Lead vs. Lag Indicators

As a sales manager, have you ever had to fire your top producer from the year prior and then found yourself asking, “What happened, they did so well last year?”. I would contend the answer lies in lead vs. lag indicators.

A lead indicator is a predictive measure. For example, in sales it would be number of prospects, or number of appointments. A lag indicator is typically output oriented. Again, an example in sales would be production numbers, or commissions.

In a typical sales environment we spend 90% of our time pouring over lag indicator reports. I’m guilty of this too, after all it’s how we’re judged, compensated, and rewarded in contests. However, we can’t change any of those numbers after the fact. I believe if we spent that same 90% of our time pouring over lead indicator reports we’d be better served.

If you’ve been in sales long enough you’ve seen someone pay that monster case. Their production numbers, lag indicators, are off the chart. We give them awards and plaques. But, what if it was just luck? What if looking at their lead indicators you saw month in and month out they only had one prospect. Yes, maybe that one happened to pan out, but, luck is not a sustainable business model.

Focusing our attention on those lead indicators, such as new names and new appointments will tell us so much more about how our sales individuals are performing. It will also help direct us were we can better train them, before it’s too late. If an agent is consistently running 20 appointments, or whatever the number is, yet closing nothing, we can focus our training on how to close, or run a better appointment. If they are consistently only coming up with 1 or 2 names a month we can focus on prospecting skills.

Yes, it is much harder to track, but, that doesn’t mean we shouldn’t try. These are the conversations we need to be having with our sales agents. Shifting from, “What was your production?” to, “What was your prospecting, how many new appointments?” I believe this will take our agents to the next level.

Life Lessons from Lacrosse??

     No, that’s not me in this picture. In fact, I’ve never even played lacrosse. This picture is actually from my younger son’s tournament this past weekend, where his team won it all. You may be thinking, “I thought I was clicking on a leadership blog, not a sports blog.” Or, “Shouldn’t I be posting this on Facebook if I wanted to brag about my son, not a blog?” You would be somewhat correct, I did post it on Facebook. However, what you don’t see is the picture of my older son. They lost all three of their games on the first day of this tournament, and that’s where the lesson lies.

     If I had taken that picture of my older son it would be of a defeated, tired, head down boy. His attitude was one of frustration, discouragement, and doubt. He was questioning the coach, the team, and thinking about why he put so much hard work into this tournament. Much like many of us after failing at something. We start to question the team, maybe ourselves, the process, the decisions that may have led up to that failure.

     That night I sat with him. I explained, from my experience, character is not determined by how you respond when everything is going well. It’s really built on the foundation of how you respond to adversity. What do you say, and how do you act, when things aren’t going your way? All too often I see people tuck tail and run, or, start playing the blame game when things don’t go according to plan. I don’t quote Mike Tyson often, but he did say, “Everyone has a plan until they get punched in the mouth.” My son had a choice. How would he respond the next day after he, and the team, got punched in the mouth? What would his character reveal about him?

      In case you’re wondering, I’m happy to say his character took a big step forward that next day in the tournament. He showed up early, excited, and head held high. He rallied around his team. Although the outcome wasn’t going to be what they hoped when they started, they still won the two games they played that day. Unfortunately, they didn’t win any trophy or medal. However, in my mind they walked away with something far better, character. I couldn’t have been more proud.

Open-Ended, Tie-Down, Porcupine

    What do all three of these have in common you may be asking? These are all types of questions identified in Tom Hopkins book, HOW TO Master the Art of SELLING. This is one of the best sales books I read over 13 years ago, and I still use a lot of what I read today. He identifies many more types of questions in the book, but I thought I’d explain these three and if you like them, you can read the rest for yourself.

Let’s start with the “open-ended”, this is the most common. It’s a type of question that can’t be answer with a yes or no response. It’s meant to elicit conversation and get the client to open up. Let me give you an example. A close ended question would go like this, “Mr. or Mrs. Prospect do you like your auto insurance?” There response short and sweet can be yes or no. A small tweak to make it an “open-ended” question would go like this, “Mr. or Mrs. Prospect what do you like or dislike about your auto insurance?” The answer is going to reveal a lot more about their feelings and how you should approach them next.

Let’s try the next type, “tie-down”. A “tie-down” question is one that’s worded so the prospect feels they are in control of the situation but either answer is perfectly fine to you. An example always helps. “Mr. or Mrs. Prospect do Thursday’s or Friday’s work better for you?” They are in control but, really weather they pick Thursday or Friday your fine with either.

Last one, my favorite name, the “porcupine”. It’s where a client asks you a question and you are unsure of the answer or how to respond; so, you throw the question right back at them. Imagine if someone threw you a porcupine, what would you do? Probably throw it right back, right? Again, an example, Mr. or Mrs. Prospect asks you why they need life insurance. You are at a loss for how to respond so you try the porcupine question. “Well Mr. or Mrs. Prospect, why don’t you need life insurance?” You took their question and threw it right back in hopes to get more information and formulate the appropriate response.

I hope these made sense and again if you enjoy these buy the book, it’s great. If you enjoy this blog so far please hit the subscribe button below and I’ll keep delivering what I hope is some good material.

Not Yet VS. FAILED!!!

I came across an article about a Chicago school a few years ago that started doing something really interesting. Students there needed a certain number of classes to graduate but instead of teachers giving them an “F” if they failed a class, they got a grade of “Not Yet”.

After that, the graduation rate skyrocketed.

The point was, by thinking in terms of “Not Yet” you can set up a path towards growth.

You escape the tyranny of “I just failed” and replace it with the hope of “I’ll get there eventually.”

Psychologists called the change in thinking the Growth Mindset and brain scans actually show a difference in the brains of people who think in terms of “not yet” versus “I failed”. In her TED presentation, “The Power of Believing You Can Improve”, Carol Dweck explains the power of “Not Yet”.

She talks about every time you push through a difficult experience or a failure and say to yourself “I’m not there yet, but I will be someday”  something inside of you changes. You grow in such a huge way that your brain actually gets rewired.

Success in business, and really life, is all about how you respond to failure. Success is not about what you have already achieved. I’m sure you can recount story after story of successful people that overcame adversity.

So today, when you fail or get told no, or when you have a rough weekend or don’t hit your sales goal, fight the urge to look at it as a failure. Instead, tell yourself “just not yet”.

Big changes can happen when you catch this mindset. It transforms the meaning of all your effort from failure to future success and it empowers you to get back on the treadmill of life and keep running.

Do you have a story you can share where this mindset paid off for you? I’d love to hear about it in the comments.

The Law of 15

15In my last blog I promised I would talk about how you create what I call, COI’s, Centers of Influence. I call it the law of 15, and it works off a worst-case scenario: you will most likely have better results then this, particularly if you have determination and discipline.  This will allow you to use the raw numbers as a motivational tool, thinking, “If I just make the numbers, the sales will follow.”

Here’s how it works.  Create a long-term goal to set and keep 15 coffee appointments each month for 15 months.  Compile a list of names of 250 potential referral sources, organized by industry (such as mortgage brokers, attorneys, other industry professionals, CPAs and realtors).

Each month, these 15 coffee appointments should yield at least one new relationship and one new referral.

Your worst-case scenario would break down as follows:

  • By the end of Month 1: You would keep 15 coffee appointments, established one relationship, obtained one referral and attended one sales appointment. Final result: up one sale.
  • By the end of Month 6:   You will have kept 90 coffee appointments, established six relationships, obtained six referrals and attended four sales appointments.       Final result: two sales.
  • By the end of Month 12:   You will have kept 180 coffee appointments, established 12 relationships, obtained 12 referrals and attended eight sales appointments.       Final result: six sales.
  • By the end of Month 15:   You will have kept 225 coffee appointments, established 15 relationships, obtained 15 referrals and attended 10 sales appointments. Final Result: eight sales

My hope is you get excited when you see how the numbers multiply. The system is simple, yet effective, and provides a vision for accomplishing a midterm goal.

With your worst-case scenario, you’re getting a new referral a month.  Your best-case scenario?  Well, what a sight that would be!

I’d love to hear your thoughts or questions about this philosophy, just leave me a comment or question below and I’ll get back to you.

The Law of Reciprocity

 

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Photo by Pixabay on Pexels.com

When you Google the law of reciprocity you’ll come up with over 20,000,000 results.  There are books, videos, posters, sales workshops, you name it.  So, what is the law of reciprocity and how have I seen it work?

Wikipedia puts it this way, “A social norm of responding to a positive action with another positive action, rewarding kind actions. As a social construct, reciprocity means that in response to friendly actions, people are frequently much nicer and much more cooperative than predicted by the self-interest model.”  Let me give a simple example, have you ever gotten a Christmas card in the mail from someone that didn’t make the cut on your list?  Don’t you immediately think about sending them a card, or feel bad you didn’t?

Business Network International, BNI for short, is the world’s largest business networking and business referral organization.  They have built their whole business model around this law, and simply call it, “Givers Gain”.  Meaning, give people as much business as you can and eventually you’ll get more business in return.

This principle, or law, couldn’t be more evident than in sales.  I have seen it work time and time again.  In the insurance industry, we network with real estate agents, mortgage lenders, and estate planning attorney’s, just to name a few.  The more relationships I’ve seen agents develop and send business to, the more success that agent has personally.  We call these relationships COI’s, Centers of Influence.  A Center of Influence is anybody that sees people on a regular basis for their business, that can give you a favorable introduction.  I tell the agents I work with the goal is a minimum of 10-15 COI’s.

If you’re still reading I imagine your next question might be, “How do I develop these COI’s to send business to, in the hopes to eventually get business?”  You’ll have to come back Friday when I answer that very question and share the Law of 15.

I’ve got a mission statement and values, sooooo…

I recently had the privilege of attending a presentation by Kindra Hall, author, speaker, and storytelling advisor. I also receive her weekly email and her last email really resonated with me.  She talked about individuals and corporations alike spending days, weeks, even months hashing out their values and mission statement, only to have them fall flat.  Why?  She argues clients and employees don’t resonate with words, they resonate with stories.   Stories about those words, what those words mean to the individual, and how they make them feel.

This is especially true in my experience with sales. I have 18 years under my belt of either selling insurance or advising new reps how to sell insurance.  Let me tell you, people don’t buy products, they buy the way that product, or service, makes them feel.  An old adage in our industry is “features tell, benefits sell”.  For example, a feature you can purchase on car insurance is road service, want to buy it?  Now a benefit of road service is if you ever break down on the side of the road you’ll have a number to call and someone will be there to help you out no matter what time of the day or night, want to buy it?

Borrowing from Kindra I would take it even a step further and say you need to add a personal story to the benefit. I often tell my new reps don’t sell car insurance to a client, you need to sell coverage to the person in a claim.  You need to tell a story of a claim, either you were in, or steel someone else’s claims story until you have your own.  Walk that person you’re talking to through that claims experience, don’t leave out the details.  Ask them what they would want to happen if they were involved in that claim, get them away from just thinking what’s this going to cost every month.  Customers don’t want to pay for vehicle rental coverage, but someone who was involved in a bad at fault accident definitely wants another car to get to work while theirs is being fixed.

Back to how this all started, your mission statement and values. Can you tell them to someone in a story, with passion and feelings?  If not, I’d suggest going back to the drawing board, if so, you’re on the right track.