How to stay one step ahead of customers to build demand

by Dirk Beveridge

Dirk Beveridge

The industrial distribution landscape is more fluid than ever. In this ever-shifting world, how do you keep pace with change and ensure that your sales team is staying ahead of customers’ expanding needs?

Step one is to make sure your people understand the forces of change impacting customer operations and decisions. If your business is more interested in partnerships than parts, here are a few considerations to help you prepare your team to better embrace the challenges ahead.

No doubt, change abounds. New technologies and standards like RFID are making demanding customers even more demanding. Mergers and acquisitions are creating a new and tougher breed of competitors. National-level contracts are raising the stakes and creating new levels of vulnerability among smaller suppliers. Customer operations are moving to faraway places like China and India. And, despite many bold initiatives to bring manufacturers and distributors closer together, 48 percent of distributors claim relations with manufacturers have worsened in the last five years.

Indeed, macro issues such as these are important to understand and follow if you expect your sales and service center to grow faster than the overall market.

Savvy distributors, however, conclude that we have neglected to encourage this macro understanding among our people. Sales management, which is primarily responsible for encounters with prospects and customers, must now, more than ever, focus on developing these skills. They must overtly reaffirm the values, skills and competencies required of the sales team.

Understandably, sales managers must play the role of the ship captain, helping the team navigate the waters, ride the changing tides and keep pace with change.

Sales managers who succeed in this role share a similar path. They:
• Unify the team around an expectation of accountability
• Provide the selling systems that evolve the skills of the team
• Inspire each individual to ensure sustained and ever-improving competencies.

Let’s take a look at these three components of successful change readiness.

Unify — Uniting the team around visionary values and behavior
By now, most distributors have reengineered their entire organization — from warehousing and logistics to IT and customer service. This reengineering has likely improved performance and resulted in better-defined processes, standards and accountability. As these business-critical areas get redesigned, there’s one area that typically gets overlooked: sales. The wand of reengineering somehow missed the sales organizations and, as a result, salespeople continue doing their own thing.

In its report, Facing the Forces of Change, the National Association of Wholesaler-Distributors recently signaled loud warnings. “The days when a salesperson could be encouraged to ‘run his own business’ are long gone,” the report states.

To address this concern, sales and service centers should aggressively move forward to:

1) Create, communicate and leverage a “differentiating vision,” one that conveys where you need to take the sales team and how you intend to get there.
2) Reinforce the sales team’s specific mission and formal plans to win.
3) Systematize a values-based selling system to instill the mindsets, competencies and skills necessary to develop the type of salesperson you need to compete in today’s challenging marketplace.

Evolve — Delivering deeper value through the sales process
As distributors change, so do customers. Odds are, your customer contacts have likely taken on ever-increasing responsibilities — from the OEM production manager to the contractor’s site foreman. As their scope increases, their available time becomes a more precious resource. That said, they only want to do business with distributors who fully grasp critical issues in their business and who can deliver a solution that’s simple yet powerfully captivating.

As you increasingly deliver on customer needs, be sure to factor in these components.

1) Take a look at the tools, positioning, and coaching required to evolve internal skills. Be sure you position the sales team as a customer resource, not simply a source. Ensure they know the right fit, form, and function to be that resource who understands the customer’s business from the inside out.

2) Many industrial salespeople routinely compete on product and price. That’s what they know best. But that’s not what customers desire. As customers change, so too must the proposal process. Today, proposals should be viewed more as profitability enhancement recommendations as they propose customer-focused solutions, not products and prices.

3) Top-producing sales professionals know how to change the conversation with customers to get in earlier during the decision cycle and deeper into the desired need. John McDonnell, former CEO of fluid power distributor SunSource, had a mantra stating, “We don’t need any new customers. We must develop deeper relationships with current customers to gain market share within these customers.” That type of directive drives news ways of viewing the customer relationship. Aligning actions result.

Inspire - Earning commitment from the sales team
In reply to new sales systems, we often hear negative, condescending and draining statements such as, “Here comes another program” or “This won’t last.” The NAW warns that distributors must “inject accountability through sales management practices. Management must establish an expectation of accountability and a system to insure ongoing implementation.”

As you build your plan to inspire those you manage and those around you, consider the following.

1) How can your sales team’s proactivity and commitment be earned through the actions of sales managers and the systems they put in place?
2) How can sales managers create, maintain and generate buy-in among the team to set non-negotiable minimum standards of performance?
3) What information does the sales team need to hear to develop a “crisis to perform” and foster greater accountability and follow through?

As we enter the second half of the year and pressure mounts to close out 2006 on a record high, these are important considerations to ensure your team provides the deepest level of customer value possible. By understanding the ever-shifting needs of your ever-changing customers, you, too, can stay ahead of the partnership as a precious resource, never again to be asked for mere price and product quotes.

That’s how record years are made.

Dirk Beveridge is president and chief executive officer of 4th Generation Systems, a sales, marketing and leadership development firm that helps distributors and manufacturers become more competitive and provide deeper value to customers. Dirk is an experienced business executive who has helped strengthen the sales and marketing strategies of leading firms, such as Time Warner, IBM, Andersen Windows, Avaya and Berlin Packaging. For more than 20 years, he has worked with over 3,000 firms as a leadership and sales management consultant, trainer and speaker. He can be reached at dbeveridge@4thgenerationsystems.com.