Over the years I’ve had many conversations with consulting customers about how the best sales and business development professionals are first and foremost risk-takers.
However, is this an inherent trait only found in a select few salespeople, or is it a byproduct of working for a forward-looking enterprise, one that encourages its salespeople to take risks?
I believe that most salespeople would take more risks if given the chance, and it’s this ability, freedom, and empowerment to take more risks that end up helping companies achieve their goals.
A salesperson working for an overbearing manager, or a risk-averse company, will never achieve greatness. He or she will never be able to come to the table with a bold and audacious forecast for growth. They’ll just play it safe. Why? Ultimately, there are too many reasons to count.
Instead of defending pricing, holding firm, and protecting gross profit margins, they’ll constantly capitulate to customer demands for lower prices. It’s the safest of bets; it’s easy for a salesperson to give in to customer demands for lower prices if they work for a risk-averse company.
Instead of pushing for higher volumes, a more firm commitment, or a longer deal, they’ll simply be satisfied with getting an order – no matter how inconsequential that order is. After all, any sale is a good sale, right? Again, it’s the safest of bets.
Instead of using market intelligence about competitor strengths and weaknesses to negotiate a better deal, and close at a higher price, they’ll simply adopt a “take-what-you-can-get” mentality, one where just getting an order is often enough. Instead of pushing back on customers who try to backtrack on large volume inventory commitments, they’ll simply let the customer off the hook. After all, why risk the relationship?
Instead of going deep into a customer’s account and uncovering multiple opportunities, they’ll simply downplay those opportunities to upper management and not expose themselves to further second-guessing. Instead of having an accurate forecast for growth, they’ll play it safe and make sure they always achieve easily-attainable goals.
Now, after reading all of this, are you more inclined to give your salespeople more freedom? Does it not make sense to encourage them to take chances and to support them when they do? Ultimately, if your business development people can’t take chances, then you need to ask yourself why. More often than not, it’s because you’re afraid to take chances yourself; a business owner, manager, or director that won’t take chances is afraid to fail and when you’re afraid of failing, it’s often because you’ve never experienced that sense of accomplishment when you’ve pushed back and won.
Yes, there’s always a dollar value that’s sitting right in front of you. Yes, there’s always that customer promise of more business to come, and yes, it’s much easier to just take the damn order. However, it takes no skill to say “yes” and no skill to just take what you can get. It takes all kinds of skills to negotiate a winning deal, one where you have healthy profit margins and a firm commitment.
There will always be that customer who promises higher volume – so why not just push for that volume and firm commitment now? Why not push them now and see how serious they are instead of going through the motions only to find out later that they were just stringing you along?
I’ve worked for several companies over the years as both a consultant and salesperson. I’m amazed at the number of times I’ve come across really bright sales and business development people, ones who have the skill-set to succeed but can’t because of who they report to or because of the company they work for.
I have experienced this. I’ve worked for a Ph.D. who didn’t understand that sales are not a research paper. He didn’t understand that taking risks is part of sales, didn’t understand that pushing back on a customer who wants to bail on an inventory commitment is a responsibility for all salespeople, and most importantly, didn’t realize that sales is about maximizing customer face-time and negotiating great deals at healthy prices.
On the other end of the spectrum, I’ve worked for managers and companies whose entire philosophy was about risk-taking. They defended pricing, pushed for larger volumes, negotiated long-term deals, and they never, ever let a customer back out of a contractual inventory agreement without pushing back.
The salespeople were encouraged to take risks and they could justify their decisions without fear of reprisal. In turn, the salespeople came to the table with an aggressive plan for growth for their respective territories.
These are the types of companies that continually meet their objectives – and if for some reason they don’t, they immediately ask why and adjust accordingly. If you haven’t given your sales team the leash they need to take well-informed risks, then you are the problem.
You’ve either never been able to push back on a customer and see how well it works or you’re simply too afraid to even try. Regardless of why you’re selling yourself, your company, and your sales team short.
