Sales vs. Ethics

I know this topic doesn’t really come as a surprise to most people (especially any non-sales people who may be reading) but seeing it firsthand kind of did shock me. In the field I work in, financial services, the by-word has always been Ethics and even more so since Mr. Spitzer came on the scene a few years ago. Every year each of us has to take a continuing ed course, three hours or so, on Ethics where we are presented with various scenarios regarding “questionable” ethics and the right actions to take in them. Like most continuing ed courses the general feeling most of us get is “this couldn’t be more lame” and/or “what kind of idiot doesn’t know this?”

Well I’ve seen the idiot and he is us.

Over the years I’ve seen many situations where, although there may not be any real malice involved, the thinking is “we can make the sale, so we should make the sale” with very little thought as to how the client is impacted. Does the sale always come first? Shouldn’t there be some tangible benefit to the customer? We all think our product and our service and our company are better than the competition, but unfortunately that isn’t always the case. Some customers have perfectly good deals with other perfectly good vendors and what do we make of those situations? Isn’t that what the Continuing Ed classes are really supposed to be teaching us?

I’ve got an ethical issue with selling a product just to generate new commissions but due to the pressures of the job (or whatever) I don’t think a lot of sales reps see it that way. In certain industries (like Life Insurance) there are specific regulations prohibiting replacing products in this manner. Many of us have to put up with onerous laws and regulations that, for the most part, we think are unnecessary, overdone and a hindrance to our selling ability. If we don’t start policing ourselves and actually think about what we’re doing, there will be more and more and more such regulations.

Are Sales Reps an IT security threat?

Many, if not most, employers arm their field sales folks with laptops so that they can be productive on the road, and more often than not these laptops are loaded with security software (virus protection, VPNs, encryption software, etc) meant to protect the corporate network from security threats. While this security software seems like a good idea there are instances where it may not be enough, due to the nature of the beast that is the field sales rep.
There’s a couple of fundamental issues with field laptops in general that are issues that don’t come up with corporate desktops. One is that while you can block websites and application loading when someone’s using a desktop on the corporate network, it’s trivial to just not launch the VPN and go and do, basically, anything you want to, unfettered by corporate Mom.
A more likely scenario in the case of sales reps is the checking of personal e-mail. While it’s not usually a big deal for Home Office employees to wait until they get home at night to check e-mail, if you’ve got a rep constantly on the road, they’re not likely to wait 3 or 4 days to do so. That’s especially true for reps with families, who likely use e-mail or chat to communicate with family members while they’re away.
Of course there are corporate rules against some or all of this type of behavior, but human nature being what it is, it will continue to happen, and locking laptops down even more is definitely not the answer. Right now I turn on CNBC and get a cup of coffee before I start booting up so I have something to keep me occupied while I’m entering passwords and waiting.
Sure you can scan for virus’ and rogue applications once reps get back on the network, but sometimes (as in the case of the Storm worm) that step might be too late.
What to do? I have a solution that I’d personally like to try, but so far, I’ve been unsuccessful in convincing corporate IT to let me do it. The answer of course is to let me use my Mac laptop. Since Windows based virus’ and worms don’t run on Macs, what I do on my laptop with the Mac layer on the road doesn’t threaten the network and I’d be happy to have IT control (and lock down) the Windows layer for corporate only use. I don’t need, or expect, IT support for the Mac.
This seems to me to be a good solution, but, obviously I’m missing something. What is it?

We apologize for any inconvenience …

Really.

Feel badly, do you?

This "We apologize for any inconvenience" phrase is rapidly becoming meaningless, seeing as how it’s both overused and usually immediately follows someone telling you the corporate equivalent of “go pound sand”. The truly irksome thing is not the insincerity of the sentiment, it’s that most of the time the inconvenience is, if not intentional, certainly not causing any sleepless nights over at the XYZ Company.

If you want to be truthful, the response should be “Yeah, we know it’s a pain for our customers. What of it?”

I imagine there really are some firms that are sincerely apologetic, it’s just the two I’ve recently been dealing with (Chase & Vonage) clearly aren’t. But it’s not just them, I see this phraseology all the time and virtually always with the same preceding “shove it”.

Listen, don’t fake sincerity. If the customer is wrong, you can point out their error, apologize for the misunderstanding and offer solutions to fix it. If the customer isn’t wrong, you need to make it right for them.

Case in point is the Chase situation. Their interpretation of their fine print (define “may”) and mine vary. Their corporate policy is to define “may” as “will”. Legal issues aside, they should either change their disclosure wording or acknowledge my understanding. Instead their response is “This the way we do it” (go pound sand) and “We apologize for any inconvenience”. It’s not inconvenient – it’s wrong and you should offer to fix it.

How about “We’re sorry you misunderstood what we meant, but you’re gonna have to live with it.” At least it’d be honest.

It's 2007, dammit!!

One of the most egregious things that companies do to hamstring their sales efforts is having numerous computer software systems that do not inter-operate; they don't speak to each other.

Let's assume for a moment that it's true* that there isn't one system that you can use in your company that can:
• automate the sales process (CRM)
• send and receive e-mail,
• calendar, and
• track customer and product information for your particular widget.

Even if that's true, there's no reason on God's green earth why you would consider saddling your sales reps (or internal staff for that matter) with software that can't share data. It's 2007 for god's sake!!

I'm sure there are some companies that have it together, but judging from what I see every day, there's not many. A company I'm working with right now uses a CRM system and Lotus Notes. While these two programs can share contacts and appointments (not automatically mind you; you have to specifically force the link and the procedure is different in each program), neither of them can share data with the separate customer/product database**. In other words, once someone actually buys a product, their data and product specs go into this separate silo never to be linked with the sales CRM system or Notes again, unless someone does it manually.

Cross sell much? What happens if you want to sell them something else, or the contact person changes, or they move? Again, it's 2007 - how can you not deploy a unified customer/client database that is one central depository for prospects, clients and their current or future product information?

And I'm not saying this because it sounds like a nice thing to do. Not doing so wastes time and resources, is costing you sales and is frustrating your sales force.

If you want to maximize sales, you should get with the program. It's 2007.



* and I don't believe this is true in 95% of companies. Software can be customized to handle just about any configuration of any product. This process is further aggravated because firms often don't deploy the latest versions or all the capabilities of software they have.
** not to mention the issues with mobile electronics which sync only with Notes, so you've got to remember to sync everything twice (CRM to Notes, Notes to Blackberry) before and after every outing.

The Sales Contest

I don't really "get" sales contests, at least in the professional world of corporate sales. Oh, I’ve won my share of them, and have the plaques and crystal decanters to prove it, but (and here’s my dirty little secret) every time I’ve won it’s been pure, dumb luck. Naturally, since that's how I've always won them, I assume that's how everyone wins them. As with many corporate sales, I've always been involved in big-ticket purchases with long sales cycles. Do you think I started working on proposals in May so that I could be sure to close deals in September to win the contest? No, that just happened to be when the client decided to buy and I was the happy beneficiary.

There are many people who think Sales Contests are great for motivation or recognition and although I, of course, think motivation and recognition are great things, I don't believe sales contests are any good at doing either of those things. Oh, sure in certain situations they work - retail, telemarketing, new product introductions ("First person to sell one of our new gas/vodka hybrid generators gets a trip to Fiji") but once you get out of that realm - not so much.

Technically, if you distribute Sales tally sheets, you have a Sales Contest all year, every year. Every rep knows where they are, where the competition is and who they want to beat.

Professional sales people are self-motivated - give them a good product, a good story, good service and point them in the right direction and they're off. A sales contest won't make your products any better, your story any more compelling or your service any better. If you've got those things, you won't need sales contests. If you don't have those things, you should be spending your sales-contest dollars on getting those things.

Fire the Coach?

It happens all the time in sports - at the end of a losing season, the manager or head coach gets fired. Obviously, that's easier than getting rid of all the players and, more importantly. it deflects responsibility for the team's failure away from management.

This same type of thing happens in the corporate world and for the same reasons. If sales are down, more likely than not sales management will take the heat and/or get fired rather than the sales reps and rather than senior management looking looking introspectively.

A case in point, from an anonymous correspondent;
"I work for a well-known East Coast based financial services firm and 2006 was a horrible sales year for our division. In December it was announced that our Sales Manager would be leaving and that our department would be rolled into a division that sells products complementary to ours. While none of this seems bad or unreasonable to the outside world, one key element was missing - any kind of real investigation as to why sales were down. The real problems were out-of-date products and horrendous service, problems upper management refused to fix, and therefore a terribly unmotivated sales force. The new management went into the change oblivious to what the issues were and treated us as if all we needed was a lesson in sales, some new laptops and a bigger quota. We don't want to be seen as crybabies or not as "team players", but until some of the underlying problems are addressed we still won't be selling and whose fault is that? I believe it's upper management's fault."

Now, I'm not sure the "management refused to fix" part is 100% accurate as it's likely as not that they were either unaware as to the extent of the problems or were unable (for one reason or another) to remedy them, but still. Even when the ball team's manager gets fired, usually management makes other changes to ensure that the new manager and the team is successful, or at least, more successful. Marching on as if the only change required is a change in middle-management is hardly ever the right approach.

If things are bad enough that team, or executive, management feels the need to fire the manager, you can be certain that other, more serious, problems are afoot and need to be attended to.

The Promise (or Threat) of Universal Health Care

2007 is likely to be a watershed year in the battle for Universal Health care, in California and across the country and sides are already being drawn in what is shaping up to be a Red State/Blue State sort of conflict.

People use the phrases “Health Care” and “Health Insurance” interchangeably when, in fact, they are two different things. Health Care may or may not be a right for all Americans but health insurance is a funding mechanism that pays for health care and is not a right but a product that is bought and sold. When we talk about Universal Health Care we really mean Universal Health Insurance where one entity (usually the government) is the insurer for the entire population and so therefore everyone should have access to the same health care since it will all be paid for in the same way and in the same amount.

This battle over what form health care should take and who pays for it is likely to be hard-fought with accusations and claims on both sides.

On one side are the proponents of universal health care who will speak to the plight of the six million uninsured Californians, while on the other side the insurance & health care industries will remind us that we enjoy the highest standard of medical care in the world. In order to address, and fix, our healthcare system both sides are going to have to be honest about what various solutions entail and be willing to compromise.

One group of proponents claim that current administrative costs are between 25 and 30% while going to a universal system would bring it down to under 5%. I’m sorry, but this claim simply doesn’t pass the “reasonableness test”. There’s never been an instance where government performs a function more efficiently than private enterprise, much less 5 or 6 times more efficiently, so it seems likely that this is either very biased research or just wishful thinking. On the other hand, since the private enterprise we’re discussing is the insurance industry, never a paragon of efficiency anyway, if there was ever a chance for government to show its stuff, this would be the place. So, let us suppose that it’s a new day; we’re about to make history and claim that through the use of streamlining technology, bulk purchasing and reduced expenses and commissions, a universal care system can reduce administrative overhead from 20% to 10%. Considering the overall size of the healthcare budget, that’s a huge win. It sounds reasonable and do-able.

There’s also probably something to be said for having just one Big Bureaucracy rather than 5 (or 7 or 10) little Bureaucracies, since health care providers won’t have to keep re-learning the rules and procedures to be followed.

Insurance carriers are likely to proclaim that they can bring these types of efficiencies to the system, but there’s really no evidence to support that. There’s never been a standardized claim form or standardized procedures that have made it easier for providers to navigate the system. Technology-wise, carriers have never been at the forefront of change and have only adopted technology as profit warranted. They have had years and years to become the solution and have not done so. It’s also clear that the current system is rapidly leading to a crisis. Health care costs are a huge drag on the economy, affecting employers large and small, making coverage all but unaffordable for families and affecting the retirement plans for millions. We simply cannot continue to allow health care to eat up larger and larger percentages of GDP, and leaving so many people uninsured.

Several other issues will need to be addressed in any major change to our health care system – quality of care and rationing.

Our current system does indeed afford us the most technologically advanced care in the world, at least for those who have health insurance. In order to not be at a competitive disadvantage, carriers have to accommodate new procedures, drugs and technology because that’s what their customers demand. Will a universal system accommodate these advances? Moreover, with a governmental entity squeezing costs, what will happen to innovation in the field? Will the pace of advances in health care technology slow or stop?

This leads to the subject of rationing health care. In order to control (much less reduce) costs the system can’t provide all care to all people. That’s one of the main knocks against nationalized health care in other countries – everyone gets care but it’s not great care. That’s fine until you need great care. Stories abound about people waiting months for surgeries, and then dying during those surgeries, in countries with nationalized health care.

In the US we ration care right now based on whether or not you have health insurance. Those without coverage get acute care when they’re desperate and that’s about it. If we have universal care, rationing will have to be based on something else. Will it be based on circumstance (we refuse to pay for a heart transplant on an 86 year-old or refuse to pay the $2 million it would cost to save a baby born 13 weeks prematurely), based on lifestyle (refuse payment for smokers, obese people or helmet-less motorcycle riders) or based on something else? And who decides these issues and to whom can adverse decisions be appealed? Can adverse decisions even be appealed?

Will the system allow private insurance to supplement the universal plan, ala Medicare or will private insurance be prohibited as in Canada?

A note on insurance agents and brokers – many will applaud the elimination of what they see is the cost of an unnecessary middleman in the health care scheme, however, we should be careful what we wish for. Yes, agents and brokers get paid to recommend and place medical insurance plans, but their real worth is not in that effort but in resolving client service and claims issues that stymie mere mortals.

It’s clear that there needs to be changes to our current system of providing and paying for health care, but whether those changes require the wholesale replacement of the current system or whether some sort of hybrid will suffice requires us to honestly answer many questions about what we expect our health care system to provide and will likely require some sort of sacrifice of us all.