Equality, Part 1

There's a long-standing tradition in sales that's about as self-destructive to a sales team as it's possible to get: Treating salespeople differently depending upon their sales metrics.

You all know what I mean - making exceptions for things you would never normally allow because a particular salesperson generates high numbers. While it's great that they are consistent achievers (wait - they're not consistent? then why are you rewarding them for sporadic results?), think about the door that you've opened. These are salespeople we're talking about; it's their job to open doors as wide as possible, and you can't expect them to act differently with internal doors than they do with external doors. They will push those exceptions as far and as wide as they possibly can, and that's not their fault - that's what salespeople do, by nature, and you're the one that opened the door.

Now think about the other members of the sales team, the folks who consistently hit goal but don't soar above it. How much of a motivator is it for them to see that the fellow who occasionally hits a high note is permitted to break the rules, sending their sales even higher, while they have to rigidly observe procedure?

It's not. That's why they're sullen. That's why their results decline. That's why they leave, and go do terrific work for your competitors, taking knowledge about your company, your Customers, and how you do things with them.

There's nothing wrong with compensating salespeople based on results - that's what sales is all about, and everyone understands that. It's the arbitrariness that makes unspoken benefits evil, not the concept. If you're going to bestow privileges based on results, put them down in black and white, for all to see and aspire to. And, rather than have them kick in when a salesperson goes above and beyond just once, make them effective with consistent high results.

Salespeople are like racehorses: It's their job to run, but it's your job to clearly lay out the track and the stakes.

PTO

There are some employers in the United States today that don't offer employees paid time off (PTO), even if they're sick or there's a public holiday. Others restrict PTO to employees who have been with their organizations for 1 year or more.

I understand the reasoning: "If an employee isn't producing, why pay them?" Followed closely by: "They'll only take advantage of it."

There's just 1 problem with this line of reasoning: It's wrong.

If you don't allow paid personal time, sick time, etc., you are essentially saying that there is no defined limit to how many days an employee can be absent (with notice, of course), provided that they are willing to forgo pay for that many days. That being the case, what actually happens is not multiple days taken off in one go - it's a day or two taken off each month, every month.

That's right - you've unintentionally consented to allow employees unpaid time off that totals 12 to 24 days a year - and to resent you for making them show up for work sick (getting everyone else sick in the process).

But give even a new employee 5 personal days up front, and here's what happens (provided you hired the right person): They hoard them.

That's right - limited to just 5 days that they can have off per year, the end of the year rolls around and people still have days left that they could take off, but haven't. Why? Because they never know when their child might be ill, or their hot water heater might spring a leak, or one of their parents might die. Against the unknown, they take those 5 days and bank them. Especially since so many of them are working 2 jobs just to make ends meet.

But really, do you really want employees that haven't taken their 5 days? Think about it: 52 weeks in a row of 40 or more hours per week, without a break. How productive do you really think this employee is going to be, even if they don't get sick?

If you really want someone fresh and sharp, why not offer 5 days of personal/sick time, and 5 days for mental health (what we used to call a 'vacation').

So, for the cost of 10 days' pay, you get:

  • Employees who are less likely to leave
  • Higher production because no one is spreading the plague
  • Sharp, fresh employees
  • Few employees who actually use all 10 days
  • An employee who has to work harder to pay for an even better vacation next year
In other words, if you're going to bean count, do it here only if you prefer employees that are mentally and physically unfit.

Moving Pianos

My entire career has been about moving pianos.

I did actually used to move pianos, years ago, when my back was younger than any of me is now. What I learned then has informed my work process ever since. The only time I've failed is when I didn't pay attention to the rules of piano moving, which are as follows:

The Customer gets to pick the piano
You can influence that decision, of course, depending upon whether the Customer (or the Customer's associates - i.e., spouse and/or children) plan to use the piano to noodle around on or to train the next Rachmaninoff. Ultimately, though, it's the Customer's dime. If they want a zebra-striped 21-foot grand and can afford it, it's their right to get that hideous monstrosity.

Yes, you want a lamp - and a grandfather clock
When Customers purchase a big-ticket item, like a piano or a database, payroll service, CRM, etc., sign the deal for that first. Then, once that deal is locked, suggest add-ons that go well with the original item, like a lamp so they can see their sheet music better, a certain amount of additional storage in the cloud, etc. Customers who've just made a large purchase are much more likely to say yes - after all, they've already said yes to the big, scary decision; anything after that is easy - and it's your job to fill the new needs created by their original decision.

The Customer decides where the piano goes - within limits
Customers always have interesting ideas about where the piano should go. The third floor? Sure, why not - provided that the floor is sufficiently braced to take the weight. Full-sized pianos are like full bookcases - they weigh a lot, and the Customer has a right to be angry if their floor starts to warp or sag and you didn't advise them that that was likely to happen. It might be more convenient for you to put the piano in the living room, where you won't have to take off its legs and turn it on its side to negotiate those treacherous, hernia-inducing stairs, but it's the Customer's house, and the piano goes where they want it. But I would still get it in writing that you've told them about that floor - just in case.

Do you want your piano tuned?
Pianos - real pianos, as opposed to their digital cousins - need regular tuning. You may offer a certain number of tunings for free, and possibly a package price if they sign up for a regular course of these after the fact. Unlike additional warranties, tuning is necessary if you don't want the neighborhood dogs to howl every time you play. You may not be who they choose to do the tunings, of course, so it's in your best interest to offer a fair price for that package to lock them in. Unless, of course, you don't mind your Customers tweeting or Facebooking that you robbed them.

What do your extended family and friends think of your piano?
It is a given that anyone who purchases a piano will show it off, partly to reassure themselves that they've made a good decision, and partly because they're proud to own something so cool. So call the Customer 2 weeks or so after the first tuning and ask what their extended family and friends think. Did any of them mention that they wish they had a piano? If so, let your Customer know that you would be honored to help their friends choose a piano that will be the perfect fit for their needs - and that they can get some kind of break for mentioning that they know your Customer.

The Hierarchy of Communication

In these days of social media, email, texts and on and on, it's easy to lose sight of the fact that each type of communication is more or less effective than another. We get into the rut of using one way to touch colleagues and Customers, even if it's less effective, simply because it's habit.

Remember the Hierarchy of Communication, in order from most to least effective.

For one-to-one or small groups:

  1. Face to face
  2. Remote videoconferencing
  3. Telephone (voice not text)
  4. Text
  5. Email

For group communication:

  1. Face to face
  2. Videoconferencing
  3. Teleconferencing
  4. Recorded video
  5. Text
  6. Twitter
  7. Facebook
  8. Email
  9. Print
There are place-changers, of course, depending on your Customer demographic. If your Customers are primarily over 55, print moves up to number 4 or higher, and Twitter likely drops to the bottom. But why in the world would you shotgun a message to every demographic using one outlet? Or use the same message for every demographic? That's the marketing equivalent of using worms to fish for marlin.

Every time you interact with a Colleague, try to make it face to face. Don't have time? Does that mean that it takes you less time to field the ping pong series of emails that it takes to convey your point - and hear your colleague's points - that way? Sounds like a hollow argument to me.

Remember: If a communication medium isn't effective, it doesn't save time, it wastes money.

Acquisitions

Congratulations! You've worked long and hard, invested in the right people, done the right things, and you're ready to make your first strategic acquisition. Now is the time for due diligence.

As part of any acquisition process, there are questions that you need to ask yourself first. If you don't have black and white answers that your management team understands and agrees with - especially your Sales Manager and CFO - the process must stop here. If it doesn't, you are making a potentially fatal mistake. What questions? Glad you asked:


  • Why this company?
  • Why now?
  • Are there other companies that would be a better fit?
  • How many people do you need to keep? For how long?
  • Do they have some people that are better than yours? Does it make sense to be redundant?
  • How much will it cost to let people go? Make sure that you are in chrge of the layoff package - not the other company.
  • Can you afford the buyout in one go, or are you financing it? If the acquisition company tanks, can you afford the loss plus the financed acquisition cost?
  • Who is going to review their books with a fine-toothed comb?
That last one, in particular, should be tattooed on your forehead. I don't care if you're buying your mom's company; business is business. They are willing to sell out for a reason. It's your job to find out what that reason is. I don't care that they told you that they're retiring; everyobody says that. Why are they retiring now? You need someone who snoops into books for a living to do exactly that, because you can't trust them and you don't know what you're looking for. At a minimum, your snoop should know this by the time they're done:

  • Are their sales rising or falling? Why?
  • How profitable are they - not just gross, but net?
  • Are they over-comping their people?
  • Who are their star performers? Can you afford to keep them?
  • Have they already made written promises to any employees - or Customers - that you will have to make good on?
  • Who are their best and worst Customers?
  • Does their Customer list add enough new names to yours to make the acquisition worthwhile? Don't assume - find out by pulling their database and having it deduped and matched against yours.
  • How do their processes work? Sit with their teams. Are there some processes that are better than yours that you should adopt? Can you make them more efficient?
  • Are you stuck with a building lease that you don't need or want?
  • How about vendor agreements? Are you assuming your competitor's headaches?
  • How long will it take the company that you acquire to pay off what you paid for them? This should be part of not just your financing agreement, but also your negotiations with the owner(s).
  • Who else are they talking to? Because it's not just you. The sooner you know who they're in bed with, the sooner you can put an agreement in place to stop all other negotiations. If they won't agree to that, it's time to walk away from the table.

That last one is a bigger issue: Never be afraid to walk away from the table. Any acquisition is a huge step, and even the biggest players get it wrong on a regular basis (just look at Time-Warner and AOL). Getting it wrong can mean not only missing a key opportunity to grow, but killing your own business in the process.

Follow the Jackrabbit Rule: If anything smells bad, run.