by Art Waskey | Dec 5, 2022 | Art of Sales Weekly, Featured
Changing Sales Dynamics
In the book, Thriving on Chaos, Tom Peters states: “If you’re not confused, you’re not paying attention”. As a result of digitalization, sales dynamics are changing at an accelerated pace. Furthermore, this has caused a lot of confusion. To put the chaos in order, I find that taking the time to plan a solution to the problem is the best approach. As Collin Powell said, “There is no secret to success. It is the result of preparation, hard work, and learning from failure.” Let’s look at how to build a successful sales team for the digital age.
More Proactive Inside Sales
Alternatively, prior to the pandemic, the distributor sales strategy was based on the complementary pairing of outside salespersons with inside customer service teams. Each group had contrasting skill sets. Additionally, the outside team was the face of the company that brought in the customers, while the inside group took care of the details. They worked together to satisfy customer needs.
With the introduction of digital capabilities like ERPs, CRMs, eCommerce, and AI-driven customer analytics, the dynamics of selling have been radically altered. The digitizing of customer data has enabled businesses to become increasingly effective in identifying and meeting customer demand.
However, today’s inside sales team has new resources that enable it to take on more complex roles. With customer analytics and AI-generated insights on their desktops, they can be more proactive and less reactive.
Reframing the Outside Sales Team
Moreover, With the changing role of an inside sales team, the outside sales team’s value proposition role shifts. Although, it becomes less transactional and more like that of a counselor/partner/profit producer. According to McKinsey & Company, companies that personalized sales and marketing were 60% more likely to grow market share in 2021. Additionally, 72% of B2B buyers said they would actively look for a new supplier if their current one doesn’t offer a consistent customer experience across all channels. The sales relationship’s basis in trust remains critical. However, the client must believe the field rep is working in the customer’s best interest.
The Objective
The objective of a successful digital sales team is to remove any stress caused by these developments. Lastly, an effective digitally integrated sales program includes the elements covered above. It can eliminate much of the confusion that can be caused by a lack of understanding. Put your carefully constructed digital sales strategy plan in place today.
by Art Waskey | Nov 21, 2022 | Art of Sales Weekly, Featured
In Baltimore City, Maryland, my father owned two 20-foot refrigerated displays in a store that sold meat. His five children learned how to develop a strong moral character from him. As an example of hard work and good business practices, he led us by example. As we age, we still adhere to those principles despite being in our 70s. This legacy he left his five children reminded me of the 5 Generation Legacy Rule.
The Five-Generation Rule
What some call the “five-generation rule” refers to the effect of how a parent raises their child on future generations. The love they give, the values they teach, the emotional environment they offer, and the education they provide. This can all influence not only their children but the four generations to follow, either for good or evil.
Furthermore, in an article by Larry Ballard, he discusses how radically different generational outcomes can be depending on the parents’ actions. He describes how American educator A.E. Winship traced the descendants of Jonathan Edwards almost 150 years after his death. Alternatively, his findings are remarkable, especially when compared to the ancestors of another man from the same time period known as Max Jukes.
Multi-Generational Success
Jonathan Edwards a puritan preacher, in the 1700s, was one of the most respected preachers of his day. He attended Yale University at the age of thirteen and later went on to become the president of Princeton College.
Further, Edwards’ 5 Generational Legacy includes 1 U.S. vice-president, 1 dean of a law school, 1 dean of a medical school, 3 U.S. Senators, 3 governors, 3 mayors, 13 college presidents, 30 judges, 60 doctors, 65 professors, 75 Military officers, 80 public office holders, 100 lawyers, 100 clergymen, and 285 college graduates.
Multi-Generational Dysfunction
In contrast, Max Jukes’ legacy came to people’s attention when the family trees of 42 different men in the New York prison system were traced back to him. He lived in New York at about the same time as Edwards. The Jukes family originally was studied by sociologist Richard L. Dugdale in 1877.
In addition, Jukes’ 5 generations of descendants included: 7 murderers, 60 thieves, 190 prostitutes, 150 other convicts, 310 paupers, and 440 who were physically wrecked by addiction to alcohol. Of the 1,200 descendants that were studied, 300 died prematurely.
The Legacy You Leave
Lastly, Ballard concludes his discussion by asking — If someone studied your descendants four generations later, what would you want them to discover? The life you live will determine the legacy you leave. In both your personal and professional life, lead by a good example and create a path to success for 5 generations.
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by Art Waskey | Nov 14, 2022 | Art of Sales Weekly, Featured
B2B buyers are doing a lot of purchasing online these days — about $1.6 trillion annually according to projections by Digital Commerce 360. Are buyers happy with these transactions? A survey of digital buyers from 150 companies finds that 97% of online buyers experience some pain point during the eCommerce purchasing process. And 94% of B2B buyers agree their company prefers to work with suppliers that continuously evolve their digital capabilities. Be sure you are paying attention to more than just the online sales figure. What are your actual customer outcomes?
Be Customer-Centric
I have been reading a lot on the topic of online purchasing that supports the findings above. The impersonal nature of online selling and its related pain points represent an opportunity for the independent distributor who knows his customers. As the post-pandemic business model moves toward more digital commerce, the distributor must become even more customer-centric.
Customer Experience
In a recent post, business innovation expert Mark Dancer explains that distributors often say that they are becoming customer experience (CX) companies. He defines CX as how customers interact with brands, products, and services. CX business models gaze inward. They are designed to optimize the processes under which the supplier operates to serve its customers.
Customer Outcomes
Customer outcomes (CO), on the other hand, measure customer satisfaction with the purchasing process. Good customer outcomes ensure that the supply chain prospers only if customers prosper. According to Dancer, the future of distribution is the relentless pursuit of CO, not CX.
Dancer finds most leaders say they’re customer-centric, but if everything they measure is CX, how could that be true? Revenue, growth, and other Key Performance Indicators (KPIs) measure how customers perform for the company. Organizations that wish to be customer-centric —and maximize growth—must also measure how the company is performing for its customers (CO).
Be Effective
Finally, distributors need to become a flexible resource that enables ever-better business results and innovations in the customer’s business. To do so, evolve your digital capabilities. As Dancer suggests, these should yield better customer outcomes. The right ERP, CRM, and AI-driven customer analytics can provide customer-centric support. And Lastly, Partner with your customers to build more effective KPIs for customer outcomes and eliminate their online purchasing pain.
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by Art Waskey | Nov 7, 2022 | Art of Sales Weekly, Featured
My son-in-law works in the motion picture industry. The film projects he works on were staffed with people from multiple companies as well as independent contractors. Making a film requires a complex network of interconnected systems, known as a workforce ecosystem.
Digital integration
In addition, to being intermediaries in a value chain, distributors are a part of a workforce ecosystem. As part of a complex and critical supply chain, they handle detailed information. Additionally, product and service identity, pricing, inventory location, and delivery are all part of a chain. Above all, this will help the end user get their work done. Suddenly, workplace ecosystems have been changing at a high rate in recent years. Now that companies are more digitally integrated and forced to be responsive as a result of this shift. Now, to be competitive in today’s workforce ecosystem you need to operate with the latest software and digital tools and platforms.
Mining data
According to Mark Dancer, “Companies that buy products from distributors will always seek to create value for them. And the users that use them will often measure the total cost of ownership, worker productivity, and the quality of the products and services needed for the end user. What’s new is, realizing that doing this can be an extension of the supply chain. With offerings not based on vague value propositions but through the value to create and measure new, and more comprehensive data.” Furthermore, he adds, “No matter what the delivery mechanism is, supply chain companies are at the center of providing this capability.” Independent distributors should consider using their ERPs to mine data downstream of customer orders. However, ERP technology distributors can solve problems and provide the right product based on data collected from actual client interactions.
Be competitive
To conclude, local distributors are at the center of these complex supply chains, which continue to evolve. To remain competitive in the workplace ecosystem, you must create added-value product offerings and services based on the comprehensive data available through your digital technology platforms.
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by Art Waskey | Sep 26, 2022 | Art of Sales Weekly, Featured
How to Measure Success
While VP of Sales, I oversaw a hospital account that was among our leading 10 customers. Their purchases topped the charts. Yet our CFO questioned the account’s profitability when their contract came up every 5 years. Due to the competitive pressures in healthcare, the pricing of the products was not increasing from contract to contract. The volume was tremendous and the product mix carried some of the best gross margins. The question kept coming up about the account’s net profit. How do you measure your high-value customers in today’s diverse marketplace?
Determining Profitability
In the seminal book, “Choose Your Customer”, Jonathan Byrnes and John Wass state: “determining the true profitability of our customers is one of the biggest problems for companies today.” They described the shift from the Age of Mass Markets, where managers had a clear responsibility to look after their unique department, to the Age of Diverse Markets in which managers are responsible for net profit contribution. With today’s robust digital ERP capabilities a company can perform transaction-based profit metrics and analytics across multiple fields.
Byrnes and Wass explain, “Instead of assuming that revenue maximization is the objective of the account management process, leading managers now understand that directly maximizing all-in customer net profitability is the right objective.”
The Net Profit Viewpoint
Additionally, In the Age of Diverse Markets, it is feasible to look at each transaction from a net profit viewpoint. This is accomplished by digitally collecting all cost aspects of each transaction. In the opening hospital illustration, there were exorbitant distribution costs involved in making deliveries to multiple locations. Furthermore, deliveries consumed a driver’s full day on multiple days each week. Additional costs accrued by having to correct persistent administrative and billing issues unique to the account. All costs considered, the hospital account produced negative net profits. It was not a high-value account and was reclassified as a profit drain.
Sales Effectiveness
Lastly, with digitally evaluated transaction-based profit metrics and analytics, companies can move to the ultimate level of sales effectiveness. High-value customers should no longer be appraised on revenues, or gross margins, but on their net profit contribution.
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by Art Waskey | Sep 19, 2022 | Art of Sales Weekly, Featured
Get Organized
Twenty years ago, as the VP of Sales for industrial gas and welding supply company, I started writing a monthly column, “The Art of Sales,” for CryoGas International (now Gasworld). The magazine focused on the industrial gas distribution business. My articles were directed at that audience and contained sales tips and stories. Today I am a consultant to that sector, have my own blog and continue to contribute to industry publications. While I still write on sales skills, I have noted that the rapid and critical change in commerce has prompted the need to concentrate more on digital and organizational practices. Many clients are asking, “What should I do with my business now?”
The Digital Transformation
Furthermore, much of my writing relates to how to deal with the marketplace disruption caused by the pandemic. For example, consultants no longer spend their time on planes in order to make face-to-face meetings. Appointments are now virtual. Also, COVID accelerated the digital transformation, and the distribution business, like all others, is feeling the shift.
Advanced ERPs, eCommerce, and virtual product content have radically changed sales responsibilities. Furthermore, Reps have moved from product presentations, quoting, checking inventory, and tracking orders, to added-value consulting and answering questions about products the customer procurement team has already researched online. Also, the distributor faces the added challenge of competing with manufacturers that can sell directly to customers, or through marketplace alternatives.
Business Choices
These facts beg the question – what do I do with my independent distributorship now? I have observed three typical responses:
- Sell out to a conglomerate
- Transfer the business to your employees through stock ownership programs, such as ESOPs
- Hire a qualified consultant to bring your company up to date
Primary Priorities
Regarding option 3, there are qualified senior executives with years of experience who know how to navigate the distributor’s challenges in the digital marketplace. Thus, The most essential primary priorities are to apply organic/systemic organizational skills nimbly and invest in digital proficiency. The most effective means to accomplish this urgent progression is finding people that understand your business – those who have “walked in your shoes.” Henceforth, talent can be developed internally or externally. You probably already have employees who have unidentified digital skills that could be enhancing your business.
In conclusion, what should you do with your business to compete in today’s marketplace? Develop your organizational skills and digital proficiency … and do it now.
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