Insights into the forces shaping our industry.

In a recent MDM article*, author John Gunderson raised an important issue about ‘sales’. His premise is that customers have changed and the mindset of how a salesperson ‘calls’ on the customers has changed as well. He posits 3 differing types of customers: Old School, Middle School and New School.

Old School. Aptly named as these are the traditional customers Baby Boomers grew up on. They’re loyal, they’re personal or professional friends and you ‘call’ on them by showing up…talking about life in general, inviting them to lunch or golf or a ballgame or fishing. These customers are loyal to the sales process of old and to the salespeople who have supported them.

Middle School. These customers tend to be receptive and eager to learn about new products or services; but limited time or resources make them more difficult to see on a regular cycle. This customer appreciates opportunities of entertainment, but typically limit access to their time.  The sales process requires a stronger demonstration of your value to that customer: expertise, services and demonstrated results.

New School. The New School customer is best typed as a Millennial: short of time, not interested in relationship development, but very open to anything that saves them time or adds convenience to buying from you. Having a simple web-based service platform or phone app for service information is the key to earn their business. Price is important; since they will e-shop you; but convenience is highly valued.

Mr. Gunderson’s assessment is a virtual summary of the generational changes that surround our industry. This begs the question: how do we attract talent that will meet our new and future customers’ needs? As effective as the baby boomer approach was; in its day… that ship has sailed for most Middle or New School customers. So, how does the cultural transition directly impact our industry? Here are a just a few things that will need to change; quickly:

1. It’s likely that a middle school sales rep can be effectively trained to nurture Middle and New school customers, but it’s unlikely a baby boomer sales rep will make that adaptation. However, boomers are going to be around for a while. Encourage them to maintain their current, profitable customer relationships and add newer talent to develop the new school customer base.
2. Support structure. New School salespeople will need marketing and IT support to provide their customers with immediate access to buying information: current pricing, current inventories, specification info, options and any comparative information that justifies your products over a competitor’s.
3. Old school hiring and training practices will doom your probabilities of success. If you try to attract a millennial-minded employee using old school retention practices; you will succeed only in landing the less-successful minded talent. Consider these classic practices through the lens of a millennial:
   1. Pay your dues. A classic strategy of limiting employee growth rates based on an arbitrary timeline of performance in roles that under-value the employee’s skills until a magical timeline allows them to move up to the next position under a similar timeline. Typical example: many distributors, and some manufacturers require all new ‘future’ managers to work in the factory or warehouse to learn how the work gets done. Millennials don’t buy into paying dues; they paid tuition, they’re ready to perform in their area of expertise…now.
   2. The traditional one-day of training on how Big Corp works doesn’t match with the millennial mind of insatiable training and input into their career advancement. Training should include the big picture of Big Corp as well as the specific duties and responsibilities in their chosen position; with regular updates on their progression to the next level.
   3. Covenants on their future. The ‘new era’ of hiring, in a market with a diminished and fully employed work force is to require all new employees to sign a non-compete contract. Some of these contracts have up to 2 years of restrictions on moving within the industry. The premise that a company can restrict future opportunities for their employees is tantamount to indentured servitude. Millennials have zero aspirations of a long-tenured career and the employer has no delusions that they are offering lifetime employment. Forcing someone to sign a non-compete, knowing in advance they’ll likely leave in 2-3 years is just an exercise in futility. Let’s just call it as we see it: you hire an employee for a return on your investment; similarly, the employee hires on as a return on their investment. When those expectations are no longer in balance; the employee moves on. I believe non-compete agreements are not worth the inherit distrust they engender between both parties. And the costs of threatened legal enforcement.
   4. Tech influence. Anybody who follows the tech industry knows hiring and training in tech companies is: easy, fast and enthusiastic. Tech companies actively ‘recruit’ people; not applicants; they actively reach out and engage potential employees. They don’t have non-compete contracts, they don’t require their employees to ‘pay their dues’ and they engage the new employee in stimulating and challenging assignments; frequently.
4. Customer segmentation. It’s time we stopped viewing a customer as an asset of a salesperson. Common sense will tell you that a departing employee does not have the power to convince a third-party buyer or partner company to change business; without a value proposition that is beyond who their sales person is. No employer assumes that the only reason they get business from any particular buyer is solely attributed to an individual salesperson. And if that’s true; then they should self-insure that relationship; with backup support and multiple relationships that will transcend the primary relationship. That fact is evident for any role: product manager, engineer, sales, marketing and executive level talent. With very few exceptions, no one person ‘owns’ a relationship to the extent that should that party leave, the customer relationship will disappear. We place salespeople regularly, and they never bring 100% of their business relationships with them to the new company. It’s impractical and illogical to assume that. If your business is exclusively tied to one individual; you don’t have a business.

Solution? Design your company to be attractive to quality talent. Start your relationship based on honesty; not a forced pre-nup. Provide value to employees to earn their loyalty; not proscribe it.

                                                                                                                                                                                                                                                                                                               *:https://www.mdm.com/blogs/14-distribution-sales-marketing/post/38572-its-all-about-the-relationships?utm_source=Real%20Magnet&utm_medium=email&utm_term=Update%3A%20April%2024&utm_content=267067508&utm_campaign=125387645

Ted Konnerth, Egret Consulting Group’s founder and CEO, recruits on a retained basis, helping leaders in the electrical and lighting industry identify their next C and V-level hire. He is also the executive director for the International Retained Search Associates, allowing him to liaise with skilled recruiters around the globe. To learn more about how Ted can help your company attract talent view his biography, check him out on LinkedIn or email him at tk@egretconsulting.com.