3 Behaviors That Drive Successful Salespeople

Originally posted on HBR Blog Network - Harvard Business Review:

Most people consider selling to be an art rather than a science: some people have it and some people don’t. But this leaves a lot of uncertainty in what is often a company’s most profitable department, and it makes managing a high-functioning sales force notoriously difficult. The prevailing thinking is that the amount of time salespeople spend with customers is the most important determinant of how much they are able to sell. But recent research has uncovered an even more powerful leading indicator: the size and quality of a salesperson’s network inside their own company.

People analytics can help organizations learn more about what behaviors differentiate their most successful salespeople. At VoloMetrix, we recently studied the sales force of a large B2B software company using six quarters of quota attainment data for a several thousand employees. We then correlated it against 18 months of VoloMetrix-created People Analytics key performance indicators…

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Book Review: The Race Underground

The Race Underground: Boston, New York, and the Incredible Rivalry That Built America’s First Subway by Doug Most is an excellent book. I can’t imagine how lumber and steel when into building these two subways. Below is an excerpt about Manhattan.

The Race UndergroundThe Race Underground

FOR AN ISLAND THAT STRETCHED only seven miles long, Manhattan presented an unusual array of engineering nightmares. The softer rock had a grainy texture, almost like sugar, and was known as dolomitic marble. It was mostly at the island’s northern end. The more solid, challenging rock, Manhattan schist, was dangerous to bore into because it could fracture more easily and collapse on workers. It was at the southern portion. The island’s widest point stretches only about two miles, from river to river, near 125th Street, but just north of that it narrows quickly like a soda bottle. And though it appears flat to pedestrians, most of the city’s terrain is actually quite rolling and rocky, especially between Twenty-Third Street and the northern tip of Central Park. North of 110th Street the island has a steep rise in elevation that tops out at 268 feet above sea level, Manhattan’s peak, in Inwood near Fort Washington Avenue and 185th Street. In this northern portion, there were two hurdles for major digging. The bedrock of Manhattan has two major cracks, or fault lines, one at 125th Street and the other further north near what is now Fort Tryon Park, that have existed for millions of years. Although gravel, sand, and silt deposits have mostly filled them in, the faults weaken the structure of the bedrock hundreds of feet beneath the sea.

A Quick Guide to Breakeven Analysis

Originally posted on HBR Blog Network - Harvard Business Review:

In a world of Excel spreadsheets and online tools, we take a lot of calculations for granted. Take breakeven analysis. You’ve probably heard of it. Maybe even used the term before, or said: “At what point do we break even?” But because you may not entirely understand the math — and because understanding the formula can only deepen your understanding of the concept — here’s a closer look at how the concept works in reality.

Managers typically use breakeven analysis to set a price to understand the economic impact of various price- and sales-volume scenario. Pricing matters. Having the right price for a product or service can boost profit much faster than increasing volume. Setting a price is, of course, complicated but breakeven analysis can help.

It’s a simple calculation to determine how many units must be sold at a given price to cover one’s fixed costs. You’re typically solving for…

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S+B: How Old Industries Become Young Again

The Building Supply /Lumber industry is an old industry. Which is dematuring. What are you doing to make our industry young again? Are you aware of your changing customer’s habits? What technology are you using to be more effective and cost efficient? Do you know what your competition is doing? Below is an excerpt from strategy+business: How Old Industries Become Young Again.

 

How Old Industries Become Young AgainWordle: dematurity

Five indicators reveal when your sector is about to be transformed by dematurity.

Leading in Dematurity

One of the few certainties in business today is that dematurity is coming to your industry, and soon. Responding effectively requires that you throw out old assumptions about how value is built and sustained in your markets. You need to ask questions about your industry that others believe have already been fully, inexorably, answered: What makes for efficient scale? Who is the competition? Who are the customers? What do customers want? Who owns what? Where is the risk?

If asking these questions and pursuing untraditional answers seems like an unlikely path to success, consider this fact: More than 80 percent of the self-made billionaires who are profiled in my upcoming book, The Billionaire Effect, made their billions in mature industries that they reinvigorated by tackling one or many of the factors identified above. They either introduced a product attuned to new consumer habits, changed the technologies of production, adopted ideas from another industry, adapted to new regulation, changed the distribution system, or made some combination of those moves. Elon Musk, CEO of Tesla Motors and SpaceX, challenged the internal combustion engine’s dominance in the auto industry by developing a customer-friendly electric car. Farallon Capital Management founder Tom Steyer worked laterally: He created an investment vehicle for university endowments and changed how those customers defined profitable investing. Alibaba founder Jack Ma created one of the largest e-commerce sites in the world by taking advantage of production and distribution changes inherent in the Web to provide platform and infrastructure services to thousands of small businesses.

Although dematurity is inevitable, your business can be the one that benefits most. Half the task is recognizing the facets of impending change early enough to prepare. The five indicators in this article provide you with a starting point, a way to begin honing your judgment and identifying the real threats to your industry. The other half of the task is to respond in a way that makes you stronger: by assembling and integrating the capabilities you’ll need in this new, rejuvenated marketplace. The right capabilities will probably be a combination of what you already do well and what you must learn to do from scratch. If you can set your company up to sense and respond to dematurity ahead of time, then you’ll be one of the first to catch the big wave of small changes—before everyone else in your industry gets on board. … Read More

 

Win More Sales with an Indirect Strategy

Originally posted on HBR Blog Network - Harvard Business Review:

For the past two decades, business-to-business selling has been conducted in basically the same way. Salespeople directly approach customers armed with facts, features, and the benefits of their products to convince customers to buy. However, customer decision making has changed and today’s buyers are smarter and more sophisticated than ever. In addition, competitors have not sat idly by. They’re focused on defeating you so they have educated themselves about your products and sales tactics.

Sales success today requires a new way of thinking about sales strategy. The question is, what is the right strategy?

In his classic book Strategy, famous military historian Lidell Hart detailed the “indirect” approach to war. In painstaking detail he described the superiority of the indirect strategy over the direct strategy, using examples throughout the history of warfare. He theorized that the outcome of every major war from Roman times through World War II could be attributed…

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HBR: The Renaissance We Need in Business Education

Originally posted on HBR Blog Network - Harvard Business Review:

Having taught at five business schools over several decades and served as Dean of two, I have come to a conclusion: The educational institutions where our future business leaders are being trained must be recalibrated and transformed dramatically.

Business education today is anachronistic in both how it is conducted and what its content focuses on. Our brick institutions have in no way caught up with what today’s technologies make possible in terms of virtual learning and individualized, customized instruction. More importantly, business education needs to evolve once again, revising its goals to educate leaders of the future who have a new set of skills: sustainable global thinking, entrepreneurial and innovative talents, and decision-making based on practical wisdom.

Historically, business schools have so far been through two waves. As originally conceived, they were institutions of practical education. In the late 19th and early 20th century, successful businessmen like Joseph Wharton

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Cubed: A Secret History of the Workplace — Book Reveiw

Cubed: A Secret History of the Workplace by Nikil Saval is a good interesting book. I like the way he intertwines the social aspects and history of office spaces. He uses novels from different time periods to give you the social background. Below is an excerpt about “knowledge workers.”

“Knowledge Workers”Cubed: A Secret History of the Workplace

Like McGregor, Drucker was a figure who inadvertently harmonized the impulses of the nascent counterculture with the outwardly stuffy world of business, Though hardly countercultural himself, Drucker’sconcepts would prove useful to people in later years who wanted to make the office hospitable to the wilder world outside it. Over the course of the 1960s, Drucker came to expound one of the notions that’ would make him famous: the idea that a swelling group of workers was becoming central to the economy. They were middle-class employees who would never identify themselves with the “proletariat,” nor, in fact, with management. They were technical and professional workers who controlled what Drucker believed was becoming the most important resource of all: knowledge. Calling them “knowledge workers” — a term he coined in 1962 at the same time as, but independently of, another social theorist, Fritz Machlup – Drucker saw them as occupying a historic role in the making of a responsible society,

In Drucker’s view, what was changing about work was the increasing need to apply knowledge to work. Knowledge as such, in the intellectual sense, was different. The mathematical formulas and theorems that existed in books were a form of knowledge useful to intellectual history, but mathematics as applied to, say, a space program was “knowledge work.” So, too, did advertising and marketing and various other new professions require the mental labor of workers, applying what they knew from various disciplines to the techniques of mass persuasion. It was one thing to be an expert in Freud or Newton in a university; another to use the insights of Freud to sell a toothbrush or to use Newton to build a ballistic missile capable of striking the Soviet Union.

Knowledge work itself came from a historic shift, one that Drucker, like so many, traced to Frederick Taylor. But his vision of the history was marked by a curious and useful elision. In Drucker’s account, Taylor came upon a working world characterized by rote, nearly mindless, activity. It wasn’t planned so much as willed: the workers simply worked harder rather than “smarter.” Until Taylor, that is: “Taylor, for the first time in history, looked at work itself as deserving the attention of an educated man.” Drucker’s subsequent description of the insensate labor of unskilled men in factories draws almost entirely from Taylor’s portrait of them–and accordingly condescends to their abilities to plan and organize work. In actual fact, it wasn’t so. Before Taylor, work was already organized by teams of factory workers, who in large part had control over how they worked. The knowledge they applied to work was largely “tacit” in nature, agreed upon among the workers themselves and developed through a silent or coded language, rather than “explicit” (to borrow a famous definition from the sociologist Michael Polanyi). What Taylor sought in particular– indeed, what constituted his signal obsession– was to extract this tacit knowledge from the workers and install it in another set of people, the “industrial engineers.” Drucker called them “the prototype of all modern ‘knowledge workers’ “– a plausible assumption but one that excised the tremendous amount of knowledge that already existed in the work process. (Taylor lamented that after being taught “the one best way,” workers had a stubborn tendency to return to their own ways of working.) It was a useful fiction, and a common one, that helped to uphold a new class of technicians and professionals as the masters of an ever more progressive society, dependent on the application of knowledge to work. For the knowledge worker, Drucker held, was not simply a freelance professional but rather “the successor to the employee of yesterday, the manual worker, skilled or unskilled.”