You may recall that the Chinese word for "crisis" is comprised of two characters: one meaning "danger" and the other meaning "opportunity." So what do you see in the tea leaves of the marketplace? We sincerely hope it is the latter, and it's our intention to help make this your best sales year yet.
We recognize that the economy is wreaking havoc with some of your clients' business operations. And there are compensation pressures due to issues like transparency and commission reductions (down to 3% in some markets). We know that some clients are asking you to reduce their health care expenses immediately instead of waiting for next year's renewal.
All these market forces are putting more pressure on you to bring greater value to your clients at a lower cost. We all have to do more with less, but doing it intelligently enables the smart advisers to excel, no matter what the external factors are. Let's talk about how to manage sales activities and resources to increase sales revenues despite the market conditions.
Take a deep breath and a step back from your day-to-day activities and evaluate a client's total business issues from a sales management perspective. Think about their business more like a management consultant. Think about their business holistically, strategically. How much do you really know about their business, aside from their health care plan or group life program? We will get around to talking about specific products and program designs. But first, focus on discovering what their needs are. What is going on with their business? What are the critical issues confronting them today? What strategies are they employing to maintain their market share and to grow their revenues? What role does human capital management play in achieving their corporate goals? What do they expect their benefits program to accomplish for them?
When you can answer these questions, you will be better equipped to develop a relevant, comprehensive benefits program that is responsive to their current needs.
We advocate a back to basics, consultative sales management, needs-based approach. Why? Consider this: many of today's "sales managers" have less than five years of sales management experience. Many have only worked in an expansionary economy. Most have never faced a tough market, let alone a full-blown recession. Think about your own practice in this context. Who manages your sales operation? What is their level of expertise in managing sales activities? This is not the time to leave sales management decisions to chance. It may be your role, or it may be a member of your management team. Regardless, the sales management focus and style must adapt to the market conditions. Unsure whether you agree? Just consider these observations.
Different strokes for different...
Markets. The market conditions should dictate both the focus of sales managers and individual sales professionals. Think about a growth market. In a growth market recruiting is rapid, and hiring criteria is often sacrificed due to increased competition for talent. Sales training for new hires is more likely to be fast and basic in order to get the producer producing as quickly as possible. Management is focused on gaining market share. Individual sales professionals are also focused on growing their books, which means that time management issues are critical. Product knowledge is limited and focused on what's moving.
When the economy slows, prudent sales management adjusts — taking a more deliberate stance toward the market. New hire standards are much more selective, as there are more qualified candidates. The training focus is on multi-lines selling and expertise in the hope of driving more revenue per client and improving account retention. Management's focus is on improving profit margins and creating value.
In a slowing economy, individual sales professionals must be conversant in the areas of account rounding and value-based selling. Client decision making is also likely to stall, lengthening the sales cycle and requiring producers to be patient and committed for longer periods of time — challenging assignments for many sales professionals.
We hope you see the validity of the argument that you need to adapt your management emphasis to match the market conditions. In this business and political climate, we need to be optimally adaptive, flexible and prepared with contingency plans. Do not remain static. Be proactive.
In this latest series of articles we have been discussing strategies to help your business excel in a difficult economy. Thus far, we have addressed enhancing your firm's value proposition for your clients and differentiating your business from your competition.
We have covered goal setting for prospecting activities and establishing a minimum activity level for all personnel with production responsibilities to make ten new prospecting calls per week and to visit five existing clients each week.
We emphasized the necessity of managing sales activities consistently. We also featured strategies that institutionalize the cultivation of centers of influence to secure more referrals.
And we acknowledged that offering superior service could be a differentiator if you put your money where your mouth is, offering some form of service guarantee.
These are winning strategies that will boost your sales results in any economy. Consider them seriously. They can make a difference.
Kwicien is managing partner at Baltimore-based Daymark Advisors. He can be reached at jkwicien@daymarkadvisors.com.
Ten sales management maxims
1. Think of your clients' best interests first. Think of your employees' best interests next. Then think of your personal interests. Build long-term relationships and become the "trusted adviser."
2. Prospecting is the difficult part; selling is easy. Develop centers of influence. Request referrals. Institutionalize prospecting to secure introductions to multiple, qualified prospective clients.
3. Differentiate your practice. Develop expertise in a market segment. Create proprietary products. Develop benefits strategic plans. Just find a way to bring value to your clients in a unique and meaningful manner.
4. Develop client needs first. Understand your client's business issues. Then create solutions that are pertinent and relevant. The product selections will become self-evident.
5. Closing should be less than 15% of the total sales process. Visualize a funnel. The time spent closing the sale should be the narrow part at the bottom. If you invert a funnel, it doesn't work.
6. We all recruit in our own image. Know yourself well. And know your deficiencies even better. Then hire to your strengths.
7. Your best sales people call you. And when they call you, they provide specifics about results. Poor sales people rarely call you. And they avoid your calls. When you hear from them they speak in vague generalities.
8. Poor performers pull down good performers. Good performers cannot improve poor performers. Eliminate poor performers expeditiously before they impact your entire team.
9. There is no sales management problem that you cannot recruit your way out of. You should always be recruiting. Select, do not settle.
10. The primary responsibility of sales management is to replace itself. Mentor your replacement and develop a winning sales management team.
Source: Daymark Advisors.
