The concept of unintended consequences is one of the building blocks of economics. Adam Smith’s “invisible hand,” the most famous metaphor in social science, is an example of a positive unintended consequence. Smith maintained that each individual, seeking only his own gain, “is led by an invisible hand to promote an end which was no part of his intention,” that end being the public interest. It is not from the benevolence of the butcher, the brewer or the baker, that we expect our dinner, but from their regard to their own self interest. We address ourselves, not to their humanity but to their self-love, and never talk to them of our own necessities but of their advantages.

An excellent example of this law and how sales people can manipulate results occurred in the great golf cart boom of 2009. An American government subsidy designed to promote the purchase of electric vehicles (cars) for the sake of energy conservation was exploited by clever golf cart salesmen who recognized that their products fit under the government’s definition of an electric car. The salesmen began to give away “free” golf carts to consumers, with the entire bill being passed along to the government.

From my own experience the sales commission plan is an obvious candidate for this law. When I worked at a large IT company, the sales people quickly worked out that the new commission plan, focused on selling more application licences, would pay large amounts of money for simply resigning customers on their current software licences. It took management about two months to catch up – happy days!

Let me know if you have any examples from your sales experience of the law of unintended consequences.

1) Deal Not Qualified
Some key questions you should always be asking to better qualify your deals:
Qualification Checklist:
- Do you understand the budget?
- Do you know how the decision will be taken?
- Do you know what compelling business event is driving the project?

2) Didn’t Understand the DMU (Decision Making Unit)
It seems often when deals fall apart, turns out you were talking to the wrong people or misread a key individual involved in the selling process.
Decision Makers Checklist:
- Have you identified all the key decision makers for your deal?
- Do you know what role each stakeholder is playing in the selling process?
- Have you had conversations with each of them regarding the deal?
- Do you understand their perspectives?
- Have you addressed any barriers or concerns brought up?
The Financial Times, British industry purchasing report showed that for a customer between 200 and 400 employees the average number of buying influencers is 4.85 whereas the number of influencers called by sales people is 1.75.

3) Weak Relationships
How strong are the relationships you built during the selling process? Chances are if you answered, not strong, you lost the deal.
Relationships Checklist:
- Have you developed a strong relationship with all key decision makers for your deal?
- Do they return your phone calls?
- Do they rate you as adding value to the solution?

4) Poor Execution & Follow-up
It may be surprising but often deals are lost by fumbling the ball on some of the basic blocking and tackling to take the deal across the finish line.
Execution Checklist:
- How are quickly are you following up on action items related to your deal?
- Do you have a strategy to get your deal closed?
- Do you have all of your internal people on board to support you?
- How well do they understand the prospect?
- Have you identified key milestones for a deal?
- How are you tracking against the milestones?

5) Bad Timing
Deals often go awry when the timing is just not right. You think you have a deal ready to close and suddenly the prospect stops returning phone calls. What went wrong? Well, it turns out the need just was not there at the current moment.
Timing Checklist
- What is your prospect’s timing for making a decision? This is something you should attempt to get very early in your sales process.
- Is there a sense of urgency? Without a sense of urgency, chances are your deal with be DOA.
- What is driving your prospect’s decision on timing? Key events such as contract terminations, CEO mandates, competitive pressures and cost cutting often drive timing on decisions.

What’s your experience, why do sales deals fall apart for you?

These can be used by sales people to understand where there are gaps in their knowledge and ask questions to get a more complete picture of the customer situation.  They can also be used by sales managers to see if the sales person has control of the account.  Personally, I would often start a sales review by asking “Why us?” and “Why now?”  All the rest of the qualification flows from these two questions.  I would be looking for a crisp response to demonstrate understanding and control, and I would drill down as appropriate.  So here are a few I have thought of:

SCOTSMAN

Solution – Do we have a product or service that directly addresses their business need or do they want something that we don’t sell
Competition – Are there many competitors on this deal or are we in on our own
Only Me – Is there something that the prospect can only get from me that is critical to his decision or are we selling a “me too” solution?
Timescale – What is the prospects timescale? Will we get a rapid decision?
Size – Is the opportunity big enough to be interesting?
Money – Has the prospect got the money to afford the solution?
Authority – Are we talking to the decision maker?
Need – Why do they NEED to do this NOW, and why can’t they just wait.

MEDDIC

Metrics – What KPIs / drivers will we be contributing to – revenue, productivity, time to market?
Economic Buyer – Who will sign the contract and/or who owns the budget?
Decision Criteria – Technical and commercial criteria; their priority and our position versus competition?
Decision Process – What is The Sequence of Events?
Identified Goal – What is the Compelling Event. What is the individual or group objective? Are their serious consequences if not achieved?
Champion – Who is the Individual who has a personal win associated with the success of this project? She provides easy access to MEDDI.

TRAM BURP

Timing
Requirements
Action
Money
Budget
Uniqueness
Relationship
Priority

And two shorter ones:

BANT

Budget
Authority
Need
Timeline

£AWN

Money
Authority
Willingness
Need

Let me know any others that you use and I will add them to the resource.

Who is buying?
Who is in the Decision Making Unit (DMU), what are their roles – Decision Maker, Recommender or Influencer? Key point – who will sign off on the order, are we talking to the executive sponsor?

What are they buying?
What business issues are they trying to solve? How does our solution address these issues? What is the competition offering and how do we beat them?

Why are they buying?
What business issues or events are driving their decision? Is it a desire for more market share? Are they on the offence against new competition? Learning their reasons for buying enables your salesperson to understand the emotion behind the decision. This prevents them from being a product-focused only salesperson.

When are they buying?
When they were going to make the decision and when will they place the order? Too often, it’s much later than either the salesperson or the sales manager expected. Be sure to ask your salespeople what the prospects time frame or sense of urgency is about their decision. In many cases sales forecasts slip due to a lack of understanding of the buying process and who is involved.

Where is the budget?
Where is the money coming from for the purchase – are budgets in place, do they need to go for board approval; are they just flying a kite? In my experience sales people are very weak in qualifying where the money is coming from.

How will they buy?
How a prospect buys refers to the terms and conditions. How are they financing the purchase – lease, lease purchase or outright sale? What performance conditions are attached to the sale – do they need a trial first?

Using these ideas as the basis for a sales review will often expose the weaknesses of the qualification and allow you to decide whether to spend time (and resources) on the bid, re-qualify by getting the additional information or move on to opportunities that are more likely to result in an order.

Here are some examples of what questions you can ask yourself prior to a call (either face to face or telephone) together with some debrief questions to help you move the sales forward. These are also detailed in the Instant Sales Guides tab together with an actual call plan for you to download and use.

Key Points

• Objectives will help you improve your performance over time
• Always be asking yourself
  “What do I need to do/have to move the sale forward?”

Pre-Call
Questions to consider before calling on a new prospect or an existing customer:
☐ What is my call objective(s) – only 1 or 2 SMART objectives?
☐ Who do I need to speak to in this business/division/department?
☐ Who is the key decision maker(s)?
☐ Who is a main influence(s)?
☐ What specific actions do you want the prospect to take at the end of the call?
☐ What potential obstacles exist that will threaten the sale?
☐ What stage am I at in the sales cycle?
☐ How will I open the call?
☐ What information do I have?
☐ What information do I need to find out?
☐ What sort of objections emerge out and how will I handle them?

Post Call
Questions to consider when reviewing your customer sales interaction:
☐ Did I achieve my objective?
☐ What went right/what went wrong?
☐ What does the customer think about me/my company/our offer?
☐ What information did I gather?
☐ What evidence do I have that this is still a viable sales opportunity?
☐ Did I advance the sale to the next stage?
☐ Who else needs to be involved in the process?
☐ What else do I need to do to progress the sale to the next stage?
☐ When am I next going to see or speak to this customer?
☐ What will be my next call objective?

Please comment if you have any feedback – note that you can download a printable pdf version of the checklist together with a call plan and more information regarding call planning from the instant sales guides tab.

Take the IT industry, years ago it wasn’t uncommon for a company to have a product advantage over the competition for a number of years – the example that comes to mind is the DEC VAX, where they had 2/3 years of market dominance over all competitors. Today, I cannot think of any examples of such dominance unless the market is distorted by government regulation. I was interested to see that when Costa Coffee launched its new “flat white” premium coffee, Starbucks responded with their own product within 4 days!

The Smart phone market is also very competitive, not only between Blackberry and Apple iPhone, but with the phone industry giant Nokia with Symbian, Microsoft’s mobile Windows and now various versions of Google’s Android operating system. Any market where there is growth and money to be made is competitive. This means that your customers will probably always have good BATNAs (see previous article) and hence can squeeze your price due to a competitor offering a similar solution. Of course, if you have failed to link your unique value to the customer’s business drivers, then it will always become a price auction!

So what can sales people do – sell harder? Well, think about today’s buyer, they have more information than ever before literally at their fingertips, with the click of a mouse. Think about buying a laptop and search for comparison websites – how many do you want – every detail of every option is discussed, analysed and rated against all of the competition. So if you are a laptop sales person, what can you do?

The first thing is to embrace the new world order, it isn’t going to go away, and information that creates savvy buyers is here to stay. So treat buyers as intelligent, computer literate people who will have done their research.

Secondly, rather than selling laptops can you sell a service/relationship advantage – sales people repeating facts they have already pulled off the web won’t interest them – what can you offer that’s new and engaging? Having case studies of people similar to them – vertical market, business challenge, application – and showing how they successfully implemented the solution is a good place to start.
Additionally, if you can also advise of potential risks and issues they may face during the implementation then they will listen. One of the key complaints of buyers is that sales people only focus up to getting the order, whereas the customer is interested in a successful implementation and return on investment of the project. Demonstrate that you are a different type of sales person who is really interested in the success of the project (back to the business issues).

Remember, buyers will not let you into their buying cycle early if you cannot demonstrate that there is a value to them in doing this. And, as we all know, if you aren’t in early then someone else is setting the agenda and so you are likely to become a purely price discounted option.

Do you have any ideas about how you can change your selling approach to be more effective? Let me know, post a comment.

The buying cycle is the steps in the process that the customer has to work through starting with idea of doing something (an awareness of needs) through to implementation and achievement of results. This is a customer internal process that needs to be respected by sales people trying to short cut the process to a quicker order. In customer interviews this is one of the most heinous crimes that sales people commit – not taking time to understand and work with the customer’s buying cycle.

So what are the advantages of understanding the buying cycle for a sales person? Well, firstly, they all differ – every customer is different, and so to sell well, we need to know what the customer is doing at each stage. This allows us to align our selling efforts with the appropriate buying steps. So, if the customer is still clarifying their needs, if the sales person puts in a proposal it is likely to be inappropriate as it is based on incomplete information. Similarly, if the customer is evaluating options, trying to close them can only make them angry and less likely to buy from you.

So, as a selling organization, you should have a sales cycle. These are the steps (the process) that you go through to ensure the best chance of winning the business. Sales organizations with a well defined sales process have a far better chance of executing business effectively and efficiently. These are the steps that are often linked to the stages in a CRM system for the % chance of winning the business. This process ensures that nothing is missed out, especially early in the cycle.

Knowing your own selling cycle and the customer’s buying cycle allows you to analyse whether the actions you are taking are synchronised with the customer’s actions. Again, the better the synchronisation between you and the customer, the better your chance of winning the business.

Throughout the process there should be an ongoing qualification of the prospect – are we talking to the right people, who will make the decision, how will it be made, what criteria will they use, etc. Interestingly, there is no timescale on these processes, and in some cases the whole cycle can be completed in one telephone call, whereas the process could take 50 meetings spread over 2 years. This is why it is important not to use generic processes (like the ones I have created), but to actually understand the real customer process.