IBM
0172 IBM Sales Prioritisation
It is a fact of life that, if you are a salesman, perhaps 80 per cent of your accounts will absorb close to 80 per cent of your effort, and return just 20 per cent of your income. This was certainly true of my own experience. It would, therefore, have been nice to be able to select the most productive 20 per cent and then go on holiday for the remaining nine months. But that is not usually possible, because it is normally not possible to see which will be the most productive 20 per cent. In addition, you will always need far more cover; in case your `bankers' don't actually live up to your expectations – a fear that always dogged me and other salesmen.
On the other hand, I am certain that most sales professionals should at least be able to identify the 10 per cent of prospects which will be unproductive. I certainly could. Even so, to abandon these is, however, a brave decision, especially when you are low on sales. I well remember when I was an IBM trainee, and had been given my first patch to develop. I spent an inordinate amount of my time on a small food wholesaler which had been foolish enough to admit that it wanted to improve its financial systems. Over seven or eight extended calls I eventually developed a 50-page proposal; which just about managed to justify the £50,000 or so I was asking them to invest in the smallest mainframe computer IBM could offer. Of course, I ultimately lost the order. They actually bought a new electric typewriter and a desktop electronic calculator (this was in the days before the universal pocket calculator appeared); at a total cost of less than £1,000!
As a trainee, the whole episode was excellent experience and I suppose I should be grateful for the valuable management time they gave up for me. The main lesson I learnt was to husband my resources, and not fritter them away on obvious losers and unproductive accounts. Such an attitude may not appeal to your management, who are greedy for any business - and are not too worried about the long hours you work. But it will help your own productivity quite significantly. If nothing else, the time you save can be very profitably used to add extra effort to the 20 per cent of key prospects that will be highly productive.
On the other hand, there are limits. Whilst working in Biomedical, I found out that one health authority was reviewing its computing requirements; potentially a massive order. Accordingly I took the IBM DP salesman in to meet the management, who I had carefully cultivated. The salesman was in there for less than a quarter of an hour and the key question he asked was “Will you be ordering this year”. When they said “No”, for such contacts take many months to finalise, he left. His sole selling activity was to hand them his business card, with the comment as he went through the door “Contact me when you are ready to order”. Outside I found he was furious with me for wasting his time, where he was only looking for business he could close before year end! IBM lost the next massive order, but got the one after that – only to run into a public cause celebre when the specification was wrong, since the salesman (once more?) hadn’t put in the effort to understand what was needed!
Having determined your outline account plan, you will need to reallocate your resources to match this. You may be lucky and have external resources to deploy, you may have a support team, or you may have budgets for promotional activities. These will need to be realigned to match your newly optimised plans. For example, one year I discovered that running stands at exhibitions generated less than 5 per cent of my sales, but absorbed 30 per cent of my budget and 20 per cent of my time; so I dropped them as a promotional tool. Having said that, I was forced to reinstate them the following year when I found that my customers (whose business I obtained almost exclusively from face-to-face contact) objected to not seeing us at these exhibitions. We had to return to them as a necessary image exercise. The moral of this tale is that not all apparently unproductive activities can be discarded with impunity - you must be aware of the wider implications.
In my (GSD) part of IBM, selling pressure was brought to a head by an ill-advised management campaign for a 'three-call sell'. In the name of efficiency, field management had decided that it should be possible to sell the smaller systems using no more than three calls, spread over less than three months. This was despite the realities of the market place. The result was a great deal of unproductive thrashing around, and a steadily deteriorating morale. My own analysis at the time suggested that less than 5 per cent of the business fell into this category, where more than 70 per cent took over six months - with an extended call pattern. At that time I was running IBM's business school, through which passed most of its best sales professionals, so I was able effectively to counter these simplistic views of field management. The following year (having returned to longer, more realistic, time horizons) the morale of the whole sales force was dramatically better, and productivity correspondingly improved (and indeed sales eventually almost tripled).
In my time running a territory in London, on examining the prospect list which fortunately was comprehensive, covering all business of any size on my patch, I identified six key accounts (my A list), a further 12 likely prospects (my B list) and something like 100 other runners. As it was early in my career I still chased all of the latter aggressively, although I was not able to devote much time beyond the initial cold calling on the 100. As I was selling mainframe computers, it was very obvious that very few of these were in my market. At the end of the year I had closed, or was about to close, five out of the six A prospects. Of the B prospects I had closed none, but four were lined up to be closed within the next few months. Of the remaining 100 prospects just one was in line for closing in the next year. My nose had been remarkably accurate.
Losers have to be treated as outcasts. No matter how much they plead, you have to be ruthless and refuse to fritter away your resources on unproductive areas. I learnt this lesson very early in life, working (just 15 years old) as a bar waiter, where a substantial part of my income came from tips. I earned, on average, twice as much as my colleagues. The key to my success was quite simply that I only served those customers that experience had told me would be good tippers. If they didn't look like tippers they didn't get served by me. I always managed to be too busy with my `bankers' to serve those I judged were time wasters. They had to use one of the other waiters, and waste their time instead of mine! Of course you may be wrong - everyone makes mistakes - and what you have previously considered a loser may still turn out to be a winner. In this special (if unlikely) case you will have to provide resource quickly.
In the early 1980s I worked in an advisory capacity with the IBM team trying to sell a large mainframe to a health board. Some six or seven years previously the team had been in the same position, and had been promised the business by the DP manager. Unfortunately that earlier business went to Honeywell. The DP manager apologised profusely that he had been overruled. On the latest campaign, the same DP manager was once more promising that IBM had the business. I, being a professional cynic on such matters, enquired of the team what the DP manager's superiors thought. I was firmly told that they did not deal with his superiors since, as the DP manager was the key to the sale and was in their pocket, the team weren't going to rock the boat. I was not surprised, therefore, when once more the business was lost (this time to DEC); with the DP manager yet again apologising profusely. I don't know whether the DP manager was playing games, or whether he genuinely misjudged his influence. But, whichever, making the mistake once was bad enough. To repeat it was grossly unprofessional.
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