Sunday, October 16, 2011
Strategic Planning Analogy #417: It also works for B2B
Lately, we’ve been hearing a lot of stories about Steve Jobs. One of my favorites is an interview he had with journalists at the time the iPad was being first introduced.
One of the journalists asked Jobs what kinds of consumer and market research Apple had done to guide the development of this new and different product.
Jobs response? He said, “None. It isn’t the consumers’ job to know what they want.”
And based on the tremendous response of consumers, the Apple iPad has been a great success, even though the customers weren’t consulted on its development.
Steve Jobs didn’t believe in letting customers drive innovation. He didn’t see that as being their job. In fact, on another occasion, Jobs said, “You can't just ask customers what they want and then try to give that to them. By the time you get it built, they'll want something new.”
No, Jobs felt it was HIS responsibility to get out IN FRONT of the customer and develop solutions customers were not clamoring for yet.
In a prior blog, I spoke at length on the pitfalls of seeking innovation via consumer research. This is not to say that consumer research is worthless. It’s a great way to get the consumer’s response to the here and now. It’s just not very insightful if you want to find great, out-of-the-box innovation for tomorrow.
Now some of you may be saying, “Okay, I get that. It is not the consumer’s job to innovate, but to consume what the professional innovators come up with. But that’s the business to consumer world. It does not apply to the business to business world. After all, those business customers are professionals at buying things. They’re paid to do what is best for their organizations. It really is their job to know what they want—for today and for tomorrow. Isn’t it?”
Well, based on some research we will soon talk about, it appears that Steve Jobs approach is just as relevant for the business world as it is for the consumer world. If you want breakthrough sales successes in the business world like Steve Jobs had in the consumer world, copy his approach.
The principle here is that B to B customers aren’t much better about knowing what they want/need than B to C customers. Therefore, a B to B strategy of giving the customer what they want can be inferior to a more aggressive approach like Steve Jobs—of giving the customer what they haven’t asked for yet.
Research by Dixon and Adamson
This can be seen in some recent research by Matthew Dixon and Brent Adamson. Dixon is Managing Director of the Corporate Executive Board's Sales and Service Practice and Adamson is Senior Director of the Sales Executive Council, a division of the Sales and Service Practice. Their research is based on interviews with over 6,000 B to B sales reps in nearly 100 companies. The full results of their research will be in their new book, The Challenger Sale: Taking Control of the Customer Conversation, to be issued November 10, 2011. But they let on to some of the key results in a recent HBR blog.
In essence, Dixon and Adamson found that all B to B sales reps fall into one of five categories.
1) Relationship Builders - They focus on developing strong personal and professional relationships and advocates across the customer organization. They are generous with their time, strive to meet customers' every need, and work hard to resolve tensions in the commercial relationship.
2) Hard Workers – They show up early, stay late, and always go the extra mile. They'll make more calls in an hour and conduct more visits in a week than just about anyone else on the team.
3) Lone Wolves – They are the deeply self-confident, the rule-breaking cowboys of the sales force who do things their way or not at all.
4) Reactive Problem Solvers - They are, from the customers' standpoint, highly reliable and detail-oriented. They focus on post-sales follow-up, ensuring that service issues related to implementation and execution are addressed quickly and thoroughly.
5) Challengers - They use their deep understanding of their customers' business to push their thinking and take control of the sales conversation. They're not afraid to share even potentially controversial views and are assertive — with both their customers and bosses.
Dixon and Adamson then looked as the sales success for of these five groups. What they discovered was that the Relationship Builders were the least successful sales people and the Challengers were the most successful B to B sellers.
At first, this seems counterintuitive. After all, most sales training organizations are set up to help reps become better relationship builders. Conventional wisdom in the B to B world is that if you build a strong relationship, find out what the customer wants and then give it to him, you will sell more. Apparently, conventional wisdom is wrong.
The problem is that B to B customers are a lot like B to C customers. They understand the difference between what a good and a bad version of the status quo is. However, they are not always good at envisioning the potential for something radically different. Therefore, if all you do is build relationships and give your customers what they want, you are not really differentiating much from the crowd. You’re just supplying the status quo, pretty much like everyone else. A closer business relationship, in that situation, doesn’t add that much value. So sales don’t go up much.
No, if you want great leaps forward in sales with business customers, you need to innovate in advance of what your customers even realize they might desire. Apple has sold a ton of iPods, iPads, and iPhones. Customers weren’t begging for them before they existed. The idea did not come up through talking to the customers. Steve Jobs was innovating in advance of his customers.
The same applies to the business world. The reason why the Challengers group in the study sold so much more than the other reps is because they acted more like Steve Jobs. They didn’t try to give the business customers what they were asking for. They didn’t try to get close by doing a lot of relationship building. Instead, they tended to be more confrontational. They challenged the businesses to think differently about their business. They offered solutions which the business customers weren’t asking for.
The Challengers would rethink the whole business of their customers and offer revolutionary answers unlike anything else on the market, like Steve Jobs. The offerings from the Challengers would be true innovation that gave the businesses a true competitive advantage. Naturally, once the business customers realized how much better these innovations were, they clamored to buy them even though they never asked for them (like consumers clamored for iPads). Sales would skyrocket (like the iPads).
So, rather than try to do a better job of what everyone else was doing, the Challengers did something entirely different. The differentiation was what made them stand out and outsell all the other groups.
If you want to be an exceptional seller to businesses, act like Steve Jobs did with consumers. Challenge the customer with great solutions they aren’t asking for.
Back when Steve Jobs returned to Apple, he wanted to rejuvenate Apple’s image. So Apple came up with a campaign with the slogan “Think Different.” Sales reps for business customers need to follow that advice. And B to B business strategies need to help the sales reps do this.