My experience suggests all companies do have some form of revenue system (heart) in place today. The reality is most are the “open loop” intermittent variety meaning the core revenue tasks of selling, forecasting, rewarding performance and staffing operate as standalone events with minimal process accountability. They may be done by one individual but that person addresses these as independent – sometimes even burdensome – tasks.

All companies have revenue stimulators (cold call Fridays, end of quarter discount promotions, etc.) that are used to keep the vision alive – and the doors open – but these are best described as tactical adrenalin, not a revenue system.  When these no longer produce the results needed, the quick-fix option is lowering the revenue bar to align with current ‘system’ capabilities assuming the financial structure can accommodate the reductions. This is the drug of choice for sustaining most ‘open loop’ based revenue models…and the number one reason why companies prefer a ‘closed loop’ revenue system (heart).

However, some sales teams are seeing higher numbers of UFO’s (Un- Funded Opportunities) such that starting with the Money discussion to confirm a budget does exist or funds can be allocated for the transaction is just a good strategy in today’s economy. There is a lot of stress in parts of our economy and it is not the first time we have seen prospects trying to identify new projects that could become their job savers.

The old rule – no money, no prospect – still applies.

What we sell and how we get paid are two different things!

Your Differentiating Value is what separates you from the competition and goes beyond core competencies like the typical quality, service and support platforms most companies promote. The Sales Revenue System 2.0 book example of the cinnamon sales rep is a typical illustration of this discovery. He was actually selling ‘time to market’ for new products but got paid in shipments of cinnamon and other spices.

The first step in our Revenue System implementation always starts with defining your Differentiating Value…and the discoveries that follow.

There is no fixed answer to that question since the CQQ’s originate from the company’s Differentiating Value (DV) platform. The more DV, the more topics you have available for CQQ consideration. One suggestion I frequently make to CRO’s working through the implementation process is this – spend your time on the CQQ’s for Motivation. If you cannot establish any DV ‘traction’ with the lead, you have a suspect – not a prospect. The heavy lifting is always with the Motivation fit and most companies can quickly modify the CQQ’s listed in the book for Money, Methodology and Market to jump start their implementation.

Coaching – 80% focus on the communication techniques for delivering the Critical Qualifying Questions. Sales reps are not born knowing how to do this.

Accountability – 80% focus on the 4 Aces audit trail and drill-down questions to maintain the “up or out” prospect flow. Nothing stays welded to the forecast.

Motivation – 80% focus on performance incentive creativity to recognize the major thresholds of contribution to the business and enable reps to skillfully navigate their own success.

Selection – 80% focus on defining the job first and keeping multiple qualified candidates in the pipeline at all times.

Revenue is only hard if you don’t have a systems-level approach for making it happen.

• You can have an additional 10% discount if I can leave with an order today.
• We can extend warranty coverage at no charge.
• Call me at home if you need anything special.
• So, what do we have to give you to get the order today?
• You really don’t understand how great our products are.
• No one would buy our old design.
• You need to understand we have a lot of engineering costs to recover.
• Maybe we should just buy your company.
• Our product is patented so you can’t get it anywhere else.
• This was a great call – I got to say everything I planned to say.

The post-call reviews were all about how to protect the remaining opportunity and recover the prospect based on this CEO-level disruption. Sales reps have called this the equivalent of performing a “do-it-yourself heart valve” meaning you never let the CEO operate on your revenue stream unless you are ready to hemorrhage out.

I realize some CEO’s can be a real asset on a sales call, especially those CEO’s with a sales background.  However, the majority of CEO’s come from financial or operational background which brings a level of danger to any prospect call.

The CRO needs to get in front of this potential train wreck and make sure the CEO knows the questions you want him or her to ask at the start of the meeting. The “glad to be here, how can we help you” dialog to get a discussion started is the best. After that, the CEO needs to wait to be called on by the members of the sales team and speak briefly to the topic requested.

I find compliance to be quite easy.  I have always notified CEO’s they will get to walk back to the airport if they misbehave. So far that approach has always worked.

My response was “Thank You!”

Just like you never see a bad sales resume, you also never see a bad business plan. After decades of reviewing new company startup plans, it became obvious the plans all had the same motivational template in that everyone involved (founders and investors) would all be rich and famous very soon. Our landfills must have been overrun with these bogus documents because I can count on one hand the total number of companies that made it to 5 years. The plans were nothing short of elegant – color bar charts, pie charts, order processing flow charts, etc.  Excel delivered pro-forma financials that were so compelling that only paupers would say no to the deal. It seemed like the next logical step was to start planning the movie.

So what went wrong? Usually there was plenty of blame to spread around, but the one truth in every failure was a lack of revenue.  There wasn’t enough revenue generated to float the boat and investors finally pulled the plug. The market-modeling math may have been correct (5% market share will produce a $50M business opportunity, etc.) but the sales execution never got off the ground.

My observation was no one in the room (founders or investors) was hands-on about the revenue challenge associated with closing new business. Street level is where orders originate and where success is earned one order at a time.

Thank You for the “street-level” compliment. It is where companies are built by competent Chief Revenue Officers.

It took about 2 milliseconds to flash back to my computer systems days in Detroit. I was branch manager for Digital Equipment Corporation and the auto industry was our number one market opportunity. The primary competition was always Big Blue (IBM) with their decades of executive contacts, global auto industry experience and massive inside networks to support their recommended solution on every bid. It was the perfect environment to learn how to win the ‘geo-political complex sale.’

We won a large factory line automation project at Chrysler involving a totally new gas guzzling vehicle they were getting ready to announce. The project was just under $1M for us which was real money in the ‘70’s. We had received the vendor selection notification letter from a Chrysler Procurement VP with a confirmation that the complete award package (contract plus new building drawings of the production line layout) would arrive in about 2 weeks.

We were celebrating our win and getting ready to start when the first gas crisis put the country and economy into a tail spin. The bottom line is Chrysler immediately cancelled the project via a courier delivered notice that we received the day before the Postal Service delivered the complete award package.  That’s right, we received the cancellation notice a day before we received the signed contract.

Initially, we thought Big Blue might have caused the gas crisis – we actually thought they might do something like that just to cancel our contract.  Now that is a serious competitor…or a bit of paranoia from being smaller company.

The lesson here was a timeless sales truth – the deal is never done until the check clears the bank.

It was in my early CRO days traveling in New Hampshire with our local sales rep. We arrived early for the meeting at our customer’s factory and found one other sales person in the lobby. Based on this sales person’s dialog with the receptionist, it was obvious he was quite frustrated at the time he had been kept waiting to see someone from purchasing.

Finally, a young man came to the lobby indicating he was in purchasing (no business card or name was offered) and ready to meet with this lobby-loitering sales person. The sales person immediately opened his 12 page brochure and simply started reading the text verbatim to this new, mysterious purchasing contact.

After several minutes of reading the technical specs promoted on each page to a totally bored contact now operating in screen saver mode, the sales person ended with the inevitable shut down the process yes / no question:  ”You don’t want to buy any of these do you?” The answer was an immediate “no.” The purchasing contact departed the lobby and this sales person left complaining to the receptionist about a 2+ hour drive back to Boston.

This may be a finalist for the shortest sales cycle award but no information was ever exchanged between the two parties. That single fact is why we spend so much time in our Revenue System defining Differentiating Value (DV) and the related Critical Qualifying Questions (CQQ’s) sales people must use in their prospecting, qualifying and forecasting activities.

As a result, the end product resembles the typical small, wood-frame boat house in Northern Minnesota that families have tried to convert into a year-round home over 2-3 generations of ownership. The roof has 5 different additions (with different slopes), some rooms have no heat, none of the doors, windows or siding match, the foundation is crumbling under the original building, etc.  Yet, families survive staying there and keep investing more money.

We define that as a 1.0 Revenue System.

Our approach is based on the 4 core processes that comprise a fully-integrated revenue system.  We typically find clients are missing 1 or more of these 4 processes in their current ‘1.0’ revenue system. Just identifying the missing processes and understanding how the 4 are connected helps CRO’s understand their current performance dilemma as well as their recovery options.