Thursday, October 22, 2020

Three Classic Negotiating Mistakes

Guest post by Clint Babcock:

Recently I was teaching a class on negotiation for salespeople. I set up a buyer–seller role play scenario and I asked two participants to work through the scenario in front of the rest of the class.  Both were provided with the pertinent information they needed to secure a good deal; all they had to do was negotiate the price.  I specifically narrowed this role play down to this one issue; neither one of them knew what they were selling.  Such a scenario allows participants to focus on how best to work through the money issue.

The point of doing an exercise like this is not the end result.  It’s observing the process that people go through, the great moves they make and/or the mistakes they fall prey to. Analyzing the process used is what creates learning and growth opportunities for everyone, including the observers.  Whenever I do an exercise like this, and lead the discussion afterward, I’ve noticed that there are three mistakes that always seem to present themselves. As I predicted, all three showed up during this role play.

Mistake #1: Talking too much. This is the single most common mistake. Salespeople, I’ve noticed, tend to defend and justify their solution, apparently under the impression that the more they say, the better the solution looks. They pile on the features and benefits of working with their company.  As you might imagine, the stream of words they unleash gets them nowhere, because the prospect already knows all of this. If they didn’t, why would they be negotiating? A better approach. Don’t talk about your features and benefits. Focus on the pains that your solution will solve by asking questions about how they see the solution solving their problems.  Become inquisitive and curious as to their position; keep in mind that the more information you uncover, the deeper your understanding of the situation will be – and the better positioned you will be to reinforce your position as the right choice for them.

Mistake #2: Offering or agreeing to concessions immediately. All too often, salespeople fail to recognize that they are even in a negotiation, and they volunteer a concession.  For instance: The buyer asks for a better price, or better terms, and the salesperson’s knee-jerk response is, “What were you looking for?”  Very often, we have not prepared for this all-too-predictable moment. We fail to process the reality that we may well be dealing with a strategic negotiator, someone who has prepared and planned for this negotiation and who has created leverage they can use against us.  Giving up something without getting anything in return is a no-no! A better approach: Instead of encouraging the other side to ask for concession after concession, do your prep work. Recognize that you will be in a negotiation at some point in your sales cycle. Identify what, specifically, you will ask for in return when someone asks you to make a concession. Hold onto concessions for as long as you can; don’t give them up until late in the sales or negotiation process, and plan to get something in return, such as a firm commitment to do business. Preparing ahead of time is the key to ensuring you don’t simply react, but instead respond appropriately to a request for a concession.

Mistake #3: Believing that money is the only issue. A lot of sales and business negotiations focus on money.  Remember: The best negotiations have little or nothing to do with money.  The best negotiation discussion is about finding the best fit solution. Yes, people want to pay as little for that solution as possible. But if we make it all about money, we both lose. A better approach. Even if buyers try to make the discussion about money, you need to stand your ground, and make it about solving their pains and issues with your solution. Yes, this takes practice! But what’s the alternative?

Most companies and sales organizations have no idea how often their teams make these mistakes during a negotiation process. Why? Because negotiation is rarely trained or practiced. What ends up happening after a long series of negotiating errors is that senior. leaders are brought into the process – because they know how to handle these situations.  This is not an efficient solution. With guidance and practice, salespeople can learn to avoid these common mistakes.

Clint Babcock is the author of NEGOTIATING FROM THE INSIDE OUT: A Playbook For Business Success. A Sandler trainer based in Florida, Babcock has over 25 years of sales, leadership, and negotiation experience; he has worked with senior executives at companies in a wide range of industries to help them strategically build their sales forces. For more information, please visit https://www.sandler.com/resources/sandler-books/negotiating-from-the-inside-out/.

Thursday, October 15, 2020

It’s Great to Lead with Smart Experiments

Guest post by Steven K. Gold, M.D.:

Leadership is all about decision and action. As leaders, our goal is to make the best decisions

that lead to the most productive actions. As the world becomes less certain, even highly unpredictable, how do we go about optimizing our chances for success?

Fortunately, we have a group of experienced leaders who have been grappling with the challenges of uncertainty for many years: successful entrepreneurs.

For over 20 years, I have studied entrepreneurs. As an academic and as a thought leader, I have conducted studies of thousands of entrepreneurs of all kinds, on three continents. This has included embedding myself within various accelerator programs to observe the daily (and even moment-to-moment) decisions and actions of successful and unsuccessful entrepreneurs. This led to the idea of Smart Experiments.

Experiments are investments of a first set of available resources that produce a second (hopefully more valuable) set of resources. I use the term “resources” broadly, and they include human connections (networks), knowledge, experience, expertise, and ability to influence others, among many others. Resources are the foundation of experiments.

Experiments – like everything else in life – can be done poorly or well. Despite this, most of us have never been taught how to do an experiment in a way that predisposes to success. Expert entrepreneurs, on the other hand, have developed and mastered a particular process that I refer to as a Smart Experiment.

Smart Experiments are done in an ongoing cycle that includes four steps:

1) DESIGN. Entrepreneurs always look around to assess their available resources. What resources do I have – human connections, material, knowledge, experiences, expertise, finances, etc. – that I can combine in creative ways to design a possible experiment? Entrepreneurs make formal and informal lists (referred to as Opportunity Registers) of all of their possible experiments, based on the resources they have at hand. Expert entrepreneurs like having many opportunities, and options.

2) DECIDE. Given a long list of possible experiments, entrepreneurs categorize them. They do this continuously, and are always reassessing their resources in light of the results of ongoing experiments. Any possible experiment that has been Designed in Step 1 can be placed into one of four categories: a) do it now, b) do it later, c) find a partner, or d) forget about it. This prioritization determines what happens next.

3) DE-RISK. Before embarking on the “do it now” experiments, entrepreneurs de-risk their experiments. This means that they identify the most likely potential causes for failure, and prepare for them in advance of doing the experiment. This step recognizes that certain easily predictable and fixable issues can make a big difference, and they are addressed up front. This predisposes any given experiment to success.

4) DELIVER. Only then do entrepreneurs do the experiment, which almost always involves a series of small steps. Since every experiment is an investment of resources intended to secure (more valuable) resources, expert entrepreneurs harvest all of the value that results from any given experiment. They do not leave value on the table.

We can each choose to do our experiments poorly or well. Doing Smart Experiments – and helping others to do them properly – increases chances for successful outcomes. The best entrepreneurs encourage everyone around them to do Smart Experiments.

Here are a few take-away lessons for leaders:

First, Smart Experiments involve thought and action. Entrepreneurs rarely get stuck in “analysis paralysis” because they break down risky activities into less risky, small steps. Instead of jumping across a room, they take it a step at a time. By taking a step at a time they increase the likelihood that each step will go well, and they are much more likely to make it across the room – even if they encounter an obstacle. Obstacles (representing uncertainties) are easy to walk around, and much harder if you fly right into them. This is one way that expert entrepreneurs deal with uncertainty.

Second, the best entrepreneurs understand that succeeding and failing are two sides of the same coin. Smart Experiments, using prioritization and risk mitigation, mean that our failures become smaller. That said, failures do occur, and are expected to occur. If an entrepreneur is not failing at least a good portion of the time (remember, they are taking small steps and so these are relatively small failures – or learning adventures), this means the entrepreneur is probably not trying hard enough.

So why is it great to lead with Smart Experiments? First, understanding resources is the best way to understand the value you have to invest. The more you have to invest, the more you are likely to reap greater returns. Second, Smart Experiments prioritize those actions that make the most sense – to do now, do later, partner, or not do at all. Smaller steps that make up Smart Experiments are also easier to get started with, and to make successful. When things go awry, as they often do in uncertain environments, smaller steps lead to smaller failures, which protect resources. All of this predisposes to a higher probability of success, which has a dramatic compounding effect.

Leading with Smart Experiments means one more thing: prioritizing intelligent action over results. If people are empowered to do their best, to do their best experiments, then they are pursuing their potential. They will succeed much of the time, and fail at other times, both of which are indicators of effort. With this in mind, celebrate Smart Experiments. Teach Smart Experiments. Be a role model for Smart Experiments.

Steven K. Gold, M.D., is the author of HOW WE SUCCEED: Making Good Things Happen Through The Power Of Smart Experiments. He is Chairman of Gold Global Advisors, a firm that advises leaders and teams in the science of sustainable success. For more information, please visit https://www.stevenkgold.com/.

Thursday, October 8, 2020

Accountability Under Pressure

Guest post from Helen Horyza:

Under pressure, when you have been disappointed or your direction has been ignored, do you
lose your temper? Do you attack the person who made the mistake? It can happen in a split second. Unfortunately, the memory of your behavior will linger much longer in the hearts and minds of your employees. Over time, you create a culture of fear and mistrust.

So, how can you take an “accountable perspective” it the heat of a stressful moment? The answer lies in your values. Ask yourself the following questions:

· What is your why?

· What are your leadership values?

· What principles guide you at the deepest level?

When you answer these questions, you have the basis for choosing accountability under pressure.

Here is a real-life example. Dave, a former client of mine, was a Chief over about 700 people. He was working hard to create a healthy work culture. As part of this effort, Dave held a multi-day off-site meeting including both middle and top management.

On the second day of the event, one of Dave’s senior-staff members (without consulting Dave) sent middle management home to save travel and hotel costs. When Dave found out, he was livid. His entire motivation for the event was to include everyone. He was ready to attack.

I happened to be presenting at the front of the room that day and could see Dave rocking back and forth on his feet, clearly agitated. I walked to the back of the room and stood next to him. I asked him what was wrong. He explained the situation, red faced and irritated.

His anger was intense. He needed to be grounded. I asked Dave what his top three leadership values were. He looked at me like I was insane. How dare I ask such a stupid question at a moment like this? With some effort, he pulled himself together and answered.

“HIT” he said. “Helping Others, Integrity and Team Work.” I looked at Dave and calmly suggested he handle the situation based on those values. I walked back to the front of the room and continued teaching.

Several days later I checked in with Dave to find out how he resolved the offsite debacle. “I didn’t do anything” he said. “What was done was done. My values helped me remember the bigger picture. Confronting or blaming was not going to change anything. It was a mis-communication.” He now had a tangible life experience to fuel his efforts to be accountable under pressure.

Choosing accountability allows you to clear your emotions and focus on what you want to accomplish and preserve relationships. Take a few moments to identify your top three or four values. Write them and post them where you can see them every day. Practice filtering your choices through your values, driving you, and the people you lead, towards accountability.

Helen Horyza is the President of Elevate Your Career Inc., and a recognized leadership and career development expert, Helen@HelenHoryza.com. Helen integrates psychology, talent management and employee engagement to elevate organizational culture. Her most recent book is Elevate Your Career:  Live a Life You’re Truly Proud Of.

Thursday, October 1, 2020

The Three Main Organizational Drivers

Guest post from S. Chris Edmonds:

Is your company primarily power-, profit-, or purpose-driven?

Approaching a meeting with the CEO of his organization, one of my culture clients (a senior executive of a major retailer) said, “I’m going to ask him whether he thinks we are a power-driven company, a profit-driven company, or a purpose-driven company.” I’d not heard about those differentiators, so I asked him to define them for me.

Organizations are not exclusively driven by a single one of these approaches,  but their primary drivers are not that difficult to diagnose. An organization’s plans, decisions, and actions provide very clear indicators of their core interests and drivers.

Power Driven:

A company that is primarily power-driven

     seeks to be a standard-setter, a “big player” in their industry that others must work with to gain a foothold in their marketplace.

     seeks to make profits, but their primary actions are designed to increase their influence, their market share, their breadth.

      exhibits behavior that can be seen as self-serving and arrogant.

Based on these criteria, I see Microsoft as primarily a power-driven company. (Full disclosure: I’m running Microsoft 365 on my Macs & iPad. I’m as culpable as any other Microsoft product user for helping them extend their power.)

Profit-Driven:

A primarily profit-driven company:

     seeks to create organizational wealth, first and foremost.

     analyzes potential products, services, and markets carefully to identify the most profitable avenues, then pursues those avenues for as long as the profits meet expectations.

     exhibits behavior that can be seen as self-serving and manipulative.

     are known to take advantage of existing rules and/or laws to create profits.

Based on these criteria, I see pharmaceutical companies as primarily profit-driven. (Full disclosure: I’m a big believer in Western medicine. I take prescription medications daily to keep my heart healthy and my knees working smoothly.)

Purpose-driven

A primarily purpose-driven company:

     seeks to engage employees and customers in helping the organization’s service vision to become a reality.

     often promote social responsibility and demonstrate service to their communities regularly.

     employees typically are very vocal about their organization’s purpose and community benefit.

Certainly, purpose-driven companies must be profitable to continue their good works; profits serve a purpose, rather than being the primary desired outcome.

A few years ago, socialbrite.org celebrated four terrific examples of corporate social responsibility. Based on these criteria, I believe that Newman’s Own, the late Paul Newman’s charitable organization, is a purpose-driven company (they’ve given over $300 million to charitable causes since 1982). (Full disclosure: I LOVE Newman’s Own products, particularly their black bean & corn salsa. Amazing quality & taste, and I’m helping community organizations every time I inhale a jar of it.)

The Rest of the Story

I connected with this client after his CEO meeting, and he said the conversation was a rich one. “He thinks we’re a profit-driven company that wants to be a purpose-driven company,” he related. “I like that – it means we’re not ‘done,’ that we can evolve to the kind of purpose-driven company I think we can be.”

I’m optimistic, as well. Creating a purpose-driven company is more art than science, pulling together key pieces that make a cohesive, vibrant whole. This client has the heart, skills, and commitment to help his organization evolve.

S. Chris Edmonds is a sought-after speaker, author, and executive consultant. After a 15-year career leading successful teams, Chris founded his consulting company, The Purposeful Culture Group, in 1990. Chris has also served as a senior consultant with The Ken Blanchard Companies since 1995. He is the author or co-author of seven books, including Amazon best sellers The Culture Engine and Leading at a Higher Level with Ken Blanchard. Learn from his blog posts, podcasts, assessments, research, and videos at http://drivingresultsthroughculture.com. Get free resources plus weekly updates from Chris by subscribing here