Sales Best Practices for Selling IT Consulting

We've Moved

2010-12-22T15:33:00.001-05:00

Sales Best Practices for Selling IT Consulting Services blog has moved to http://www.menemshagroup.com/itsalestips

Writing Effective Proposals

2010-12-02T18:07:00.001-05:00

Last month I spent a few minutes talking about responding to RFP's. More specifically I shared two thoughts to keep in mind when considering responding to an RFP. First, if you didn't create the opportunity through your own sales efforts than you have a very low chance of winning (less than 10% according to an IBM study) . In this case your time is better spent on creating your own opportunity, not responding to a random RFP. Second, if you must compete on random RFP's you need to develop a strategy. Ideally your strategy should dictate how you're going to change the playing field (decision making criteria) and to do that will require you to go around the person who included you in the RFP. This month I want to talk a little about how to write an effective proposal.

I don't know about you but most proposals I see-and I have seen a lot (selling software, staffing, consulting services) -focus 98% of the content on broadcasting features and benefits and 2% focused on the customer's goals and objectives and anticipated outcomes. It's as if we think whoever sends in the heaviest proposal is going win! Let me make this clear; your customers don't care about your service offerings. They expect you to do all those things. They're not buying your services, their buying business results that are the end deliverable from your service offerings. So how do you sell business results?
The most important part of a proposal is the Executive Summary. Interestingly enough most proposals don't even include an Executive Summary and those that do still miss the point. The Executive Summary can be broken down in to a few key points.

Define the customers business problem

The first you need to do is demonstrate to the customer that you truly understand their business and their business issue(s) that need to be resolved. This is not simply paraphrasing the customer's requirements. The customer's requirements is not the same as their business problem(s). You must write in as much detail as possible everything that you know about your customer's business and the problems their experiencing. The problem is the compelling event that has driven them to seek a solution. If you can't demonstrate that you understand their issue than how can you expect them to have confidence in your proposed solution? You might be asking, "how do I find out the details of my customers business problem(s)? By asking. Asking the questions that lead you to these answers is selling! So ask really good questions and take really good notes because this information is going to go into your proposal. Specifically, the executive summary.

Define the impact of the business problem

Simply understanding your customer's business problem is not enough. Now you must explain why resolving the issue(s) is so important. You need to understand the impact of the problem. Who is the problem affecting? Customers? Employees? Partners? Shareholders? Stock price? Market share? Your client's year-end bonus? Perhaps their job? All of this needs to be detailed in your executive summary.

Define the anticipated business results

How am I suppose to know what the anticipated outcome are? Isn't it always just reduced costs? No! Certainly cost reduction is often one benefit but you need to talk to all of the executive stakeholders and ask them what specific results they hope to see. You need to describe all of the ways in which the company will benefit if the problems are resolved and the goals are met. This can mean many different things to different people, depending on how you ask. For example, replacing a legacy order entry system can please the CFO from a cost stand point (reduce costs), the CEO from an earnings standpoint (generate more profit) and the CIO from an efficiency stand point (less employees to manage a new system with less down time). This is not a discussion of your features and benefits. But if in your proposal you only write about the anticipated outcomes for the CIO, it will not appeal to the CEO or CFO. Also, this is NOT the area to talk about your features and benefits. Instead, this area should focus on the benefits the customer will get from your solution....increase revenue and market share, shorter time to market, etc..

Define your solution

Here is where you should define (in non technical terms) your solution. You should include your approach for solving the problem and be able to connect the dots between the client's business problem and your solution. Ideally, you should have a story (keep it pointed) that highlights how you have solved this same problem for other customers.

Call To Action

Finally, and don't forget, ASK FOR THE BUSINESS. Let the customer know you are excited about the opportunity and look forward to working with them. Don't include pricing or any other company literature in this area.

I can assure you that most proposals are won and lost based on the vendors ability to demonstrate how well they understand the customer and their business. If you have ever hired a vendor (even a contractor to do work on your house) than you know what I am talking about. You want a vendor who understands you and "gets it," not the vendor with all the bells and whistles.

Thanks and Happy Selling!

Dan Fisher is Founder and Managing Director of Menemsha Group, a Boston based sales training and consulting organization. To learn more visit www.menemshagroup.com or email dan at dan at menemshagroup dot com.

Responding To RFP's

2010-11-09T11:24:00.002-05:00

Greetings and happy Fall! This month I turn my attention to talk about responding to RPF's and participating in bids. I see a lot of organizations in our industry exert a lot of time, energy and resources ($$ and manpower) responding to RPF's only to get little or nothing in return. I have spent a large part of my sales career "elephant hunting" for winning large global accounts and I have a learned a few lessons. Going into all the details would be impossible but let me share with you two rules that you should keep in mind when evaluating and responding to RFP's.

Rule #1

If you didn't generate the sales opportunity through your own prospecting, relationship building and qualifying efforts on your own than you have a slim to zero chance of actually winning the opportunity. Have you ever received an RFP from a prospective company where you (and your company) didn't have much or any relationship with the prospective client but they still included you in the RFP process? Sure you have. We all have! Did it ever dawn on you to question it..."gee, why are they including us, we don't have a relationship with them." These are the opportunities I'm talking about. 99% of them are a waste of time. IBM actually did a study on this and discovered that if you didn't "create the opportunity and set the buying criteria," than you have less than a 10% chance of winning it. The reason is some other sales person out there has been working their tail off creating and cultivating the opportunity. They set the buying criteria and vision of the ideal solution with the customer and in many cases even wrote or contributed to the RPF themselves. Don't waste your time on these, instead invest your time on creating your own opportunities. Of course it is more work, that is what sales is. Focus your time and energy on creating your own opportunities and you will significantly increase your close rate. And you will have much healthier pipeline.

Rule #2

If you simply can't resist responding because the RFP opportunity is " too good" pass then......You must find out who is on the decision making committee and what each member's role is on the committee. I know the procurement person who sent you the RFP will clearly tell you "If we find that you have contacted anyone in our company regarding this opportunity, your company will no longer be considered." Whippidy do!! We already have a 90% chance of losing! Instead, go around this person (their job is to keep you at bay so don't even bother asking for their help) and uncover who the decision makers are and push for a face to face meeting (our training teaches you how to get these meetings) to interview each decision maker and uncover the business drivers for the initiative and what their ideal solution is to solve the problem(s) they seek to fix. Without this information how can you expect to pitch a solution that will meet their needs? Now I know some of you reading this disagree with me and might be saying "I won the ABC account off of an RFP bid like this and we now do $5M in business with the customer." If that is the case that is great. But how many RFP's just like that one have you had to bid on before you actually won that one account? Let's not forgot about the most valuable asset of all and the one we have the least of. TIME. It takes a ton of time to gather the information requested in these RFP's. So let's be sure we qualify the heck out of the opportunity before making the decision to invest the time. Deciding when to compete and what strategy to deploy are critical to your success.

Next month I'm going to share some ideas on how to write winning proposals. At the end of the day, we should really be presenting proposals, not responding to RFP's. There is a difference between the two. Specifically I'll share with you the most important part of the proposal including the key ingredients that go into a successful proposal.

Thanks and Happy Selling!

Frustrated With The Sales Cycle?

2010-10-13T18:32:00.000-04:00

As I talk with customers, industry thought leaders and other product and service providers across the country about the recovering economy and the staffing industry as whole, one common theme has emerged; order activity has picked up but customers are “dragging their feet.” CEO’s, executives, sales and recruiting professionals alike are frustrated with what little results they have to show for all of their hard work despite the significant increase in order activity. The sales process continues to be plagued by delay after delay and move at a snails pace. What is one to do?

I figure the timing couldn’t be better between this revelation and the fact that I am hosting a sales training workshop on this very topic at this week’s Staffing World hosted by the American Staffing Association in Las Vegas. The topic: How To Manage The Sales Cycle and Close More Deals Quickly & Efficiently.

What I have come to realize in our industry is that our sales process can be described as a random sequence of events. We get a job order from a customer-either over the phone, via email or in a client meeting-post it to our internal CRM system and the job boards and write it up on our white board in our office for all to stare at -and then we simply focus on finding and submitting candidates. Beyond that we have no clue as to what needs to happen in order for our deals to close. We just hope we submitted the most qualified candidate for the job. Many of the common sales bottlenecks and major points of frustration occur when we try to get feedback from our client’s on the candidate resumes, when we try to schedule interviews or when we try to get feedback after an interview and/or attempt to get the client to make a final decision. It’s one delay after the other. And we all know time kills all deals. So what is one to do? How can we prevent these delays and keep the process moving forward? First we must understand the problem.

The problem is twofold. First, we focus exclusively on the tasks that WE have to complete and far too often fail to recognize, understand and appreciate the tasks that our client has to complete in order to hire our consultant or temporary employee. This is why I typify our sales process as a “random sequence of events.” After we complete all of our tasks (take job order, screen candidates, interview candidates, reference checks, etc..) we stop selling. We go into “wait and see mode” and hope to hear back from the client because we think once our candidate completes the face-to-face client interview that we are now at the end of the sales cycle. We’re not. And that leads me to the second problem. We stop selling. We stop selling because we have completed all of our tasks in the sales process but we fail to understand and recognize where our customer is in their purchasing process.

In my workshop this week I am going to be sharing with the group how and why we need to continue to sell well beyond the submittal and interview process. We’re going to explore all of the steps or tasks that a typical client has to complete in order to hire a consultant or temporary employee and why it is critically important that we understand these steps. Second, I’m going to share how you to lead your customer through their purchasing process by applying project management principles. Third, I am also going to share strategies on how to eliminate these bottlenecks. In the end, the group will discover that the sales process is your customer’s purchasing process and that you earn commissions based on what your client does, not what you do.

If you’re interested in putting an end to the frustrating bottlenecks in your sales opportunities and would like to close more deals quickly and more efficiently, give me a call at (617) 506-1186 or simply email me at dan@menemshagroup.com

"I'm Happy With My Current Vendor"

2010-09-06T10:50:00.002-04:00

I'm happy with my current vendor. Try me back in 6 months.

We've all heard this one before...over and over and over again. Let's face it, it's not an easy one to overcome. And rule #1 in sales is "no pain, no sale." In other words, if the customer has no dissatisfaction with their current situation and/or supplier(s) then they have no compelling reason to make a change and start using your service or product. They will stick with the supplier that has proven themselves. After all, "if it's not broken, why fix it" The trick to getting new opportunities with new customers who give you this objection is getting the prospect to open up and share with you their dissatisfaction with their current provider. How do you do that?

First, we must be certain we are doing an effective job of disarming our prospects and making them feel comfortable in speaking with us. Ultimately, if our prospects don't "let us into their world," we will never learn about their business issues and thus be able to offer ideas and solutions to those business issues. If a prospect is afraid to make themselves vulnerable to you than you have not effectively disarmed them. Think of the movie Goodwill Hunting and how Robin Williams (the psychologist) had to make Matt Damon (patient) feel comfortable before he would open up and talk. For tips on how to do this check out my white paper, Cold Calling Tips & Techniques. Now back to that objection.

When I first got into sales and I started hearing the "I'm happy with my current vendor" objection, I use to always respond by asking "if you could change one thing about your vendor, what would it be?" My hope was that that the prospect would tell me something about their vendor that they were not happy with and thus give me an opening. But I almost always got a "nothing, our vendor is great" response. And in those rare occasions when the prospect did have something negative to say about their vendor they always counter balanced it by saying "but I don't expect my vendor to be perfect," or "but that doesn't mean I'm looking for a new vendor." In the end, I never got through the objection. Until one day, and on accident I finally broke through. Here is what happened.

Client: "Dan, were happy with our current suppliers, but you're more than welcome to stay in touch. Try me back in 6-9 months."

Me: "Thanks for the feedback Mr. customer. Despite how much I really want your business, I'm sincerely happy for you and your company and how well your vendor has performed. Let me ask you, what is their secret? It's as if they are perfect."

Client: Goes on to tell me about all these great things their vendor does and what they love about them.

The client just went on and on about how great his vendor his, what am I suppose to do? I had nothing to say in response because I was stuck. I didn't know how to respond. So we have a long uncomfortable pause that seemed to last forever. While I'm thinking of how to respond the customer finally speaks up (after a long pause) and says "You know Dan, I guess the one area that has been a concern is....."

First, I was relieved that the customer said something, because I had no idea where to take the conversation. He sort of let me off the hook because nothing was coming to mind. Second, and more importantly, he opened up the door for me to ask further clarifying and qualifying questions to understand this concern in further detail. We went ahead and had a conversation about that concern and how I thought I might be able to address it. Long story short, that prospect became a customer. So what is the lesson learned?

When a prospect gives you the "I'm happy with my current vendor" objection ask them the following question: "What do you like best about working with ABC Company?" No matter what they say in response, wait 7-10 seconds even if it seems like an eternity and becomes an uncomfortable moment of silence (which it will). See if the prospect offers up a negative comment or concern about their current supplier. Not always, but often they will. And as my example above shows, a prospective typically will not share with you what they don't like about their current supplier when blatantly ask them. But you can pull it out of them if you are patient and tactful. Remember, the key to this is to shut your mouth and not say a word no matter how unnerving it is. Try it next time you hear the objection and see how the conversation goes. Once you get the prospect to share their point of dissatisfaction with their supplier it is up to you to turn that "pain point" into a sales opportunity. Keep asking questions.

How Do We Sell Differently?

2010-08-15T19:24:00.001-04:00

Times are a changing! Actually times have changed. Senior level buyers and executives-the people who are now making the decisions on what staffing and professional service organizations their companies ought to use-are interested in buying business results, not just individual products or services ("skills," "talent" and "people") or features and benefits. Leading sales organizations today are recognizing changes in buyer behavior and client expectations and redefining what value means, through the eyes of their customers. In other words, they are taking the time to understand what their customer's business goals and objectives are and what business outcomes they seek. That is what the customer values. Translated into the world of IT staffing and consulting (and this applies for all of staffing/professional services), customers are interested in buying the business results that your consultants/candidates will produce for your customer. To achieve this we need to understand what their "current state" is and what their desired state or "end state" is. And we need to understand why it is important for them to get there. To operate at a strategic level sales professionals must understand the customer's problem, the impact the problem has on the organization (who, what departments, how, does it impact customers, suppliers and partners too?), and the group of stakeholders responsible for solving the problem(s). Lastly we must understand what the customer must do in order to solve the problem (and determine if they are committed to doing so).

Why Haven't We Adapted?

2010-08-05T15:59:00.003-04:00

I watched the movie "Hot Tub Time Machine" the other day. I know, nothing to brag about but hear me out..... I was looking for some good humor that required no thinking. The movie is a big spoof on the "80's." Watching the movie and seeing (and remembering )the fashion from the 80's and what was in style and "cool," was hilarious. All good humor. But all this time lapse back to the 80's got me thinking. Why are we still selling staffing and professional services the same way it was sold 10, 15 and 20 years ago? If you really think about it and if we're being brutally honest with ourselves, we as an industry are stuck in a time machine......in the wrong time zone!

Let's do a quick (high level) history lesson of our industry. Over the past 10-15 years we have witnessed a lot of change in our industry. Low-barriers to entry have crowded the marketplace with an over-saturation of service providers. The supply of IT staffing firms (and all professional services) far outweighs the demand for these services. The .com boom represented the dawn of the job board era with the birth of Monster.com, Dice.com, Career Builder and many others and it introduced us to procurement services software products such as Ariba. Traditional clerical and administrative staffing firms expanded the scope of their service portfolio to not only include IT staffing services but also MSP and VMS programs. Bench based system integrators including the “big-five” now generate a significant portion of their revenues through staff augmentation services. And perhaps the biggest change and impact on the industry has been the rise of the Chief Procurement Officer within corporate America. The process for purchasing contingent labor within corporate America has become fragmented among executive stakeholders thus making the selling process more complex. Competition and pricing commoditization have reached unprecedented levels and service differentiation is close to impossible. Customer expectations continue to rise and buyer's are much more sophisticated than they were in the past. Despite all this we still sell the same way we always have. Why are we still selling with our "leg warmers" and "Miami Vice T-Shirt" on? Why haven't we adapted?

Here is an interesting quote I recently read.

"We're aggressively positioning ourselves in important ways for future growth. We did a complete refresh of our strategy for growth. We did this with the bias that the economy has not just slowed, it is resetting itself. It will emerge differently in terms of client needs, business models and buyer values."
-William D. Green, Chairman & CEO, Accenture

How Do We Sell Differently?

Time are a changing! Actually times have changed. Senior level buyers and executives-the people who are now making the decisions on what staffing and professional service organizations their companies ought to use-are interested in buying business results, not just individual products or services ("skills," "talent" and "people") or features and benefits. Leading sales organizations today are recognizing changes in buyer behavior and client expectations and redefining what value means, through the eyes of their customers. In other words, they are taking the time to understand what their customer's business goals and objectives are and what business outcomes they seek. That is what the customer values. Translated into the world of IT staffing and consulting (and this applies for all of staffing/professional services), customers are interested in buying the business results that your consultants/candidates will produce for your customer. To achieve this we need to understand what their "current state" is and what their desired state or "end state" is. And we need to understand why it is important for them to get there. To operate at a strategic level sales professionals must understand the customer's problem, the impact the problem has on the organization (who, what departments, how, does it impact customers, suppliers and partners too?), and the group of stakeholders responsible for solving the problem(s). Lastly we must understand what the customer must do in order to solve the problem (and determine if they are committed to doing so). Critical to executing this is the salespersons ability to recognizing and understanding the customers problem and connecting the dots between the customer's pain point and their solution offerings. Lastly, the salesperson needs to be able to translate the concept into a workable solution so that the customer feels confident in your ability to help them achieve their "end state." One of the biggest challenges or issues I hear from business owners and sales professionals is their inability to establish follow up meetings with their clients and prospects. This is especially true with senior level contacts-VP's, EVP's and the C-suite. Perhaps one of the causes for the lack of follow up meetings is the salespersons inability to demonstrate to the customer that they understand the customer's critical business issues and can map those issues to their service offerings and offer a solution?

Why Haven't We Adapted? When Will We Adapt?

So back to my original question, "Why haven't we adapted?" I don't know the answer to this question, I am sure there are lots of reasons. But what I do know is that every sales professional, business owner and managers across the country that I work with desperately wants to "sell to the C level," "sell a solution," "get on the approved vendors list," and "win the RFP/bid." They want to win more market share and they want to "sell deeper and wider" in their existing accounts. To do so we will need to start having these conversations with our prospects and customers. If you're ready to lose your "leg warmers" and get with the times, give us a call, we just might be able to help you.

Have The Courage To Walk Away

2010-07-21T10:14:00.005-04:00

Last month I shared with you, A Quick & Easy Way To Grow Gross Profit. In the spirit of growing and maintaining the integrity of our gross profit margins, this month I share a few thoughts regarding the difference between "good" business and "bad" business. And more importantly, why we need to have the courage to walk away from bad business.

First, let me begin by saying that not all business is good business. Just because we have a customer who hires IT consultants (or any type of temporary employee) doesn't mean we should pursue them as a client. They must qualify for our business. Yes, I said that right, they must qualify for our business. We're sales professionals, this is how we pay our bills and put food on the table for our families. We don't have time to chase "tire kickers" or "window shoppers." One of the beauties of being in professional sales is that we can pick and choose who we do business with. We don't have to do business with a jerk or someone who treats us with disrespect. We have total control! In sales, we all (myself included) need to look ourselves in the mirror from time to time and make sure we're being honest with ourselves. As sales professionals it can be easy to fall into the trap of chasing business even though we know in our heart we don't have a great chance of winning it. We have to take more pride in the quality of the deals that we bring to the table. Let me share a few examples.

I am currently seeing employers with crazy, unrealistic expectations. In essence, I'm seeing customers who are looking for a "Mercedes" but are only willing to pay for a "Ford Pinto" (sorry to anyone driving a Pinto)! I see recruiting and sales teams waste their time on these efforts everywhere I go. Remember, YOU are the experts on the employment market. YOU know what skills and experience warrant the corresponding salaries and/or hourly pay rates. Despite that, I see recruiters and sales people agreeing to do a search for candidates where the client is looking to pay $90,000.00 even though the market rate is $110,000.00 or even more in some cases. Stop This! Consult with your customer by educating them on what is happening in the market. This is the perfect opportunity for you (and us as an industry) to step out of the "transactional selling" mode and put on your "consultative sales hat." Customers want a vendor who can consult with them and educate them on market factors and trends. They want a vendor who will push back on them and challenge them. What they don't need is another "bobble head" vendor who always agrees with them. Where is the value in that? If your customer is looking to hire someone at $90,000.00 and the market is demanding $115,000 don't be afraid to tell them that. Consult with them by suggesting they consider some technical trade-offs in exchange for finding someone with a lower salary history/expectations and who will fit into the client's budget. If they can't live without any of the skills/experience and still expect to pay $10-$20K (or whatever the difference may be) below market value then you have to have the courage to say "thanks but no thanks. This sends a strong message to the client; that you're a professional, you know the market, you take your job seriously and you respect their time. Oh, and you will also sound different then all the other vendors. Many of the other vendors don't have the courage to say this to the customer so perhaps you will earn some additional respect in the process and differentiate yourself. Don't be afraid to walk away and find a better deal. They're out there. Otherwise you are just wasting your time and your customer's time.

Another example that I frequently see (and we've all experienced) is where the client gives us zero feedback. They don't respond to our emails and they don't respond to our phone calls but yet we still hold on to the deal for as long and as hard as possible. It's like that scene from the movie Dumb & Dumber where Jim Carrey asks the girl what his chances are of him going out with her. She tells him he has a one in a million chance. Jim Carrey responds with "so you're saying there's a chance! Yeah!!" Trust me, there are customers out there who need your help, value your business and will treat you with respect. Go find them and stop wasting time on deals and customers that have little chance of closing. We all know better. Listen to your gut.

Ask yourself this. How long would you stay friends (or pursue a friendship with someone) who never returned your phone calls and basically displayed behavior indicating that they were not interested in your friendship? You can't build friendships (or client partnerships) when one person is doing all of the work.

My third example is plain and simple and this happens far too often in our industry. The client asks us to drop our rate. Often times they ask us to drop our rate for no reason and we typically get nothing in return for reducing our rate (we don't negotiate for anything in return). Even worse is when the customer asks us to reduce our rate so low that we barely even make a profit, don't make a profit, can't get paid a commission or worse of all, actually take a slight loss to retain the business. Yes, I have seen that on more than one occasion. In these situations we need to know ahead of time how much of a "hit" we're willing and able to absorb prior to the conversation with the customer. If the customer asks us to reduce our rate below this threshold than we need to have the courage to walk away.

No doubt there are a number of factors outside of our control that have led to the commoditization of our industry. But let's be honest with ourselves. We (staffing professionals) have been our own worst enemy. Far too often we try to win business on price. We engage in bidding wars and give in to customer price reductions far too easily. Bidding wars is bad business for everyone-the client, the winning vendor and the losing vendor. We need to have the courage to walk away from bad business. I can assure you this: Once you reduce your rate, you're not going to make up that GP with the customer at a later date. It just doesn't happen.

Easier Said Than Done

I know this is easier said than done. I know it has been a challenging 18+ months and the economy has struggled and Wall Street is putting pressure on companies to produce a profit, but where does it end? The best and easiest way to put an end to doing bad business is to go find more and better opportunities. They're out there. I know many firms that are consistently making placements and generating GP margins north of 30%.

From my experience, sales professionals often give in on price for one simple reason: They don't have any other opportunities to rely on. So start building a bigger and better pipeline of opportunities so you don't get put into the position of having to reduce your price.

Just image if all the staffing firms in the industry starting pushing back on client's when they asked for a price reduction? Imagine if the bidding wars to win business ended? Imagine if we all started walking away from bad business? The market might actually turn in our favor. Do your part and start making it happen today.

A Quick & Easy Way to Grow Gross Profit

2010-06-29T22:08:00.001-04:00

One of the most surprising (and far too common) things I have discovered within our industry is how unaware and out of touch we can often be when it comes to pricing a deal. I work with staffing professionals all day long, every day and I watch them put deals together. Screening process complete, check. Meet the candidate face to face, check. References conducted, check. Completed background check, check. Get the job offer from the client, check. What amazes me however is how little and infrequently I see a sales representative or recruiter using their calculator to crunch the numbers to ensure they hit their target GP%. Naturally I ask the folks I work with and observe "How did you arrive at the bill rate?" And the response I always get is "oh, well we always just shoot for an "x" markup." I might respond with an "oh, and does that markup get you to your target GP%?" "Is that markup going to give you the highest commission payout you can earn?" I often get a funny look back in response. And I ask another question, "do you know what your target GP% is?" I get another funny look. I can't emphasize this enough, it is very important that you know basic math formulas for pricing deals. Let me offer a quick overview on the math so you can start putting more money in your pocket today!

Understand The Difference Between Markups and Gross profit

To some of you this may be really basic stuff but to many others, as I have discovered, this is new. A markup is simply "marking up" the candidates pay rate by a specific percentage but not (typically anyway) accounting for your T&B (tax & burden, also referred to ask fully loaded cost). For example you get a job order and find a candidate for a $35/per hour pay rate and you multiply that by 1.50 to arrive at your bill rate of $52.50. Gross profit on the other hand is your bill rate minus your fully loaded cost (candidate pay rate x your burden %. This varies from state to state but is around 15%-22%). For example, many firms feel a really good markup 50% but did you know that a 50% markup is only equal to about a 24% gross profit. A good gross profit % to shoot for is 35% (in the IT staffing industry, it is often lower in other staffing disciplines). If you are not familiar with the math and the correct formulas to use to calculate gross profit dollars or gross profit % send me an email and I will email you back a document that has all of the formulas you need to know.

How Can I Quickly & Easily Grow Gross Profits?

Us staffing folks are addicted to markups! Stop working off markups and start working off of a client budgeted bill rate. The next time you get a job order simply ask the client what their budgeted hourly bill rate is. Once you figure that out, figure out what the maximum pay rate is you can pay the candidate and still hit your targeted gross profit % (formula available in my content, just email me, dan@menemshagroup.com). Then share that number with your recruiter. Tell them that is the maximum pay rate for that job. It's up to you if you want to flex a little with your client on the bill rate. But doing this instead of just assuming an "x" markup will significantly increase your gross profit dollars. When I was selling, my targeted gross profit % was determined by my compensation plan. So whatever GP% would pay me the highest commission, I made sure I closed every deal at that GP%. Chances are you get commissioned off your gross profit, not your markup. Take a look at your compensation plan and let your compensation plan drive your pricing. I promise you, if you start doing this and move away from working off of markups you will make your company more profitable and you will earn more commissions.

Five Dangerous Trends Facing IT Staffing Firms & Recommendations For Action

2010-04-07T08:00:00.012-04:00

Executive Summary

According to a study by TechServe Alliance the IT Staffing and Consulting Services industry has ballooned into over a $20 billion-dollar market. In recent years however we have witnessed a number of dangerous trends taking hold within the IT staffing services industry. Low-barriers to entry have crowded the marketplace with an over-saturation of service providers. The supply of IT staffing firms far outweighs the demand for these services. The .com boom represented the dawn of the job board era with the birth of Monster.com, Dice.com, Career Builder and many others and it introduced us to procurement services software products such as Ariba. Traditional clerical and administrative staffing firms have expanded the scope of their service portfolio to not only include IT staffing services but also MSP and VMS programs. Bench based system integrators including the “big-five” now generate a significant portion of their revenues through staff augmentation services. And lastly, a rising star within corporate America has been that of the Chief Procurement Officer. The CPO has gained popularity due to their ability to cut costs and reduce expenses primarily through a mix of strategic sourcing, demand management, change management and supply chain optimization initiatives. Under the CPO’s leadership, organizations have consolidated demand to achieve purchase price reductions across the enterprise. If all of that were not enough, the process for purchasing contingent labor within corporate America has become fragmented among executive stakeholders thus making the selling process more complex. As a result of these trends IT staffing firms are fighting for their lives. Competition and pricing commoditization have reached unprecedented levels and service differentiation is close to impossible. Selling IT staffing services has transformed from a simple category buy to a complex, enterprise sale. Yet the industry continues to sell the same way it has sold for the past twenty-five years. How can IT staffing firms survive the impact from these trends? What must they do to counter these challenges in order to restore the integrity of their gross profit margins, differentiate from the competition and win "good" business? This white paper examines these trends and their implications and offers recommendations for action.

Click on the link below to read the rest of this white paper
The Five Most Dangerous Trends Impacting IT Staffing Organizations

Six Strategies To Deploy in a Recovering Employment Market

2010-02-26T10:43:00.001-05:00

Preparing For the Economic Recovery: Tactics To Increase Your Placements Today

Fortunately or unfortunately I'm not much of an optimist. I tend to see the glass as "half-empty" which I suppose is the irony in me writing this article. Me merely writing it implies that I do in fact see and believe that the worst of this recession is behind us. I certainly don't expect miracles to happen overnight but I do believe the staffing industry is on the road to recovery. From what I am seeing and hearing from customers and others in the industry, budgets are slowly opening up. Job orders and interview activity is also picking up pace. As a result there are a lot of hungry sales professionals in the industry ready to start making placements. The question is, are you prepared to deliver? Here are six tactics you need to keep in mind in order to capitalize on a recovering employment market.

1. Understand the Market: First, you need to understand that there is a ton of pent up demand. Client's have put a number of different projects and initiatives on hold for the past 9, 12, 18 and even 24 months. As a result there is massive pent-up customer demand. Customers want and need to innovate and deliver new products and services to meet customer demand. They also need to meet this pent-up demand in order to stay competitive and retain their market-share. Key Takeaway: Find out what "pent up demand" resides within your client accounts and prepare to help your clients deliver by understanding their sourcing plan and establishing your bullpen of candidates. In past recessions, pent up demand has fueled the hiring of additional staff.
2. "Recruiters Come Out Of Hibernation:" In a down economy, like the one we've been living in the past 12-18 months, all of the pressure is on sales. Sales people are trying to do everything they can to generate job orders. It's not easy and it can be down-right frustrating. During these tough economic times staffing organizations focus much of their time and effort on their sales process and how they can generate new business. Recruiting takes a back seat because the focus is on generating new job orders. The reality is that recruiter's are not on the hot-seat like sales is in a down economy. Recruiters are simply in a holding pattern until they have job orders to fill. Don't get me wrong, recruiters are frustrated too and I know many who work diligently to prospect for new business. But what I have seen in this recession as in the past is that recruiters tend to go into hibernation. What I mean by that is they become passive and they lose their edge. It's not a knock against recruiters, it's simply human nature. You go 12-18 months or even longer where job orders trickle in at a snail's pace and you become a victim of circumstance. You don't stay in touch with your candidates as often because you don't have any new job opportunities to share with them. You don't add as many new candidates to your CRM system because you don't have any active job orders. You don't focus on recruiting passive candidates because employees are simply fighting to keep their jobs, not change employers. This is the wake up call. As the market starts to turn and the volume of job orders picks up, the tables are going to turn. The pressure that has been on sales the past 12-18 months will soon gravitate to the recruiting side of the house. Soon enough the mounting pressure will fall on the recruiters to fill all the open job orders. And believe me, there is a lot of pent up customer demand. The question is, are you prepared to deliver? Key Takeaway: Now more than ever you need to stay in touch with your candidates on a daily or weekly basis. Interview activity is going to pick up. The recruiters who have their pulse on the market and their database of candidates are the ones who will reap rewards.
3. Recruit Passive Candidates: When a recession hits, employees naturally become fearful of losing their jobs. They do everything they can to keep their job and survive layoffs. However, actually surviving a company layoff, especially multiple layoffs, can be demoralizing. For the employees who survive a layoff(s), it is very common for them to want to make a move to a new company because they become frustrated with their current employer. Often times they have to give up responsibilities, take a demotion and even a pay cut. When the economy rebounds however, these employees are ready to make a change as soon as possible. These are the candidates who are top notch and in high demand but are typically not working with a recruiter and their resume is not posted on the job boards. Key Takeaway: Proactively recruit candidates and tap into the hidden pool of candidates who have patiently waited for the market to turn. They need a recruiter to help them make the next step in their career. You need to act now and you need act quickly because the competition will be fierce for acquiring and delivering this talent. This is the talent your clients are seeking, not those who have been out of work for 3, 6, 9 or 12 months.
4. Skill Market Candidates: Assuming you have done tactics #2 and #3, you're now ready to skill market your candidates to your prospects and clients. However, when I talk about skill marketing candidates I am not talking about matching buzzwords on a resume with buzzwords on a job description. What I'm referring to is actually selling business results. What I mean by that is you need to understand the business results your candidate(s) has delivered for their past employers and be able to demonstrate how they can deliver the same or similar business results for the client you are skill marketing the candidate to. For example, when proposing (selling) a candidate to a customer, focus the conversation on what the company was able to do a result of your candidates work, not on their individual skill sets. You can sell skill sets when the customer asks. What you are doing instead is proposing a more strategic, holistic solution. Key Takeaway: Understand the problem(s) your candidates have sold for other/past employers. Find customers/prospects who struggle with those same (or similar problems) and sell your candidate as the solution.
5. Sales & Recruiting Alignment: A common mistake that I often see within staffing companies, especially those selling professional staffing (Scientific, IT, Engineering, etc) is that there is often no alignment between the sales team and the delivery (recruiting) team. As a result you have sales people generating job orders for candidates in which the recruiting team has none of. Put another way, recruiters may have a database full of Oracle database administrators but sales keeps getting job orders for Project Managers. On the tail end of a recession or the brink of a recovery it's more important than ever that sales and recruiting teams work closely together to ensure that their strategies mirror one another. Competition is going to be fierce for new job orders as well as candidates. you can't afford to misfire on opportunities. And spreading yourself thin and trying to "be everything to everyone" is never a good strategy, especially in times like these. Key Takeaway: Have a sales and recruiting strategy meeting to ensure sales is focused on pulling in job orders that are aligned with the recruiting team's candidate database or vice versa. When the market does turn and hiring budgets truly do open up it will be a feeding frenzy for staffing companies. Make sure you are properly aligned internally to meet this demand.
6. Cross Selling Existing Accounts: We have all heard the ole' saying "it's easier to get more business from a current customer than it is to get new business from a new customer." The reality for us in the staffing industry however is that we do a poor job of executing this strategy. In selling during "tough times" in the past I have found that selling to companies as they are coming out of their "shell" represents a great opportunity. Not always, but often once one group receives approval and funding to begin hiring again the ripple effect takes hold and other departments can hire as well. But it's up to us to identify those other departments and hiring managers to get the opportunity to fill additional job orders. When you make one or two placements with a customer don't stop there. Keep asking for referrals and seeking out additional business. I suggest you even to talk to people in departments that you think would never have a reason to use your service. You'd be surprised what you'll find. Key Takeaway: Build out an organizational chart accounting for all VP's, Directors and Managers (and team leads if need be) within your customer accounts and make sure you have accounted for every potential ordering source in your accounts. Ask your best customers to facilitate introductions (not just referrals) to other contacts

The Value of Employee Training

2010-02-01T12:52:00.003-05:00

Since launching Menemsha Group seventeen months ago I have gained some interesting insights into employee training within staffing organizations. What I have discovered is that executives of all levels and within all staffing companies place a high value on employee training but....
• Often don't budget for training (internal or external)
• Simply don't have the resources or time to provide the training (especially long-term training or a program with consistent reinforcement)
• Training is typically a "one time event" with little or no follow-up/reinforcement
• Staffing companies struggle to measure and/or see the ROI of employee training

What I have also found is that employees of staffing companies typically don't carry out and execute consistent and standardized operating procedures such as responding to a client/candidate objection or serving a new customer who just gave you your first order, etc. Sure, most if not all staffing companies have documented SOP's and workflow diagrams highlighting the business process for performing such tasks, but what I am talking about is consistency and standardization for how your employees respond in those critical conversations with candidates, clients and employees. How you respond to customers and candidates in those critical selling situations determines the difference between winning and losing.

The Problem With Most Training

Classic "shadow" training (and very common in the staffing industry) is where an employee begins working for a new employer and the training consists of the new employee "shadowing" other employees. They spend a few hours with customer service, a few hours observing sales and another few hours observing a recruiter. The new hire spends some time in the finance and accounting department and they will meet with a few other key people in the organization such as marketing and product development to understand their role and standard operating procedures. This type of training typically doesn't offer any sort of class room training, little or no role-playing, no formal methodology and often no formal training materials. It's all based on observation. And of course, the training is different for every new hire because it's dependent upon the person that the new hire shadows and the type of day that person is having and the tasks they are focused on. Because most (if not all) staffing organizations run very lean operations, this is a very common approach to training in the industry. Unfortunately it has not proven to be very effective.

Without effective and consistent employee training, activity, production and performance is characterized by inconsistent patterns of peaks and valleys. Look at the consistency that Larry Bird and Magic Johnson were able to achieve over their careers in the NBA. Magic Johnson and Larry Bird worked with a trainer every day and took 2000 jump shots to perfect their shot. Look at the training that Jerry Rice (hall of fame NFL receiver), Derek Jeter or Tiger Woods goes through to stay at the top of their game. All of these guys have built their reputation on their training routine and how hard they work. Their peers and coaches will tell you. Consistent training.

Training Establishes Best Practices & Performance Standards

Consistent and focused training keeps your team in tune with company goals and objectives and helps to raise the standards for performance. With the right training every employee knows the perfect protocol for every type of client and candidate interaction including the best probing, drill-down and trouble-shooting questions and the correct course of action for follow-up and next steps. If you don't train you can't expect your people to get to the next level. This is why so many staffing companies stay small (there are literally thousands of IT staffing companies under $10M in revenue). I see staffing companies discuss the same issues and challenges over and over again because they have no formal training for how to address these issues. They talk it about once but nothing ever sticks long term.

Training Drives Revenue

Ask yourself this. Can your sales and recruiting team consistently respond to any and every client and candidate objection with the perfect rebuttal? Probably not. But with consistent training and role-playing they can. When I work with a sales rep and he or she tells me about a sales objection they're facing with a customer we write down our script for how to overcome that obstacle (objection). We come up with multiple ways in which to address the objection in case the first rebuttal does not work. To take it a step further we also right down every possible way the prospect might respond to our initial rebuttal. We then develop another list of rebuttals/scripts to overcome the second or underlying customer objection. It's with this magnitude of training and planning that drives revenues and leads to more closed deals. This is how the top producers do it. Folks, this is where the rubber meets the road! And this is so much more than simply following a SOP diagram. With consistent training it becomes second nature for your sales and recruiting team to handle any situation because they have seen it before. They're prepared and can even anticipate the objections. How you handle critical/crucial conversations with customers and candidates determines the difference between winning and losing. A deal lost or a deal won. Let me give you another example. Earlier in my career I inherited a sales team that was way behind budget. Our sales were flat and they were all coming from the same legacy accounts. Let's just say we were not too effective at opening new accounts or developing existing ones. To address this I immediately implemented mandatory role play where we role played every sales objection known to mankind. We did this daily. At first the team hated me because nobody likes role play. I pushed them way out of their comfort zone. And the first few weeks were ugly. People were nervous, we tripped over our words and messed up our scripts. But after a few weeks we got better. And after a few months we got even better. It was amazing to see how a rep handled a sales situation one day and then a few months later how differently (and more effectively) they could handle that same situation. My sales team started getting into accounts and generating new sales opportunities where previously they were shut down. In time we slowly raised the bar for performance expectations and I earned their respect because they saw the value of the training in their personal results. With role playing you are prepared because you have already practiced the conversation ahead of time which helps ensure the positive outcome. Training also reduces turnover which saves money. When employees know how to respond to any situation they're growing and feel they can grow within your organization.

Consider this fact. 48% of sales people never follow up with a prospect yet 80% of all sales are made on or after the fifth contact with the prospect. Without good sales training, the majority of sales people don't call back prospects who reject them just once. Trust me, they don't.
Here is another interesting observation. Have you ever noticed that our industry is typified as reactive? "No day is the same" the saying goes. When your team is in constant reaction mode your chances for growing the business diminishes. With proper training you can eliminate this "reaction mode" and produce results. When people are in "reaction mode" they simply go to their "to-do list" by crossing off the quickest and easiest tasks (to feel good about themselves) and put off the real work-driving new business- to another day. Then the issue morphs into a time management issue, another hot topic and major challenge I see professionals struggle with.
If you take the time and commit to consistent, long-term employee training you can crush your competition. You'll raise your internal performance standards and establish best practices. Your team will improve their knowledge and skills which in turn will allow them to better serve your customers and employees. Slowly, conversation by conversation you will start to win new business.

How To Get Started

Here are a couple of quick and easy ways to launch training within your organization. For additional ideas feel free to contact me at dan@menemshagroup.com
• Build a list of all the objections you hear from clients when trying to: A.) get a face to face meeting, B.) get past the gatekeeper, C.) negotiate rate and contract terms, D.) generate sales leads from candidates, you get the idea.....
• Implement daily role playing sessions to overcome the objections above
• Write voice mail scripts for calling on prospects with different job titles and role play them.
• Use your past experiences (sales/recruiting/customer service challenges) as role play models. Role play old scenarios (remember that awful situation with that candidate) that actually happened so that you can learn from them. Test your team on how they would handle it if that situation happened to them
• Rapid Fire: Quickly go around the room and make everyone overcome a sales objection. After someone overcomes one objection they get to give out an objection to the next person. Repeat this process for 1 hour. Do it every day for 12 months. Reap the results!
• Role play qualifying prospects...you will be amazed at how much you miss!
• Role play taking a job order...you will be amazed at how much information you really need to capture vs. what you typically get in a job order

2010 Strategic & Tactical Sales Plan

2009-12-05T09:35:00.004-05:00

2010 Strategic & Tactical Sales Planning

Every year around the holidays I am often asked, “How do you develop your sales and recruiting strategy and what will your underlying tactics be to ensure you hit your goals in the upcoming year?” “How do you plan for the new year?” “How do you intend to identify new accounts and decide what market segments to pursue?” These are great questions that require time and attention, but when? For those of you who are new to working in the staffing industry, you’re probably now learning that business slows down around the holidays. For you veterans out there this is nothing new to you. With new sales order activity coming to a halt and active orders stalling, what is one to do with all this down time? How about building a recession-proof sales plan for 2010? From my sales leadership experience I always found that a strong Q1 always set the tone for the remainder of the year. The activity and foundation you lay down in Q1 sets the table for the rest of the year. Here are my thoughts on developing your strategic sales plan and underlying tactics that support that plan.

First, a few thoughts on developing your high-level sales strategy

Developing Your Sales Strategy

• Chances are whatever you are thinking of doing your competitors are too. Think out of the box. Try something new, go in a new direction.

• Most staffing companies try to be all things to everyone. They often lack the discipline to “walk away” from a potential sales order even if the order is way outside of their core competency. Pick a niche and commit to it. Don’t stray away because you need to build your niche and your brand within that niche. Besides, this allows recruiting to build expertise in chosen area’s rather than recruiting anything and everything.

• Make sure sales and delivery (recruiting) are aligned. You are only as good as your delivery team. Everyone needs to buy into the strategy.

• What needs exist in the marketplace that are going unmet? Figure out how you can meet them.
• Have you interviewed your current customers recently to understand what they like about you and your service offering? Do you understand how what problems your consultants are solving for your customers? That is your story. Get your customer’s input; you will be surprised with what they have to offer. You can build a strategy around this.

• Build a case study library (from your client and consultant interviews). This will help you build your brand in your niche and sell more effectively. Client's love to hear success stories.

• Don’t just understand what type of people (skills/titles) your customers are seeking in 2010, find out why. This will help you move up the customer value chain. What problems do they need to resolve?

• Read business and personal finance magazines such as Kiplinger’s, Money, Fortune, and Forbes. These magazines are loaded every month with advice from the world’s best investment and portfolio managers. They will open your eyes to industries and prospective accounts you have never thought of and provide you with the insight to devise a specific strategy for selling into each company they recommend.

• Cross-Sell into new areas within your existing accounts. Chances are, even with your best accounts you don’t have 100%% market share in that account. Work to increase your footprint within your existing customer accounts.

Developing Your Tactical Sales Plan

A very common exercise (and one that I love) in the field of sales is that of “backing-in” to your number. What this means is, understanding exactly what and how much activity is required of you to hit your goal. For example, your manager may tell you that your budget or quota for the year is to generate $1M in Gross Profit. As an example, let’s breakdown exactly what we will have to do to generate $1M in Gross Profit in 2010. And for you’re your own purposes, if you email me at dan@menemshagroup.com, I can send you my excel spreadsheet that will do the calculations for your own personal goals.

I’m going to use arbitrary numbers to simplify this exercise but you can simply plug in your own numbers for your personal situation.

Goal: $1M in Gross Profit for 2010

Assumptions:
Average Bill Rate $120.00/HR (all straight pay)
Average GP% 35%
Avg. Wkly GP or Spread (per consultant) $1680.00 (based on 40/hrs)
Average contract 4 months/680 hours per contract
Total GP Per Sale $28,560 ($1680 x 17 weeks)
# of starts needed 35 (35 x 28,560=$1M)

Activity Assumptions:
• For every 6 prospects you qualify and/or meet with you get 1 REAL job order
• 60 day lag between initial contact with prospect and initial sales order
• 4 week sales cycle (review resume/interview/decision making/hiring process)

Required Sales Activity To Meet Goal
We now know that we need 35 starts for the year to reach our goal of $1M in Gross Profit. And because we fill or close 35% of all sales orders, we will need to identify or generate 100 orders. Because we generate 1 order out of every 6 prospects we qualify, talk with and/or meet with we will need to qualify and add 600 qualified prospects to our CRM system in order to generate 100 sales orders. In order to get 4 months of billing out of all 35 consultants before the end of 2010, they will all need to be working by September 1, 2010. This means we will need to have identified and added all 100 sales opportunities to our sales funnel by the end of July. This also means that we will need to have 600 qualified prospects added to our database (CRM system) by June to account for the 60-day lag between initial introductions with prospective customers and their first order. What does this all mean and how does it impact me personally? We better start hitting the phones!!

Broken Down Into Actual Sales Calls….

To add 600 qualified prospects to our CRM system by June and 100 qualified sales orders by July we will need to have 5 really good, quality conversations with new prospects every day. Qualifying 5 new prospects per day gives us 25 new prospects added to our CRM system each week and 600 by June which meets our goal. Lastly, how many phone calls do we have to make to reach one qualified prospect? For this exercise I am going to use 25. For every 25 prospecting calls made, we have a conversation with one qualified prospect that will give us a legitimate shot at earning their business (reaching decision makers who hire IT consultants is a big challenge). That means we will need to make 125 phone calls per day in order to add 5 new prospects to our CRM system each day and 625 calls per week to add 25 new prospects each week.

I know this is a cliché but it’s simple and it works, plan your work and work your plan.
Do it and you will be a happy camper 12 months from now because of it!

Enjoy the holidays and happy selling!

Effective Time Management

2009-11-23T20:06:00.004-05:00

A hot topic of discussion of late has been effective time management. Many of the Sales and Recruiting professionals I coach and mentor (link) are sharing with me that they struggle with effectively managing their time. What I have discovered through the course of having these conversations is that sales professionals become paralyzed trying to decide what to spend their time on. They claim that they want to focus on prospecting but "unexpected emergencies" prevent them from doing so. They claim that these unexpected events or emergencies take precedence over their sales activities. My question is, do they? Really?

Having worked in the industry for fourteen years I certainly understand that on any given day you face unexpected events that can wreck havoc on your daily plan. And yes, it can be very frustrating. However, we have a choice in how to handle these unplanned events. How you chose to adapt to these unexpected events determines your success in this business. For the sake of argument, let's suppose for a second that every unexpected issue you face truly does have to get resolved on the spot. That doesn't change the fact that you still have to find enough time in the day to do the amount of prospecting necessary to be successful in this business. Accomplishing this feat comes down to the decisions that you make each and every day. Think about how many decisions you make each day when doing your job. Should I send out this submittal now or should I follow up with this sales lead? Should I pick up time cards or continue prospecting into this new account? Should I call this candidate back to answer their question about benefits before or after my prospecting time? Do I prospect or send in the drug screening information for my candidate? Should I make prospecting calls or sit in on a candidate interview? These are just a few examples of the choices you have to make each day. These choices may seem small and meaningless at the time, but your choices impact your results.

The next time you find yourself in the midst of making of one of these decisions ask yourself, "how does this fit into helping me hit my overall sales goal for the year?" If what you are working on does not fit into your overall strategy and goals than you are probably focusing your time on the wrong activities.

Here is my advice and it is very simple. Rather than simply reacting with a knee-jerk reaction to these unexpected events, simply take a few minutes and think about the overall situation. Don't just react, think it through. You will find that a few minutes of thinking before doing anything will save yourself a lot of time in the long run. Ask yourself, "is this something that has to be completed today?" "What is the impact if I don't address it today?" "Am I the only one who can solve this issue or can it be delegated to someone else?" "Is addressing this issue going to generate revenue for the company?" "Am I really going to lose this customer if I don't get back to them until the end of the day or even tomorrow?" They key is being able to recognize the difference between issues that truly need to be resolved on the spot and those issues that can wait. And from my experience, many "issues" can usually wait. But what I have found is that most sales people in the industry think otherwise. They put their sales activities on hold and simply react to the new set of circumstances.

Here are a few other words of wisdom on time management.

Establishing Your Priority List:

Ask yourself: "What is it that you and only you can do?" This is your priority list. Delegate everything else.

Ask yourself: "Am I doing what I do best and getting the best return for the company?"

Remember the Pareto Principle.

Time 20% of our time produces 80% of our results
Counseling 20% of the people take up 80% of our time
Services 20% of the services bring in 80% of the profit
Reading 20% of the book contains 80% of the content
Job 20% of our work gives us 80% of our satisfaction
Donations 20% of the people will give 80% of the money
Leadership 20% of the people will make 80% of the decisions
Picnic 20% of the people will eat 80% of the food!
People 20% of the people will be responsible for 80% of the success

Don't Fret the Recession, Embrace It

2009-09-15T15:28:00.003-04:00

Now is the time. Let me repeat that. Now is the time! Now is the time to capitalize on a career changing moment. This truly is (and has been for months) your window of opportunity. How can I make such a statement in the face of the worst recession since the great depression? It's in difficult times like these that present the best career opportunities. Period. Leaders become leaders in organizations because they develop track records of solving problems. Facing a recession like the one we face today presents the ultimate leadership opportunity. This recession will shape your career. How you respond to this recession will impact your future and the future of your organization. So, is this recession going to make you stronger or weaker?

"It's the economy," "there is no budget," "we're in a wait and see mode," "let's see how the remainder of the year plays out and then reevaluate." My personal favorite that I hear repeatedly is "We're going to wait this thing out." Does any of this sound familiar? What exactly are we waiting for? This recession is the reality of the environment that we live in. During tough times like these, these fears and limited beliefs run rampant across all industries and in companies both large and small. Soon enough employees throughout the organization believe this to be true. And then they begin to settle. They settle for mediocre results. They do the bare minimum to get by because they place blame on "uncontrollable events." John F. Kennedy once said "Once you say you're going to settle for second in life, that's what happens to you in life." Whether it be in business, sports or any other industry, opportunities that arise out of difficult times represent the most valuable opportunities for personal growth. This is especially true for the learning or aspiring leader. So what can you do to embrace this recession? Below are four actions that you can take today, if you have the courage.

1.) Understand that people want to be led. People want to know that someone is working on solving the "big issues" to alleviate their own personal fears. In essence, they want to know that someone is looking after their well-being. Make it clear to those who you work with (and/or lead) that you are aware of the critical issues and that you are working to solving them.

2.) Act Quickly. It's very rare if ever that business leaders have all of the information they would like to have before making a business decision. The stakes are even higher now which makes us vulnerable to falling into the "paralysis by analysis" trap. Understand the situation and move quickly to make a decision. Stick with your decision and don't look back.

3.) Be Confident. Face bad news head-on and address it with your team. Don't avoid it. Acknowledge the bad news publicly with your team and confidently share with the team the plan to resolve the issues. Don't try to avoid the issue or be evasive, people will see right through it.

4.) Get out of your comfort zone. Research has shown that what turns average performers into top performers is their willingness to step outside their comfort zone and be pushed beyond their current abilities in response to overcoming challenges. Constantly attempting to do what you can't yet quite do is the process of "getting out of the comfort zone." As renowned leadership expert and thought leader John Maxwell puts it, "If you're not learning you're not growing. And if you're not growing you're dying." After all, an expert is simply someone who has failed every possible way at trying to accomplish a specific task. And accomplished business leaders will tell you that they have learned far more from their failures than their successes. Get out of your comfort zone. Seek input from your peers and teammates and keep pushing for the answers to the challenges you face.

I can assure you that in these challenging economic times organizations are looking for employees who can step up and solve problems. Embrace this recession and all of the challenges, adversity and turmoil it has to offer. Do you have the courage to start embracing this recession?

How Can I Quickly Identify Good Accounts-Part 2

2009-07-17T16:15:00.003-04:00

If you read my June blog How Can I Quickly Identify "Good Accounts," you will recall that there is no easy and quick fix answer to this question. Finding "good accounts"-those that spend in excess of $500K on IT staffing services annually where you can work directly and exclusively with the IT hiring managers takes a lot of time, patience and grunt work. It requires us to do our due-diligence in order to find these hidden gems.

On far too many occasions I have personally experienced the frustration of investing months of time and energy trying to do business with an account only to discover that it just wasn't meant be. My goal this month is to share with you what I learned from those frustrating experiences including the key indicators that you need to be looking and listening for when prospecting into new accounts so that you can avoid the frustration that I experienced.

Understand And Recognize Your Window of Opportunity

As a company (your client) grows they become more mature and formal in the way they conduct business with their customers, partners and suppliers. They implement policies and procedures and business processes to optimize their supply chain, reduce redundancy, and take advantage of economies of scale. What does this mean for us in the staffing & recruiting business? It means it becomes more challenging to sell into the account and conduct business with these organizations. Let me share with you a real life example. Several years ago I started selling into a rapidly growing company with revenues of $1.5 billion. I quickly discovered that the IT and Engineering department were staffed 3:1 contractors to full-time employees. Yes, it was a “cash-cow” of an account to say the least. All hiring of IT contractors was decentralized. There were no HR policies in place. It was the "wild, wild west," and I (along with competing sales reps) loved it. I quickly got a contract in place and put a handful of consultants to work in a short time period. Naturally I thought this account was going to be my bread and butter for months or years to come. But what I didn’t realize however was that I started calling on this account at the end of the opportunity cycle. About three months after I started calling into the account it came to my attention that there was a transformation taking place within the organization. Decisions had been made a high level to implement policies and processes to either convert all contractors to full-time employees or let them go (with a few exceptions). The CIO also developed an offshore outsourcing partnership for application development which was bad news for me and the other domestic suppliers. Hiring of additional IT contractors (on U.S. soil) quickly dried up. Unfortunately for me I showed up to the party late and missed the opportunity.

As it stands today this organization's procurement department has implemented an approved vendor list. Even more recently it has come to my attention that the vendors on the approved vendor are being asked to work on very low mark-up. And I have also learned that this organization is looking to implement either an MSP or VMS type program in the coming months.

My point in sharing this with you is that you need recognize (as early as possible in the prospecting phase) where your prospect resides within the continuum of contingent workforce management. Your "cash cow" account today will not be there forever. Eventually they are going to start purchasing staffing and professional services like a commodity, such as paper, pencils and other office supplies. You know the tagline "buyer beware," think of this as "seller beware."

Red Flags

Here are the red flags to be aware of with your existing customers and when prospecting into new accounts. These are key indicators that in the near future, you will most likely be treated like a commodity where low markups will be imposed on you, you will not be allowed to work directly with the hiring managers and you will compete with 10+ vendors on every job order.

Hiring Chief Procurement Officer (or VP or Director of Procurement)

If your prospect has added a new senior procurement professional to their leadership team, you need to find out why and how they intend to cut costs because at some point it will impact you and how you do business with that company. To find this information you can simply scroll through an organizations' press releases to see if they recently hired a new CPO or VP of Procurement or conduct a search on Linkedin.

Implementation of ERP software

ERP (enterprise resource planning) software is simply software to run and automate back office functions such as human resources, finance and accounting (among other areas). Oracle (Peoplesoft, JD Edwards) and SAP are the two major players in this space. Within ERP software packages are procurement modules to help organizations automate the way in which they purchase products and services. Find out if your prospect has or is planning to implement either an ERP system or the procurement modules within their ERP package. If so, find out what processes (for purchasing products and services) they plan on automating and when. This is the beginning of the end.

Implementation of Services Procurement or Workforce Management Software

This one seems obvious, but if the prospect company is still in the planning phase and is close to implementing, you need to be aware. Services Procurement and Workforce Management software include Fieldglass, IQ Navigator, Taleo, Beeline, Peopleclick and many others. You need to call on people in the IT and Procurement department to determine if this type of initiative is taking shape within the account. These initiatives almost always take place without the input from IT leadership.

Automation of Purchasing Process for Products

If the prospect account you are calling on (or currently doing business with) has recently automated the way they purchase products and services such as office supplies, marketing materials or business travel services than there is a good chance they will soon be automating the way they procure staffing services. Typically organizations automate the way the purchase products before services because procuring professional services is much more complicated. Again, you need to ask people in your accounts how they do this today and what their plans are for the future.

Green Flags

Here are some key account indicators I suggest you look for when prospecting into new accounts. These are characteristics that we want to see in our customers and prospects.

Account characteristics:

High-Flyers

High growth trajectory (30% or greater, ideally for 12+ months). Companies that experience significant growth, especially in their early years tend to have to play catch up when it comes to implementing infrastructure including policies and procedures. When a company starts off they don't assume sales are going to go through the roof and thus hire employees based on a growth rate of 1000%. Instead, when sales go through the roof, they have to react and that takes time to catch up. Monster was a great example of this. And yes, even in this economy, there are companies out there that are growing.

Little To No HR Presence

Small to mid size companies with no HR department or an HR department of 2 or less. Also call on companies with no procurement or purchasing department.

VC Funded Firms

Start-up's and VC funded organizations are run by entrepreneurs. These people are driven by a passion for product innovation and sales, not processes. As a result they don't hire HR personnel or implement formal processes and policies until they "needed them yesterday." And that is our window of opportunity. Until that time comes, if at all, they let their employees and managers make the decisions.

Small To Mid-Size IT Department

Call on companies with IT departments between 25-250 people. This is simply a ballpark number. Anything much larger is likely to be a headache to sell into.

Growth Through M&A Activity

Accounts that have grown through a series of mergers and acquisitions. These organizations typically struggle to standardize with consistent, enterprise-wide policies and procedures. As a result, managers are empowered to make their own business decisions and/or the various subsidiaries operate as their own entity.

Keep in mind that picking "winning accounts" is akin to picking winning stocks. There are no absolutes and you need to listen to your gut. But if you follow these guidelines I assure you that your prospecting will yield you a higher return.

How Can I Quickly Identify Good Accounts?

2009-06-09T08:21:00.003-04:00

This is a question I hear quite often from CEO’s, business owners, sales executives, and recruiters. Out of the millions of companies we have available to prospect for new business, how does one quickly decipher through it all and identify “good accounts?” This is arguably one of the most challenging tasks in the staffing & recruiting industry and we haven’t even started selling yet!

“Good Accounts” Defined

First we need to define “good account.” What is a good account? That depends on your business model and sales objective. For example, are you selling MSP or VMS type programs or are your trying to get a contract in place to be one of many suppliers to a large managed program? Or, is your model such that your goal is to establish one-on-one relationships with the end-using hiring managers? Based on those different objectives, I would define “good accounts” differently, based on each of those unique sales objectives. But let’s assume (and I think this is the case for most staffing/recruiting professionals) that your objective is the latter. Your goal is to establish one-on-one relationships with the actual hiring managers so that you can sell value and generate high-end gross profit margins. Your goal is to avoid HR and Procurement at all costs!

Having agreed on our sales objective, let’s define a “good account” as one that:

Spends at least $500K annually on contract labor (within your staffing specialty: total spend could be lower or higher depending on your avg. bill rates) and

Where you have the ability to work directly with the hiring managers. HR (nor any other third party) has NO influence over how you conduct business with your managers.

Despite the wealth of information that is available to us via the web there is no data source in the marketplace (that I am aware of, hmmm…sounds like a business opportunity) that can provide us with those two points of data. How do we get that information you ask?

Qualifying Accounts

Before I answer that, let me first point out that I am a huge proponent of account research and pre-call planning. I believe that you need to know who you are calling on in order to have an intelligent conversation. But for now we are going to put that activity on hold. I will come back to this in a moment.

How do we uncover our two criteria points for what we consider to be a “good account?” The only way we can get that information is by actually talking with managers who have hiring authority. To identify those “good accounts”, we need to uncover the following:
1. Does the account (hiring manager) hire contractors?
2. If so, what is their (each hiring manager’s) average spend per year?
3. What is the process by which they (hiring managers) hire contractors?

Key Takeaway: Ask Drill Questions Regarding Process. This last question is critical because it always requires multiple drill-down questions to further qualify the initial answer from the customer. What we are trying to determine exactly is what role if any, does HR or procurement (or any other 3rd party) play in the hiring of external contractors or temporary employees. The key, determining factor in qualifying accounts is understanding exactly what the hiring process is. Will I be able to communicate directly with the hiring manager throughout the entire sales process? Is HR involved and if so, to what extent? Exactly what role does HR play in the hiring process and how will it affect my ability to sell? If HR is going to impact your ability to sell than you probably will want to move on and find another account to call on.

Key Takeaway: Get A Complete Account Picture
Second, after you find an account that does in fact hire contractors and does in fact have enough business volume to justify you developing the account further, then you must ask the third question (what is the process for hiring contractors) of multiple hiring managers. This is critically important because hiring manager #1 might tell you that HR has absolutely nothing at all to do with hiring temporary employees or contractors in his or her group. But if you call on hiring manager #2, #3, and #4, they might tell you the opposite, that the hiring is all handled directly by HR. Hiring manager #1 might just be a “cowboy” within that account where he or she is going around the process. My point is you need to determine what the process is overall for the account. To do this you must verify what you’ve been told by one manager with other hiring managers. This is how you get a complete picture of the account. Until you complete this task, you have not fully qualified the account.

Pre-Call Planning & Research

Back to my point about pre-call planning and research. As I mentioned above, I am a huge believer in the fact that as recruiting and sales professionals you need to understand your customer’s business like a mutual fund manager understands his portfolio of investments. You need to be an expert on your client’s business. But you don’t need to invest all the time and energy into this activity until you have qualified the account. However, you do need to understand the bare minimum basics about the account and hiring managers you are calling on during the qualification process. I consider the basics to be:
· Company size, industry, products and service offerings, top 3 competitors
· Any major news (company merger, product release)
· Hiring manager’s title and some idea of the scope of their role and responsibility

Gathering this basic information takes no more than ten minutes (if that) prior to calling on the account.

How Can I Quickly Identify “Good Accounts?”

As you can see getting to the answer to this question takes time and discipline. You have to roll up your sleeves and actually do the work to figure this out. While you will always have to do the work outlined above to truly identify “good accounts,” there are some key indicators that you can look that can help expedite the process of identifying “good accounts” in a quicker and more efficient manner. In my July blog I will share with you what those key indicators are.

Happy Selling.

The Toughest Objection Of Them All: “We’re not hiring and we have no budget.”

2009-05-12T18:11:00.001-04:00

If you are like most sales professionals in the staffing industry you’re probably sick and tired and frustrated with hearing your prospects and customers tell you “we’re not hiring and we have no budget.” How does one overcome such an objection? Better yet, how does one even engage in a meaningful conversation when you know your prospect or customer is operating under those circumstances? Here is an idea that has worked for me, and hundreds of others.

As we all know, the employment market is currently very challenging and many or most organizations do not have budget to hire consultants. But rather than hoping our prospect or client doesn’t bring up the “no budget/not hiring” objection, we need to do the opposite. We need to bring it up. Yes, you read that correctly. We as sales people need to bring up that objection and address it head-on. If we don’t address it head on and wait for our prospect or customer to bring it up (which we know they will), then we’re stuck in objection handling mode. And coming up with a rebuttal for this objection is much more difficult and challenging to overcome than if we address this objection on our terms. Here is an abbreviated sample conversation:

Sales Rep: (Immediately following introductions/pleasantries) “John, can I assume you’re business circumstances are similar to most of my other customers in that you’re not hiring and don’t have budget to hire any additional help now or in the near future?

Customer: “Yes Dan that is the case. I wish I could but the funding is locked down. We are currently not spending any. Try me back in 6 months.”

Sales Rep: Show empathy for his current situation “Gosh John, how are you and your team coping with that?”

Customer “Well Dan we are swamped but we are getting by”

Sales Rep “John, now that we understand that and expectations are clear that you don’t have budget to hire, let’s change gears and talk about your current projects and all this work that is keeping you so busy.”

Customer: “Uh, ok Dan, what specifically would you like to discuss?”

From here we steer the conversation to learn more about the specific details of their projects and more specifically the challenges and issues the customer currently faces.

By leading with the objection we take away the prospect’s excuse for not talking with us. Now that we have eliminated their objection from their “bag of objections,” we are able to move forward with the conversation and discuss their projects and challenges. Now you may be asking yourself, “Why would I want to talk with a manager who has no budget and can’t hire?” Because in a down economy you have to actually sell in order to generate job orders and make placements. And by selling I mean creating sales opportunities where no pre-defined, budget approved job order exists. More specifically, you have to identify the customer’s pain points or critical business issues and then convert that into a job order. And right now, in this tough economy, your prospects and customers have a ton of “pain.” The only difference between a down economy and a good economy is that in a good economy your customers would already have budget approved to hire consultants. In a down economy we have to remind our prospects and customers just how big their challenges are and the impact those challenges have on their organization if left unattended. In a good economy your customers have these very same issues and challenges but you never know about them because you never have to ask. They just give you a job order. But now, in a down economy, you have to uncover what those issues are and sell to them. You have to offer a solution to their problem. In a good economy they do that for you by developing a pre-defined job order. If you’re not familiar with this style of selling (it’s the only way to sell in this market) you should try reading my industry white paper Effective Sales Strategies For Selling IT Staffing During A Recession by clicking here http://www.menemshagroup.com/whitepapers.html

In a tough economy you need to stop seeking out pre-defined job orders and instead seek out customer problems. It’s only when you find a customer problem that you have an opportunity to make a sale.

Closing Job Orders: Project Management 101

2009-04-09T07:52:00.000-04:00

In my last article titled, “Are You Bird Dogging,” March 2009 (http://menemshagroup.blogspot.com/) I discussed the importance of understanding when the sales cycle starts and when it ends and who is responsible for driving the job order through to closure. In that article I contend that far too many sales professionals including sales managers and executives in the staffing industry are more focused and concerned with finding the next job order than filling their current job orders. In other words, they don’t concentrate hard enough on filling their current orders. They lack strategy. In this article I’m going to discuss how managing the sales cycle is like managing a project and how you can effectively drive your job orders to closure.

In the IT staffing world, project management is often a popular topic of discussion. Some of the key principles of effective project management include defining the customer requirements, project deliverables, timelines and milestones and creating a communication plan. And if we are using the waterfall methodology, we don’t proceed to the next step or phase of the project until the current one is complete. These same principles apply to closing a job order or managing the sales cycle in the staffing & recruiting industry. Let me explain.

Defining the Project Plan and Project Milestones

When you get a job order, the first step and your first obligation is to qualify the order and take a detailed statement of work from the customer. A job description is NOT a qualified job order. (For more on how to take a detailed job order, go to http://menemshagroup.blogspot.com/2008/09/you-mean-youre-body-shop.html.) Just as important, when capturing the requirement you also need to set expectations with the client for the course of action that will follow from that moment forward. Think of it as building your project plan. To do this, you need to uncover in finite detail exactly what steps and action items your customer will have to complete internally before he or she can hire your candidate and have them onsite working. This is your project plan framework. Why must you do this? First, because the steps and action items the client must complete (review resumes, schedule interviews, sign off on purchase orders, get other approvals, fill out job description for HR, etc) is the sales process. And you need to understand the sales process in order to close business. You can’t expect to close business (with any consistency) unless you know these details and have a project plan. Additionally, you (and/or your recruiter) must also find out exactly what steps and action items your candidate will have to complete before they can accept an offer. Having captured all of these steps and action items, you have now defined your project milestones. Each completed step represents a project milestone. The goal is to hit each milestone on time until we reach the delivery date-the day the consultant begins working.

Having your project milestones in place you now need to develop a timeline. I like to work backwards. For example, lets assume the client says the project must be delivered by December 31, 2009 and to meet that deadline they need the consultant on-site working by April 20, 2009. Today is April 1st. When taking the job order, either on the phone or ideally face to face, you need to walk your client (recruiter’s walk their candidate) through every project milestone you identified and find out from them exactly how long each milestone will take to be completed before you can move on to the next milestone. That timeline should map into the April 20, 2009 delivery date. Having assigned completion dates to each of these milestones, you now have your project plan. At this point in the conversation I like to replay this plan back to the client for them to reconfirm they are on board and committed to the plan. Gaining commitment from the customer is key and the goal is to get their agreement. You also want them to feel like it is their plan, not your plan. When it’s their plan, they take ownership of it. It’s real. Here is a simplistic example of what you will wan to discuss with your client and get them to agree to.

Project Milestone Delivery Date
Initial review of resumes April 4th
Feedback on resumes April 5th
Face-to-face interviews confirmed April 6th
Interviews concluded April 10th
Client review of candidate interviews April 13th
Client interview feedback provided to Dan April 14th
Purchase order approved by manager April 15th
Purchase order approved by VP of IT April 17th
Purchase order approved by HR April 18th

In this scenario there are still many more milestones (at least in my world) that would be included and that would need to be completed before we can hit our end deliverable. But hopefully you get the idea. Going through this simple exercise it’s easy to see how many steps your client has to go through in order to hire a contractor. It’s a lot of work on the part of customer to hire an external consultant. Remember that.

Expect The Unexpected

Let’s be honest, projects typically don’t go 100% according to plan. Within your project plan you need to plan for the unexpected. For example, what happens if someone from the interview team is out sick for two days? How does that impact the interview and feedback schedule? How does that impact the delivery date? What is the customer’s contingency plan for that? Have they thought of it? As the project manager it is your job to be thinking at least two steps ahead of your customer. You need to be playing out all of the potential scenarios that could potentially jeopardize the project. The best way to do that is to play out the scenario with the customer and ask them, what will you do in this situation or that situation? You have to think of the things that are going to prevent you from closing the deal ahead of time. Let your customer tell you how they will handle it. This is your contingency plan.

Managing Expectations

In the staffing business, it’s all about managing expectations. Think about it. You are managing your own expectations in terms of what you expect to happen and when. You have to manage the expectations of the candidate and the client, not to mention the recruiters. And oh yes, what about your manager? The ones who are always asking and wondering, when is that deal going to close? If your manager ever asks you a question about the sales process or the next step in the sales process and you don’t have definitive answer as to what is going to happen next, you are not doing a good job. So put a project plan in place, manage to the milestones and get your client on board and you will be able to manage everyone’s expectations with supreme confidence. And you will put more people to work too!

Are You Bird Dogging?

2009-03-18T18:54:00.000-04:00

When does the sales cycle start and end in the staffing industry? Seems like an easy and straight forward question but ask ten different industry professionals and you’re likely to get ten different answers. My experience is many staffing organizations and sales professionals think that once the job requirement comes in and sales “hands over the order” to the recruiting team, the sales cycle ends. I couldn’t disagree more.

Many staffing and professional services organizations deploy this philosophy as their customer service model. I like to call it the “bird dog” sales strategy or “bird dogging.” What this means is the sales representative goes out and finds job orders and brings them back for recruiting to work on and fill. Once recruiting has the job order(s) it’s the sales representative’s responsibility to go find additional job orders and let the recruiting team fill the existing order(s). This strategy is akin to a hunter who shoots a duck. The hunting dog fetches the duck in the field and brings it back to his master. After fetching and retrieving the duck, the dog runs back into the field to fetch the next duck. Staffing organizations like to deploy this service model because they want to keep their sales people focused exclusively on prospecting for new business (or fetching ducks). Prospecting for new business is critical to success, but this is a poor strategy.

First, recognize that when you receive an order from a customer, especially a brand new, first-time customer, you’re transitioning from the 1st sales cycle to a new or 2nd sales cycle. What I mean by that is you have just spent weeks or most likely months doing everything you can to build trust and credibility with the prospect and differentiating from your competition. You’ve finally established a relationship and they’re ready and willing to give you a shot. After putting in all the time and effort why would any sales representative want to hand it over to their recruiting team to close? You’ve invested too much. Not only are you handing over the fate of that sales opportunity, you’re also potentially handing over future sales opportunities and the client relationship to your recruiting team. You’re not working the drive-thru window at McDonalds, you’re a sales professional. I believe that a recruiter should communicate with a client but they shouldn’t drive the sale or own the relationship with the client. This transition from sales cycle #1 to cycle #2 is a critical point on multiple levels. You don’t want your customer wondering, “where in the heck did Dan go? I spent the past 4 months talking with Dan about working with him and his company and now I find out I’m going to be working with Tom the recruiter.” It’s bad business. You need to be there for your customer. You are the quarterback. You have to lead your team (the client, candidate and recruiter) into the end zone. If you think you did your job by simply pulling in the job order you’re wrong. As sales professionals we need to get the job order and we need to drive the sales cycle until the order is filled. More importantly, if you want to truly build client relationships and close more business, you need to be leading your team (client, candidate, recruiter) through every step of the process of sales cycle #2. Just expecting recruiting to fill the order is not selling. In fact, I believe that philosophy helps drive the commotidization that has wrecked havoc on our industry. It minimizes your value and makes you a transactional vendor. I bet companies who deploy this sales/customer service model have lower GP margins than those who don’t.

Justifying “Bird Dogging” as a Customer Service Model

Organizations who deploy “bird dogging” as their sales/customer service model will tell you they want their sales people focused on generating new business and bringing in more orders. And as I already mentioned, prospecting for new business is critical to success in this business. But it’s not more important than overlooking your existing opportunities. You’re priority has to be on driving your existing orders to closure. The good news is there is enough time in the day to properly manage your open/existing orders and driving them to closure and prospecting for new business.

The other thing that proponents of this sales/customer service model will tell you is that they have a recruiting team that is more than capable of working with customers and managing customer relationships. I agree, most recruiters are. But customer relationship management and closing business are two completely different activities requiring different skill sets. And that leads me to my final and most important point, recognizing when and how sales deals are won and lost.

Unless your filling low-end help desk or desktop support positions, the reality in IT staffing is that your candidates are typically not going to be a 100% perfect fit for your customer. Most candidates you present are going to be somewhere between an 80% and 95% fit for your customer. It’s your job to close that remaining “X%” or gap with the customer. The conversation that takes place after a candidate interview (or resume review) is typically when deals are won and lost. This is why you want your sales people driving the sales cycle, to close this gap. I’ve found that recruiters (and sales people alike) are often afraid to push back on clients who express concerns regarding the candidate’s skills and qualifications. Recruiters also tend to lack the experience & skills to properly sell through a client objection. Recruiters will often accept what the client objection is and move on to a new search for a new candidate. Meanwhile the client is off filling the order through a competitor and you’ve lost the deal. I’m not suggesting you try to “sell” a candidate your client doesn’t need or want. You have to be able to recognize the difference. But this is exactly when and why the sales person needs to be engaged. They should not be focused on prospecting for new business. And if the sales person is not having this conversation with the client than you have another issue to contend with altogether. In my next article I will discuss what it means to drive the order throughout the sales process until closure and how to properly manage the sales cycle.

How To Read An Industry Publication

2009-02-10T08:42:00.000-05:00

Odd title for an article huh? You may be wondering, “How exactly does this tie into sales and more specifically, selling IT professional services?” You’d be surprised just how much it can not only help you sell but help you differentiate. If you are like most professionals in any industry, you read industry publications to stay on top of the trends, challenges and news taking place within your given industry. And if you are a top performing sales professional you read what your customers read to stay connected with the events taking place in their world. If you are not currently doing this than I strongly encourage you to quickly adopt this exercise into your daily or weekly routine. The ability to talk intelligently about the events, challenges and industry drivers taking place in your customer’s industry and/or product space is one sure way to help you build credibility. And we all need credibility in order to sell value. Let’s talk for a moment about reading the industry publications that your customer’s are reading and how to leverage that information to differentiate yourself from the competition and create sales opportunities.

For sales and recruiting professionals in the IT staffing and consulting space, industry publications could include Computer World, NetworkWorld, CIO Magazine or eWeek among many others. When reading these publications keep in mind that not every article is going to blow you away with mind-numbing excitement as if you are about to hang glide off an ocean side cliff. In fact, you may find some of the articles down right boring. And you may not even fully understand what the article is talking about. But trust me on this, read them and keep reading them because over time it will start to make sense. You will eventually be able to connect all of the dots and make sense out of both the business issues your clients are trying to solve and the complex technology solutions they are trying to deploy as the solution. Why is that so important? As a sales person in the IT professionals services industry you want your customer’s to seek you out as a knowledge expert and someone who understands their critical business issues. As an IT Recruiter you need credibility to attract the top consultants to you and your organization. “Best-in-class” consultants don’t work with rookie recruiters and they can spot them a mile away. As an IT Recruiter you will be able to take your conversations with your consultants to a whole new level because you will understand the challenges they are solving for your customer’s. You will also understand the technologies and methodologies organizations are utilizing to address these challenges. This will enable you to do a much more effective screening and interviewing process of your consultants, not to mention building long term relationships.

Take Advantage of Information Available to You

Let’s take the January 15th, 2009 issue of CIO Magazine as an example. I will explain how you can leverage the information found in the article they highlight on the cover of this issue (and apply this same method to any article you read) to differentiate from the competition, position yourself as knowledge expert and create a sales opportunity that you didn’t even know existed. On the cover of the magazine in big bold letters it reads:

YOUR M & A SURVIVAL PLAYBOOK: Whether it’s a shotgun merger or a planned acquisition, IT can help make it work. Here’s how.

How many of you are calling on accounts today (prospects or customers) who have gone through an acquisition, are currently going through an acquisition or have an account that is about to go through one? We’ve all called on these prospects and heard “I’m really tied up with the acquisition, please call me back in six months.” Haven’t you always wondered exactly what work keeps IT people so busy during an acquisition? And we’ve all felt in this situation that there is a sales opportunity there for us but we just didn’t know how to develop it. Frustrating to say the least! Now you may understand at a high level the work that gets completed during an acquisition but I am talking about the nitty-gritty systems integration work involved in integrating two organizations and the specific challenges and “pain points” that customers encounter during these acquisitions. The difference between understanding the “high-level” work and the “nitty-gritty” work is a missed sales opportunity. Let me explain. First, this article and all the articles published in these industry publications are written and designed for your customers to read and learn from mistakes made by other organizations implementing similar solutions. In this case the article chronicles the “best in class practices” for going through a merger and acquisition and the common pitfalls to avoid. CIO Magazine interviewed several IT executives for their input on how to successfully navigate a merger. They explained the challenges that they had to overcome to complete their own mergers and acquisitions and how they accomplished it. I’m not an M & A expert but after reading this article I discovered a half dozen common challenges or mistakes that IT organizations typically make when they go through an acquisition. The article explains in detail what some of these issues are. After reading the article I wrote down those half-dozen challenges in the form of open-ended sales questions for me to ask of all my prospects going through an acquisition. I want to understand how they are addressing the challenges that I just read about in the article. Now when I call on that prospect who says “call me back in six months, I’m really busy with the acquisition,” I am prepared to counter that objection with some thought provoking questions of my own. Questions that will most likely speak to the specific issues my prospect is currently struggling with. This level of questioning gives me credibility and differentiates me from all of my competitors because I can both empathize with my customer’s current situation and I have demonstrated that I understand their critical business issues and why it’s important to them. Combining that with my own sales ability, this line of questioning opens up sales opportunities for me to explore. It allows me to get the customer to open up and share with me what their challenges are. I have now uncovered a problem that my customer is trying to solve and if I play my cards right I can position myself as the solution provider to solve that problem. And it was all made possible by reading this article. Not bad for someone who doesn’t know a whole heck of a lot about mergers and acquisitions.

How Do I Do It?

Suppose you are calling into “ABC Company” and you know they are implementing Microsoft SharePoint Server. Do some searches on Google for articles or blogs that discuss implementations of SharePoint. You can even do a search at http://www.cio.com/ to search their articles and case studies. Highlight the sentences that explain or detail the issues that the customers had to overcome to implement SharePoint and translate them into open-ended questions such as this. Here is an example:

“It might not be the case with you but we are seeing many customers who are implementing SharePoint struggle with….insert your issue from article…..how are you addressing this challenge?”

As you can see, you can easily duplicate this method across multiple disciplines. And you can do many variations. Remember, you can’t make a placement unless you first uncover a problem for your consultant to solve. Our job is to uncover our client’s challenges and then present consultants who can solve those challenges. I’ve found this to be a wonderful way of doing just that.

If you have any questions regarding this article feel free to email me at dan@menemshagroup.com

Happy Selling.

Dan Fisher
The Menemsha Group

About The Menemsha Group
http://www.menemshagroup.com/

The Menemsha Group, creator of the MoshupMethodology, a proprietary methodology for selling IT Professional Services, is dedicated to serving sales professionals in the IT Staffing & Consulting industry. Leveraging the MoshupMethodolgoy, sales professionals are equipped with the necessary tools, knowledge, and self-confidence to sell up the customer value chain, resulting in high-end gross profit margins and bill rates. Our content & training is focused exclusively on wining strategic IT staffing engagements including the placement of senior-level IT practitioners and winning IT projects. The MoshupMethodology provides a predictable and repeatable process guaranteeing success in selling IT professional services.

Dan can be reached at dan@menemshagroup.com

Strategies For Selling IT Staffing in a Down Economy

2009-01-12T10:36:00.000-05:00

Effectively selling IT staffing in a good economy is never easy. It’s highly competitive, requirements change on a moments notice, candidate availability often fluctuates, and there are pricing pressures and other factors in the sales process that we have little control over. It also requires a high level of sales activity, relentless persistence, discipline and attention to detail, not to mention exceptional salesmanship. In a down economy we face all these same challenges, only on steroids. All of these challenges are now magnified because opportunities are fewer and farther apart. Think of a pack of wolves that have not eaten for over a week hunting for their next meal. They can’t afford to waste energy so their senses and awareness for executing that next kill are at an all time high. They’re sharp. They’re “dialed- in” to the moment. We need to be “dialed-in” when selling in a tough economy. Here are a few strategies to keep in mind when selling in a recession.

Adjust your mindset
When making sales calls do not lead with your product or service and do not lead with questions related to “are you hiring?” We know the answer is most likely “no.” Where are you going to take the conversation from that point? Instead, change your mindset and approach to uncovering projects within the account and the challenges the customer faces. When no “pre-defined, budget-approved” job orders exist, you need to find a problem to solve. Seek out problems, not job orders. Every IT hiring manager has problems. It’s our job to uncover those problems and propose a solution. Just ask your prospect the right questions and listen. They will tell you what they need help with.

Account Selection & Targeting:
I first suggest you group your accounts into three buckets. Hot, Warm and Cold.

Hot Accounts: Hot accounts are those customers where you have a good relationship and a high volume of business and which there is significant upside for additional opportunities. You need to stay in front of these customers as often as possible via face-to-face meetings, phone, email, mail, etc. Host a group lunch meeting at their office and invite the entire IT department and do a presentation of some sort. Whatever it is you do, just stay in front of them. Make sure you are cross selling into every department within these accounts even if you don’t think it makes sense to call on someone. Call on them. Sell into the functional business line managers (Sales, Manufacturing, Supply Chain, Marketing, etc). Spend time on location with your consultants (your clients will see you in the hallways, cafeteria, etc) who are billing to get their help in expanding your footprint within these accounts. Think of your consultants as your personal account managers. They will help you find additional opportunities. Create an account development plan with them. Think about contract extensions 45 days in advance and start preparing your case for an extension for all of your consultants. And be prepared to negotiate. Spend a significant amount of your time in this area. Market previous candidates back into the account and to managers who hired the consultant in the past. Depending on the number of accounts you have in this category and their sheer size, you should spend a good portion of your time in this area.

Warm Accounts: Your warm customers are those who you have a good relationship with but volume is low. Start thinking about how and where else you can cross sell within these accounts. They have opportunities in areas you have yet to develop. You just have to find them. Start working to create new opportunities within these accounts.

Cold Accounts: Don’t just cold call willy-nilly. Instead, you should operate like a neurosurgeon with a well thought out plan and calculated activities to support your strategic plan. You should have specific industries and specific accounts within those industries targeted as prospects. You need to understand what industries are growing (there you out there, you just have to do the research) and why and what business issues those organizations face. Most importantly, you need to be able to map out how your service offering can help solve those business issues. Don’t waste your time prospecting into companies who scaling back or not growing. Don’t just randomly call into any account, have a specific purpose for calling the account.

Unsolicited Opportunities: If you get invited to participate in an RFI or RFP for a sales opportunity in which you didn’t create through your own selling activities and/or you have no relationship with the account, don’t waste your time. Unless you created these opportunities, they are very difficult to win. Statistics show you have less than a 10% chance of winning under these circumstances. Another sales rep from another firm has already done all the sales work and helped the client write the RFP or RFI. The only reason the client has included you is to fulfill their strategic sourcing strategy. Learn to quickly recognize these opportunities because they are time killers! Instead, go out and create your own sales opportunities.

Messaging
Now more than ever sales people must have a laser-focused and airtight message in order to stimulate interest on behalf of their customers and prospects. Specifically, your message regarding your service offering must be tied to the business/technical challenges your customers and prospects are currently experiencing. If your message doesn’t talk directly to their issues, customers will have no interest in talking with you. A little bit of research and a few extra calls will get you the information you need to deliver an air-tight message. Suggestion: Make sure you understand the problems your consultants solve for your customers-these are your solution offerings. For example, if your Business Intelligence Business Analyst set up the meta data repository for your client, which solved problem “X”, create a message around that and target other Business Intelligence Managers within your prospect accounts. Tell them how you helped your current customer with their meta-data repository.

No Business Pain, No Sale
It’s that simple. I learned very early in my sales career that people buy for two reasons: 1.) To make themselves feel good, for emotional happiness such as purchasing new clothing or a flat screen HDTV or 2.), to move away from discomfort or “pain.” Think of that dishwasher that has been on the fritz for a month. The repairman came and told you that you need to purchase a new one. While contemplating the purchase for the past month you’ve been doing dishes by hand. As a result, you finally decide to purchase a new dishwasher. You don’t purchase it because you enjoy loading it every night; you purchase the new dishwasher because you hate doing the dishes by hand. You want to move away from that personal discomfort or “pain.” Every IT hiring manager has “pain” and as sales people it’s our job to uncover it and turn it into a sales opportunity. That is the true art of selling IT staffing. Creating an opportunity where no “pre-defined, budget-approved” job requirement exists. You have to create it. That requires salesmanship. One good way to gauge how much “pain” a customer has is to ask them a few test questions when they give you a requirement. Here are a couple of examples.
· “What is the impact if you can’t hire a consultant to solve these issues?”
· “What would it cost you/the company if things stayed the same?”
· “What are the personal consequences if things remain the same?”
· “Are you/the company committed to fixing this problem?”

If they can’t convince you that they need to solve this problem than they probably will not be able to convince their boss either.

Qualify, Qualify, Qualify. And Qualify Some More!
I’m not exaggerating when I say you can never ask a client too many qualifying questions. During a recession it’s more important than ever to make sure you and your recruiting staff are working on real, qualified sales opportunities. The first and most common mistake sales people make during a recession is they talk themselves into believing that the requirement they have is real when often it is not. They’re afraid to ask the client tough questions because they are so excited over the fact that they finally found an opportunity. Remember, customers have no problem giving a job requirement that is not fully approved. It’s no skin off their back. And all IT hiring managers have challenges every day that they need our help solving. But they don’t have budget to hire a consultant to solve every problem. What hiring managers often do is give us a requirement, tell us it’s approved and hope we provide them with a candidate who is so exceptional that they convince their boss and their boss’s boss to approve the budget and hire your candidate. But we don’t know this is happening if we don’t ask the right questions. Here is a good rule of thumb; if you are afraid to ask your customer a question it’s most likely a question you need to ask. Always be qualifying throughout the entire sales process. Budget approved for a $100 bill rate on Monday does not make it so on Wednesday. Remember to keep qualifying and reconfirming your understanding of the customer’s requirements until your candidate is hired. Things change on a moments notice in corporate America, especially in a recession.

Understand Your Customers Purchasing & Approval Process
During tough economic times when organizations tighten their budget they often implement more stringent purchasing processes. They will add additional checks and balances that might not normally be in effect during “the good times.” Unless your client is the CEO, you need to make sure you ask your client who all of the decision makers are for approving your requirement. I’ve seen VP’s, SVP’s and EVP’s think they have approval only to get their request squashed by the CFO or CEO. Don’t be afraid to ask the tough, money related questions, it can save you a lot of time and grief in the long run, not to mention your reputation with your recruiting team.

Don’t Drop Your Price
Don’t drop your price. Not only is it a sign of a weak sales person but it also commoditizes your service offering. Just because your competitor’s do it doesn’t justify you doing it. You don’t need to lower your price to compete. You need to sell value. Once you drop your price your customer will always ask you to lower your price and they will expect you to do it. That is how you become a vendor instead of a business partner and trusted advisor. Your goal is to build long-term customer relationships and get exclusives on their requirements. Hold your ground. Besides, lowering your price can often lead to delays in making a hiring decision. If you lower your price then the customer is going to ask the competitor to lower their price and create a bidding war. That is a lose-lose scenario for everyone. Don’t give in. It’s bad business for everyone.

Use Case Studies
In times of a recession is when you really need to rely on using good customer case studies. A good case study is one that clearly articulates the business problem(s) your consultant solved, and the results (increased revenue, decrease costs, reliability, security, scalability etc) you delivered. This is how you demonstrate ROI and value for customer. Sharing these success stories is a great way to sell and customers love hearing them. Review your best customer case studies and think about what other prospects might be struggling with the same issues discussed in your case study. Determine who those prospects are and go tell share your story. A good place to start is usually with your customer’s competitors.

Strategic & Tactical Sales Planning For The New Year

2008-12-15T07:42:00.000-05:00

Every year around the holidays I am often asked, “How do you plan for the new year?” “How do you intend to identify new accounts and decide what market segments to pursue?” “How do you develop your strategy and what will your underlying tactics be to ensure you hit your goals in the upcoming year?” These are great questions that require time and attention, but when? For those of you who are new to working in the IT professional services industry, you’re probably now learning that business slow downs during the holidays. For you veterans out there this is nothing new to you. With new sales order activity coming to a halt and active orders stalling, what is one to do with all this down time? How about build a recession-proof sales plan for 2009? From my experience in selling IT staffing and consulting, I always found that a strong Q1 always set the tone for the remainder of the year. The activity and foundation you lay down in Q1 sets the table for the rest of the year. Here are my thoughts on developing your strategic sales plan and underlying tactics that support that plan.

First, a few thoughts on developing your high-level sales strategy

Developing Your Sales Strategy

Here are a couple of thoughts to consider when devising your sales strategy.

Chances are whatever you are thinking of doing your competitors are too. Think out of the box. Try something new, go in a new direction.

Most IT staffing companies try to be all things to everyone. They often lack the discipline to “walk away” from a potential sales order.

Pick a market segment or niche to pursue and commit to it. Don’t stray away because you need to build your niche and your brand within that niche.

Make sure sales and delivery (recruiting) are aligned. You are only as good as your delivery team. Everyone needs to buy into the strategy.

What needs exist in the marketplace that are going unmet? Figure out how you can meet them.

Have you interviewed your current customers recently to understand what they like about you and your service offering? Do you understand how your consultants are impacting their business?

Get your customer’s input; you will be surprised with what they have to offer.

Build a case study library (from your client interviews). This will help you build your brand in your niche and sell more effectively.

Don’t just understand what type of people (skills/titles) CIO’s are looking to hire in 2009 and what technologies they intend on deploying, find out why. This will help you move up the customer value chain.

Read business and personal finance magazines such as Kiplinger’s, Money, Fortune, and Forbes. These magazines are loaded every month with advice from the world’s best investment and portfolio managers. They will open your eyes to industries and prospective accounts you have never thought of and provide you with the insight to devise specific strategy for selling into each company they recommend.

Cross-Sell into new areas within your existing accounts. Chances are, even with your best accounts (unless it’s a very small company) you only have 75% market share in that account. Work to increase your footprint.

Developing Your Tactical Sales Plan
A very common exercise (and one that I love) in the field of sales is that of “backing-in” to your number. What this means is, understanding exactly what and how much activity is required of you to hit your goal. For example, your manager may tell you that your budget or quota for the year is to generate $1M in Gross Profit. As an example, let’s breakdown exactly what we will have to do to generate $1M in Gross Profit in 2009. And for you’re your own purposes, if you email me at dan@menemshagroup.com. I can send you my excel spreadsheet that will do the calculations for your own personal goals.

I’m going to use arbitrary numbers to simplify this exercise but you can simply plug in your own numbers for your personal situation.

Assumptions:
Average Bill Rate $120.00/HR (all straight pay)
Average GP% 35%
Avg. Wkly GP or Spread (per consultant) $1680.00 (based on 40/hrs)
Average contract 4 months/680 hours per contract
Total GP Per Sale $28,560 ($1680 x 17 weeks)
# of starts needed 35 (35 x 28,560=$1M)

Assumptions:
For every 6 prospects you qualify and/or meet with you get 1 REAL job order
60 day lag between initial contact with prospect and initial sales order
4 week sales cycle (review resume/interview/decision making/hiring process)

Required Sales Activity To Meet Goal
We now know that we need 35 starts for the year to reach our goal of $1M in Gross Profit. And because we fill or close 35% of all sales orders, we will need to need to identify or generate 100 orders. Because we generate 1 order out of every 6 prospects we qualify, talk with and/or meet with we will need to qualify and add 600 qualified prospects to our CRM system in order to generate 100 sales orders. In order to get 4 months of billing out of all 35 consultants before the end of 2009, they will all need to be working by September 1, 2009. This means we will need to have identified and added all 100 sales opportunities to our sales funnel by the end of July. This also means that we will need to have 600 qualified prospects added to our database (CRM system) by June to account for the 60-day lag between initial introductions with prospective customers and their first order. What does this all mean and how does it impact me personally?

Broken Down Into Actual Sales Calls….
To add 600 qualified prospects to our CRM system by June and 100 qualified sales orders by July we will need to have 5 really good, quality conversations with new prospects every day. Qualifying 5 new prospects per day gives us 25 new prospects added to our CRM system each week and 600 by June which meets our goal. Lastly, how many phone calls do we have to make to reach one qualified prospect? For this exercise I am going to use 25. For every 25 prospecting calls made, we have a conversation with one qualified prospect that will give us a legitimate shot at earning their business. That means we will need to make 125 phone calls per day in order to add 5 new prospects to our CRM system each day and 625 calls per week to add 25 new prospects each week.

Learn To Master The Art of Patience

2008-11-29T11:02:00.001-05:00

For as long as I can remember patience has never been something that I’ve had much of. One thing I have learned however from my career in professional sales is that patience is a critical success factor. So I thought I would blog about the importance of patience and how it can play a key role in your success in the world of selling IT professional services.

From my experience, there are two core areas (and I am sure you can think of others) in which we as sales people don’t always demonstrate the patience we should in order to maximize our potential. The first area is simply with making sales calls to prospective customers. Most of us tend to just pick up the phone and dial away without any specific goal or strategy for the call. We just dial away until we get a decision maker on the phone. Heck, you can’t close a deal without talking to the customer right? Our thinking goes something like this…”we’ll figure out what to say when they pick up the phone and go from there.” This is often a poor strategy, especially when you are selling IT consulting and staffing services. Why? We sound like every other sales person in the industry because they are all taking the same approach. If we could simply demonstrate some patience by taking the time to properly research the account and the hiring manager we are calling on and have a specific call strategy for the prospect we would be better served in the long run. In all likelihood, the conversation we have with that prospect would be more meaningful for both parties We could ask better questions specific to the customer’s situation and make intelligent comments and suggestions based on our understanding of the customer’s business conditions. Instead, we tend to simply dial away and introduce products, our services and ourselves and ask for orders. How effective has that approach been for you? As I have learned to become more patient over the years I have become convinced that one of the few ways in which we can differentiate ourselves in the IT staffing and consulting industry is the way in which we prepare for our sales calls and introduce ourselves to our prospective customers. And this comes back to having some much needed patience to properly prepare.

The other area where we need to demonstrate patience is within the sales process itself. I don’t know about you, but after I have a consultant interview with a client I’m making umpteen phone calls until I reach the consultant (and then the client) for feedback on the interview and to “close the deal.” As sales people we naturally want to push each deal to closure as quickly as possible. That is just our human nature. As a result however, we tend to put our clients (and consultants) in our sales process and impose our process on the client. I’m not suggesting we just sit back and rely on a strategy of “hope.” Of course we have to pursue the client and initiate contact. Instead of imposing our sales process on our clients however, we should exercise patience by uncovering the client’s interviewing, decision-making and hiring process. When we understand those processes, then we understand the sales process for that particular opportunity. Then we can manage the process like a project with milestones along the way to ensure the “project” continues to move in the right direction. The same thought process could be applied to working with your consultants as well. Have the patience to understand their decision-making process and timeline and together with the candidate and client set milestones with the to ensure you keep the process moving forward.

Even though there are many areas of the country still characterized by a tight candidate market, in these economic times employers are not going to rush into any hiring decisions. And they certainly are not going for the “the candidate has another offer, you have to decide today ultimatum.” So learn to be patient by moving your deals forward in small baby steps instead of going for the close during every client interaction.

Control the Controllables And Don’t Beat Yourself

2008-10-22T10:09:00.000-04:00

As a sports fan, nothing is more frustrating than watching your team lose a game not because the other team beat your team, but because they beat themselves. Back in September Michigan played Notre Dame in their annual rivalry. In that game Michigan turned the ball over to Notre Dame six times and as a result they never gave themselves a chance to win the game, let alone keep it close. How about the 1986 World Series in which Boston Red Sox first basemen Bill Buckner made an error on a routine ground ball that he probably makes 99,999 out of 100,000 times. That cost them game 6 and they went on to lose game 7 of the World Series to the New York Mets. Talk about beating yourself!!

In the world of competitive football not beating yourself usually means playing sound fundamentals. If you consistently block & tackle well, you’re going to have consistent and long-term success. Just look at Joe Paterno of Penn State. The same rule applies in the field of sales. Losing a sales opportunity to a competitor is going to happen. It’s just a fact of life. You are not going to have the perfect solution for every client need. But losing a sales opportunity because you beat yourself is simply unacceptable. Yet in the world of selling IT professional services I see it happen every day. But with sound fundamentals and by controlling the controllables, you will consistently put yourself in position to meet and exceed your goals and objectives. Below is a (partial) summary of the common pitfalls where sales professionals tend to beat themselves.

Selling features and benefits. When a prospective client requests information from you regarding your company’s products and services, how do you respond? Do you go into a tirade about your company’s history, products and services? Better yet, do you tell them that you offer contract, contract to hire and permanent placement? Do you explain in detail what your recruiting, screening and interviewing process is? If you are doing these things guess what, you are selling features and benefits. Even worse, you are selling features and benefits tailored to HR professionals. Yes, that is part of your value proposition but Information Technology leaders (the folks you really want to be in front of) don’t care about this stuff. They expect you to be carrying out extensive screening and recruiting processes. What they really care about and want to hear about are your solutions to their problems and ultimately the results your service will deliver. Focus on selling results.

How much self-inflicting damage can I do by selling features and benefits? First, it’s a great way to pigeonhole your self as a transactional vendor. The customer sees you as a commodity. Why? Because there isn’t a professional services organization in business today that doesn’t boast their screening and interviewing process as “the best.” Everyone is saying the same thing. You are no different and neither is your screening process. This approach also locks you in with the HR department. You’re offering features and benefits that are a Human Resources competency. Naturally the IT and Business executives you are calling on (and hoping to meet with) are going to refer you to their HR department. Lastly, selling features and benefits is about you and what you offer. Instead it should be about the customer. There are far more effective ways to sell professional services than selling features and benefits. I suggest you start off by understanding what their technical and business issues are than seeing how your product or service can solve those issues.

Email over phone. “My client tells me they prefer email over phone, so we use email to communicate.” First of all, if you are asking your client what form of communication they prefer I would encourage you to stop. Of course they prefer email. They prefer email because it allows them to blow you off without feeling guilty about it. Did you know that the average Senior IT Manager receives over 75 emails a day? Emailing gives your client a simple and easy excuse for not following up with you because it goes unread with all the others. Regardless, the bigger and more important issue here is the fact that relying on email is a cop out to doing what you know you should be doing. And that is making sales calls. Think about it. You know what you have to do to make a sale and be successful. That is talking with decision makers on the phone and in face-to-face meetings and building relationships with them. Email simply doesn’t allow you to do that. Most sales people have some level (to varying degrees) of fear of failure or rejection. By replacing the phone call with an email you displace your fear of rejection and in the process you convince yourself into believing that you made your best effort to reach that prospect and advance the sales process. Next time you go to send a client an email stop yourself and pick up the phone. Better yet, ask yourself how committed you are to making a successful career in selling IT Professional Services. Assuming you are serious, than I suggest you relentlessly hammer the phone. There simply is no substitute for it. Email does have a place in conducting business but using it as the communication platform for pursuing and closing sales is a sure sign of a weak sales person.

Account Development. If you are guilty of selling features and benefits than chances are you’re doing a poor job of account development. Why? You can’t develop an account when HR has you handcuffed. Because you have been relegated as a “transactional HR vendor,” Human Resources manages you. They dictate the rules and either you obey them or they threaten to kick you out of the account. Nice business relationship huh? . Have you ever met an HR Manager who encouraged you to build relationships with their business and IT executives? Me neither. So how do you claw your way out of the “ transactional HR vendor stigma?” It’s very, very difficult and goes well beyond the scope of this article. It can be done however, but it takes time and skill. There are many other reasons for poor account development but the most common pitfalls include complacency, lack of understanding (training), fear, arrogance and laziness. Getting the necessary training to become an expert in account development and major account sales is the easy part. It’s not rocket science, anyone can learn how to do it but only you can do the work. Complacency or even arrogance can be a little more challenging. Have you ever heard the Sales Rep who had a great relationship with a contact in an account but was afraid to ask them for a referral because they “didn’t want to screw up the relationship?” It’s not like you are trying to sell Amway to your best friend! Get over yourself. Sales Representatives who have a few consultants billing in one account and have a great relationship with one or two key contacts tend to think they “own the account.” By this, this think they have the mind share of the hiring managers and the market-share of the account over their competitors. Think about your best accounts and test how well you have developed those accounts by answering the following questions. Have you accounted for every person on the IT organizational chart? Have you identified the client’s three most strategic projects including the executive business sponsors? Think of the five hottest technologies/trends in enterprise IT, have you identified those projects within your accounts including the IT and business stakeholder for those projects? How many different projects are your consultants working on? Depending on the size of the company, organizations typically have dozens to hundreds of IT projects taking place simultaneously. Do you have consultants working within every phase of the SDLC? As for fear and laziness, those are both personal issues and a decision needs to be made. Are you in or are you out?

Self-Education. Do you have good business acumen? How do you know? Are you comfortable sitting down with your boss’s boss and able to talk confidently about your business and the trends and challenges of the IT Professional Services industry? Are you comfortable having this same conversation with the CIO of your top account regarding their business goals and objectives? Are you comfortable sharing with them what you see as the major technology trends and challenges and how they might leverage technology to deliver greater customer value? Do you understand your accounts the way a stockbroker or financial analyst understands a clients P/E ratio, market capitalization or return on assets? You should. Folks, I am not suggesting we all invest $100K in an MBA from Harvard Business School. What I am suggesting however is that you need to invest in yourself. By this I mean investing the time, money and energy to educate yourself on business acumen including technology, industry & business drivers, trends, financial instruments, leadership, innovation, industry regulations and associated challenges so you can have meaningful business conversations with your prospects and customers. And when it comes to technology you need to have a sound foundational understanding of how this stuff works. You should be able to have intelligent conversations with your clients, consultants and peers in these areas. Unfortunately, this is usually the exception, not the norm in our industry. For example, simply recognizing and matching buzzwords on a candidate resume with buzzwords from a client job requisition is not good enough. Understanding this stuff is NOT the responsibility of your leadership. It is YOUR responsibility. Challenge yourself. Push yourself outside of your comfort zone. Get involved and your clients will seek you out!

Filing orders instead of solving client problems. I think we can all agree that it is indeed very exciting when we get a new sales order from a client, especially a new client. Unfortunately what often happens from that point forward is we focus 100% of our time and energy on finding the right candidate for that sales order. We take the order at face value and automatically go through our own internal process of filling it, much like the teenager working at your local McDonalds drive-through does when taking your order. Instead, we should be using that job description (or sales order) as our sales lead to uncover our customers true business and technical challenge(s). Now we can’t solve our customer’s problems without first knowing and understanding what those challenges are. But without that we are simply order fillers. And clients don’t place a high value on “order fillers.” Why do you think the staffing industry as whole has such low gross profit margins? Remember this, the value you deliver to your clients is directly reflected in your gross profit margins. Now you may be thinking, what is the difference between filling an order and solving a customer problem? And why do I want to go through the trouble of uncovering their business problems when I already have a job requirement to work on? Because you want to differentiate yourself and you want to close more profitable business. In the MoshupMethodology, my proprietary sales methodology for selling IT Professional Services, I go into this in great detail and demonstrate how to apply this concept and why it’s a best practice. Don’t settle for the status quo job order, develop it.

Quality & Qualified Job (Sales) Orders: If you didn’t read my article titled “You Mean You’re A Body Shop?” (http://menemshagroup.blogspot.com/2008_09_01_archive.html) posted Monday, September 29th, 2008, please take a look. In a nutshell, I would give our industry as whole an overall letter grade of “C” when it comes to the level of quality and qualification of our job orders. Just look at the different job boards and the job orders on your competitor’s websites. Notice all the 3-5 sentence job descriptions? How about the long-winded job descriptions that don’t really tell you a clear story? And the buzzwords, gotta love the buzzwords. Taking a highly qualified sales order (Job Requirement) of high quality is important for a number of reasons. It differentiates you as a sales person because most sales representatives in our industry simply settle for the pre-defined job descriptions that are written by HR eons ago. Don’t you want your recruiters competing to work your job orders? Done correctly, they will compete to fill your business. Lastly, 80% of sales is figuring out who is serious and who is kicking tires. Don’t risk wasting your time and your recruiter’s time on tire-kickers. It makes you look bad and you lose credibility with your delivery team.

In summary, remember to control the controllables. As sales professional who sell IT Professional Services you do have a lot of control over your sales opportunities. However, the margin for error is pretty thin. You can’t cut corners because it will always come back to haunt you. And your competitors are constantly knocking on the doors of your best customers. So make sure you stick to the fundamentals and do the proper preparation. Otherwise you are just beating yourself.

"You Mean You're A Body Shop?"

2008-09-29T14:04:00.000-04:00

Admit it, at least once you’ve all heard these words come out of the mouth of your prospect. It’s a not a good feeling and it certainly doesn’t articulate the value that we deliver to our clients each and every day. Next thing you know you are reeling to turn the conversation around and convince the prospect why you are not a body shop. Not a good place to be to say the least. But let me ask you another question, when was the last time you took a really hard look and scrutinized your open job requirements/sales orders? I decided to take a gander the other day at the open IT consulting/contracting opportunities on the various job boards and vendor websites. Based on the quality of what I saw, it’s no surprise our prospects often use the term “body shop” to typify our industry. Let me share with you what I uncovered and then provide some thoughts and insight to help ensure you’re never labeled a “body shop.”

Despite what you read in the papers and hear in the news, the IT consulting market for the most part continues to remain robust. There were a plethora of requirements posted on the Internet, but they all looked the same. Zero differentiation. And I would say at least 90% of them screamed “Human Resources”-indicating they wrote and posted the specification. They were all simply listings of technical buzzwords. Big long laundry lists. The postings I reviewed were often long-winded and wordy lacking articulation or way to vague in describing the role and the day-to-day responsibilities. None of them talked to the goals and overall scope of the project or career opportunity nor did they explain the technical challenges the consultant/employee would be expected to solve. I never saw the word “deliverable” mentioned once, in any of them! Yes, I know staffing companies typically don’t take on deliverables. Guess what, even so your consultant is still expected to deliver work output or work product, actual artifacts and/or functionality to enhance your customer’s business. That is what the consultant gets paid to do. Deliver results. And the person responsible for taking and writing the job requirement should understand this.

Interestingly enough, most if not all had an extensive laundry list of technical jargon and/or buzzwords. Yet in most cases, the technologies listed in those “laundry lists” spanned the entire technology spectrum, making it impossible for any recruiter to find the right candidate, if such a candidate exists. Because the Sales Representative didn’t further qualify or ask additional questions, they’re now sending their recruiter(s) off on a fruitless exercise. More on that in a second.

Lastly and most importantly, not one of the postings I saw articulated anything compelling or unique about the project, the consulting/career opportunity, or anything unique and compelling about the client company the consultant would be working for. Talk about lack of differentiation. Yes, I know you are thinking that you explain those things over the phone but you have to receive the phone call in order to have the conversation.

In our industry there are limited opportunities and limited ways in which you can differentiate yourself from the competition. Developing a high quality statement of work or sales order is one of them.

Now put yourself in the shoes of an independent IT consultant. When reviewing IT consulting/contracting opportunities on various websites, how are you going to decide which opportunities to pursue and which to pass on? Aside from narrowing it down by technical discipline and location, you’re going to pursue the opportunities (job descriptions) that are interesting and tell a story. The opportunities that share with you the information you need in order to make an informed decision. What do those descriptions look like? Those are the descriptions that share with you what the company’s goal and strategy is and how the consulting opportunity (or career opportunity) will help support and carry out that strategy; the descriptions that share with you what the business drivers of the project are, who you will be working with, the tasks you will perform, and who, and how many users will be using the application or product you are going to help develop; the descriptions where you understand the scope of the project, team size, and technical environment and technical challenges you will be expected to solve; the descriptions that share with you the project milestones and exactly what you’re expected to deliver to the customer. I could go on and on but you get the idea.

Now let me jump back to the salesman asking his recruiting team to spin their wheels on a wasted recruiting cycle. We’ve all been in morning huddles where we get to that one requirement where everyone is saying to themselves “not this one again, take it off the board, it’s a waste of time.” But to everyone’s amazement, the sales representative is still convinced that it’s a real opportunity and they expect their recruiter to fill the order. Meanwhile, the recruiters and other staff members are rolling their eyes and/or looking away because they are afraid to tell the sales person that they’re really not working that hard on their job order. (Thus the tension and proverbial invisible wall is erected between sales and recruiting. Another topic for me to discuss in a future article!) Folks, these are the job descriptions/sales orders I am talking about. These are the job descriptions that I saw posted all over the job boards and competitor websites, possibly even yours.

As professionals of the IT Staffing and Consulting industry we can all relate to the above to varying degrees. The question then becomes, why are our job requirements of such poor quality and lacking proper qualification? I could write another article on the many different answers to that question. Instead, let me arm you with a few tools for taking a detailed statement of work or sales order. Your boss and recruiting team will love you for it!

Quality

Ask the customer for a project overview including, scope, business drivers, and goals. What are they building and why? Who will use the application once built? This explains why the project is so important to the customer. Find out where they’re at in the SDLC and what is their next project milestone (more sales opportunities).
Get the details of the day-to-day responsibilities. Simply developing code or testing an application is too vague.
Differentiate between the desired skills and the required skills. Ask the customer to commit to drawing a line in the sand. This is critical.
Understand the entire technical environment and uncover how it’s all connected. This includes databases, operating systems, application and web servers, programming languages etc.
Find out what the biggest technical challenge you client is facing. Getting the details on this will help you find your candidate and look like a hero.
Don’t just find out why the opportunity exists; find out what the consequences are if the opportunity goes unfilled and how that personally affects your client.
Secure 3-4 interview time slots at the time of taking the statement of work. It gives you an idea of how serious they are sends the right message to your recruiting team and potential candidates.

Qualification

Always get the answers to these six questions before getting started.

Determine what the budget is and if it has been approved. If it has not yet been approved, find out in excruciating detail the steps and tasks the client needs to complete to get it approved.
Find out if they have hired consultants before. If so, have them explain to you exactly what steps they need to complete before they can extend an offer AND allow the consultant to begin work. If they have not hired consultants, you need to lead them down this conversation.
Find out in detail what the interview process is.
Uncover in finite detail the decision making process.
Uncover the hiring process in detail. There are never too many questions you can ask in any of these areas.
Think two steps ahead of your client. For example, ask them him if they have an office or cube already set up for the consultant? How long will a security badge take? Do they have a computer available for them along with network access?

Hopefully my observations will compel will you tighten up your game and write high quality job descriptions that differentiate yourself as a sales person as well as your organization. Heck, it’s too competitive out there for you not to. And nobody wants to be referred to as a “body shop.”

Happy Selling.

Dan Fisher

Menemsha Group, creator of the MoshupMethodology, a proprietary methodology for selling IT Professional Services, is dedicated to serving sales professionals in the IT Staffing & Consulting industry. Leveraging the MoshupMethodolgoy, sales professionals are equipped with the necessary tools, knowledge, and self-confidence to sell up the customer value chain, resulting in high-end gross profit margins and bill rates. Our content & training is focused exclusively on wining strategic IT staffing engagements including the placement of senior-level IT practitioners and winning IT projects. The MoshupMethodology provides a predictable and repeatable process guaranteeing success in selling IT professional services.
Dan can be reached at dan@menemshagroup.com