Sales people's achievements are often overstated - The Star Principle

Sales people sell - especially when it comes to their own achievements.  I was recently reading a book that more succinctly stated things I've been ruminating about for years now.  My mother works closely with sales people for a large corporation.  And people think sales is like this thing you can either do or you can't.

Somewhat true, and this is perpetuated by how sales is portrayed in pop culture and in media think  Willy Loman, Wolf of Wallstreet.  Recently my Mom said to me, "I guess if a salesperson is good they can sell anything."

This is true for things of low value.  You can talk someone into a quick knee jerk purchase.  You can't "talk" a business into a serious purchase.

I've observed my former colleagues hitting home runs selling years ago fall out of the groove.  I saw company founders start a business that sold for millions and fail to achieve similar results now 5 years later.

All smart guys who worked hard.

This got me thinking among other things, that with b2b sales, there really isn't much difference between 1 rep and another assuming they have the same work ethic and product knowledge.  The real differentiator is having enough opportunity aka qualified prospects.

Fast forward to a few weeks ago as I'm riding the path and getting some quick reading in - Richard Koch's latest "The Star Principle."

Page 57 discusses Professor Phil Rosenweig's work..."Nearly all the usual explanations of business success are useless and exaggerate the impact individual managers have.  When a company is doing well we explain success in terms of it's leadership and culture.  When a company starts to do badly we make the opposite attributions - we find all kinds of reasons why the leader and culture have screwed up.  In reality we are not explaining success or failure we are rationalizing it."

When I read that I was like "Damn, this is true!"

Koch points out that this goes against everything we like to believe.  But isn't it true that what we like to believe and what's actually real are often 2 different things.  The world of "should be" versus the world of "IS."

Years ago I was part of a national sales team that started off without territories and then shifted to them after an acquisition by a much larger company.  I got curious and broke out the sales performance of each US State, and it was interesting to see that nearly all states sold the same amount regardless of the rep working them - there was little exception to this.

Koch also states, "...Executives have much less influence than they and we like to believe, once a firms positioning is set.  One executive versus another is almost completely irrelevant unless he or she makes a brave and dangerous decision to try to transform a firms positioning."  (The latter rarely happens)

By the way Richard Koch has sold over 700,000 books, and knows how to repeatedly invest in companies and make fortunes many times over.  His book "The Star Principle" is about what makes a star business, such as Google or Apple.  A business does not need to be as big as Google or Apple to be a star business. Koch made most of his money investing in Betfair, Europe's largest Internet gambling business.

Richard got his start at Boston Consulting Group where they advised companies strategically.  Businesses fell into 4 different groups.  Stars, which you would try to dump as much cash into as possible, and keep this business growing and leading.  Cash cows are basically leaders in low growth mature markets.  The 3rd is "question marks" -  these are interesting.  These are not market leaders, but they do quite well.  Often times "question marked" businesses are sold because it's too risky to try and transform them into market leaders.  And finally there are dogs - and you were to exit or sell these immediately.

If the achievements of executives are overstated then the achievements of sales people are most definitely overstated.  The success of an individual sales rep has more to do with the product to market fit than anything else.   As long as a sales person is a good listener, which can admittedly take years, and is competent at selling, success comes down to having qualified prospects to talk to and that is a marketing and advertising issue.

Certainly there are exceptions where a one may hit pay dirt by way of having relationships or sheer persistence but these are not sustainable.

Koch's book is a great read - especially for those in sales and marketing!  In it you'll learn about what makes a business a star, one of the first criteria is that there must be a market gap.  This is not easy stuff, and involved critical thinking.  Businesses take off or succeed not because or work but because of positioning - again product to market fit.  Not talent or the right mix of people.  Koch points out that all companies struggle with talent.

I say, give the book a read and make sure the company you're working in has the "star" criteria.

 

 

 

 

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