The problem with short-term thinking
By John R. Graham
Though faced with the reality of economic
change, the constant reconfiguration of the business landscape
and most of all pressure to make the numbers, U.S. companies
continue on the short-term thinking path.
It’s so widely accepted today,
short-term thinking is all that seems to count. Long-range
goals seem strangely out of place and irrelevant, reminiscent
of hunters of an earlier time. A popular business saying
summarizes this concept: “Every day, week, month and
year, we have to do it all over again.”
Getting up every morning is like going
back to the starting line. Life insurance agents and other
salespeople look in the mirror and ask themselves the question,
"Who can I talk to today?" Even more to the point,
“Where can I find the ripe fruit?”
If a short-term strategy is so necessary
and useful, then why do 46 percent of sales managers report
that their biggest challenge is dealing with under-performing
salespeople?
A pipeline approach
Whether it’s investing, developing
a transportation system or making sales, the tendency to opt
for the short-term and ignore longer-term issues is all but
universal. On a personal level, studies show that most
Americans fail to plan for their retirement. “Now”
takes precedence over “then.”
Our tendency toward
“either-or” thinking drives us to conclude that it
must be either “short-term thinking” or
“long-term thinking,” one or the other.
What about “both-and” instead
of “either-or”? Composer/guitarist Dan McAvinchey
points out that failures in the music business stem from
short-term thinking. He suggests a “both-and”
strategy. For example:
Short-term: “I want to release my
first CD this year.”
Long-term: “This year, I want to
release the first of eight CDs I plan to record over the next
ten years.”
This model applies to marketing and sales
as well. While everyone is faced with meeting immediate
objectives, does that mean we should ignore planning longer
term?
It has become crystal clear that buyers
are not making snap decisions. An insurance sales manager
landed a very large account. When asked how long she had worked
on it, she replied, “Well over a year.”
Here’s the point: Without a
pipeline of prospects, there can be little long-term growth
— or proper short-term results.
The process is one of constantly filling
the pipeline with potential business while taking care of the
new business that flows from the pipe. More effort going into
customer creation pays off in increased business. Instead of
spending valuable time and resources to scavenger for new
business, a more prudent approach is to create a process that
produces new business continuously.
Building the pipeline
Here are the elements of implementing a
pipeline strategy:
1. View prospects as
customers-in-the-making. Although salespeople are quick to say
that they are solution-oriented and want to help customers,
their behavior often betrays the most noble of intentions.
It isn’t difficult to identify a
salesperson who has a single objective in mind: making the
sale. Everything is aimed at achieving that goal. With such
transparency, prospects easily sense their true mission and go
on the defensive, either rejecting the salesperson or backing
away from making a decision.
More often than not, the excuse
that’s given for not making the sale is price.
A different mindset views prospects as
customers-in-the-making, who may buy today, tomorrow or a year
from now. The goal is to bring them into an orbit where they
can gain an understanding of why they should do business with
you.
2. Make prospect identification a
continuous process. It’s easy to put making the sale
ahead of creating the customer. The goal of prospecting should
be identifying those who fit a company’s customer profile
and who, when properly cultivated, hold the potential for
becoming buyers.
Yet, most companies find it difficult, if
not impossible to make prospect identification a continuing
task. Even when prospect identification occurs, it is more
often than not a “temporary activity,” driven by a
need to boost sales.
The life force of sales is a pipeline
that’s filled with prospective customers who have learned
the value of doing business with you––and who have
discovered all this before becoming customers.
3. Implement prospect cultivation
tactics. The purpose of cultivation is to build a relationship
with prospects. Customers set their own buying schedules and
they’re not about to have their priorities changed to fit
the needs of a salesperson who makes a flurry of calls or sends
a half-dozen emails and then quits because of a lack of
response.
Today’s prospects are not moved by
attempts to arrange a meeting or someone saying,
“I’d like to get together with you to gather
information.” There’s no time. But when it comes
time to buy, those who have established themselves in the
prospect’s mind get the opportunity to write the order.
4. Segment prospects to focus on
individual needs. In effect, there’s only one prospect
— even though you may be working with many. The goal is
to have prospects conclude that your solution meets their
specific needs.
It’s an age of the individual
customer where expectations are increasing daily. The customer
expects everything to be personalized. For example,
“boiler plate” communications and proposals do more
to undermine prospect confidence and interest than the actions
of the most inept salespersons.
Today, we can manage our individual
retirement accounts, order cars that are customized to our
specifications instead of having to take what’s on a
dealer’s lot and dine at restaurants that prepare meals
to individual taste.
This is what customers also expect from
salespeople.
5. Be a valuable resource. The most
effective way to convince a customer to buy from you is to make
yourself invaluable. What you sell may help a customer become
more successful, but what you know solves customer problems.
There are those who are reluctant to share their knowledge,
fearing that prospects will take what they want and never
bother to become buyers.
The president of a highly successful
insurance operation reports receiving calls from both customers
and prospects about his newsletter articles. “They want
to discuss an idea they found in one of the articles,” he
reports.
What you know is more important than what
you sell. The best way for prospects to become aligned with
your company is to allow them to discover what’s helpful
to them from your experience and knowledge.
6. Find ways to help customers be more
successful. If partnering has any value as a concept,
it’s to be found in helping prospects and customers meet
business challenges. Just selling them the right product or
service isn’t nearly sufficient to build a lasting bond.
Almost any “vendor” can do that.
Going beyond the expected is
today’s challenge. A wholesaler of bakery mixes found its
customers asking for help in marketing their products. It
almost came as a shock to management that quality, innovative
products were not enough to secure accounts. Customers were
looking for ways to sell more baked goods. Meeting this need
was the first step in selling more mixes and fillings.
7. Demonstrate leadership. While playing
it cautious can be prudent, it’s leadership that captures
the attention of prospects. Mass merchandiser Best Buy is
leaving the competition behind with its assertive marketplace
strategy. Through advertising, store design, cutting edge
product emphasis, Best Buy sends the message that it’s
number one.
On a smaller scale, a Chinese restaurant
opens in a location seemingly saturated with similar
establishments. But the cuisine and atmosphere are noticeably
unique. Sensing something new, different and comfortable,
customers stand in line at the door.
It’s establishing a leadership
image that appeals to today’s prospects and customers.
A results-based approach
Because results are what count, wasting
time chasing possible sales, following up on less than serious
prospects and preparing dead-end proposals doesn’t make
sense today. Time is too valuable. Short-term sales tactics
fail to deliver long-term results.
What’s required is a pipeline of
prospects that, because they know and understand your products
and services, create a steady flow of new business.
In the end, it’s a carefully
crafted combination of longer-term planning that creates
short-term results.
John R. Graham is president of Graham
Communications, a marketing
services and sales consulting firm. He is an author of several
books, writes for a variety of publications and speaks at
association meetings. Graham can be contacted by phone at (617)
328-0069.
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