Sales

WARNING: I have a SHORT FUSE

/ Jai Thampi / Leave a comment

Mark is a senior manager at a reputed MNC and I’ve been his coach for the past few years. He recently took up a new job with a team of three reporting to him. But within the first couple of weeks he noticed one of them, Tracy, showing resistance to his suggestions and initiatives. Soon she escalated to their general manager that Mark is a difficult person to work with, and work for. In order not to “rock the boat” the general manager promptly re-assigned Tracy to a new manager. Despite this change Tracy continued to spread unpleasant words about Mark at the lunch table and water cooler. His attempts to be more sensitive and garner her support were all futile, driving him to consider a new job search.

When Mark called me for guidance I told him I will meet him at his office. Reaching his office I took a walk around and observed his team’s work desks. Tracy’s cubicle stood out with a loud poster on the wall which said:

i-have-a-short-fuse

Very often we, managers, tend to miss or ignore such early warning “signs” in our sense of urgency proving ourselves at the workplace or meeting deadlines. In the daily grind we tend to forget that we are all eventually dealing with people – and every individual is unique. What triggers one to stay motivated could be a total deterrent for another.

Further discussion made it apparent that there was a fundamental culture chasm in Mark’s company, and these were the telling signs:

  • Everyone knew the company’s “vision 2018” but had no clear idea how the management was executing to this vision.
  • Mark’s role and responsibilities were not properly communicated to the wider organisation by the general manager.
  • She gave him no orientation on the team, their attributes, attitudes, or background.
  • The idea of ‘change’ was alien to most of them. “It’s always been done this way” syndrome ruled their kingdom.
  • The general manager was too busy or inexperienced to coach the team, and quite often exhibited lack of professionalism in managing the people.

Managers ≠ Leaders

It is true – not all managers think or act as leaders.

Managers must demonstrate leadership by diligently communicating the vision and purpose of work, identifying what motivates their team, and keeping them motivated and committed. I covered these topics extensively in two of my earlier blog posts, you can read them here and here. Today’s leaders have an additional challenge at hand. As my ex-CEO John Chambers wrote recently, we have to go through “near-death” experience in order to make our companies great. In today’s digital world we have to constantly think of disrupting ourselves, else we will be disrupted and displaced. Managers have to act as leaders, and inculcate this culture throughout the organization.

The Culture of Change

If you want to be the best, you have to embrace change. From the top down, everyone in the organization must adapt and adopt this culture. In her most recent interview with HBR Indra Nooyi, the CEO of PepsiCo said “I told everyone that if they don’t change, I’d be happy to attend their retirement parties”. I encourage you to read the full article for the context of her statement, and also for some incredible lessons from her experience at PepsiCo.

When Lou Gerstner remarkably turned around IBM, it was through wide-ranging programmes of management culture change, and diligent focus on execution. In his book Who Says Elephants Can’t Dance, Gerstner says “The hardest part of these decisions was neither the technological nor the economic transformations required. It was changing the culture – the mindset and instincts of hundreds of thousands of people […] It was like taking a lion raised for all of its life in captivity and suddenly teaching it to survive in the jungle.”

Coaching Tips

Let’s re-look at Mark’s case now. It is apparent that his general manager showed poor judgement by instantly re-allocating Tracy to a new boss. A better approach would be to first have an open unbiased session with Tracy and Mark, and observe his communication style to learn what makes Tracy so sensitive about it. As a leader she should then coach her whole team to collaborate, ensure they all understand the company’s strategy and execution plan, clarify to Tracy why they hired Mark as a change agent, and reinforce that there will be more changes coming ahead, and for the better. Keeping Tracy happy is a myopic approach, because if she continues to light her short fuse the whole team’s future could be in jeopardy. As for Mark, building rapport with the team, and taking Tracy’s poster as a warning sign to adapt his communication and delegation style accordingly, could have saved him half the trouble.

Here are 3.5 things you can do as a leader to inculcate the right culture in your company:

1. Communicate

Communicate your vision, strategy and execution plan all the time… simply, and consistently. Garner feedback, get people involved and aligned. Make sure everyone’s roles and responsibilities are clearly articulated, but don’t let them build silos.

2. Set an example

Be authentic, passionate, decisive, demanding, consistent, impartial, and firm. Be a role model for the whole team. Get the culture right, and be maniacal about driving it through the length and breadth of the organization.

3. Coach

Stick to the strategy and demonstrate in execution. Don’t tell them “this is how I do it.” Teach them how to fish, don’t give them a fish every time. Give them the tools to do their job. Understand every team member’s motivational triggers and sensitivities, and adapt your coaching style accordingly.

3.5 Zero tolerance

Do not tolerate mediocrity, and certainly do not tolerate people who are unable or unwilling to operate within the values – no matter how talented, experienced, or apparently successful they are. Remember that letting small things go unfixed can have surprising repercussions.

So are you are a manager aspiring to be a leader? Go ignite your people’s passions, not their short fuses.

Advertisement

Looking for ways to screw up your Emerging Market business?

/ Jai Thampi / 2 Comments

In 2014 McKinsey published an insightful article that provided a great perspective on ASEAN – the seventh largest economy in the world, its multi-dimensional diversity, its high growth potential, etc. Most western multinational Companies recognize the importance of entering this market, but they tend to look at the exciting stats, build strategic growth plans without truly understanding the complexity of the market, and eventually go down making losses. ASEAN is just an example here, this is also the case with other emerging markets like China, India, Latin America etc.

Emerging markets are complex in nature, but they don’t have to be complicated. We often complicate things ourselves by not understanding what makes these markets unique, and by not building a clear strategy and execution plan.

Have an emerging markets business in your portfolio that you want to destroy? Here are 5.5 things for you could consider:

1. Do not create localised products

Differentiate, or Die – that’s what you need to remember if you want to win in emerging markets in the long run. If you don’t develop and deliver localised and customised products relevant to the market, your business will die a slow painful death. It might be a smart approach for large multinationals to enter emerging markets focusing on the premium price segment. But do remember that this space is not a safe haven forever. If you don’t do continuous, agile, product innovation and branded differentiation, competitors will eliminate you from these markets in the long run.

2. Ignore your local competition

Asia is arguably the most competitive market to do business in. FSG has a brilliant blog post on this topic. Many Asian competitors operate in a factory model. Vertical integration, low cost production, extremely lean OPEX model, aggressive management that drives volume share gain as their key KPI – add up all these and you have a tough battle to win if you are a multinational corporation. If you don’t plan a differentiated product roadmap and a consistent brand superiority strategy across all touch points, you will lose the battle over time. Needless to say, this needs a very disciplined cross-functional execution model.

3. Do not build a dynamic distribution strategy

Most emerging markets have a fragmented multi-tier distribution model. See this China example. It is not a walk in the park to tightly manage all tiers of distribution and ensure inventory sell through and revenue growth. Yet another decision MNCs face is to operate via distributors vs. going direct. You need to consider multiple factors before making a decision to go direct – including your targeted geographic and channel breadth, your distributors’ appetite to grow, their support infrastructure to help you scale your business, your own organisation’s constraints on OPEX spend etc. If you do not build a strategic distribution plan that addresses all these factors, you will eventually fail.

4. Live and breathe the mantra “one size fits all”

One size doesn’t fit all when it comes to emerging markets’ channel landscape. For instance, if you are an FMCG company you will quickly learn that the levers to pull to gain mindshare and win at small format resellers are totally different from that for a large format retailer. One way to avoid the pitfall of doing the same thing for everyone is to properly segment your customers. Rigorously implement this across the value chain, and repeat this segmentation exercise on a regular cadence to see how things change as you scale and grow.

5. Operate with myopic investment mindset

The myopic mindset is to look at past years’ results and make budget and investment decisions. Really dumb executives tend to react to market volatility by thinking short-term and re-directing their investments into mature markets. Some even eliminate headcount in their emerging regions, citing excuses that they can return to the market when the market is ripe again. I have seen some companies setting myopic KPIs which prematurely kill any future growth-oriented investments for these frontier markets. Want to fail? Continue doing these things.

5.5 Build the same operational model for emerging markets and mature economies

Asia is a unique region – you have some of the most transparent economies next to some of world’s most corrupt nations. Political changes could happen any time and they will influence your decision-making. Currency fluctuations could catch you off-guard. Regulatory systems may be immature, and in some cases non-existent. If you are operating in a highly regulated industry (eg. healthcare) expect to experience tons of roadblocks that you will have to patiently remove as you make your way into growth. Be prepared to get surprises from regulatory bodies and authorities like Customs. A sure-fire way to failure is to ignore all of the above, build no rapport with the authorities, develop no government engagement strategies, and do business like how you operate in developed economies.

As multinational companies start to look for growth it is normal to have an eye on emerging markets. My advice – don’t set yourself up for failure. Understand and acknowledge the challenges of operating in this environment. Attract and retain senior-level talent who have “been there & done that”. Prepare for roller coaster rides. Things will be complex here, but don’t become the moron who makes it complicated.

5.5 Communication blunders you can easily avoid

/ Jai Thampi / Leave a comment

Every day we communicate with people via many modes: face-to-face conversations, phone calls, emails, snail mails (who sends them these days?), text messages, you name it. We communicate professional and personal stuff. Though we all recognize the importance of proper communication, what we don’t realize often is that we tend to make fundamental communication mistakes that can cause serious consequences such as angry clients, lost business, tarnished reputation, or an upset spouse.

Here are 5.5 common communication blunders found in work environment… and the good news: they can be easily avoided.

1. Not preparing properly

Whether it’s a presentation, an important email message that you are about to send out, or an important conservation you are about to have with somebody, it is essential that you prepare and plan your communication carefully. Create an intelligent, credible and compelling message that can be understood by your audience.

2. Not proof-reading/editing your work

Mistakes such as spelling and grammar errors will make you look silly and careless. Do not rely on spelling checkers because they won’t pick up words that are used incorrectly. Did you notice that I had inserted an intentional spelling error in the above paragraph? I used the word  ‘conservation’ instead of ‘conversation’? A spell check tool will never pick that up.

Do not misspell the name of the recipient. It is an insult.

And how about sending that email to the wrong person? Email clients tend to pick up names from the address book as you start typing the name. What if you accidentally sent out an extremely confidential internal company document to some random guy in your friend’s list (who happens to work for your competitor)?

Another annoying thing I see is the incorrect use of words such as “your/you’re,” “their/there”, “it’s/its”, “effect/affect” etc.

It’s not always easy to spot your own errors so you may want to consider asking one of your colleagues to proof-read the content before distributing it.

3. Assuming that your message has been understood

Email clients can notify you when your message is delivered. But do you know if your message has been understood? You can ensure this by prompting the recipients to respond with questions, or by asking them to repeat back to you what the key take-away of your message was. It is a big big mistake to assume that the recipient or audience has understood your message.

4. Not being assertive

Being assertive is about stating what you need, while taking into consideration the other person’s wants and needs. Being assertive is often confused with being aggressive. Aggression is pushing your way down someone else, and that is not what you want to do to anyone. Assertiveness also means saying “no” when you need to, and saying it in a smart and agreeable manner.

5. Reacting instead of responding

How often have we seen people shout back at somebody, or send a nasty email reply in haste? These are all emotional reactions rather than calm and careful responses. This is what spoils your reputation and upsets people around you. I have known people who lost their jobs because of this.

When feeling emotional rage, tell yourself to calm down… turn off that email client or your computer… step away from the situation for a couple of minutes… do whatever it takes to regroup yourself and get back your composure. Those few minutes are perhaps worth your career or relationship.

5.5 Delivering bad news over email or text message

Am sure you saw that hilarious Facebook post going viral about the guy who broke up with his girlfriend via SMS. If that was laughable and childish, how about laying off someone in your team over email or Whatsapp? Sending difficult messages is not an easy task, and it demands softening the message with non-verbal cues such as body language and tonality.

If you need to deliver a bad news to someone, do it in person. Think of the sensitivity and the emotional state of the recipient before you plan to do so. And be available immediately to actively listen and to take questions from them.

 

We all make communication mistakes once a while. If you can work on the above and avoid these common blunders in your day to day life, you can certainly protect your reputation and maintain your relationships. Over time this will help you achieve greater job satisfaction and to develop into a credible leader and team player.

How NOT to respond to a sales inquiry

/ Jai Thampi / Leave a comment

Bad example for sales response

A few weeks ago I was on the look out for a new serviced residence. In Singapore certain hotels allow attractive long-term (2-3 months) stay packages and I came across this website which indicated they have “negotiated rates” with hotels. However no specifics were given except an email address to contact them, so I wrote in and asked for details indicating my budget and stay commencement date. What I got in reply was appalling (posted above).

Needless to say it was such a useless reply I didn’t bother to contact them further. The reservation agent who replied me clearly didn’t snatch the opportunity to lock me in as their customer. Instead she gave me a stock response, stating in bold letters that she cannot help me further. I took some important lessons out of this and wish to share with all of you.

1: Always remember this about a potential customer – If (s)he wrote to you in the first place that’s because (s)he had considered you as a potential client to do business with. So now your only job is to not scr*w up the opportunity. Does that remind any of you of a scene from the movie Hitch where the namesake character says “remember, she’s already out with you. That means she said yes when she could have said no. That means she made a plan when she could have just blown you off. So that means it’s no longer your job to make her like you. It’s your job not to mess it up.”?

2: Read your customer’s message properly. If (s)he has clearly asked for something, give that…and more. Not less.

3: Never say “I cannot help you”. And for heaven’s sake, do not put that in bold black letters. If you really cannot help, state so politely and advise a possible alternate solution.

4: If you have a company website go check it and see what’s on it. A customer might reach out to you when there is lack of information on your website. If you point the person back to the website, (s)he is going to walk away…for good.

4.5: And for the love of business don’t send back stock messages starting with “Dear Sir/Madam”. If your customer has written an email and signed a name on it, just copy it. A personal message shows you care.

9.5 Tips on pricing and price strategies

/ Jai Thampi / 1 Comment

Lately had quite a few people reach out to me with queries on pricing strategies. Here are 9.5 tips for you if you’re responsible for pricing in your organization. This is not meant to be a comprehensive list, but should give you useful pointers if setting price is part of your day-to-day work.

1. Dropping price is easy. Raising it back up is often near impossible

2. A 2% price increase would, on average, lead to a 15% profit increase for FTSE 100 companies

3. Demand-driven price will always bring bottom line improvement than supply (cost) driven pricing. So create demand

4. If you’re launching a new product, do no employ a Price Penetration strategy without proper research on demand elasticity

5. Wherever possible, bundle services such as after-sales support that enable you to set a higher price and create customer stickiness

6. When setting price take all costs – fixed cost, variable cost, out-of-pocket cost, opportunity cost etc. – into consideration

7. Do not fall prey to the tendency of transferring product cost-downs immediately to price-downs

8. If you’re running a Small Business, consider the ratio of your fixed cost to variable cost, vis-à-vis your competitors when setting price

9. If you are an International operating in emerging economies, keep a close tab on your FX rate to prevent price and profit leakage

9.5. Always do a Break Even Analysis and set volume commitments towards your Account teams (and to your Customers, if necessary)

Unlearning the human nature – a Sales & Marketing conundrum

/ Jai Thampi / 1 Comment

If you are a salesperson, skip this paragraph and go to the next. If you are a marketer, continue reading. Raise your hand if at least once in your work you came across a sales team complaining to you “Our competition has this new product X, why aren’t we making it?” or “So-and-so brand just launched this new marketing campaign, why aren’t we doing something similar?”. Looks like everyone’s hand is up in the air. Rest of this post is all about this real-life sales vs. marketing conundrum. And by the way, dear salesperson, I know you continued to read this paragraph despite my asking you to skip to the next. It was a test to make you understand the fundamental human nature – the insatiable desire to get what you don’t have, especially when you are told someone else will have it.

We humans evolved with desire. “This is the monstrosity in love, lady,” Troilus tells Cressida in arguably Shakespeare’s most vexing and ambiguous play, “that the will is infinite and the execution confined, that the desire is boundless and the act a slave to limit.” Human desire, in other words, is infinite – we are perpetually unsatisfied even when we get what we want, and we are capable of wanting anything at all. And when we get what we want, we usually start to wish for what the neighbor has.

Good sales people are generally relentless and aggressive in nature. They want to sell the best products and services (who doesn’t?) and that’s when marketers and product managers get thrown the question “why aren’t we making the so-and-so product, when our competitors have it?”. Reasoning about tight budgets and resource constraints and technology challenges and vendor issues won’t work in this context.

In my 15 years of international experience, I’ve come across salespersons who are blatantly ignorant of their company’s products and services – people who cannot even articulate the real differentiators of their own products – but are well versed and thoroughly knowledgeable about their competitor’s products. Why? Because of the fundamental human nature to desire and want what they don’t have. Remember how kids crave for a certain toy, and once dad brings it for them, they play with it for a while, toss it aside and start wishing for their next toy. Very often I see the same tendencies in sales people. Needless to say, this is not good for the organization as a lot of energy and creativity is being wasted on wishing and wanting what they don’t have yet.

When Airbus launched the A380 super jumbo, the Boeing sales force must have rained over their product team asking for a matching response. Instead of wavering from their course, Boeing stuck to their core message of fuel efficiency and eco initiatives, and developed the 787 Dreamliner which has eventually taken to skies earlier this month. At the same time they also worked on a new version of their own jumbo jet, the 747-8, which is slated to fly by year’s end. Industry analysts have obviously shared varying opinions about Boeing’s approach, their production delays etc. But I do see them as a great example in the context of this post, as they stuck to their strategy rather than jump all over the place. Agree, this may not be applicable to your industry as the capital investment profiles, production costs and timelines are very different (prohibitive) for an aircraft manufacturer to change course every now and then. So treat this as an example to drive home my point.

Enough of understanding the problem, you will now be asking “is there a way out of this?” Absolutely yes. But it demands both marketers and sales leaders stepping up and acting as a team. Here are some practical tips that can help your organization get out of this perpetual cycle.

  • Come together as a team and think about selectively unlearning the human nature of desire. Observe the usage of the word “selective”. Be aware that it is desire that drives the sales force to perform and outperform. So don’t spill water over the fire and make them lose their passion to sell and achieve. Instead, brainstorm together on ‘how can we sell what we have, instead of crying out loud for what we don’t have’.
  • Sales leaders could coach their field sales force to channel their resources and energy and emotions to selling “the bird in hand”, instead of fighting in vain for “two in the bush”. They must handle it sensibly and sensitively as some sales people may get de-motivated when they see their manager “take sides with marketing” (this is particularly true in Asian context).
  • Product managers could take the opportunity to clearly articulate the company’s product strategy. Explain in simple one-two-three steps, why they chose to make product A and not product B, unlike competitors.
  • Marketers could build sales force training materials that can be used for educating the team as well as for external client presentations. Re-deploy existing marketing collaterals to reinforce the main messages and themes, so the sales force is well trained on their product benefits and differentiators.
  • Leaders could encourage sales force to go for a solution-sell approach instead. If backed by deep customer understanding, a total solution offer would appeal more to the customer than a stand-alone product, thus eliminating product-to-product comparisons, sanity check of features and technical specs etc.
  • At the same time collectively investigate any possible quick product wins, so long as it doesn’t jeopardize the company’s product strategy or trigger a financial debacle.

Yes, it is human nature to desire… but channel your desire in the right direction and you could be the next sales superstar.