Also, tailoring products to individual customers' needs can be tough on cash flow, at least in the beginning. You'll feel the effects of the longer selling cycle. And meeting customers' needs today may call for an investment in people, training, and systems that can eat into cash reserves. Manco found that to reduce customers' costs, it had to increase some of its own. When it began managing its inventory for big customers, that meant keeping more inventory on hand and shipping smaller orders. It also meant investing in people and computer systems. None of that is great for cash flow.
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The Payoff
You may get many mixed signals in the process of changing the way you sell, but it won't take long to see results. The evidence will be all around you. Customers will quickly take note of the change and become your most vocal supporters. Displaymasters recently received a letter from a large client that credited the entire company for the client's success at a major trade show. The letter begins:
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Displaymasters is a first-class operation. That became evident from the moment we began discussing the project, to when you made your proposal. The "teamwork approach" may be new to the exhibit industry, but it is definitely apparent that this trend is the only way to go. Nothing could be more "customer-friendly" and productive, to both employees of Displaymasters and clients alike. . . .
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Of course, glowing customer feedback is the stuff that repeat and word-of-mouth sales are made of. Nearly all the CEOs interviewed said they've reduced selling-and-marketing costs by working so much more closely with customers. And one of the best feelings, John Argitis says, is when customers call. It's no longer the old refrain: "Uh-oh, it's the customer calling -- what's wrong now?"
Employees take pride in a job well done and enjoy working for companies dedicated to customers. Judy Okerstrom, the Displaymasters salesperson who talked about the difficulty of changing roles, now sings a different tune. "It's like a breath of fresh air," she says. "I am accountable. We all feel a real responsibility to each other with the team concept." Riley of Fletcher Music says he even gets good comments in exit interviews.
Finally, you should know that no matter how topsy-turvy things get, the investment you make now will pay off many times over. When more employees start thinking about (and eventually taking responsibility for) customers' needs, it takes the weight off you. CEOs who've taken their companies down this road say it's their managers and employees who now suggest how to organize work to better serve their customers. And the effort never ends. "It was probably the start of our quality process," says John Sample of Business Interiors, "even though we wouldn't have called it that eight years ago."
READINGS TO SELL BY
SPIN Selling, by Neil Rackham (McGraw-Hill, 1988, $22.95). Companies small and large use this book in sales training. "It's selling the way you ought to be doing it," says John Sample of Business Interiors. Offers strategies for making the high-ticket sale, based on extensive research into why salespeople succeed or fail. ("SPIN" is an acronym for "situation, problem, implication, need-payoff.")
Value-added Sales Management, by Tom Reilly (Contemporary Books, 1993, $9.95). A handy primer on what it means to sell on value rather than price. Includes basic questions to get you brainstorming. Gives practical tips on how to rally your sales force, including a chapter on motivating the person who's reached a sales plateau.
Customers for Life, by Carl Sewell and Paul Brown (Doubleday, 1990, $10). The book for customer-respecting CEOs. If a Texas car dealership can do it . . .
The Virtual Corporation, by William Davidow and Michael Malone (HarperCollins, 1992, $23). A richly annotated look at how the best companies are structuring themselves around "customer control." There's great stuff in chapters like "A New Kind of Worker" (learning to learn, teamwork) and "Spreading the Word" (value marketing). On Manco president Tom Corbo's reading list.
New Benchmarks for Worldclass Sales Success (The H. R. Chally Group, 1992, $5; send fax orders to the attention of Customer Services, 513-299-0630; or call 513-299-1255). Large companies are dealing with the same issues you are; there's proof in this 20-page booklet. More than 60 top sales and marketing executives reflect on the challenges of selling in the global 1990s. Nucor Corp.'s John Correnti sets the tone: "Good American sales companies see the customer as king. The Japanese see the customer as 'God.' "
The Great Game of Business, by Jack Stack (Doubleday Currency, 1992, $24). Stack, CEO of Springfield Remanufacturing, is one of the few who have put all the pieces together -- from setting goals based on open-book management, to bonus plans, cost accounting, and employee ownership. It's all here, told in lively, no-holds-barred fashion.
