Achieving Business Excellence with John Spence

6 Key Business Ideas to Help You Succeed in 2017

Mercedes, John, Sheila, Esther

Mercedes, John, Sheila, Esther

On behalf of myself, my wife and business partner, Sheila Spence, our Operations Manager, Mercedes Petrus and our Financial Manager, Esther Mallard – thank you VERY much to all of our clients from 2016 for trusting us to be involved in your businesses.

 

I hope you will share this video with your network, and if you have not already, please sign up for my blog – I only post good stuff!  blog.johnspence.com

 

Selling Value Where None Exists

John Spence on Selling Value

In my last blog, The Big Trends From 2016, I got lots of great comments and questions. I especially liked this question and wanted to share my answer with all of you.

 

Q: How often do you find executives who expect their salespeople to sell value that does not exist? In my last two sales jobs, the real value of the product or service was not a differentiator in the marketplace. Even for the most incredible sales person, companies are not naive and they can quickly assess whether there is value in an offering or just double talk. What are the executives’ responsibilities in this situation? How often are you seeing this situation at companies?

 

A: Good question, tough answer. You have to find some way to add value above the product or service even if it is truly a commodity. I have worked with a lot of companies that had very little differentiation, and the executives wanted their folks to sell on value, but few people understood how to create real value beyond what they were selling. If you cannot figure this out, then the only thing you have left to sell on is price.

In my strategic thinking workshops, I tell the attendees that all effective strategy boils down to: Valued Differentiation X Disciplined Execution. In other words, you have to bring something to the marketplace that is unique, exciting and compelling – that your customers VERY highly value – that is difficult, if not impossible, for your competition to copy – and that you can deliver on flawlessly. Until you can discover how you, your products and/or services can meet these criteria – the only thing you have to sell is lower price, which is the fast lane to bankruptcy.

You ask above, “What are the executives’ responsibilities in this situation?” It is my feeling that they must understand their product and market well enough to clearly show their salespeople where the real value exists. If they cannot clearly differentiate their own product from the competition’s product, then a salesperson needs to ask how they can sell on value if the executive can’t even describe it. One of the big issues I see are companies that demand that their salespeople sell on value and capture a premium price in a market that truly will not support it. This is a recipe for failure and is exceedingly frustrating to the sales force. As the old saying goes, “You can’t get blood from a stone,” and you can’t sell value where none exists.

However, it has been my experience that where there is little product differentiation the only way to command a premium price is for the salesperson to add massive additional value. What unique expertise can you bring to the situation? How can you give your customer insights and ideas they could not have developed without you? What recommendations can you make to improve the customer’s business? What additional services can your company deliver that significantly increases the value of your total solution?

In other words, if the product is not a differentiator, the salesperson must be. This is easy to say, but extremely hard to do. It takes a lot of work, time, effort and energy to educate yourself at a level where you can be positioned as a trusted advisor – not a salesperson. Luckily, very few salespeople are willing to make the personal investment necessary to become a high level consultative salesperson, so if you can achieve this you will have created a good deal of job security because every company wants a salesperson who can create unique value for the customer that drives high margins.

I hope you found this of value.

The Big Trends From 2016

shutterstock_150443150I am sitting in my hotel room in San Diego taking in the view from the 16th floor. I’ve just delivered my last speech of the year, it was on advanced sales, teamwork and the future of work. This year I had the opportunity to work with clients in six countries, dozens of different industries, from small startups to the Fortune 10. Here are a few big trends that stuck out to me as I look back over 2016.

Communications: I have not worked for a company in my entire career that did not have some sort of communication challenges, but this year they seem to be even more prevalent. In business after business I encountered organizations which had trouble clearly communicating their vision and strategy for growth, their purpose and core values, and the critical information needed to keep their employees engaged and aligned.

The key to successfully overcoming this ever challenging issue is simply to over communicate using every channel available; one-on-one meetings, town halls, weekly meetings, email, social media, video… any way you can think of to share important information with your employees, vendors and customers. When you think you will get sick if you talk about the vision and strategy one more time, the lowest person in your organization just heard it for the very first time.

Execution: The lack of disciplined execution is the single biggest problem I see in companies around the world. I meet a lot of very smart people who develop unique and compelling strategic plans that would surely give them a strong competitive advantage, only to see them struggle mightily in taking their plans and turning them into results in the marketplace.

The key to successfully overcoming this challenge is to make sure you spend as much time building your execution plan as you do on creating the strategic plan. Your plan must have clear, specific, measurable and binary goals. As I often say: Ambiguity Breeds Mediocrity. For a strategic plan to be successful it MUST have extremely clear expectations of what is required, who is responsible, how the work is to be done and when it is due. Then, you have to have the discipline to consistently work the plan and make sure it stays at the forefront of everyone’s mind. I promise you this, if you could increase the effective execution of your strategy by just 10%, it would have a massive positive impact on the success of your organization. This was a major focus of my work for clients this year and I anticipate it will be again next year because even the best strategy in the world is useless without superb execution.

Technology: For the last several years people have been talking about the, “hyper-speed of technological change,” but I don’t think they really understood just how fast technology is actually changing and the mind-boggling impact is going to have on every business in just the next few years. A number of my clients have asked me to deliver speeches on the future of leadership and business, which has forced me to invest a large amount of my time into studying the various trends in emerging technologies. To name just a few; robotics, artificial intelligence, big data, Internet of Things, genetic decoding and recoding, synthetic medicine, virtual reality and augmented reality are all accelerating at a pace that will leave many, many companies and people completely unable to keep up. Even though I have devoured all of the information I can get my hands on, it is still exceedingly difficult for me to comprehend just how monumental the changes to our lives, businesses, communities, and the world will be in just the next decade.

The key to successfully dealing with this change is to dedicate a minimum of 10% of your time to studying all of the technologies that will potentially impact your business. I currently work with several clients who are directly connected to the auto industry and have challenged them that unless they become “experts” on autonomous cars and other forms of transportation technologies their business might not exist in 5 years. Let me make this Awesomely Simple: Learn or Die.

Talent: For many, (if not most) businesses, two of the only sustainable competitive advantages left are the quality of the people they can get, grow and keep on their team – and the relationships they create with their customers. This means that talent acquisition, talent development and talent retention should be a major strategic objective. However, I still see many companies tolerate mediocrity, do not invest sufficiently in training and development and have difficulty retaining their very best employees (the bad employees don’t want to leave because they know they can’t get a job anyplace else). The success of your business is directly determined by the talent on your team and creating a culture of engagement, customer focus, collaboration, accountability and disciplined execution.

The key to successfully overcoming this challenge is to make getting and keeping wildly talented people as a major focus of your business. Build a talent pipeline to ensure a steady stream of quality recruits, implement a focused and consistent interviewing process, create a robust onboarding system, develop a focused and intensive training program to take great people and make them even better, and have a career pathing program with mentoring, assessment, feedback and coaching to keep your top performers engaged and thinking long-term about their role in the company.

Sales Effectiveness: Nothing happens until somebody sells something. Let’s face it, all of the other stuff I’ve mentioned is useless if at the end of the day nobody buys anything from your company. Sales are the lifeblood of every business, or as Peter Drucker famously said, “The purpose of a business is to create and keep a customer.” Unfortunately, the vast majority of salespeople that I meet are NOT prepared for success. They have not had enough good quality training, they don’t have the right attitude, they don’t spend enough time investing in their own development, they don’t do their homework on their products and services and they don’t spend enough time asking superb questions and being an intense listener when they are in front of their customer. In other words, they waste their customers time, which is the single biggest complaint that executives have about dealing with salespeople.

The key to successfully overcoming this challenge is to be highly selective and targeted in who you hire as a salesperson and then ensure they get all of the training, support and resources they need to be successful in the field. Set clear and specific sales targets, coach and mentor for them for success, over-train them on both sales skills and product knowledge, and align their compensation plan to strongly encourage their full engagement and a strong desire to be successful in their sales efforts.

Leadership Development: I have been teaching leadership skills for nearly 25 years and I can say with great confidence that in the last few years the requirements for being an effective leader have actually changed quite a bit. Theory X, command-and-control and “do as I say not as I do” has not worked in a long time, yet I still see people trying to “lead” this way. Currently just over 50% of the workforce is made up of millennials with this number growing every day, and millennials definitely have a different way they want to be led. If you agree with me that talent is a critical element in building a successful company, then it is important to remember the single biggest reason millennials leave a company is poor leadership. Several research studies also show up to 50% of lost revenues are a direct result of ineffective leadership. Those numbers should be eye-opening to you.

The key to successfully overcoming this challenge is to understand everyone in your organization needs to be a leader. That begins with treating them like a leader, training them, supporting them and rewarding them for superior leadership skills. It also means having the courage to remove people from the team who are ineffective in leading in your organization. I’ve also stumbled across a new idea this year that I think is an important complement to creating great leaders: helping people to learn how to be great followers. Although everyone in your organization needs to be a great leader, they won’t be leading all the time, actually they are typically “following” a good amount of the time as well. So it is also essential to help people understand the importance of being a supportive, encouraging and productive follower.

There are other issues I came across during the last 12 months, but these are the major ones my clients specifically hired me to help them with. I hope my recommendations above will help you if any of these sound familiar.

I look forward to your feedback and comments, what have you been seeing?

Two Superb Books I Highly Recommend

John SpenceI have just returned from three weeks on the road, including 10 days on a speaking tour across Poland as a guest of the United States Consulate General in Krakow. I had a lot of time on airplanes and read several books but there are two that I would especially like to recommend.

The first is called “BOOKSMART – hundreds of real-world lessons for success and happiness,” by my friend Frank Sonnenberg. This is an absolutely fantastic book of wisdom and sage advice that is presented in a very user-friendly way, with lots of lists of things to think about and apply. The book covers numerous topics around business, family, success, financial health, marriage and other critical issues. The chapters are short but powerful. I have already reread this book twice and have applied several of the ideas to my business and life. This is one of those books I plan to come back to often as a reminder of what I should be focusing on and how to build a happy, joyful and highly successful life. This book would be a wonderful Christmas present for anyone you know that enjoy books on self-improvement or business improvement.

The other book I’d like to recommend to you is called, “The Leaders Mindset – how to win in the age of disruption,” by Terence Mauri. In this book Terence describes three major leadership mindsets:

  1. Think Big Mindset (Future Shaper)
  2. Act Bold Mindset (Risk Taker)
  3. Learn Fast Mindset (Knowledge Seeker)

He then goes on to describe how to integrate all three of these mindsets in order to be an effective and successful leader. I underlined a lot of this book, and I’ve recommended it to several of my clients. It’s a good, solid book that will help you take a new look at how you lead in your organization. One of the reasons I love this book so much, is that it aligned very strongly with what I have been studying for years about great leaders and great organizations. It was reassuring to read such focused and detailed ideas and descriptions that match so closely with my strongly held beliefs about what makes a real leader. If you are interested in a book that will help you examine the way you think about leadership and the actions you take as a leader, you will definitely enjoy this book.

I have just a little bit of downtime around the Christmas holidays, so I will have a few more books to recommend at the start of the new year. If you have recently read a great business or self-help book, please comment on it here so that my followers and I can pick it up and learn from your recommendations.

I hope you find these books of great value – take good care – John

 

6 Keys to Effective Strategic Planning

mini-peepsI am currently preparing to facilitate three strategic planning meetings, for an association, a technology company and a Fortune 100 client. Here are a few things that I see as foundational for creating an effective strategic plan.

  1. The key to a successful strategic plan is: FOCUS. Every company, regardless of size, has limited resources and strategy is all about effectively deploying an organization’s resources where they will have the most positive impact in the marketplace.
  2. To mirror my first point, one of the most important things a great strategic thinker does is figure out what to say “NO” to. What markets will we not compete in? What products or services should we not try to sell? What current projects should we abandon?
  3. If you have 10 strategic objectives, you do not have a strategy. All of the successful companies I’ve worked with were able to focus in on 3 to 5 major strategic initiatives. Anything more than that causes a lack of focus and ultimately a lack of success.
  4. When examining business issues, are you trying to solve a puzzle or a mystery? With enough data and information, you can find the right answer to a puzzle, but no matter how hard you try it is impossible to find the exact right solution for mystery. Because of this, as much as I hate to admit it, a large part of strategy is simply an educated guess about what might happen in the future.
  5. Alignment is critical. If the senior team is not 100% committed to strategic direction of the organization, the plan will fail.
  6. It’s an age-old business cliché, because it is correct: What gets measured gets done. A major reason that many strategies are not effectively executed is because there is no way to determine exactly what the expectations are. Ambiguity Breeds Mediocrity.

Those are just a few of the key ideas I try to help my clients keep in mind as we move through a strategic planning retreat. I will also add one more critical point; to make sure you follow through and implement your plan, you should spend just as much time on strategic execution planning as you do on planning the strategy. This is a very important idea that few companies truly embrace.

What are your thoughts?

The Six Fundamentals of Business Success

blog-money-1This evening I’m giving a speech to 350 CEOs of small to medium-size businesses and I’ve been asked to talk about some of the fundamental elements necessary to build and sustain a highly successful organization. After running several companies and spending the last 22 years of my life helping businesses around the world be more successful, here are a few things I think every business owner needs to focus on:

1. Start with a clear vision and purpose for why you are building the company. By the way, if the only reason you’re starting the company is to make money, there’s a good chance it will fail. Success comes from a genuine passion to help your customers, if you are focused intently on that and charge a price that allows you solid profit margin, everything should work out fine in the end.

2. Solve a real problem. You also have to make sure that your vision and purpose are focused on delivering products and services that the market eagerly wants to buy. It does not matter if you think what you sell is really cool, the only critic whose opinion counts is the customer.

3. Build a world-class team. Competitors can copy your products, beat you on price, outspend you on marketing, but one thing they cannot do easily is beat a company that truly values top talent and gets them engaged and passionate about serving their customers.

4. Extreme Customer Focus. I have said this a million times and I am more than happy to say it a million more: whoever can attract, grow and retain the best talent, and also “owns the voice of the customer,” has a huge market advantage. Fantastic employees who build great customer relationships are a key to success in every business.

5. Quality and control. This one is very fundamental, but without it the other things above can’t work. You have to have very high quality products and services, deliver consistently superior customer service and manage the financials of your business with extreme discipline. There is a reason that one of the most often used clichés in business is: Cash is King.

6. Disciplined Execution. Once you’ve got all of the above factors in place, then you must be incredibly vigilant in always focusing on the most important things in your business and making sure they get done. If you do not take the time to make these things your top priorities, then you will likely have to make time for bankruptcy court.

Leaders Are Readers

How To Achieve Customer Service Success

shutterstock_2246461dqs72I think pretty much every business understands that giving great customer service is important. However, it confuses me why so few businesses actually deliver consistently good (not even great – just good) customer service when they know it is critical to their success. In my opinion, I think it’s because they have skipped some of the fundamental elements of creating a culture of great service, they simply talk about how important service is, but do not do the things necessary to achieve a high level of superb customer service. Here are a few questions to get you thinking about how well you have prepared your employees to consistently deliver an absolutely delightful shopping, buying and owning experience for your customers.

  • Does your company have a written Customer Service Credo that clearly explains exactly how your business and employees should be treating customers?
  • Has everyone been thoroughly trained (with plenty of on-going training) on all of the things they need to do in order to meet or exceed your Customer Service Credo?
  • Do they have all the resources they need to deliver the level of service you have promised your customers?
  • Do you specifically hire people that enjoy giving great service?
  • Do you assess your current workers by their ability to deliver superb customer service?
  • Are people who do not deliver great service removed from your company?
  • Do you do a minimum of two customer satisfaction surveys per year?
  • Do you have an awards program for employees that deliver superior customer service?
  • Do you benchmark against other companies that are recognized for customer service excellence?
  • Has your company won any awards recognizing you for great customer service?

If you can say “yes” to all these questions, then you are likely one of the few companies that can actually claim outstanding customer service as one of your unique differentiators in the marketplace. If you answered “no” to several of these questions, you’ve got some work to do.

*** By the way, I recently wrote a short and focused e-book on how to build and sustain a winning culture. It sells for just $4.99 and is available on Amazon. Here is a link to learn more about the book: Winning Culture e-book

To Win in Sales: Be Greedy

032415_SalesBlog-300x300This is an excerpt from a new book I am working on about how to generate more high quality referrals.

Several years ago I was brought in to help a computer training company increase their sales. The sales team were missing their numbers badly and the business was in serious trouble. When I got there I found out that many of the salespeople were uncomfortable because the price for their training program was nearly $40,000, which was a very high price point for the potential customers they were talking to. Each of the salespeople had a quota and there was a large white board in the sales office tracking exactly how much money each person had brought in. The sales were basically being managed as a numbers game.

To understand the situation better I asked a few questions.

What was the graduation rate for people who entered the course? Which I found out was above 90%. What was the placement rate for students who had graduated from their computer training? I found out was above 90%. What was the average salary of someone who graduated and got one of these jobs? About $80,000 a year. For the people they were talking to, what was their current average salary? Which I found out was about $30-$40,000, hence the reason a $40,000 training program was extremely expensive for them.

I brought the sales team together to talk with them. I explained to them that when someone bought one of these programs and invested $40,000, there was a 90% chance they would graduate and be a certified computer technician and a 90% chance that they would get an awesome job at a very high salary that would completely change their lives and the lives of their families. They would finally have a good paying job in a growing industry where they could build a solid career and continue to improve their income. I told the sales team to stop worrying about the quota and start worrying about how many people they could help, how many lives they could change. I told them not to be greedy about money, but to be incredibly greedy about how many people they could help. Once they were able to make the mental shift from making sales – to changing people’s lives – the sales numbers went through the roof.

It is the exact same thing for asking for referrals. It is not about new clients, new revenue, more profits for you and your business – it’s about how many more people can you help. There’s an old saying from Zig Ziglar that I love: “If you just help enough other people get what they need you’ll get everything you need.” This is the heart of generating lots and lots of quality referrals – be fanatic about getting as many referrals as you possibly can, so that you can help as many people as you possibly can. Look at it that way and you will do very well.