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[EDITOR’S NOTE: This is a replay of the Sales Game Changers virtual learning session sponsored by the Institute for Excellence in Sales on May 21, 2022, featuring Nigel Green, author of Revenue Harvest.]
Find Nigel on LinkedIn.
NIGEL’S TIP: “Schedule a meeting with the CEO and say, “I want to know from you what the ideal exit would be for this business. What’s the timeline? Is it three years? Is it five years? You’ve got a number in mind, how much do you want to sell this for? Who might buy it?” Get an understanding, because it goes back to the first principle of plan, beginning with the end in mind. Go figure out from your leadership team what the best potential outcome for the business would be. Then start designing your work to help them achieve that.”
THE PODCAST BEGINS HERE
Fred Diamond: Nigel it’s great to see you. You’re down in one of my favorite cities, Nashville. I’m of course in Northern Virginia, and you are the author of The Revenue Harvest, A Sales Leader’s Almanac for Planning the Perfect Year. We’re going to be talking today about the mindset of the modern sales leader, and how sales leaders probably have to shift their mindset to take their sales career to the next level. Let’s get started. Revenue Harvest. How’d you come up with that title?
Nigel Green: In 2018, Fred, I moved out of the city core of Nashville about 55 miles out of downtown to a farming community. My wife’s family has farmed this part of the country since 1833. She is the seventh generation to manage the land and just a few months into living in the community and being surrounded by these hardworking individuals, I realized there really wasn’t much difference between a farmer and a sales leader except for one thing. If you identify as a farmer, but then there’s no crop at the end of the growing season, you’re not a farmer.
But there are a lot of sales leaders, this is the difference, that bounce around from job to job, the average tenure of a sales leader is 18 months and the average tenure of an account executive is 11 months. Part of that is not producing results, or meaningful enough results. There are a lot of factors that go into that.
I realized that farmers do this year in and year out since the beginning of time. It doesn’t matter how many crops they grow, what the growing season looks like, they have so many things that they can’t control. It’s never going to be just a perfect weather, it’s always too hot, too cold, too wet, too dry. They don’t get to control the price of their crop. Right now fertilizer is up at 1400%, they have no control over that.
But there are a lot of sales leaders that can say the same thing about their role, they don’t get to set the pricing of their offering, or they don’t get to control the competitive landscape. Yet, despite all these uncontrollables, farmers produce crops year in, year out. I thought sales leaders can probably take a little bit of a lesson from the farmers. I condensed the book into seven timeless principles that farmers have been practicing regardless of what they grow, where they grow, and when they grow, and modified that for the sales leader.
Fred Diamond: Let’s get deep into that. You’re absolutely right about the 18 months. One reason why I know that besides the fact that I know it, is we have a database at The Institute for Excellence in Sales of sales leaders. It gets old fast, because the people are no longer at the address that we may have them for.
I’ll get all these bounces. I was like, “Gee, that guy, I thought he was still there.” Then I go to LinkedIn, you and I see each other on LinkedIn pretty frequently. I’m like, “Oh, he’s no longer at Microsoft. He’s now at Amazon or Salesforce or this small company.” Why do you think it’s still persist? Why do you think that the 18-month turnover for sales leadership still persists?
Nigel Green: It’s a misalignment of desires versus expectations. That’s not all on the sales leader. In the work that I do, Fred, I work with sales leaders and their management team to help include the sales leader into the C suite. Oftentimes, there’s the expectation that is set by the board or by the CEO is ridiculous. I tell them, “It’s not the sales leader, I don’t care who you hire next. That’s not attainable. That is an unrealistic set of expectations.”
Then sometimes it’s about desire. There’s a lack of patience on the sales leaders, and an overstatement of their capabilities and the value that they bring. You and I talked about this before we hit record. A frontline sales manager is one of the most important roles in a sales organization, but let’s not mistake it for what it takes to be a sales leader and part of the C suite. They think very differently. I see a lot of sales managers that are impatient. They want to have carried interest to stock options, and they want to get access to the board but they’re just really good frontline sales manager.
Somewhere in between these two sets of mismanaged expectations and these desires, that’s really the center of the issue. The answer to that is being really clear about what you desire, and being really clear about the expectation and holding the management team to not moving the expectations in the middle of the game.
Fred Diamond: I have a question for you. One thing we talk a lot about, Nigel Green, is that a lot of times the frontline sales manager will be a high performer who was promoted. It’s like, “You’re great at it, you’ve proved it for 3, 5, 7 years, you should be our next sales manager.” He or she then accepts the role. Usually they’re not trained, usually they’re thrown into the role with the expectation that, “You were so good at this, you’re probably going to be very good as a sales leader.” That doesn’t always happen. Conversely, when someone goes from excelling at sales leader into the C suite, which we’re going to talk about today, is it a similar type of thing? Where this guy is a great performer as a sales leader, he’s had 10 years of blowing out his quota, people get promoted as well, we’re going to move him into the C suite. Does the same type of dynamic happen, where they’re not really trained for that, or what has been your experience?
Nigel Green: There is an element of that, Fred. It comes down to a couple of core competencies that I see persistent with really strong sales managers that need to get better in a leadership or C suite role. Generally, really good sales managers that get invited into the C suite are like magnanimous personalities. They’re phenomenal coaches, they are compelling, they’re convincing. All of that is really good characteristics to have of a C suite sales executive.
The challenge and the downside of that is they tend to make decisions too much on intuition and not enough based on objectivity. They come in, and they make claims like, “We need this resource, we need to do that.” You have to understand that when you go in and say, ” We need this,” the individuals in that room, your peers, the CFO, the COO, largely make decisions based on objectivity and facts. They ask for these things, but they can’t provide a business case.
They don’t know how to provide a business case. That’s the first thing, is knowing how to provide a business case. Similarly, but a little bit different is they don’t understand how to read the three major financial documents. You don’t have to go be an accountant. You don’t have to go get an MBA.
Warren Buffet has a great book on how to basically read the three major accounting documents, which is a statement of cash, a balance sheet, and an income statement, or P&L. The reason why you have to do it, and you may be rolling your eyes is, that’s the language of business. If you can’t speak the language, you can’t talk to the board who speak this language day in and day out. You have to be able to translate your language, which is the voice of the customer, the voice of the reps, into the language they speak, which is EBITDA and those three documents.
Fred Diamond: We have a question here that comes in from Douglas. Douglas says, “Nigel mentioned seven core leadership principles for sales leaders,” are you prepared to list those and go into detail on those?
Nigel Green: Sure, we can run through them. The first one is plan. All farmers and subsequently, all sales leaders need to go into the year with a plan. Now, here’s the mistake that a lot of them make. The plan itself is useless. We’ve all seen this. You write out a plan, or the board gives you this plan, and the CEO gives it to you, it looks great. Everything goes up into the right, well, that’s not how the year is going to go. The exercise of planning, thinking through contingencies, assigning the results down to rep and account level, thinking about what happens if this top rep leaves or if we lose this customer, that’s indispensable. A lot of sales leaders don’t do that. They just take the plan, they give it to the team, and then good luck. After you do the plan.
The second principle is positioning. How many times have we seen a really good plan not fly because the sales team didn’t understand what was in it for them? We had to change the commission plan or we had to take this product offline, or we ran into some fulfillment issues. We didn’t position the plan well enough to get them to do it. If they don’t execute it, the plan is useless. Then the third is prepare, we can have a really good plan, we can have it well positioned, meaning we may be launching into a new product or calling on a new segment. If we don’t prepare the team, if we don’t train them, it won’t work. We’ve got plan, positioned and prepare.
Then the fourth is plant. That’s pretty easy. That’s prospect, and that’s putting seeds in the ground. We all want to put seeds in the ground, and we’re waiting on the harvest, but if we don’t do tend, which is the fifth, tend principle, to take care of. If we don’t think about the day to day, how we want to manage the business, how we want to manage our team, there will be no harvest, which is the sixth principle. In that principle, I don’t talk about closing, I talk about the harvest from the perspective of the sales leader.
What I’m talking about is forecasting. Forecasting accuracy, managing the expectations. How many times have you in your sales leadership role do you get that midnight email from the CEO saying, “How’s the month going to look?’ You don’t get that email anymore when you unhide the work. When you point that CEO to go look in real time how sales are trending.
Then the last and that often most ignored principle is the restore principle. People read this principle and they think, “Oh, Nigel is just talking about rest.” No, rest is to take a break. Restore is to bring it back to its original state. Farmers do this well. That’s why they have crop rotation and they use supplements. They know if they plant corn, it’s going to take vital nutrients out of the ground that need to be replenished before they go do it again. Yet we don’t do this with our sales team. We don’t do this with our customers. We go ask them to sign a multimillion-dollar deal, then we’re knocking on the door 11 months later, asking them to sign another multimillion-dollar deal a year and we haven’t made any investment into that business. Those are the seven principles, plan, position, prepare, plant, tend, harvest and restore.
Fred Diamond: Out of the seven, Nigel, what do you think most people fall short? You work with tons of sales organizations as do I. I have my idea, but I’m curious on what you think. What you see time and time again, or maybe what they keep asking you for assistance with?
Nigel Green: Restore. It’s the hardest one to measure because every business has slow seasons and they don’t take advantage of them. They don’t allow for their reps to take two weeks off to go to a conference. They reduce their quota. They say, “Look, we’re giving you 50% quota relief, and I want you to go cross train with marketing.” Or, “Go get an MBA or go get a financial literacy course done.” They don’t do that, because they don’t see the ROI. What ends up happening is their team is burned out and depleted. For me, I take all of November and December off to restore.
There are a lot of sales leaders that need to start thinking about ways, really from probably Thanksgiving to the end of the year to recalibrate how they’re managing the team and the expectations. You expect them to run hard in January or whenever the new year starts. If they’re already tired and feeling behind the eight ball from trying to close the last of the year, you’re going to have a hard start to the year. Restore is an opportunity where leaders need to be a little bit more empathetic and check in with the whole person.
Fred Diamond: We’re doing today’s interview in the middle of May 2022. Nigel, every day, almost for two years now we’ve been doing a daily webinar. It’s just unbelievable. It seems like we haven’t been doing them and it seems like we’ve been doing it forever. Where do you think we are right now? Where do you think the sales profession is right now? Before we did today’s show, I flicked on the news as I was eating my lunch and they were talking about a new possible strain of the COVID that would continue to keep us in some degree of, not locked in. We’re no longer in lockdown, but some degree of working from home and customers still being at home, etc. I’m curious, where do you think we are right now as a profession?
Nigel Green: Where we are as a profession is that all of us could probably stand to check in on customer sentiment. We want so badly for our team to be out there and go into your event tomorrow, call in on customers. But for so many businesses, our customers, even if all the indicators are that it’s safe to meet, they don’t want to meet. They don’t want you to show up anymore. For a lot of sales leaders, it’s our responsibility to check in on that sentiment, and to make sure that our go to market and our buying cycle is aligned with the way customers want to do business with us. You’re going to have a hard time keeping talent when the way they want to sell or the way you’ve trained them to sell is misaligned with what the market’s doing.
I’ll give you a couple of examples from both sides of the spectrum. I was coaching a sales leader, one of the top reps who was really frustrated, he’s like, “I just wish she’d let me go do my thing. I’m highly relational, I need to get back out there, I need to get on the plane.” I said, “Buddy, she’s not holding you back. Your customers don’t want you to fly to Kansas City and take them out to dinner. Their world has fundamentally changed.”
Then on the other hand, you’ve got reps that were struggling at the high volume of activity expectations at the start of the pandemic. They have insane amounts of EQ and empathy and they know how to connect the dots. They don’t need to do 100 calls or 50 emails a day. They just convert really well. They’re largely introverted, they hide behind a screen. They maybe even sell with their video off, but they understand what the customer wants. They go slow and slow is fast. Those are a couple of examples to give you an idea. The point is, as a selling professional, everybody’s business has changed, because the way the customer wants to transact has changed.
Fred Diamond: Now that is a great point. I’m harkened back to a moment we had, it was probably back in January, and we were talking about The Great Resignation. We’re going to talk in a second here about finding top tier talent. We’re talking about the resignation and up until that point, Nigel, we were focusing on what you and your company, as a sales organization can do to combat The Great Resignation. One of our guests, her name is Joanne Black, she’s an expert on prospecting and cold calling. She said, “The problem isn’t with you. The problem is that this is also happening at your customer. This Great Resignation-ish thing is also happening at your customer’s customer.”
If you’re in the software supply industry to the food industry, the food industry is no longer servicing restaurants like they used to. Restaurants can’t hire people right now. There’s a whole down chain related issue. I like the example you just gave there. Yes, sales people would love for the clock to go back two years, most would. I loved your point that it’s not about you. It really is, how do we respond to our customers? That being said, finding talent right now.
I was talking to one of our big members, it’s a well-known company, Fortune 1000 company, maybe 500. You would think this company wasn’t really struggling with finding salespeople. He told me they’re having those struggles, the same thing that hotels and retail and fast food are. He said, “There are people that are coming, they’re going.” Give us some advice. For the top sales leaders, what is your advice to them on finding top tier talent right now?
Nigel Green: I’ll share a real example that we’re having to work through a company that I’m a board member of. We sell into the healthcare system, and healthcare is one of those businesses that they just won’t take a meeting. Even the health care CEOs are working from home, they’re not going into the system anymore. It’s not a place that they want to be. We could go hire a bunch of salespeople, but they’re going to struggle to get the attention of the customer.
We’re actually finding old, not old in the sense of the age but burnt out. One of the things that’s coinciding with The Great Resignation is you’re seeing healthcare workers, clinicians leaving the clinical field saying, “I’m not I’m not doing this anymore.” We’re repurposing them. They already have all the relationships, so we’re repurposing them in ten ninety-nines. They’re not full time. We pay them for introductions. There is a lot that leaders can learn from this is, who already has the attention of your customer? Maybe it’s a similar but different or it’s an ancillary offering to what you’re trying to sell. Or, maybe you just go to the rep that already has that customer’s attention that works for another company, and give them an opportunity to represent your product in a very lucrative way.
The other thing that’s interesting, too, is to recognize that, and this is from Gartner, 60% of all buyers would prefer a sales rep-less buying process. Maybe the answer is you don’t need more salespeople. Maybe the answer is you need to do a better job at showing what the product does, and letting the customer learn online. Learn, educate themselves through materials. We’re doing a lot of work of, you could technically categorize it as sales enablement. We’re getting more done with fewer reps in a lot of the companies I work with just by investing in content and letting the customer learn more about the decision and saying, “We’re not going to hire a sales reps, they’re just going to struggle.”
Fred Diamond: Would you encourage people at a school to go into sales right now, into professional sales?
Nigel Green: Absolutely. There’s never been a better time, if you can find a role that you really care about the offering, and you think it’s noble, I still think there’s never been a better time to be in sales. Because of the way the supply demand economics work, there’s just flat out more demand for sales talent than there is supply. You can name your price. We’re seeing SDRs with no experience making first year OTE, 80, 95, $100,000 a year. If you learn how to sell, you can do whatever you want.
Fred Diamond: That’s true. We have a question here from Carlos. Carlos said, “Is Nigel going to speak to the mindset shift that he talked about before?” We did talk before about how you need to have a mindset shift from typical sales manager or sales leader, if you will, to get to the C suite. You want to get to the first level, which is good enough to be invited to be a sales manager. Like we talked about before, usually, the company is going to find one of their top performers who can move into that role. Some like it, some don’t.
Some want to go back, and obviously it doesn’t really matter. Let’s talk about the mindset shift from someone who’s a manager, director, maybe even senior director, who wants to get into the C suite, wants to get to the VP level. You talked about how they need to understand business and the three critical financial reports. Talk a little bit more about the mindset shift that needs to start to happen. When should it start to happen? Should it start to happen the day before you want the job or the moment you become a sales manager?
Nigel Green: Let’s start with when it needs to happen. The minute it happens is when you decide you want to graduate from being an employee, and you want to be a business owner. You can be a business owner and still technically be a W-2 employee. It’s mindset. The employee versus owner is a technical tax code, whether you get a K-1 or a W-2. Business owners think differently. They think more than hitting this quarter’s number, they think more than getting my commission this month. They think about a longer three-to-five-year horizon. Especially in the mid-market where I play, Carlos, most of them are thinking about some type of liquidity event.
The mindset for a sales rep is, “I can get paid cash today, I can go make 4, or $500,000 a year now.” That’s short term thinking. The business owner knows that that’s highly taxed, and there’s no multiple paid on that. What I mean by multiple is when you go and have a liquidity event, when you sell a company at some exchange, some multiple of value to an acquirer, all of your carried interest gets taxed at about half of what your normal income would be and you get paid a multiple on it.
Your CEO and your board, they’re thinking differently. They’re thinking about, this decision today, how does it affect what we need to happen in three to five years? The mindset shift that you’ve got to make is, one, I’ve got to have my incentives aligned so that I’ve got some participation and I’m incentivized to think like a business owner. Then two, to not be so short sighted about, once your basic living standard needs are covered, you don’t need all this cash today. Defer it, put it in a nest egg that instead of getting taxed at 38, 40%, today, it’s going to be taxed at 23% or 18% and you get paid a multiple on it. That’s the mindset shift. You’re never going to get rich as a sales leader, as an employee, but you sure can get rich as a C suite business owner that isn’t responsible for sales when you have carried interest in the company that you represent.
Fred Diamond: That’s a great attitude to take. We always tell people that, “You may be working for a company, but your career is yours. You are the CEO of your own career and maybe you’re a VP of sales at a particular company at this point in time.” We talk today with Nigel Green the book is called Revenue Harvest, A Sales Leader’s Almanac for Planning the Perfect Year.
Nigel, congratulations. It’s an intriguing idea. It’s nice that you noticed your wife’s family and what they have been doing since 1833 and applying those principles to the sales process. It’s interesting, your seven principles, plan, position, prepare, plant, tend, harvest and restore. It goes back to the basic premises that we talk about all the time.
That the sales profession is a profession. If you really want to take your life and your sales career to the next level, you need to treat it as professional. You need to understand the business. We talk about it all the time too. For you to be more valuable for your customer, it’s not just about how are they going to use your product to solve some of their problems. It’s about understanding what their challenges are. In most cases, the higher up you sell, based on the product, there are business-related challenges. Cash, growth, productivity, tax planning, whatever it might be, no matter what it is that you sell. Good for you for creating this book, for coming up to the idea.
Nigel Green, thanks so much for the insights. Why don’t you give us one final action step? You’ve given us so many great ideas, give us one specific action step people can do right now after listening to today’s podcast to take their sales career to the next level.
Nigel Green: The thing for sales leaders particularly around mindset, is I want to encourage everyone listening to this to schedule a meeting with the CEO and say, “I want to know from you what the ideal exit would be for this business. What’s the timeline? Is it three years? Is it five years? You’ve got a number in mind, how much do you want to sell this for? Who might buy it?” Get an understanding, because it goes back to the first principle of plan, beginning with the end in mind. Go figure out from your leadership team what the best potential outcome for the business would be. Then start designing your work to help them achieve that.
Transcribed by Mariana Badillo