in engineering or product development may be ready to release some major innovations. We may have discovered that a few of our salespeople have become very successful selling in a different way, or to different buyers, or to different types of companies.

Whatever the cause, the moment will come. How you respond will determine your personal success, that of your customers, and to a great extent that of your company.

It’s pretty common to confront changes like those above and deny them, at least initially. Successful selling requires a great deal of optimism, so too often sellers and sales leaders dismiss early signs of the need to change as unnecessary negativity. Optimism alone, many sales leaders facing change believe, will win the day. But in this case optimism is just another word for denial. While it’s natural to be in that space for a while, too much time there, or too much commitment to past success, can be deadly.

“Creative Destruction”

It’s not so easy to be great forever. By most accounts, only 2 of the 11 companies cited by Jim Collins in Good to Great are still “great” today. Using another measure, the length of time that a corporation spends in the S&P 500 has dropped from 61 years in 1958 to just 18 years today. Richard Foster and Sarah Kaplan, in Creative Destruction, explain that the companies that perform best over a 10- to 15-year period typically have strong cultures and meticulous bureaucracies. But it is exactly these qualities that make them stall out after that period.

Foster and Kaplan propose that success comes not from continuity but instead from discontinuity. They advocate the constant destruction and re-creation of companies to remain competitive. They argue that successful companies are those that are as dynamic as the market itself. Foster wrote in an earlier book that during periods of technological discontinuities, “Attackers, rather than defenders, have the economic advantage.” This is the situation we see so often today, where new entrants deploy new technologies to disrupt established markets. Legacy players are left facing the moment of clarity we described above.

High-performing salespeople often naturally figure out the right things to do in times of disruption; or because they are so skilled, they can get by for longer by ignoring the need for change. Low performers often become victims in times of change, blaming bad leadership, misguided efforts by other departments, and irrational customer demands. Fortunately, the core of most sales organizations is populated by optimists, but they often don’t know what to do when confronted by change and can easily fall into a state of denial.

Who is responsible for staying ahead of the market? Maybe it’s the R&D folks; maybe it should be owned by marketing and product development. You can argue that it’s the CEO’s responsibility. But here’s one thing that is true: the chief sales officer who takes responsibility for staying ahead of marketplace changes (rather than becoming a victim of them) is the CSO who will likely become a CEO.

That Sinking Feeling

The need for sales transformation is presenting itself in different ways to people, depending on their roles. Here is how the world looks today to three real sales professionals we have met (names and identifying details have been changed).

The Lost Edge

Jack has been selling for over 20 years. He has spent most of his career at two companies and has been successful at both. In fact, he quickly moved from key accounts to area sales manager. Within the region, the entire sales team was delighted to see one of their own, a guy that really gets it, in charge for a change. Today Jack is back in the selling role and struggling to meet his targets. What happened?

Jack failed at the sales manager role, as many successful salespeople do, because he was unable to provide meaningful direction to his team. He had good intentions, but he tried to get others to sell the way he had, which was somewhat unique, given his particular personality and experiences. For a while he was seen as a good manager because the person he replaced was not suited to the role, but eventually the numbers caught up with Jack. He was not able to lead his team to growth.

Jack was discouraged by the chain of events, and as we noted earlier, he is back as a salesperson and struggling. Is it because he’s been depressed by his recent experiences? Perhaps. But more likely, Jack’s failure at sales management and difficulty selling today is a result of falling out of sync with the changing marketplace.

Jack—like many other salespeople today—is feeling that he has lost his edge. The activities and behaviors that once worked for him no longer get results. He is questioning whether he can be successful again.

Back to Basics

Joan is a sales manager. Her sales team, which is very experienced, has shown some improvement recently, but really it has continued to struggle since the global financial crisis many years ago. There has been very slight growth, but it has often come at the expense of margins.

Customers of Joan’s company, which we will call Allstar, have shown an increased resistance to Allstar’s pricing model. These customers are less interested than they once were in paying a premium, particularly given that newer competitors have similar offerings at lower prices.

Joan feels that the market has not really changed. She believes her team has become complacent, and even lazy. In response, she has pushed harder to drive and measure specific sales activities. She is focusing on five measures: call volume, meetings scheduled, opportunities identified, proposals submitted, and referrals generated. While this has had some positive impact on sales, it has also added a lot of noise to the CRM: leads that are not qualified, meetings that don’t drive sales, and opportunities that never close.

Joan knows there are people in her organization who are pushing for a major change in how Allstar goes to market. Joan tries to build consensus around the idea that no big change is necessary. She aligns herself with others opposed to change, and she shares examples of how any significant level of change would negatively impact her customers. In management meetings, Joan recommends that the sales organization stay focused on internal issues, such as conflicts with the marketing department, customer service issues, and a quality problem in a recent product release. Fixing those, Joan argues, is the key to growth.

In summary, Joan believes that one more quarter is all she needs to prove that a big change is not necessary.

Horror Show

Helen has spent her whole career in the same organization and has been in her sales leader role for several years. As a salesperson, she had the fastest success of anyone in the history of the organization. She is well loved both by customers, who value her intelligence, and by her employees, who value her passion and compassion.

Helen recently had a moment of clarity. Her team just posted a year-over-year decline, a first in her career. While also feeling accountable to her company and boss, Helen’s primary reaction is one of having let the people on her team down. “They trusted me to make choices that protected their jobs,” Helen thinks to herself. “I’ve got to figure out a way to fix this.”

Helen finds it hard to put a finger on when the problems started. She isn’t sure what she missed. What she feels is a great deal of uncertainty. It feels like the wind has blown open a door in a horror movie. For an instant everyone can’t help but expect a serial killer on the other side. Helen tries to keep her emotions just this side of panic.

Helen knows she needs to fix the situation, but she does not know how.

Taking the Bird’s-Eye View

For Jack, Joan, and Helen, these are highly uncertain times, as they are for the salespeople, sales managers, and sales leaders they stand in for. Most sales professionals have been in the same sticky situations as Jack, Joan, and Helen even if they haven’t held the exact same roles. How many of us have not:

  Feared losing the skills that made us successful in the past?

  Hoped that increased activity levels will overcome decreasing performance?

  Experienced feelings of panic when a major realization sets in?

For every sales role, and for every negative emotion above, there is an answer. That answer requires looking at the situation from a higher vantage point and seeing it in the context of larger waves of change that are washing over all markets today. By reconfiguring our response to marketplace change, we can quickly shift from being a victim or lost soul to being a leader.

Charting the Course

This book is a road map to staying ahead of marketplace change. For sales leaders, it provides a path for transforming the sales organization. For sales managers, it describes how to inspire change in the behavior of salespeople. And for salespeople, it offers a new way of selling that will have a dramatic impact on success. Whichever role you are in, this book will provide you with immediate actions you can take and experiments you can conduct to find the right direction for your future efforts.

This book is about sales. It is also about change management. In fact, in many respects, sales today is essentially change management.

The book is organized into five parts. In Part 1, we propose a new logic for thinking about and executing major change in sales organizations—what we will refer to as sales transformations. In Part 2, we examine sales transformations from the customer’s perspective, and we show how the customer’s changing buying patterns suggest a particular way of focusing a sales transformation and selling activity. In Part 3, we focus on the perspective of salespeople and what they can do to sell change to their customers who are also going through transformations. In Part 4, we look at how sales leaders and sales managers can change the way selling works in their organizations. Finally, in Part 5, we highlight the pivotal moments that determine the success of major change initiatives in sales organizations.