Neil Rackham has built a strong international reputation in the global business community as a speaker, writer, and seminal thinker on sales force effectiveness.
Three of his books have appeared on the New York Times best-seller list, and his works are translated into over 50 languages. Recently he has been named by the Speaker’s Bureau as one of 2009’s ‘9 Business Speakers you need to know’, and was included in The Speakers Group list of ‘8 High-impact Speakers’.He is Visiting Professor of Sales and Marketing at Portsmouth University and a Visiting Professor at Cranfield University.
I’ve had a number of conversations with Neil recently, and one of the topics which I know many have asked to hear about is “lessons from past recessions”. In this discussion, Neil outlines 3 things that salespeople and sales managers should focus on – in good times as well as bad.
Neil, could you please give us some background about recessions of the past – and things we should focus on in more difficult times?
Let me start by just talking about the specifics of the selling in the economy we’re in, because that’s a good starting point. It so happens if you look at people selling today, less than 20% of them had ever before sold in a real recession. It’s a sign of how long that prosperous boom went on.
And now, we’ve got to the point where, frankly, people are making a lot of mistakes. And I’ve gone into my research files. In the ‘70s, ‘80s, ‘90s even, I did a lot of foundation research into what makes people successful in selling. As it turns out, a big piece of that was done in a fairly bad recession, particularly the recession of the 1980s. And I’ve gone back into those research files and looked at the mistakes people made. And I’m just going to raise those as an opener here. Because I think exactly those same mistakes are being made by sales people, sales managers, and by sales forces all across the world today. And I’d like to in particular raise three of them and talk about why they’re such problems and what to do about it.
So let me being with number one. In hard times, sales people try harder. Now, that doesn’t sound as though that’s a particular sin. That sounds like it’s a sensible thing to do. They try to be more active, to make more calls, to knock on a few more doors, to try to open up more opportunities, because that seems the best way of dealing with hard times. We haven’t got enough business going in, so let’s go out and beat the streets for a bit more.
Well, the issue is – what’s wrong with that? Because you might think that’s actually the smartest strategy you could adopt. In fact, in certain cases, it is. We did studies in the recession of the ‘80s, where, for example, we had one company in New York that was selling office supplies. They had a new Vice President of Sales who said – I want you to make twice as many calls a day. And in fact, sales went up by 40%. So, in that case, the strategy of let’s go out and make more calls, let’s work that bit harder, turned out to be very, very successful.
But, now let’s look at some other cases. What we found is that if you’re in a very large sale – the kind of sale which usually can’t be completed in one call, and in fact may make two, three, or five calls to complete – things are different. When you make more calls, you actually reduce your sales. We did studies of this in Motorola and found that happening there. We looked at it in a dozen other companies. The same thing happened. Continue Reading…
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