Archive for February, 2011

Team Work

February 24, 2011

This week I started thinking about team work after watching my son play basketball for his district team.

When I was watching my son I reflected on how much they had travelled to become a team in a really short timeframe. My boy is just 10 years old and his team were getting beaten comprehensively. But the boys didn’t give up. They tried new routines and kept persevering, eventually getting a basket and scoring. While the end score was a thrashing 66-8 the boys grew as a team and all improved and helped each other out.

Similarly in my team at work we have helped each other out in achieving our sales targets this year, even though it has been within a very hard ecomonic environment.

Katzenbach and Smith in ‘The Wisdom of Teams: Creating the High-Performance Organization’ (1992) investigate the lifecycle of a team. In analysis of this model I have compared the model and Sam’s basketball team:

Kazenbach & Smith Example

The more a team moves towards high performance means that the team’s performance will increase as will their effectiveness. I have seen this in my son’s team over the summer and I can also see it in my work team since we formed. This is why it is so important that we reach high performance as it will impact on our sales result. The Team model follows (1992, p.17):

Team Performance Model

What resonated with me was that a real team works together to achieve the performance required. The high performance team takes this one step further, not only does a team of this calibre achieve the task, its output is better and that the team earns more success and growth as a result.

I am going to use my new knowledge on high performing teams to ensure that we all have personal growth and contribute to collective success of the budget achievement.

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Sales Techniques That Really Work

February 17, 2011

In my current position I manage 22 Retail Shops, an 80 seat Contact Centre, a direct B2C sales force and a web sales team. My teams sell insurance, security, travel, automotive products and merchandise for the entire Group. To have such as diverse multi-skilled sales force you really need a system to drive the performance of the team and to hold managers accountable. To enable the teams to be effective in 2006 I introduced the Friedman Gold Stars sales system.

The system is very simple, it is a process to engage with the customer, in essence to become their friend, so that you can match your products and services to their needs to save them time and money. Then to measure the effectiveness a simple red dots for under budget achievement, green dots for getting budget and gold stars for over budget performance helps keep the staff motivated towards success. For managers it is about understanding that you need to keep your people free and clear to sell with little distractions and to coach this behaviour, similar to Greenleaf’s servant leadership.

For sales people the 8 steps to sales success are:

1. Precheck – making sure that you are ready to sell & that the store is presentable

2. Opening the Sale:
• Acknowledge every customer
• 180 degree Walk Pass – this is acknowledging the customer, but walking past them rather than approaching asking ‘can I help you’ which always gets a ‘no,
just browsing’
• Non-business related opening – breaking the ice to build rapport, as simple as saying ‘that’s a nice watch you have, where did you buy it?’
• Moving into business – saying ‘so, what brings you into the store today?’

3. Probing – finding out about the customer & their needs to match a product

4. Demonstration – selling the value that the customer wants

5. Trial Close – getting the sale by adding on another product

6. Handling Objections – investigating what is the issue, working through any price objection and using the objection to close the sale

7. Closing – identifying buying signals, asking for the sale and closing techniques

8. Confirmations & Invitations – confirms the sales and helps the customer get over buyers remorse and inviting back for another visit

I was introduced to the Friedman system in 2001 and have used it ever since as an effective tool to drive sales behaviour and success. What has been your experience with sales systems in your career?

Review of Harvard Business Review Article on Fiat

February 11, 2011

“Fiat’s Extreme Makeover” by Sergio Marchionne (Marchionne, S 2009, ‘Fiat’s Extreme Makeover’, The Australian Financial Review Boss, February, pp. 47-49)

In this broad ranging article Sergio Marchionne reviews the turnaround at Fiat from a company that was near bankrupt to one considering the purchase of Chrysler in just 4 years. While there are a number of factors that have contributed to this success there are two strategic human resources management (SHRM) initiatives that have assisted. These are:
• Terminating the old management and replacing them with new, younger managers with a background in marketing, not engineering (Boss, 2009, p.48)
• Replacing the old managers and the ‘management by committee’ leadership style (Australian Financial Review, 2009, p.60) has changed the culture of Fiat to leadership characterised by autonomy and initiative (Boss, 2009, p.48).

Holmes, Schnurr and Marra (2008, p. 434) say that a change in top level management will also change workplace culture. This clearly occurred at Fiat when Marchionne changed the top managers. Gone is the CEO making all of the decisions to an organisation where everyone is expected to lead and to achieve their stretch targets (Boss, 2009, p. 48). This is supported by Yukl (2008, p. 716) who says that the CEO can’t be the only hero; a distributed leadership is required to achieve a high level of financial performance.

This change to top management occurred after just 60 days of Marchionne’s arrival (AFR, 2009, p. 60). These managers were replaced with a new generation of leaders mainly sourced from within the company, including consumer marketers and HR specialists. This is an example of SHRM and strategic planning in order to reshape Fiat and to change the culture for success. While on the surface it may appear harsh of Marchionne to terminate a large number of leaders within Fiat, this is becoming a common occurrence in other organisations throughout the world (Manderscheid & Ardichvili, 2008, p.113). One of the key strategies is placing the right leaders in the right positions (Manderscheid & Ardichvili, 2008, p.115) and the need for organisations to position and reposition leaders as required to stay competitive. Fiat needed to change the culture and achieved this through terminating old style managers in order to promote talent that could move Fiat towards profitability and survival.

Workplace culture has been defined as ‘the way we do things around here’ (Bower cited in Holmes et al, 2008, p. 435) and this definitely was the case at Fiat where leadership was management by committee. Marchionne has changed this by:
• Unlocking talent within the business and appointing new energetic leaders to top management roles
• Giving staff responsibility and holding them accountable (Boss, 2009, p. 48)
• Moving away from engineers in top roles and replacing them with marketers or external specialists (Boss, 2009, p. 48-49)
By making these changes Fiat’s new way of ‘doing things around here’ is now based on accountability, openness, communication, flexibility and sharing ideas (AFR, 2009, p. 60). This has allowed Fiat to reduce their time to market on a new vehicle from 4 years to just 18 months (Boss, 2009, p.48). This could only be achieved by changing the workplace culture.

Despite this success, not all is ‘rosy’ at Fiat. Marchionne says in Boss (2009, p.49) that being a leader at Fiat is ‘a lifestyle decision’. Leaders need to give up their time including weekends to attend meetings and therefore there is a lack of work-life balance for them. Fiat clearly requires their top talent to dedicate extraordinary amounts of time and resources to help drive the company. This could lead to reduced staff satisfaction and over time could increase staff turnover (Deery, 2008, p. 795). It also could be seen as discrimination against women or people with families (Stone, 2008, p.747). In contrast kindergartens and shops have been built near plants to assist front line staff to balance their lifestyle (BOSS, 2008, p.49). Marchionne could have also changed the culture by creating for Fiat a new set of values and goals that all employees and managers must religiously adhere (Freeman, 2009, p.47). Through a top down approach this would have resulted in a radical shift in employee and top management behaviour (Freeman, 2009, p.47) and may have caused less short term pain at Fiat than terminating top managers.

It is clear that Marchionne is driven to change Fiat and so far these strategies appear to be working. Fiat has a definite SHRM philosophy and has been able to change its culture. However, other aspects of employee relations such as leaders work-life balance are still very underdeveloped. This should be a focus of the HR Executive and CEO to prevent turnover of top talent and to encourage a more diverse range of people to apply for these positions at Fiat.

What are the capabilities that a Key Account Manager must possess?

February 4, 2011

The main attribute of a Key Account Manager is to be the intermediary between the organisation and the customer, focussing on finding solutions for the customer and building long term relationships. Other capabilities are:

• The ability to find solutions and match needs with outcomes, whether the outcomes be a product (sale), advice, support or connecting the customer with experts.
• Investigating ways of ensuring that the customer gets the best deal and identifying ways of reducing their costs while increasing their profit.
• Multi-tasking to manage several large customers simultaneously.
• A deep understanding of the products, services and solutions sold by the company.
• A deep understanding of the each of the customer’s businesses, needs, attitudes and response times required.
• The ability to build long term relationships through exceptional customer service while demonstrating a genuine concern for the customers wants and needs.
• The willingness to go beyond the call of duty to service, manage and offer solutions to their valued customers.
• The ability to make immediate decisions on their own to overcome customers’ problems.
• Challenging the company’s procedures and policies to ensure that the customer is at the centre of all activity.

The outcome of doing all of the above will be to generate more sales for the business.