Plan, Sell, Celebrate

Plan, Sell, Celebrate

Planning to win the most profitable sales

By Alan McCarthy and Steve Hay

Copyright 2016 The Resource Development Centre Ltd

Smashwords Edition

First Edition Nov 2016

This book is available in print at most online retailers

ISBN: 9781370622191

License Notes

This book is licensed for your personal enjoyment only. This book may not be re-sold or given away to other people. If you would like to share this book with another person, please purchase an additional copy for each recipient. If you’re reading this book and did not purchase it, or it was not purchased for your use only, then please return it to RDC and purchase your own copy. Thank you for respecting the hard work of the authors.

Plan, Sell, Celebrate

Table of Contents

Introduction

Planning techniques, plus your own judgment

Marketing, sales, and account planning

The scope of this book

The balance between planning and selling

Key components in your account plan

Your vision for the account

Transactional relationships

Strategic relationships

Transformational relationships

A positive example of transformation

The best type of relationship

Is there a fourth type of relationship?

Re-inventive relationships

Should account plans be approved by customers?

Account profitability

Your client’s goals and objectives

Board level terms:

Vision

Mission

Sales level terms—GOSPA

Goals

Objectives

Strategy

Plans

Actions

Your customer’s high level goals

Your customer’s financial accounts and budgets

An example of poor account planning

Information requirements

Your client’s purchasing profile

Price, cost, and value

Delegated powers and limits

Risk defined as probability and consequences

Tolerate the risk

Terminate the risk

Treat the risk

Transfer the risk

Purchasing management

Materials management

Sourcing management

Supply management

Classifying purchasing requirements

Relative strengths of buyer and supplier

The balance of power

The seller’s perspective

Strategic items

Bottleneck items

Leverage items

Non-critical items

An example of confused perspectives

Deal delay factors

The competitive terrain

Your customer’s products

Opportunity—what could you supply?

Threat—your competitors

Competitor strategy

New entrants

Is change a competitor?

Why customers switch suppliers

Stealing your competitor’s lunch

Summary of competitive terrain

Sales target assurance plan

Contracted and assured

Contracted but in jeopardy

New business identified

New business not yet identified—the Gap

RDC sales target assurance matrix

RDC grid for new business

Analysis of new business identified

Sales target assurance matrix—live example

To orient and prioritize goals

Your campaign analysis

What constitutes a campaign

The context for your campaign analysis

Leads from social media

Leads from lunch and learn

Leads from your customer contacts

Customers are lost—and later found

How we define a real campaign

The real deal

The right customer

The forecast date

The compelling event

The decision making unit (DMU)

The close

The relationship landscape

Economic influencer

Operational influencer

Specifier

Champion

Coach

Anti-champion

Your contact plan

A surprise change of the whole DMU

The personal touch

The management framework for planning

Strategic account management

Management and financial information

Organizational structures

Reflective practice and coaching

The ‘Virtual Coach’

Overall conclusion

About the authors

Alan McCarthy

Steve Hay

Other titles by Alan McCarthy and Steve Hay

Advanced negotiation techniques

Sales target assurance planning

Finance for sales managers

Appendix – working papers for your own plan

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Plan, Sell, Celebrate

Introduction

Welcome to our book on how best to plan in order to win the most profitable deals. In our experience, the guaranteed way to ensure that you can continue to celebrate ongoing success is to sell well—and that requires effective planning. For 25 years across 40 countries plus 26 of the American states, the Resource Development Centre Ltd (RDC) has been helping thousands of salespeople and account managers to plan and then execute their strategies for winning more profitable sales of every type and across all sectors of the economy. Many of our clients have been businesses striving to plan more professionally so that they can develop their target accounts and sell more successfully. Other clients have improved their commercial buying skills. A few clients have used our techniques outside the business environment altogether—for example in charities and various public sector bodies. This book provides a framework to guide account managers and salespeople who may already be successful in ‘transactional’ sales and perhaps are developing their skills in ‘strategic’ selling, to now rise to the challenge of planning how they will win sales that will be ‘transformational’ for their clients. We will shortly define these three different visions that you may choose to adopt for each of your customer accounts, but the selection of the most appropriate vision will be determined by how you can best win the most profitable deals.

Your primary contact in your target customer account may be at any level in the organization—and in any type of division within the enterprise. For example, your customer may be a buyer from an engineering or operations function acquiring components that form part of their own products. Or you may be dealing with a large retailer wanting a fresh flow of merchandise at the desired times to maximize profits by keeping the consumers interested in returning. Your contact may be a chief financial officer wanting the best terms for a long-term loan of the capital required for a new plant. Or your customer may be a manager in information technology looking to replace an ageing software system. The key techniques presented in this book will help you to develop your planning skills so that you can create the right type of high level relationships with senior executives and decision makers in both new and existing clients. We will discuss plans that are relevant to acquiring new business, as well as to enable you to develop deeper and broader penetration into existing customer accounts, without succumbing to price erosion. We will cover plans that may involve new products, as well as your existing products and services. Finally, we will discuss planning for defensive and aggressive stances toward your competitors who may also be targeting your accounts.

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Chapter 1

Planning techniques, plus your own judgment

Over many years we have had the privilege to work with some of the best account managers in the world and we would attribute their success to a combination of technique, discipline, and courage. A large part of the analytical techniques and judgmental skills that you will need to wield is for you to decide how best to invest your time with the customers who are most likely to generate the maximum returns for you. Some types of customer contacts may be focused on routine, repetitive tasks; others on complex one-off projects. They may be concentrating on either the immediate or short term, or they may be looking into the long term future of their organization. Your contacts may be primarily facing inwards, providing specialist services to other parts of their own organization, or they may be facing outwards, adding value to your goods or services that they pass on to their customers or to consumers further down the value chain. To deal successfully with all these different types of contacts requires you to develop appropriate planning techniques—and good judgment. The trick is to robustly decide not to squander your time and other scarce resources on the contacts that are less likely to deliver your targets—and for you to focus your account management skills and sales resources on the contacts and prospects that have the greatest potential in terms of your profit and revenue. This book describes how best to prepare the information you will need and to plan the concrete steps you will take to make the appropriate contacts and forge the sort of engagements with your key accounts that you can develop into profitable, professional relationships.

Marketing, sales, and account planning

Our clients across the world operate in many different sectors of the economy and in a wide variety of market segments. But even those that happen to make their living in almost identical circumstances seem able to do so successfully despite having completely different ideas of the most suitable boundary arrangements between marketing and sales. Sometimes we find that what one client calls marketing is often more like what another client calls sales. We see what we recognize as the function of ‘account planning’ more often than not in our client’s sales organization; but we also see other enterprises that successfully locate it in marketing. We have evaluated many different organizational structures, each with their own version of the way that coordination is achieved between marketing and sales. We have come to the conclusion that the difference between marketing and sales can’t be usefully defined in terms of organizational arrangements, but rather on the practical differences of who is doing what.

Most of our clients feel that sales is all about the immediate contacts and conversations at the point when the customer commits to the transaction—while marketing is everything else that happens before and after that point. We often hear that marketing is about ‘pull’ while sales is more about ‘push’. Most of our clients agree that the marketing planning horizon is much longer than that of sales; and that marketing must build a strong brand identity that prospects more easily identify with fulfillment of their wants and needs; while sales is more opportunistic and correctly focused on clinching the deal. Marketing is often a ‘one-to-many’ process; while sales is more often a ‘one-to-one’ relationship. Marketing has a broad approach, with a wide range of activities to promote products and services—it’s about pricing, channels, distribution, competitiveness, market share analysis, and overall budgets. Sales is more immediate; matching the customer right there in front of us with the products or services that can fulfil their current wants or needs. Our clients often see marketing as performing market research, advertising, public relations, and customer satisfaction surveys, while sales concentrates on persuading the customer to buy.

The critical function of customer account planning very often swims in the stormy sea between marketing and sales. Its planning horizon may not be as long as that of marketing, but it recognizes there can be more to a customer than a one-off transaction. Account planning often tries to build a bridge between generic promotions designed to reach out for prospects, and specific, targeted campaigns to develop and grow individual relationships. Of course, sales activity needs to be in line with the organization’s vision and business goals, and in line with its agreed marketing objectives and strategy. The sales ‘behaviors’ will also need to reflect the organization’s values. But the account manager responsible for account planning is primarily concerned with planning, developing, and managing customer accounts in a way that ensures that the customer keeps coming back for more, in a relationship that is the most profitable we can achieve.

The scope of this book

There is one area that we are defining as outside the scope of this book—as we want to focus on planning for account management and development, rather than on how best to acquire new customer accounts. We will touch on the subject of how to recruit new accounts, but we will not be going into depth, because in this book we are aiming primarily to help account managers rather than recommend how an enterprise should set its strategy for deciding what markets it will target and with what products and services. The assumption is that your organization has already determined such matters as customer segmentation and has analyzed entry and exit barriers to these segments. We’ll assume that your enterprise has identified the major potential customers in the sector, and has considered the dynamics in terms of which potential customers are growing or shrinking—and how long the key customers are likely to stay on top of the market. We will also assume that your senior executives have agreed on a strategy for monitoring your chosen markets and spotting potential new entrants who could be prospects for your enterprise—and any new technologies, or changes of a social or legislative dimension that may present you with threats and opportunities.

This book will not focus on such factors as political, economic, social, technological, legal, and environmental issues that make up the ‘PESTLE’ acronym. Nor will we be delving into such factors as strengths, weaknesses, opportunities, and threats that make up the ‘SWOT’ acronym. We’ll assume your organization has already documented its analysis of such factors and that, for the most part, the account managers know which customer accounts they are responsible for managing and developing into the most profitable relationships possible. Finally, we will be concentrating on the subject of planning, rather than on the techniques for account management, but we'll dip into the latter to the extent needed to illustrate the rationale behind our guidance on how you should plan for success.

The balance between planning and selling

Of course, we fully understand that salespeople and account managers are often the type of personalities that would much rather be, "Out there in the real world, selling," rather than, "Sitting at a desk, planning." We often hear people say they don't have the time to be filling in planning documents that aren't really needed and which are simply part of the administrative overheads that take them away from their real job of developing customer accounts and winning sales.

In our many decades of collective experience, it is clearly true that too many sales organizations have evolved planning systems that are ineffective and overly bureaucratic. We have worked with many clients to help their sales functions to recognize that they often need to provide only a light-touch planning methodology which defines a high level framework to explain how target account planning should be done in their organization. Such organizations don't need to document in great detail precisely how planning should be done, because they can depend on the professionalism of their account managers to work within the high level guidelines that simply state, in the minimum of detail necessary, how that organization wants its account plans to be created and documented.

This book describes a practical approach to planning which avoids unnecessary bureaucracy, yet provides you with a framework of guidance that enables you to plan in the most appropriate manner and detail that suits your own business circumstances. A good way to look at this is to realize that account planning is primarily for your own benefit, to help you hit targets and be successful. A secondary benefit is that your sales organization obtains a consistent set of plans for all its target accounts, using a common language that aids communication when discussing targets and sales. As an added bonus, showing your management your plans will at least get them off your back so that you can focus on actually managing and developing your key accounts and generating the necessary revenue and profits!

The primary skill sets needed for success in account management revolve around industry knowledge, a grasp of wider business drivers, communication skills at senior executive level, value creation, persuasion and negotiation skills—but what is often forgotten are the critical skills and disciplines in planning. This book will help you to fill that gap.

Key components in your account plan

Let’s begin by depicting the seven key steps you can take to ensure that you create a plan that will enable you to manage and develop your target accounts. We envisage these steps as being seven cogs in the management cycle, so that as you plan each step it engages with the cogs on either side and helps you to drive your plan forward. Instead of a dry, academic plan,