Archive for the 'Wise Counsel' Category

12
Aug
10

Throughts on Successful Sales Management – Friday at 11:30

By Dave Stelzl's Blog Leave a Comment
Categories: Channel Management and Wise Counsel
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Preparing for this week’s upcoming Teleseminar on Successful Sales Management, a few random comments from things I see almost every day… (sign up at http://www.stelzl.us/business_strategy_TeleS.asp)

1. Good sales people are entrepreneurs.  They can’t be managed like a team of factory workers.  Keep in mind – high risk, high reward.  Let let the compensation plan do most of the managing.

2. Building on No. 1 – high reward means you are willing to pay them when exceedingly great things happen, so don’t manipulate the pay plan, claiming they are making too much.  High risk (required to receive the reward part) means, when things don’t go well, they don’t make money.  It’s not your problem.

3. Complex compensation plans drive sales person into hours of meaningless research and number crunching.  They lock up the entire selling process.  Keep it simple.

4. Smart sales people are going to sell things that pay well.  Stop telling people what to sell – instead, design your compensation to drive the behavior you need.  This requires focus and a clear understanding of what needs to be sold.

5. Quota is not a tool for controlling how much people make.  It’s a gauge, letting you know if people are hitting the number required to stay.  Compute quota based on necessary performance, then design compensation to pay big on the things that are worth paying for.  E.g. Accelerators are great – but set them above quota if that’s where they need to be.  Don’t raise the quota just to make this year harder than last, instead raise the accelerator.  If people don’t make quota – send them on their way.

6. Don’t create two goals for any one person.  Selling is hard and requires focused effort.  Give a person one thing to aim at that will then drag many things.  That one thing becomes the strategic objective around which the compensation plan hinges.  This leads to successful selling.

7. Most meetings are a waste of the sales person’s time.  On the other hand, you need to know exactly where the sales are, the timing, the numbers, etc.  Let your CRM tool manage this and require your sales people to keep it up to date.  This is one area where micro management and penalties may apply.

8. Sales people are consummate negotiators.  Stability is required to create a strong sales team.  Set your “well thought out” plans in place, have a great, well constructed compensation plan, and hire people a great character.  Set things in motion and stick to them.  If a sale person isn’t making enough money, advise them to sell more or move on.  (This assumes that you really do have a well thought out plan).  Change leads to more thrashing.

9. Don’t accept a personal plan that compensates you more for selling then managing.  This leads to failure as a sales manager and is destined to lead to your own termination.  Negotiate your plan up front to focus on multiplying the sales of your team by working alongside them and relieving them of any and all distractions from selling.  Most sales people spend a solid 90 minutes a day selling.  Imagine if you could help them double this!

10. When new hires come on, ride with them, mentor them, and make sure they really know how to get started. Most won’t, but a little direction will go a long way.  If you’re too busy for this, it’s the wrong time to be hiring.

© David Stelzl, 2010

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09
Aug
10

Raising Entrepreneurs: WSJ Writer Is Missing Something…

By Dave Stelzl's Blog 2 Comments
Categories: Wise Counsel
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Interesting article today related to my ongoing theme and future book on Raising Entrepreneurs.  Writer Jeff Opdyke (so close to John Updike he was destined to write!) comments on his thirteen year old getting a job.  Actually it’s a great write up as he contemplates the reality of teaching his young ones how to work and instilling some kind of work ethic.  The disconnect comes with thinking work is somehow a deterrent to having a great childhood!  Nothing could be farther from the truth.  The problem here is that we’ve associated work with jobs at a fast-food restaurant or blue collar operation.

Sure, not every child comes from a family where opportunity is readily available (although many can make it happen if they really try – most won’t)  But certainly John’s do.  Stop thinking about work as something a teenager goes out to do and start thinking more in terms of the entrepreneurial experiences available along side a parent or sibling.  The writer actually comes close to making the right connection when he references the traveling and learning experiences his thirteen year old is already engaged in.  Think outside the box.  What can he do to incorporate this child in his own work in a more profitable way?

We’ve created worldview that assumes all well-off families have children that will follow suite without experiencing the work we did to get here.  That’s just wrong.  From there, we assume that teen years should be spent playing ball, and then somehow, magically, one is transformed in their college years, into a hard working, creative entrepreneur.  This is also not true.  The time to start is now!  In those early years, finding exciting ways to make money.  My kids are bee farming, building things, creating jewelry, building blogs and websites, and writing books.  They are making money through their own creative efforts, and daily, they consider how else one might creatively start a new line of business.  It’s a game in a way.  What need can I meet, and how can make it a win/win that produces profit for me and value to my clients?  Are they somehow missing out on a great childhood?  I doubt it.

You can read John’s article here (and I do recommend reading it): http://online.wsj.com/article/SB128121678189825407.html?mod=iGoogle

03
Aug
10

No time for boondoggles

By Dave Stelzl's Blog 1 Comment
Categories: Wise Counsel
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No one has time for boondoggles, or for attending far away meetings, events, or sales calls without real purpose in mind.  However, many will attend conferences like the one I am speaking at tomorrow (Ingram Micro’s Network and Security Symposium) without taking full advantage of it.  Some things to keep in mind when making these trips:

1. This is not your vacation.  If it is, you made the wrong choice.  Take vacation with  your family, leaving your business concerns to those still “on the clock.”  True refreshment does not come from this type of vacation.  Even if it’s a great destination, you are better off planning a real vacation, totally focused on recreation and cultivating family relationships.

2. There’s value here at the conference – don’t miss it.  Set up your automated attendant and change your voice mail to let people know you are largely unavailable for the next three days.  There is no value in spending your session time or  break time on the phone.  Periodically check in, but plan to use free time to build your business.

3. Study the schedule.  Not every session will have value, so figure that out ahead of time.  Make sure you are ready to go on the sessions that matter to you most.  Spend time outside of these sessions reviewing notes, networking, and preparing for your next session.

4. Speaking of notes…why do so many people just sit there.  I hope this is not you.  Take notes! Don’t bother writing it all down, but when idea stimulating comments are made, write them down.  Stay focused, write, and prepare  to review.  You’ll be amazed at how many ideas you can come up with in a great session.  If you don’t write them down, they are gone forever.

5. One major distraction comes as you start thinking of all the tasks waiting for you at home.  I keep a separate list of to-do items.  Every time one pops into my mind, I write it down and forget about it.

6. If the speaker is great and is willing to give out cards, has a book or audio program, or provides electronic media, get it.  I always buy the book if the speaker is good.  Usually they have only touched the surface and I’ve invested 3 days and thousands of dollars in opportunity cost.  Another $25 dollars isn’t going to kill me – but it may turn into millions of dollars down the road.

7. Meet people!  Don’t be shy – most of the people attending this event are here alone and ready to engage in conversation.  If you came with a group, get a plan together on who is there and who you need to meet.  Reconvene periodically and exchange insights.   If you hang out together, chances are you will miss one of the most important opportunities these events hold.

© David Stelzl 2010

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29
Jul
10

Raising Entrepreneurs – Understanding risk and investment

By Dave Stelzl's Blog 1 Comment
Categories: Wise Counsel
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It’s that time of year – time to rob our bee hives!  If you’ve seen me speak you know I am in the process of raising entrepreneurs.  Avoiding traditional learning programs that tend to produce “worker bees”, while searching out ways to develop my children’s creativity and business acumen.  Seth Godin writes about this in his latest book, “Linchpin” – urging us to move beyond the #2 pencil, to develop our problem solving skills and creative abilities.

Yesterday we suited up in our “almost” bee proof uniforms, and headed out to the bee hives.  They’ve been working all summer to make enough honey to survive the winter, and hopefully enough to support my apiculture team through the winter as they sell their honey.  But, like all business ventures, there are no guarantees.

The bees do most of the work.  They begin by building up the hive in the early spring.  We start to really see some activity in March as the queen is mating and recreating to build up her team.  As the first flowers appear, nectar flows and the bees collect pollen.  Comb is then built on frames, first in the lower brood boxes, then in “supers” which are added as the brood chambers are filled with both brood and honey.

But there’s a risk.  As the hive builds, the bees know its time to multiply.  They’ve been created with an instinct to raise up a new queen, and so some of the brood are targeted for this new role in the hive.  Royal jelly is applied to several eggs to raise up this new queen.  A queen cell develops from this application, and two-thirds of the hive members prepare to leave with the old queen!  That’s right, most of our hive will try to flee the hive, hunting for a new home somewhere out of our reach.  If we don’t find a way to stop them, they’re gone.  The new queen will then emerge and begin repopulating the hive.  All of this is natural, however it completely disrupts the honey production, leaving the bee farmers with only a small amount of honey at the end of the season.

There are other problems as well. Mites may infect the hive, killing it off.  There are other pests that may disrupt the hive, weather conditions such as drought or a freeze may disrupt the nectar flow leaving us empty. Or perhaps an animal will get into the hive and completely destroy it as they help themselves to the honey.

It turns out that this was one of those years.  After faithfully caring for the hives through the summer, we incurred a few swarms (this is how the bees take off with the new queen), one of our hives died last winter, and for some reason the hives just didn’t produce.  In fact, only one hive had enough honey to actually harvest.  The rest only made enough for next winter.

Of course the kids were disappointed!  But let’s not miss the important lesson here.  For the Stelzl family, keeping bees is less about profit and more about learning (at least that’s how I see it).  I don’t expect any of my kids to actually support their future families on bee farming, however I do want them to learn about investments, overhead, gross profit, marketing and selling, and the work required to produce their product.  This year we’ve learned a lesson on risk – there is no guarantee.  They’ve put in a great effort, however the pay plan is pure commission.  In fact, they’ve even spent their own money buying bees to replace past failures, purchasing equipment and hive repairs, and purchasing jars to sell the honey in.  Who will make up for their loss?  No one.  There are no bail-outs for this type of failure.  Instead they will have to rely on their other business ventures to support their coming year’s expenses.  And of course, there’s always next year’s honey if all goes well.  But there are no guarantees.

20
Jul
10

Creating Business

By Dave Stelzl's Blog 2 Comments
Categories: Wise Counsel
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Tomorrow I’ll be presenting the opening Keynote at Ingram Micro’s vertical symposium – health care and finance, in Dallas.  As I’ve prepared for this, I’ve recounted numerous conversations over the past year concerning the economy, cloud computing, business struggles, and managed services.  What’s working and what isn’t.  The majority would say, not much is working…

Creativity might be defined as approaching a task or idea from a different or unique perspective.  It’s a simple concept, but often misunderstood at the deepest level.  We have creative teams, creative people, creative software, and Adobe’s creative suite…but what’s so creative about these things?  Most of the time, nothing.  I see thousands of websites, data sheets, and even resumes sporting the same meaningless esoteric language.  I love how Goden, author of Lynchpin describes the education system of our country – we learn to use #2 pencils, dress the same, write the same, follow instructions, take notes, take tests, forget the material and move on.  Failure is not an option, and so the idea of creating and trying new things is not permitted.  Being a home educator I can really see this in the materials offered to us.

Instead, I’ve opted to largely ignore traditional books in place of creative problem solving, team oriented learning, and building entrepreneurial enterprises with my kids.  Business is getting harder to conduct, competition is greater, and price pressure is killing us (and of course taxes will finish us off).  Going the traditional route is not going to succeed on average.  In fact, history shows us, of the thousands of companies that start, only about 4% (according to a recent business conference I attended) make it to ten years, and this says nothing about profitability.

So what are we going to do differently to stay in the game?  Creating business has to to be part of it.  Understanding how to build effective messaging and move people from prospect to client, is fundamental.  Finding more efficient ways to buy and sell, and delivering greater value through discontinuous innovation, is needed.  Intellectual capital is important, but those who tend to be risk adverse are destined to fail – the entrepreneurial spirit has been stripped from us.

I’m just coming off of a 4 day planning and strategy sabbatical with lots of ideas and enthusiasm.  Hopefully you’ll be in Dallas tomorrow to hear about it.  Either way, start thinking outside the box – start practicing creativity.

12
Jul
10

The Park Hotel Meeting

By Dave Stelzl's Blog Leave a Comment
Categories: Wise Counsel
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In 1995 I was working with a small group of guys to establish a profitable, strategic business in systems integration, support, and services.  One of the most important investments we ever made became known as the Park Hotel meeting.  At the start of each quarter I set aside an entire day with my leadership team to work on the business (rather than in the business).  As the company grew, it became more and more difficult to set aside this time, but we did it anyway.  We set the date for our next meeting while in the current meeting, picking a date that worked for the group.  This date was written in stone – it was non-optional.  We talked about strategy, personnel, futures, profits, ideas, etc.  Things that would make our business not only work, but work well. Looking back, those four days were worth every minute.  We could bill or sell that day, however the plans we set in motion multiplied the profits of our company.

In 2003, when I started Stelzl Visionary Learning Concepts, the business I run now, I set out to do the same.  My leadership team is just my wife and I, and often I schedule my “Park Hotel Meeting” alone, yet it has the same result.  Fresh ideas, a broader view of where I am headed, and a rest from the daily grind.  This week I am doing something a bit more extravagant.  I’m spending not just one day, but 4.  No vmail, no email, just focused time…

If you’ve never done this sort of thing, I highly recommend it.  One of Rockefeller’s habits includes this sort of planning and strategy time.  In fact, many great leaders did this – why do we have such as hard time stopping our wood cutting to sharpen the saw?

10
Jul
10

I hate resumes

By Dave Stelzl's Blog 2 Comments
Categories: Channel Management and Wise Counsel
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I think Wall Street’s headlines put an end to the recession a year or so ago – I guess they missed it.  In any case, there are lots of people on the street and resumes flying about wherever I look.  Most of them poorly written boiler plate text that won’t land a position with anyone worth working for.  I found this great (in my opinion) article through one of my colleagues…it’s worth a read if you are updating your resume.  I prefer to answer no, when someone says, “Do you have a resume.”

http://www.businessweek.com/managing/content/aug2008/ca20080822_050187.htm?chan=careers_managing+your+career+page_find+a+job

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07
Jun
10

Raising Entrepreneurs…quotes from the week

By Dave Stelzl's Blog Leave a Comment
Categories: Wise Counsel
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We’re back from a week of home school training – but along with great ideas for schooling comes some great thought provoking business concepts from the sessions I attended:

  • We need to be writers – writing forces you to think precisely.  This in turn enables you to speak persuasively.  Whether selling or running a business we all need this.  One speaker said, “What book are you writing?”  We should all be writing a book on the lessons we’ve learned and how to succeed.
  • Clutter creates confusion, slows down learning, leads to irritability and stress.  Take a look at your desk.  Perhaps post it on You Tube!
  • 4% of new businesses make the first 10 years.  What are you doing to be on the list of successful companies?  Not all of them will be profitable – this requires extra thinking.  So what are you doing to stay alive that the other 96% just won’t do?
  • Everyone needs a coach, wise counselors, and great books to read.  Success doesn’t just happen.
  • Whether in sales or running a company, you need a clear vision – one that makes sense.  If your vision is to make a certain amount of money, it probably won’t happen.  Making money is the result of a well constructed plan and vision, not the core of it.  It’s just one of the gauges of success.
  • Fire your team every year – mentally.  Picture everyone gone, then figure out who you will rehire for the coming year.  Those that don’t make the cut have been on staff too long.
  • Hire the right people.  Things you don’t like in the interview will be even more annoying once they start.  Once hired – invest in them.  Everyone needs training in order to keep growing.  This is expensive, yet if costs less than having untrained people, or people who over time, lose their edge.
  • Stay out of debt.  Companies that take on big debt to grow are making a mistake.  Interest will eat at your profits for years to come.  Remember, top line revenue is a poor measure of success.
  • Avoid 50/50 partnerships – they rarely work.
  • Charge the right amount.  Companies tend to charge too little for their consulting services.  This requires a solid value proposition, but is necessary to grow.
  • If you want to make a million dollars, then you had better have million dollar people, million dollar coaching, million dollar training, and million dollar abilities.

© David Stelzl, 2010

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03
May
10

When Calling High is Painful

By Dave Stelzl's Blog Leave a Comment
Categories: Sound Bites and Wise Counsel
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Sometimes calling high (meeting with CIOs), works out and you get the deal. Other times they make you feel stupid and treat you like dirt.  When this happens, remember:

  • You are a profit center (if you are in sales), they are a cost center – overhead
  • You get paid on commission, generally commensurate with the work you put in
  • They are reliant on circumstances largely out of their reach, to make their bonus
  • If they display this type of inhumanity toward you as a sales rep, they probably have a handful of friends that only stay around for the perks.

Present your best face, constantly be a source of enthusiasm, and demonstrate genuine gratefulness for the position you hold, your mission to help others make wise buying decisions, and the opportunity for character development.

© David Stelzl, 2010

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29
Apr
10

Reseller’s services margins may not be what they seem

By Dave Stelzl's Blog Leave a Comment
Categories: Channel Management, Sales Strategy, The Bottom Line, Video and Wise Counsel
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Resellers, VARs, Solution Providers, and Channel Managers – this is an important lesson on the profitability of services.  While your (or your partner’s) services may be very profitable, they may not be as profitable as they seem.  As the market has commoditized, I’m seeing far more short product/install contracts…less consultative, long term engagements.  This is particularly  true in the mid and smaller markets. What is the result.

Listen and see how calculations on profit, gross profit, and net profit are sometimes confusing.  To the sales rep, all GP is good – you get paid, right?  To the person with P&L responsibility, the numbers don’t always add up…I frequently run into people who initially think they have strong services margin.  When I show them how to calculate it, we find profits to be much lower apart from the product sales.

© David Stelzl, 2010

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