|
Retrofitting for tough times
|
By Tom Coyner
JoongAng Daily
January 20, 2009
A winnowing out process among businesses is taking place . . . New, more
competitive methods need to be implemented, often for sheer survival.
Tough
times have arrived. And they will be with us a good deal longer than most of
us have experienced. Regardless, business must continue.
Among all the increased challenges business managers face, perhaps the
toughest of all is in sales. Given the brevity of this space, allow me to
focus on this one aspect for business survival.
During the past years, most Korean sales people have relied on “relationship
selling,” based on personal connection and prior introductions.
Much of selling has been schmoozing so as to be among the first to learn of
buyer intentions. Usually, the buyer has determined on his own what he
needs.
The Korean salesman has been there to best understand the pre-determined
needs and ultimately negotiate the price of the order. In other words,
Korean sales people have been more like field order takers than true sales
professionals.
But we cannot knock success. The approach has worked reasonably well for the
most part.
But we all are now faced with some radically different circumstances. Due to
layoffs, networks of personal connections are crumbling.
Increasingly it is becoming less important whom you know and more critical
how one’s daily performance can justify continued employment.
Meanwhile, other stresses build up. Customers have reduced budgets.
Sales people are quietly murmuring that sales calls are becoming a waste of
time. Sales managers are cajoling and threatening their subordinates to work
harder or else.
Some companies are dealing with major morale problems within their sales
forces. Since selling starts with customers, consider how the current
economic situation is affecting them.
In Korea, the real decision makers generally are the middle managers. They
have the toughest jobs of all. And their jobs have suddenly become even more
demanding. They are being ordered to cut costs while maintaining, if not
improving, their departments’ functions. If they cannot achieve this, they
may find themselves in the next round of layoffs.
So the first tactic for most buyers is to demand price concessions. But at
best, this approach in sharing the pain can only last medium term.
Ten years ago, during the financial crisis, price concessions worked. But
many business planners believe this recession is going to last substantially
longer than then. In other words, drastic price cutting can only be
sustained until either the recession subsides -- or the vendors go out of
business.
In the case of the latter, the buyers may find themselves in even worse
circumstances should the discontinued goods and services be critical to
business operations.
As a result, we can see the marketplace initially hardening as most buyers
demand lower prices.
But in time, we may expect the market to soften as buyers realize vendors
can no longer reduce prices. It is at this point buyers will need to look at
new solutions that offer greater value for the price. In short, desperate
times can create desperate buyers who are more open to new solutions from
untried vendors.
To take advantage of this market shift, new sales strategies may be needed.
Specifically, sales teams need to focus more than ever on customer needs at
both the buyer’s corporate and personal levels.
While it is always important to have good personal relations with buyers,
especially during tough times successful sales professionals help buyers
better define their core needs.
In other words, many Korean sales people need to learn to elevate themselves
from being lowly order takers to becoming more consultative in solving buyer
needs within a business solutions perspective.
Now, this approach is very Western. And I have heard Koreans say that Korea
is different when it comes to selling. I have also heard the Japanese say
the same thing about Japan.
But I have witnessed the positive difference in sales when Korean and
Japanese sales people learn how to apply consultative selling to their
personal relationship skills.
During tough times, the market can become more of a level playing field.
Special personal relationships are still to be valued, but these connections
are more vulnerable than in the past.
A winnowing out process among businesses is taking place. Some traditional
business practices need to be re-evaluated -- and even jettisoned -- if they
have become more of a hindrance than a help. New, more competitive methods
need to be implemented, often for the purpose of sheer business survival.
In this essay, I have focused on sales. But much of the same can be applied
to accounting, marketing, logistics, manufacturing, and so on.
For highly skilled business professionals, regardless of the discipline,
tough times offer these individuals and their companies the best of
opportunities.
In the face of a paradigm shift, should a company have the raw talent but
lack sufficiently competitive expertise, this is the time to educate
employees on more effective business skills.
But that may require reviewing conventional priorities. When times are good,
many businesses are “too busy” for professional development.
When times are tough, education is among the first budget items to be
deleted. But remember the old adage of “working smarter, not harder”?
That principle was certainly applicable during good times. During tough
times, the same takes on an even more critical meaning.
*The writer is the president of a technology sales and marketing firm,
Soft Landing Consulting (www.softlandingkorea.com).
|
