Blog posts on sales

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• Google: Good Service not Arbitrage (2005)

  Google, to use a internet bubble phrase, is doing a good job monetizing eyeballs. However, that is not arbitrage it is just doing a good job of maximizing revenue and profits. Yes Google is able to make money because they are paid more by advertisers than it costs them to deliver what the advertisers want. But I don’t see how that is more like arbitrage than Toyota selling a car for more than it costs them to make the car.

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• Malcolm Gladwell and Synchronicity

  Today I had lunch with a friend of mine, Sean Stickle, who continually provides me with interesting ideas to contemplate. One of the things he mentioned during lunch was a story in the New Yorker about the current college admission process.

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  Obviously there are good things to learn from surveying and talking to your customers, but Deming understood that asking customers about what innovations they would like was dangerous.

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• There is Much to Improve in How We Use the Internet to Serve Customers

  Webinars can have great interaction. They can provide very useful archived webinars covering some content (live webinars could be provided for free too if the reward was worth the cost) . If the public finds that free content valuable it can be about the most effective marketing in many ways including for gaining customers for live interactive webinars on more advanced topics.

  Webinars also allow the presenter to do multiple two hour sessions for different clients anywhere in the world in the same day. So you could customize your content to specific client needs. Also each of those sessions could include employees from multiple sites around the globe.

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• Marketing in a Lean Company

  The company needs to be viewed as one interdependent system not independent departments. The system needs to be optimized as a whole. And that means optimizing the overall system not optimizing the individual departments independently.

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• Deming’s Ideas at Markey’s Audio Visual

  Mark Miller, General Manager, Markey’s Audio Visual spoke on Markey’s experience adopting Deming’s ideas.

  • Markey’s needs to anticipate the changing needs of customers and anticipate those needs
  • Unknown and unknowable – not really unknown just un-measurable (again taught to all employees)
  • Gemba – where the real work gets done (the customer interaction – he stressed time and again that the key to their success was Markey’s employees interaction with customers – Markey’s aims to provide the best customer experience the customer has with any company)
  • Break down barriers between departments – Markeys doesn’t charge internally. Indianapolis looses money – they own the high end equipment used by the other offices.
  • Intrinsic motivation v. Extrinsic motivation – he has the chart from page 122 of New Economics in Deming’s handwriting on his wall.

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• Problems with Bonuses

  Commission pay and bonus often set up a conflict between what is in the interest of the company and the employee. They lead to bunching of orders around quarterly quotas, deadlines and competitions. They lead salespeople to think their job is to sell whatever pays them the most not to assist the customer.

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• Blogging is Good for You

  Blogs are a valuable tools for individuals (or small firms).  They allow for focused marketing that allows you to make a good impression by sharing your thoughts. Marketing is often one of the most difficult parts of making a successful career as a consultant.

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• Another Quota Failure Example

  However, as I was to learn from Dr Deming, this was judging performance using arbitrary goals, which fostered short-term thinking – the only thing they cared about was: Did I make my quota this week? Misguided focus. The focus was not at all on the customer. The focus was: How much money can I make off this customer?
  …
  It created a lot of internal conflict. What type of internal conflict? Well, the salespeople hated having new salespeople hired on the floor, because they felt like it would cut into their commission…

  Also, judging performance using arbitrary goals fostered a giant amount of fudging of the figures.

  Jim McIngvale, CEO Gallery Furniture and author of Always Think Big.

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• Making Changes and Taking Risks

  The system had to change. “We eliminated commissions, incentives, promotions, contests, P&Ls, forecasts, budgets, the entire functional organization chart,” Rodin says. It was a radical move. Contests and commissions — internal competition — were a way of life in the industry, the universal motivational tool.

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• Applying Quality as a Business Strategy at Hallmark Building Supplies

  Hallmark Building Supplies has profit sharing for all and doesn’t do annual performance appraisal. They attempt to let the market dictate pay and take pay out of the performance discussions. To manage performance they seek to “coach while the game is going on” (and mentioned the importance of people being receptive to coaching). Cooperation between sales people has increased since they eliminated commissions.

  Everyone is trained on the purpose statement, it is not just something that hangs on the wall. We use it to make decisions on a regular basis.

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• Aligning Marketing Vision and Management

  Why do so many companies market one thing and provide something else? I know it might be easier to sell something different than what you offer your customer today. But if you decide to market one vision, why don’t you change your organization to actually offer that?

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  Treating a marketing message as something separate from management is a serious problem. When your marketing message says one thing and your customers get something else that is a problem. I think the message is often based on what the executives wish the company was (and the outsourced marketers think it should be), but it isn’t the customer experience the management system provides.

  If you believe the vision of your marketing then make sure your organization has embraced those principles.

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• It Just Works

  The Kano model of customer satisfaction is an excellent way to view customer expectations.

  The Kano model states that you have expected quality – it just does what it needs to (what is expected). Then more is better type – give me more at the same price and I am happier. But where you really want to get as a company is products and services that delight customers.

  When you are delighted you are not easy prey to other companies. When you are satisfied you are ready for offers that say we will give it to you a bit cheaper or give you a bit more. But if you are delighted you don’t want to leave and instead are telling everyone you know how great this product or service is.

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• Aligning Marketing Vision and Management

  If you believe the vision of your marketing then make sure your organization has embraced those principles. I think, often, companies would be wise to follow the vision their marketers came up with. But instead they tell customers to expect one thing and manage the organization to provide something else. I just don’t see how that is sensible...

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