Sales Leaders Create Performance

Are You Building a High Performance Sales Environment?

It is the Sales Leader’s challenge to create the circumstances that stimulate improved sales performance and strategy execution from their sales force.

Of course having the right sales and customer service people is critical, but once “on the bus” how does a sales leader create a sales environment that improves the performance of the sales force? That is the sales leader’s challenge and, when it is not done, it will matter little if you have the right people or not. An ineffective sales leader can greatly hinder sales employee retention. Like a great coach improves the performance of an athlete, effective leadership can improve the performance of the sales force.

Research has indicated that 46% of organizations cite creating a high performance sales culture as one of their top 3 talent management priorities and yet 61% of executives do not feel that the talent and management training processes they have today are driving greater performance from the business.

So the question is not whether you should do it but rather HOW.

How do sales leaders drive improved execution and individual contribution? How can sales leaders consistently make the right move to stimulate performance improvement? How can sales leaders ensure that performance improvement scales throughout an entire sales organization? The answer is to create and maintain a High Performance Sales Environment.

People Change When Their Environment Changes
It has long being held that people will adapt to their environment. Physically, mentally, emotionally people will make subtle and sometimes significant shifts in their behavior based upon the environmental circumstances. Driven by this presupposition our research project has been investigating the specific environmental circumstances that stimulate improved performance in people.

Through a process of interviews and analysis, we have spent the last 16 years researching human high performance and the factors that shape a high performance environment. Research subjects include: Nelson Mandela, Carl Lewis, Sir Edmund Hilary, military generals, leaders of NASA, MIT, Harvard Business School, the Juilliard School of Music, and CEOs of leading corporations among a bank of over 7,500 research participants.

Every performance population has a primary comparison. Leaders need to ensure that this comparison drives performance.

The Key to Building a High Performance Sales Environment
The key to implementing high performance in a sales organization is:

1. Clarity,
2. Effectiveness

Not only does a sales environment need concepts defining direction, performance status, and motivation, those concepts must be clear and effective if a performance management outcome is desired. It is the Sales Leaders’ job to provide this clarity and ensure effective implementation throughout a sales organization.

Many sales environments have goals and objectives that are not stimulating performance. Equally many sales forces have consequence systems that don’t motivate the population to perform or appraisal systems that are viewed as a bureaucratic process not a tool for performance exposure. Each concept has a set of “effectiveness criteria” that need to be met in order to stimulate improved performance in a sales force. This issue, a lack of clarity and effectiveness in one, some, or all of the nine components of the High Performance Environmental Structure®, is the cause of many of the problems with driving improved execution and enhanced productivity in sales forces today. Sales Leaders believe they have provided goals and training measurement and rewards and have engaged employees, but they are merely ticking the boxes not making those concepts “clear and effective” in stimulating sales performance.

Sales Performance - Referral Selling Training

It's not just who you know, it's who your clients know. If you don't ask your clients to refer you, you miss your most critical business development activity.

If it sounds too good to be true, it's not.

Everyone Is a Part of Your Inside Sales Team
If you don't include your current clients in your referral-sales team, you leave money on the table—every single day. If you ask them, they will refer you. But, you must ask.

Get upfront and honest with yourself. Ask (and answer) the two most important inside sales prospecting questions:

1. How many client relationships do I have?(Translation: How many people do I know in all of my current and former client organizations?)
2. With how many of these clients do I have great relationships? (Criteria for "great": They return my calls.)

Savvy executive sales professionals have at least 100 client contacts. If just 20 percent offered you referrals, you'd have 20 amazing new contacts. Once you actively cultivate them, they become part of your "executive sales team." Can you see where this leads, and how much business you could generate?

Take a few minutes and imagine your new solution selling life when you talk to prospects who want to talk to you. When you receive a referral introduction, you:

• Are pre-sold (They know you and the results you deliver.)
• Have already earned trust (One of the hardest things for solution salespeople to gain.)
• Gain instant credibility (They know you're not just there to "sell" them something.)
• Shorten your sales process by at least 25 percent (You decrease your cost of sales.)

Convert that referred prospect to a new client more than 50 percent of the time (You decrease your strategic account planning time and increase your client-facing sales presentation time.)

It's Who You Know
Here's the hard fact: most clients think of us only when they need us. It's up to you to get them thinking about you between sales calls. Your clients may not automatically offer referrals: Regularly remind them that you exist, so when a consultative selling opportunity arises, you're the one who gets it.

The clients you serve well--the ones who know you, like you, and trust you--truly want you to achieve sales territory success. After all, they know your work and the business results they've achieved from your solutions. Referring you makes them look good to their customers and business partners.

Our clients will refer us--if only we ask. With a little "instruction" you can empower your clients (your Referral Source) to refer you. Teach them how to introduce you (How do you want "what you do" to be described?). Teach them about your Ideal Client, and provide them with the answers to these critical questions:

• What business issues do you solve?
• What is the function of your Ideal Client? (CEO, VP, IT, Marketing)
• In what industry or geography do you work?
• What size company is your sweet spot?

Referral selling sounds too good to be true. But it's all true. Referral selling works. You choose how to spend your time. Get back in touch with your clients, ask them for referrals, and ask how you can help them. Your new sales opportunities will amaze you!

It's time to ask.

New Hire Onboarding in the Communications Industry - A Case Study in Sales Force Talent Management

Shortening New Hire Ramp and Reducing Turnover in the Telecommunications Industry

A Case Study in Sales Force Talent Management

Business Goals

• Increase sales performance while maintaining existing customer base
• Increase average revenue per unit (ARPU)
• Reduce salesperson turnover

Performance Challenges and Needs

• Sales team totally product-focused—need skills to uncover a customer’s core business issues and transition to solution selling
• Long ramp for new hires (5-7 months)—need a way to accelerate employee orientation and help new hires to achieve quota in three months or less
• High turnover (89%)—need to increase new hire success rate and retention of top performers

The Solution

• Manager and executive sales coaching sessions
• Implementation of focused executive selling training
• Execution of a 12-week follow through program designed to ensure the transfer of training
• Sales Training Measurement

©Acclivus

Growing Customer Satisfaction & Issue Resolution - A Case Study

Background - Major Telecommunications Company

Business Goals

• Increase data unit sales to 50% of revenue
• Build strong, long-term customer relationships
• Drive business within existing customer base

Performance Challenges and Needs

• Inconsistent approach to the customer across regions
• Disconnect between the Sales and Service organizational designs in terms of role and process
• Need to enable consultants to own the customer relationships, manage expectations, handle demands, make recommendations, differentiate the value of the service delivered, and take a consistent approach for customer service

The Solution

• Predisposition and alignment of service consultants
• Service training for representatives; Coaching for managers
• Reinforcement via an intensive field application program and weekly coaching
• Measurement using online surveys and comparison of performance

The Details

• Basis for Comparison: Each participant was classified as a “high” or “higher applier” based on frequency of use and level of confidence for 8 key service skills measured using an online
• Time Frame: Monthly/quarterly CSAT and Individual Resolved metrics from October - June; 3,570 surveys total
• Population: 122 phone and email consultants; dedicated to specific accounts as well as to open queue
• Statistical Significance: For the difference between “high” and “higher” appliers of CSA and Resolved metrics, p < .35 (CSAT) and p < .05 (Resolved)

Personal Value of Service Program
“I have gained the confidence to be able to talk to any client in any given situation, whether the issue is an escalated scenario or a pleasant one.” Service Consultant

"Our customers are telling us that the program is working! Our future is bright because both our path and our progress are clear.” Service Leadership Team

Learn more about LSA Global's Training, Coaching, Consulting and Change Management expertise in the areas of Sales Strategy & Account Planning, Inside Sales, Sales Communication and Presentation, Executive Selling, Sales Negotiation, and Customer Loyalty.

© Acclivus

Why Social Networking Isn't The Next Big Thing...

You are! It's still the personal connection that seals the deal.
The Internet, social networking, and other breakthroughs in technology have fundamentally changed the way we do business. New technology drives communications, messaging, and information access at warp speed, and our clients expect immediate contact. This pattern of ever-increasing speed and sophistication not only creates an intensely competitive marketplace, but places further demands on us to act and respond quickly.

The rise of social media sites such as Facebook, Twitter, MySpace, YouTube, and LinkedIn have lured many sales pros into scaling back their personal interactions and relying on social media to generate sales opportunities and surface "qualified leads." Get Real Social media is a powerful tool for three things and three things only:

1. Search engine optimization—use your key words and raise your presence on the web
2. Find out who people are—learn about a person's background and your connections
3. Find out who people know—look for close connections that you can leverage

Some salespeople tell us they actually get clients through social media. Well, maybe if you have a commodity business. Could it happen? Yes. Should you rely on it? Absolutely not. Only count on what you bring about—through a proactive, intentional, referral strategy with personal introductions.

To Know You Is to Like You

There's a saying in sales: Clients buy with emotion and justify with fact. If our clients don't like us or don't feel comfortable with us, they won't buy from us. You can “wow” your clients with technology know-how now and try to win them over later, once they find out you're honest and reliable. But the reality is that you need people to start liking you within the first few seconds of your relationship. You need to start off on the right foot. Fancy gizmos won't make that happen. But a trusted referral and a personal connection will.

Eric Schmidt, Chairman and CEO of Google, in his commencement address to the graduating class of the University of Pennsylvania in May 2009, urged college graduates to step away from the virtual world and make human connections. "Turn off your computer. You're actually going to have to turn off your phone and discover all that is human around us."

To Like You Is to Trust You

The most important business decisions are still based on personal relationships. There is significant research about why customers make buying decisions. Bottom line: It's because they like and trust the salesperson and his organization. Think about it. We're selling to executives services, investments, systems, products...we're asking for people's time and money! Why would they work with someone who hasn't been referred?

3 Winning Tips

That said, a social media presence is a must-have in today's world. Start this way:

1. Develop a social media strategy—Like a sales plan or a marketing plan, write your social media plan. What is your goal, who is your audience, what do you communicate, what presentation best practices work will best relay your ideas? Leverage social media as part of your go-to-market strategy. How does your strategy link to your customer's needs and your business priorities?

2. Establish relationships—Take the time to build your personal connections, pick up the phone and talk to people. Just because you have a name in hand, doesn't mean you have a relationship.

3. Communicate useful information—Social sites are not for consultative selling or selling solutions. They are for establishing connections, identifying ways to collaborate, and providing value. What tips can you provide? Link to other sites that you recommend. Be recognized as the expert and build your web presence. Be a resource.

To Trust You Paves the Way

The most energizing and exciting part of our work is the relationships with our clients—the interaction. We enjoy learning about our client's business and co-developing strategic account plans and approaches that match our solutions to their needs. In an era dominated by ever-expanding technology and social media pressures, always remember that personal connections, referrals, and thoughtful sales negotiation techniques that build trust are what count. Yes, it requires brainpower. But isn't that what we love about what we do? Indeed.

Training RAI (TM) - Raising the Bar through Assessments & Coaching

By Tris Brown, President & CEO
Even in this climate of tightened belts and increased analysis, more than 90% of training initiatives continue to fail.

If that sounds surprising, try to remember the last training session that resulted in measurable and sustainable behavior change. Then try to remember a session that quantifiably impacted revenue, costs, or productivity. Does the fact that the great majority of training initiatives fail still seem so far fetched?

When we ask leaders about behavior change and impact related to training, we typically get a long pause and then a pensive and pained look. Then we usually get a long answer that would make many politicians proud for the lack of clarity and specifics.

Unfortunately, the training bar is still too low. Most people continue to consider training successful” simply when participants get a few “Aha’s” and feel that it was not a waste of time. We can’t think of another business process that gets less scrutiny or has lower expectations than training. The training bar needs to be raised.

To help raise expectations and quality, our recent Q3 Poll highlights 4 critical success levers behind impactful learning initiatives and a positive Training RAI™: Results.Adoption.Impact.

1. Strategic Business Link: An urgent business relevance
2. Skill Gap Assessment: The strong understanding of individual skill gaps
3. Performance Coaching and Support: The consistent and timely performance coaching of participants by their bosses
4. Training Measurement: The impact on the business

We define Training RAI™ as a solution with 3 key characteristics.

1. Relevance: The solution needs to be relevant to the (1) Business, (2) Leadership Development Strategy, (3) Target Audience, and (4) Audience Supervisors. Without relevance, you would be better off buying books on the subject – you’ll get the same result.

2. Adoption: The new skills, knowledge, and behaviors must be consistently adopted. Without on-the-job application, a disconnect will occur between learning objectives (skills and knowledge) and performance objectives (desired results).

3. Impact: The business impact needs to be measured. Contrary to popular belief, this can be one quickly and easily. Measurement is a key component to driving accountability for execution and providing actionable feedback for follow-on coaching. Read more about training measurement.

In this article, we will tackle one of the major impediments to obtaining a positive Training RAI™: a Lack of Individual Skill Gap Assessments and Coaching Profiles.

In our experience over the last 15 years, we have seen that the lack of proper individual training needs assessments and coaching plans causes a disproportionate amount of training failure. The majority of corporate learning initiatives continue to bypass individual skill assessments prior to designing or delivering new training programs. Skipping over the first step of assessing skill gaps is one of the root causes behind the 90%+ failure rate.

What if doctors prescribed the same medication and the same dosage to all patients before an individual diagnosis? Training practitioners who continue to sell, buy, and facilitate training with little regard to ensuring that the prescribed solution is the best fit for each participant could similarly be accused of “malpractice.” And even if you have diagnosed correctly, each participant has different strengths and weaknesses that need individualized attention before behavior can change and performance be improved. Not many problems get solved without a detailed, carefully considered plan.

When asked, most training practitioners mistakenly identify attributes such as participant materials, length of program, location, facilitator personality, content, and instructional design as the culprits behind failed learning. If only it were that easy. Changing behavior is a process, not an event. With the assumption that a clear and thorough business case must precede any individual skill assessment, this article outlines the top 6 assessment questions that you should ask to ensure a successful Training RAI™.

1. Does Leadership Agree Upon a Clear Direction?

While this seems like common sense, we continue to be surprised at how many seemingly experienced learning consultants and practitioners fail to answer two fundamental questions with key stakeholders before designing and implementing learning solutions:

- Barrier: What are the skills that are holding us back from achieving our goals?
- Focus: Where should we focus our efforts for the greatest impact?

An effective skill assessment should clearly identify the key “money making” skills for your initiative.

You need to know the critical few “A,” “B,” and “C” skills and invest your resources and efforts accordingly. For example, a recent client called us to help significantly increase revenue. This global technology company had seen revenue decrease consistently for the last 8 quarters. With other initiatives in place to focus on product quality, competitive positioning, and service, they wanted to significantly increase the capabilities and performance of their team when selling solutions, value selling and executive selling. After our initial meeting, it was clear that the President, SVP of Sales, VP of Sales, and Senior Account Reps all had different ideas about how to solve the problem based upon their past experiences. We knew that a lack of agreed-upon direction among the leadership team and supporting cast was a death knell for meeting their goal. To clarify the direction to take, we designed and conducted an online assessment covering 93 key skills related to selling successfully and strategic account planning in their industry. 10 specific skill areas and 35 “Must Have” skills rose to the top. The assessment and the accompanying process to align sales executives started the initiative off on the right foot.

Alignment can also occur through interviews and focus groups; however, an assessment backed by (in this case) a research bank of 150+ proven behaviorally-based questions and scenarios provides a data-driven approach to ensure that your project is set up to succeed. A thorough approach also underlines the fact that you and your company are taking the initiative seriously. In this case, perception is indeed reality.

2. Are Leaders and Employees Aligned?

Once you have clear direction and executive alignment, your next step is to get your target and supporting audiences on the same page. This is accomplished by sharing the Leader Assessment results with the target audience and reviewing the 3 skill buckets:

A – “must have”
B – “good to have”
C – “nice to have”

Necessary adjustments that increase focus and buy-in can then be made based upon input, discussion, and analysis. This alignment process is a critical step in achieving any behavior change.

3. Do You Know the Specific Skill Gaps of Your Target Audience?

Once you have direction and alignment, it is time to pinpoint individual, group, and company skill gaps against a proven standard. The skill assessment should be online, take approximately 20 minutes, and be based upon researched and behaviorally-based questions and scenarios that have been agreed upon by your key stakeholders. The results will give you a clear picture of individual, group, and company:

- Strengths / Opportunities
- Differences between high and low performers
- Barriers to success
- Coaching / Development priorities
- Customization needs

With this detailed skill gap analysis, you have the data required to both plan and act intelligently.

Remember, this is about creating Training RAI™: Results.Adoption.Impact™, not about learning for the sake of learning.

4. Do Your Participants Have a Game Plan?

From a participant’s perspective, it seems a little crazy to go into an important training program without a clearly presented game plan. It is hard to improve your performance without knowing where you stand, what is expected of you, and what options you have at your disposal.

Customized profiles are excellent tools to help drive individual performance management from the beginning.

5. Are Your Coaches Set Up to Succeed?

There is an incredible amount of data correlating the value of ongoing performance management, coaching, training, and behavior change. In a nut shell, if you do not coach your target audience, the majority of them will not change their behavior. Without behavior change, you will not get the performance or business results that you desire. Without the results that you desire, you would be better off buying participants books, saving your money, or going golfing.

Training, by itself, is typically a waste of both time and money.

The same data that is used to provide participants with a game plan should also be used to create a targeted and individualized coaching plan with their new manager. The amount of involvement and support from the learner’s manager has direct impact upon their success.

In fact a recent study at a Fortune 500 Financial Services comparing a “Coached Group” vs. “Non-Coached Control Group” showed:

- 20.3% higher overall skill scores for the coached group
- 5.9% to 65.6% higher individual skill scores for ALL 38 skills
- 10% net increase in skill levels pre/post compared to control group
- 3 times the skill improvement attributed directly to their manager
- 2 times the success story results attributed directly to coaching

Additionally, of the 61 participants who received individual coaching, 9 out of 10 improved their scores in the critical areas measured. Of the 47 participants who did NOT receive coaching, their scores decreased in 9 out of 10 areas measured.

- Strengths
- Weaknesses
- By Key competency
- Individual Development Plan

This is not a fluke. It has been proven repeatedly that in order to change behavior and performance management results you need two things:

1. Plan & Action: A plan and immediate action to begin applying new skills on the job
2. New Manager Coaching: Involvement and support from the learner’s manager

If the outcomes are important to you, important to the participants, important to their boss, and important to the company, then you owe it to yourself to do it right.

That means treating your learning initiative as a process, not an event. That means investing in accordance with the results that you desire. That means ensuring that in addition to the 6 steps outlined above, you use a well communicated assessment process to also:

- Urgency: Create a sense of urgency and creative tension to get people engaged
- Kickoff: Initiate the change process and predispose participants to get the ball rolling
- Exactness: Customize the training to ensure that it is exactly what you need
- Baseline: Set baseline metrics against which to measure improvement
- Buy-In: Obtain buy-in right from the start

In Conclusion: While many assessments on the market today are statistically invalid and often implemented in a way that inhibits trust, decreases relevance, and wastes time, we believe that the assessment process is an invaluable tool to drive true behavior change and positive results. Interviews, focus groups, and best practices can provide interesting data points to help ensure that your training design is on target. They are key elements to a successful solution. However, the assessment process, combined with an individual coaching plan, allows you to provide both the participant and the coach the tools required for sustainable success.

So the next time you have an important business issue related to skill or knowledge gaps, be sure you can answer “yes” to the following 6 questions before you jump to or initiate a solution. Only then can you be assured that you are on the right path to the success that you seek.

1. Does Leadership Agree Upon a Clear Direction?
2. Are Leaders and Employees Engaged and Aligned?
3. Do You Know the Specific Skill Gaps of Your Target Audience?
4. Do Your Participants Have a Game Plan?
5. Are Your Coaches Set Up to Succeed?
6. Are You Serious About Getting Results?

Sales Executive Onboarding - A Case Study

Background

This technology industry service start-up grew quickly as a forerunner in a new and rapidly expanding market segment. Infused with external capital and charged with growing revenue fast, the company embarked on a strategy to hire senior level Sales executives who could bring success with large, complex sales.

In addition, a large part of the company’s success to date is attributed to its proprietary business practices and cross-functional execution capabilities—both are an integral part of the sales process. Given the breadth and complexity of the sales process, the company’s original plan called for a 12-week employee Onboarding and orientation process that would “certify” a sales executive’s knowledge and understanding of how the company sells and does business.

Goal

The goal of the Onboarding program was to ensure that new sales executives attained productive, on-the-job performance as quickly, effectively, and efficiently as possible. Specifically, the objectives were to:

• Ensure that participants could demonstrate their understanding of the company’s sales process and business practices
• Establish a cross-functional orientation to selling and build relationships with key sales process partners
• Reduce the formal Onboarding learning process from 12 weeks to 5 weeks

Challenges
The Onboarding program design had to address the following challenges:

• Create the experience and learning of a 6-9 months sales cycle within 5 weeks
• Communicate a significant amount of company information that will directly influence the executives’ performance in this program and in the field
• Conduct the Onboarding program for one Sales executive at a time and/or multiple executives staggered over time
• Hold the attention of experienced senior level Sales executives in the learning process when they are eager to be out solution selling

Approach
The program approach blended various learning methods within a structured framework of eLibraries, presentations, meetings, real-world tasks, shadowing, mentoring, and apprenticeships.
The underlying context of the Onboarding approach is a Sales Cycle Simulation based on the sales process that was used to acquire one of the company’s largest clients. Sales Cycle activities, deliverables, and presentations were blended into the 5-week learning process and provided realistic “performance tests” at each phase of the Sales Cycle.
Areas covered within the Sales Cycle included:

• Perform due diligence on a prospective client
• Create a Sales Account Plan and Strategy
• Develop a pitch and several contextual value propositions
• Deliver the pitch and value propositions to a panel of experts
• Design an implementation solution with the account service team
• Recommend a pricing scheme for the solution
• Craft and deliver a sales presentation to the prospective client (role played by company
  executives)

Participants were also immersed into “on the job” learning contexts in numerous functional organizations, such as Marketing, Inside Sales, and Sales Territory Planning, and Account Management to meet their key counterparts and to learn about the different functions, roles, responsibilities, challenges, targets, key projects, etc. Within Account Management, for example, new sales executives:

• Worked with an assigned primary account team
• Participated in account-specific business sales training
• Conducted research and quote preparation and shadowed reps making those specific calls
• Prepared team analytics with a Team Lead
• Presented an overview of the account to the account leadership team
• Worked with a channel account team to understand the nuances of the channel business
• Worked with “support team” members from across the company to participate in cross-functional meetings and activities

In the late stages of the Onboarding program new sales executives were apprenticed to an experienced Outside Sales executive. They were then slowly “weaned off” until both the participant and experienced executive agreed that the new salesperson was ready to call on clients and lead his/her team.
Participants moved through the Onboarding process as quickly as they were able to demonstrate learning objectives by successfully completing varying types of performance tests. Most performance tests involved being observed performing a task or presenting back to a subject matter expert or group what the participant had learned. In these cases the primary focus was to give and receive feedback to aid the learning process.
Performance tests associated with key steps in the Sales cycle were evaluated more critically by company executives. In addition to several client-focused presentations conducted during the Sales cycle simulation, the program culminates with a full proposal presentation to the prospective client executives (role played by senior executives). While the Onboarding program was not intended to develop sales skills, the performance test allowed company executives to assess the sales skills of new hires.
Results
Overall, the program created an intense, engaging experience that challenged participants and provided a clear path to accelerate their learning and quickly prepare them to start generating revenue.

• Participants were impressed with the amount of thought and rigor that went into the process and said it demonstrated the company’s commitment to their success
• Participants estimated that the program enabled them to get to a “productive” level 40-50% more quickly than past onboarding experiences
• The “Performance Test” component of the program enabled the company to identify and take action on a hiring mistake within 4 weeks rather than waiting 6-9 months for the new hire to go through a complete Sales Cycle

Learn more about LSA Global's Sales Training and Talent Management Consulting expertise.

Toss the Technology—Relationships Still Rule: Driving Business through Networks

The Internet and other breakthroughs in technology have fundamentally
changed the way we do business. New technology is created at warp speed, and customers expect immediate decisions. This cycle of ever-increasing speed and sophistication not only creates an intensely competitive marketplace, but places further demands on our companies to act and react quickly.

Ironically, whether a business is ultrahigh tech or low tech, the most important business decisions a customer makes are still based on personal relationships. There is significant research about why customers make buying decisions. Bottom line: it’s because they like and trust the salesperson and his organization.

There’s a saying among salespeople that customers buy with emotion and justify with fact. If our customers don’t like us or don’t feel comfortable with us, they won’t buy from us. You can wow your clients with technology know-how now and try to win them over later, once they find out you’re honest and reliable. In reality, you need people to start liking you within the first few seconds of your relationship.

That's really all you have to get off on the right foot. And fancy gizmos won’t make that happen. But a trusted referral and a personal connection will. Think about it—with who would you prefer to do business: someone you've met only via the cold call or a colleague with whom you have an established, respected relationship?

If you think you can substantially build your business by cold calling, think about the value of your time. The new business climate demands you make the most of it. How many cold calls do you or your team make to close a deal? Chances are it's not a healthy ratio. Cold calling just isn't an effective use of time.

We often delude ourselves by thinking that we’re making a warm call. In reality, there’s no such thing as a warm call. A sales call is either cold or hot. A cold call is one that’s made to someone who doesn’t know you and is not expecting your call. Consider the following situations:

• You call someone because you got the name came from a colleague or friend. Cold!


• You call someone and then follow-up with a letter. Cold!


• The person’s name came from a specific list. Still cold!

These are all cold calls — the person doesn’t know you and is not expecting your call. Even though you think you've been able to avoid sounding like a telemarketer, this type of call is still cold. And cold calling is a numbers game. If we make 100 calls, we’ll talk to about 20 people, schedule 10 appointments, and if we’re lucky, close one new deal. That’s a 1 percent return on our time.

Not only does cold calling have a low percentage return, those who do it and those who receive it rarely have a positive attitude about cold calls. Recent research by Huthwaite® surveyed buyers about their attitudes on prospecting:

• 91% of buyers never respond to an unsolicited inquiry


• 71% of buyers find cold calls annoying


• 88% of buyers will have nothing to do with cold callers


• 94% of buyers couldn’t remember a single prospector or message during the last two years

Obviously cold calls aren’t working. In fact, why would you settle for the illusion of a "warm call" when you can make genuine hot calls? Fortunately, there is a way to make nothing but hot calls, with a fantastic rate of return. The secret is referrals.

A call is hot when there’s an introduction. The person knows who the caller is and is expecting the call. This is the kind of call that shortens the sales cycle, increases a salesperson’s credibility, results in qualified prospects, and means a new client over 50 percent of the time! Why would you waste your time doing anything else? Here’s how to get HOT calls:

1. Make a list of everyone you know—current clients, past clients, peers, neighbors, service providers, friends, past coworkers, professional association members, volunteer groups, etc. You should have at least 100 names. Prioritize the list by starting with the people that you know the best. You are not asking these people for their business; you are asking them to introduce you to people they know.


2. Set a goal and decide how many people you will contact each week. Arrange in-person meetings if at all possible.


3. Tell these people (your referral sources) that you are building your business through referrals and would like their help. Describe your ideal client and ask for one or two people who meet your description.


4. When your referral source makes a suggestion, find out as much as you can about the person and his company.


5. Then ask your referral source to make the introduction. The introduction could be by phone, in person, or by e-mail.

You will now make a HOT call! Start thinking about how you spend your time and the type of payoff you want. Get HOT and get that introduction. So if referrals are such a strong and successful way to build business, why are people still cold calling? The answers run the gamut: It's not the right time to ask their colleagues; they're afraid of being told no; the approach might come across as too "salesy." Dispel these misconceptions. Dispense with your fears. Energize and strengthen your business-development process by calling on your targeted referrals.

By calling on referrals, the business decision-making time collapses, your competition fades into the background, and you establish immediate credibility. The relationship closes the deal. What's to lose except that long list of cold calls!

Remember, the most energizing and exciting part of sales work is the relationships with our customers—the interaction. Salespeople like learning about a customer’s situation and matching their solutions to the needs of their customer. That said, enrolling in a quality inside sales training program is worth the expenditure. In an era dominated by ever-expanding technology, the creative, strategic part of our business is back. Yes, it requires brainpower. But isn’t that what we love about what we do? Indeed.

No Does Not Get You Closer to Yes. Just Say No to No’s

There has been a longstanding mantra in sales: The more "No's" we get, the closer we are to a "Yes." Well, not in my book. It's old news, tired and worn out. It's time to retire and bury this mantra.

Think about it: Why would you spend your valuable time talking to people you know will say no? This mantra about getting no's emanates from prospecting techniques that no longer work. It's an old-school sales formula: make 100 cold calls, perhaps talk to 20 people, set 8 to 10 appointments, and get one deal—if you're lucky. Really, 100 cold calls? That's a lot of no's, and a lot of time. It's not a winning strategy.

There other prospecting activities that salespeople count on, such as advertising, trade shows, marketing leads, web inquiries, and mail campaigns. All have a dismal conversion rate, averaging anywhere between 3 to 10 percent. Let's be clear: these are visibility and credibility activities. They are important to build your brand, but they don't make the phone ring off the hook. I'm not against them. In fact, I believe in establishing, building, and maintaining brand. However, I am against salespeople expecting earthshaking results from these activities. Customers react to these activities; they don't engage.

Here's the irony in how many salespeople spend their time: When we're referred and introduced to a qualified prospect—someone we want to meet and who wants to meet us—we get a new client a minimum of 50 percent of the time, and more likely 70 to 90 percent. There is no other marketing strategy that comes close to these results. It's not about the number of no's. And it's not just about the number of yes's (although they are really important).

It's about connecting with people, learning about their businesses, and finding out how you can help them. So even if you do end up with the 30 percent who don't become clients, these people will still be glad to brainstorm opportunities to refer you. And you will have even more yes's. And you'll set yourself up to win—and win big.

Remember that it's not just about the number of leads, but the number of qualified leads. Activity is important, but only if it's quality activity. Mindless activity that focuses only on quantity is bad business. Referral selling is about using your past successes and your well-nurtured relationships to build your business. It's like having your own private sales force putting you in touch with people you want to meet and who want to meet with you. Referral selling leverages your successes instead of endlessly starting over by prospecting for cold leads. Your prospecting will never be the same again.

Don't be hoodwinked: stay away from the no's and invest in your career through inside sales training. When you go for the gold, you're not satisfied with silver and bronze—or worse yet—no medal at all. Go for the yes, get those referrals, and just say no to no's!