SELLING

The Selling CEO
Why the head of the company should add Head of Sales to his job title.
by Jeff Thull – Executive Travel – 11/01/05

When Shakespeare wrote the line, "Uneasy lies the head that wears a crown," he wasn't thinking of today's CEOs. But he may as well have been. According to sales consultant and strategist Jeff Thull, one more responsibility has been added to the CEO's already considerable load. It's no longer enough to demonstrate excellence in the art of leadership, he says—CEOs must now be firmly entrenched at the head of the sales department.

"Over the past few years, we've seen the CEO's role evolve into one that's intimately connected to sales," says Thull, author of The Prime Solution: Close the Value Gap, Increase Margins, and Win the Complex Sale. "Take Jack Welch, for instance. Though he was basically an engineer, he was totally customer-focused. This new emphasis on sales represents a strategic evolution from the traditional CEO focus on branding, market share and the like."

"Analysts are looking at a company's sales performance more closely than ever before," he adds. "In today's climate, if a new product falls on its face, analysts will look closely at the sales process. Because we live in an increasingly complex world, [the] sales organization is the most critical link to the customer. The CEO must understand every aspect of the sales process—to assure the accuracy of strategy execution."

Thull says that as business problems and products/services become more and more complicated—the customer has become less able to comprehend the unique value a company provides. In today's market, conventional sales methods no longer work. Salespeople must think for their customers, creating revenue-building solutions that the customers can't come up with on their own. He calls this process "Diagnostic Business Development," or the "Prime Process."

The sales process must be a precise extension of the go-to-market strategy that integrates departmental functions from R&D through marketing and on to sales and service. Why is it critical that the sales process become a top priority? Thull offers the following insights on how to translate market strategy into sales results:

Avoid the "black box" view of sales. The black box view of sales is an attitude frequently found among senior executives who do not have sales experience. To them, the workings of the sales department are, for the most part, a mystery to solve. They will set organization goals and send revenue requirements into the black box of the sales department and anxiously wait for the outcome. But they can't effectively manage what happens between the two points. What CEOs need is a process that can make the black box transparent—a process capable of connecting the sales function to the rest of the organization in strategic terms and creating a common language and process through which the go-to-market strategy is formulated, executed and monitored.

Understand the limitations of legacy systems. The conventional sales process—whose response to performance downturns is "do more of what you are already doing"—is what an information technology expert would call a legacy system. In the computer world, legacy systems are usually outdated networks that were originally developed for limited local purposes. As holistic, organizationally integrated networks are developed, these systems must either be modified or replaced. The conventional sales process is a legacy system in that it offers the sales department a way to communicate internally, but it doesn't connect the sales function to the rest of the organization in any meaningful way. It does not offer a common language or filters through which sales and other functions in the business can communicate and respond.

Know the four prerequisites for a successful go-to-market strategy. Ignore one or more of these prerequisites, and your go-to-market strategy will be seriously impaired and the ability to generate profitable results is at risk:

1. A high level of understanding of, and agreement on, the business strategies in place to acquire, expand and retain profitable customer relationships. Is every function in the company, from product conception to successful implementation with the customer, united by a shared vision and a common effort?

2. A successful transfer of business strategies to departmental and individual responsibilities that encompass both quantitative and qualitative objectives. Does everyone in the company know what they, individually and as a group, must accomplish to achieve the defined objectives?

3. A monitoring and measurement capability that enables leadership to assess the performance of departments and individuals as they progress toward their objectives. Can everyone monitor their progress toward the achievement of those objectives?

4. A capacity to anticipate and correct the most frequently occurring issues and obstacles blocking the successful execution of the strategy. Can everyone anticipate requirements, learn from their mistakes and respond and adapt to changing conditions customer requirements?

Embrace a strategic alignment mechanism. Organizations need a mechanism that can create a cohesive team, communicate and reinforce messages, get everyone working toward the same goal, and measure the progress toward that goal. Everyone in the organization should be concerned about creating and capturing value for customers.

One way to generate alignment around corporate goals is to require that each function involved in the formulation and execution of the go-to-market strategy cycles through the four stages of the Prime Process—Discover, Diagnose, Design and Deliver. The "Four Ds" offer a single, customercentric process through which each organizational function can explore the marketplace and ensure that its efforts are aligned.

Commit to an integrated process. Whether an organization must respond to new opportunities or changes in the market or correct miscalculations in its own go-to-market strategy, it must have a mechanism capable of capturing and responding to feedback. It needs to be able to identify, communicate and respond to customer needs throughout the value creation process. When the Prime Process is distributed across the organization, it can serve as that mechanism.

The Prime Process requires that the various functions within the organization, charged with delivering value to customers, take to the field in one voice and one process. In order to effectively Discover, Diagnose, Design and Deliver, they must frame their assumptions in terms of the customer and they must test those assumptions against the reality of the customer's world. As CEO, you'll want to push marketing and product development out into the real world, where they can directly experience the issues and challenges of their customers' business. You'll want the sales team to communicate the issues they uncover as they conduct diagnosis, and you'll want the service and support staff to report the issues they uncover during the delivery and implementation of your solutions. This ongoing diagnostic feedback loop creates a learning flow that, in turn, can be used to generate continuous improvement and breakthrough innovation.

It is clear that in order to embrace a successful go-tomarket strategy, CEOs can no longer accept "smoke and mirrors" communications from the sales department.

"Sales organizations have traditionally been known for unreliable sales forecasts," Thull points out. "If the financial arm of a company did the same thing, someone would face legal ramifications. As I mentioned earlier, analysts are beginning to make the connection between forecast methods and forecast accuracy. CEOs and their sales organizations are being held to higher standards. You must have a system in place for understanding and refining your sales process. Continuous improvement processes have been applied throughout organizations. The sales function should not be exempt. It takes a lot of work and possibly, a whole new way of thinking about your business. Your profitability—not to mention your credibility as a CEO—depends on it."

JEFF THULL, president and CEO of Prime Resource Group (www.primeresource.com), is a strategist and advisor for executive teams of major companies.

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