Chances are, your business spends more money on sales and marketing than any other part of your P&L. I know it’s true for almost all high-tech companies, some of which spend nearly 50 percent of revenue on sales. So as a senior executive, what can you do to either reduce the cost of sales or improve the productivity of sales? Is it merely a matter of hiring lower-cost people or changing compensation plans?
Recently, Brent Adamson and Mathew Dixon of CEB, formerly Corporate Executive Board, released a book titled “The Challenger Sale.” Unlike a lot of sales books, these guys did an analysis of more than 6,000 sales reps in order to answer the question: Who are the most effective salespeople, and what are they doing differently? I won’t steal their thunder, but basically they discovered that, contrary to what one might believe, just hiring someone for their Rolodex (for those who remember what that was) is simply not enough.
The most successful sales reps, the authors said, were “Challengers” (hence the name of the book), which are defined by their ability to do three things: “teach, tailor and take control.” I want to emphasize the first point – that the sale begins with teaching. What does that mean? Teaching means the rep must be knowledgeable about the business, and be able to share that knowledge with the potential customer.
A few months ago I had the opportunity to share the stage with the CIOs of Qualcomm, San Diego Gas & Electric and Amylin Pharmaceuticals. They unanimously agreed that the thing they hated to hear most from a typical salesperson was, “What problem keeps you awake at night?” Clearly that’s not an example of a salesperson teaching. The next time a sales team shows up talking about cloud computing, see if they teach you anything.
So how does a salesperson teach, or for that matter, how do you as CFO teach investors about your company? If you think back to how you might have learned best in the past, it likely involved someone telling you a story. Stories, when told the right way, have a powerful, deep meaning to all of us – one that leaves an impression. It’s one thing to relay a fact, but quite another to communicate in such a way that people will learn. If you listen to NPR’s “This American Life,” you can testify to the power of storytelling. Without the help of video – or PowerPoint – the hour-long program has the power to keep you in the parking lot listening until the end. What if your company’s sales team could package some of that magic?
Well, maybe they can. It’s worth becoming a student of good storytellers. There are numerous talks on YouTube, including several pieced by Ira Glass, the host and producer of “This American Life,” to get you started. You might also appreciate a TED Talk by Melissa Marshall entitled, “Talk Nerdy to Me,” in which she teaches scientists how to tell a story that non-scientists can understand. And recently, former movie producer Peter Guber released a book called Tell to Win: Connect, Persuade, and Triumph with the Hidden Power of Story that documents numerous examples of the power of storytelling in his career.
Next, start thinking of the company’s story as you would any important asset. Bring your chief marketing officer into the conversation. You might have story developers, but how do you test the story and ultimately put it into production?
And finally, do you have a story architect, at a product level, solution level or company level? How is the story you tell investors linked to the story you tell a potential customer? In an increasingly technology-driven world, take a moment and think about the ancient art of storytelling and what it can do to change your cost of sales or the productivity of your sales force.
Timothy Chou teaches cloud computing at Stanford University. He is the former president of Oracle on Demand and the author of Cloud: Seven Clear Business Models.