When a company is not growing, it is not only because of the shortcomings of its sales team. Sometimes, your entire sales management is unaligned with the strategies your salespeople are executing. Mark Cox sits down with Frank Cespedes, a senior lecturer at Harvard University and the author of six fantastic books, who explains how to realign your sales goals with your team goals. He also explores how self-directed omnichannel buying impacts B2B sales today, as well as how AI can be used to increase sales performance and productivity in today’s fast-paced world.
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Dealing With The Root Issues Of Sales Management With Frank Cespedes
A couple of years ago, my lovely wife asked me, “What do you want to do for your birthday?” My response was, “I want to go to Harvard and sit in on an MBA class being taught by Frank Cespedes.” That's exactly what the two of us did. Frank had provided us a gracious offer for the two of us to sit in on one of his MBA classes in marketing. In this episode, you're going to understand why I picked that as my birthday treat because we have a great conversation with Frank.
Friends of the show know Frank Cespedes as a Senior Lecturer at Harvard University and the author of six fantastic books. Two of my favorites are Aligning Strategy and Sales back in 2014, and in 2021, Sales Management That Works. Those are amazing books. Frank also consults on the boards of some of the largest companies in the world. He has deep expertise in terms of sales, marketing, and business.
We had a fantastic conversation. We talked about a few things. First of all, Frank has always gone against the grain of that sales assumption that when a company's not growing, it's the sales rep's issue or sales rep performance. He's always had a perspective that oftentimes, it's the strategy or the management that's misaligned. It's not at the sales rep level. We talk a little bit about what he's seeing out there.
We then get into what buyers are facing. Complex, self-directed, omnichannel buying is having an impact on B2B sales. We do talk a little bit about what a salesperson needs to become. How do they help that buyer navigate that complex journey? We talk a little bit about AI, given what's taking place, and because we're joined by our AI Sherpa, Mike Sparling, who always adds enormous value.
We had a couple of great conversations. Where are we seeing AI impact companies? Frank's on the board of some of the largest companies out there, so he's seeing the real impact of AI. We talk about whether it is transformative yet or it is still relatively early days. We talk about the 4 or 5 areas where companies are leveraging AI to sell better and increase performance and productivity.
As always, we get into the attributes of B2B salespeople. What are we looking for when we're trying to hire great B2B sales people? We talk a little bit about why this is a great career to jump into, or what has to be true for it to be a great career for you. If you're a young person thinking about investing your career, why would you invest in discipline B2B sales? As always, the conversation is amazing with Frank and Mike. I enjoy talking to these guys. I'm sure you will, too. You'll enjoy this episode. If you do, please like and subscribe to the show because that's how we get great guests, like Frank Cespedes. Enjoy.
Welcome to the show. Frank, it's great to see you again.
My pleasure. As always, it is good to see you.
As always with this string of episodes, we're joined by our AI Sherpa, Mike Sparling from MHS. Mike, how are things with you?
Things are very good. I’m looking forward to spring and summer and a great chat with Frank.
Frank, I have to ask this question. I know you're up in our neck of the woods in Toronto over the last month or two, working with some clients. How was the visit up here?
Good. It wasn't actually in Toronto. It was about an hour and a half outside Toronto. It was Elora, Ontario, which was a charming place. The interesting thing, to me, is the weather there was about, that day, 15 to 20 degrees warmer than it was in Boston, so I'll take it.
I'm sure tons of value for the client you were working with there. Frank, like people in Boston and New York, if you're from Toronto, everything within three hours of Toronto in my view is Toronto. I'm sure the people in Elora are delighted to hear me say that. I’m glad it went well. This is always a red-letter day on the show when we have our friend Frank Cespedes back.
Addressing One Of The Biggest Assumptions In Sales
Frank, we'll start at the highest levels here with a couple of questions. I know you've been doing some great publishing with HBR articles. One of the things you constantly challenge in all of your writings, which I love, and two of my favorite books ever are yours. You challenge one of these big assumptions in sales. Frankly, this totally aligns, Frank, with a lot of the clients when they come to us the first time.
A lot of times, CEOs come to us, and they say, “We have a growth problem. We think it's a sales rep performance problem. Mark, we need you to come in. We need the funnel to train 150 salespeople.” We're quick to come back and say, “It's fantastic. We love to work with you. Let's go back to your core sales playbook. Let's think about your sales strategy.” That's one of your themes. You always come back to this. Maybe growth is a rep problem, but it's likely a strategy and a management problem. You've been talking about this for years. Tell us a little bit about what you're seeing out there on the boards you sit on and the clients you consult with.
First, let me reiterate the basic point. In any business, profitable growth is an organizational outcome. It depends on the skills, capabilities, and motivation of your customer contact people or salespeople, but it also depends on product, price, service, and especially strategy. A direct answer to your question, Mark, of what I am seeing is I'm still seeing a confusion and a disconnect between those larger systems, especially strategy and sales.
Frankly, for many of the same reasons, which are fundamentally management reasons, that I outlined in some of those publications, one of the dirty secrets about many businesses is that they do not have a business strategy. They may have a mission, a vision, or purpose. Everybody has got a purpose statement. Those things are useful, but they are not the same as a business strategy. Many executives still confuse them.
The typical planning process in many companies takes weeks, sometimes months. Meanwhile, sales has to respond in market time. Not planning time. Even if what comes out of the planning process is a great strategy, which is a big if. It's often irrelevant to the people in sales. Then, compensation. If you look at sales compensation plans, most of them are based sheerly on top line volume, not the profitability of the sale and the cost to serve. For many salespeople, there is no such thing as a bad customer. If you've got a strategy, there are no bad customers.
Having said that, let me also say that what I see in the past couple of years is that sales is increasingly productive in more businesses. The reason is due to the data revolution, AI, which Mike will get into. Also, there is a big secular change in the cost structures of many businesses. They're increasingly driven by software. That's a high fix cost. Once you get beyond those product development R&D costs, much of the ongoing operating expenses are go-to-market costs. Companies recognize that, and they begin to pay more attention to sales. In general, it has made sales more productive. It has made sales managers' lives more uncomfortable, but as they say in the gangster movies, they chose this life.
There is a big secular change in the cost structure of many businesses because of new software.
Improving Productivity In Professional Sales
It's a great thing to touch on. Team, so you've got it, and we reference it all the time, one of our favorite books of all time is Sales Management That Works: How to Sell in a World That Never Stops Changing. One of the things I got to touch on right off the bat and have attention to jump on, Frank, is that it's so great to hear you say sales is improving productivity or it’s improving in terms of performance.
We have a lot of authors on this show. God bless, but I understand you write a book, and the first thing you're picking at are faults, oftentimes. Our brains are wired to find faults. We're in the same boat. I see a lot of amazing things happening out there in B2B sales where it's almost evolving to management consulting.
First of all, Mike, I'd like your thoughts on that, too. Sometimes, you get to see sales as somebody who's adjacent to it. What are you seeing? Frank, I'd like to push on what are the other things that we're seeing that are working out there within professional sales. I'd love to focus on those for the audience. Mike, your thoughts?
We've had a few different guests. Frank is calling out the core nugget of a theme we've seen for a while, which is that professional sales is becoming more management consulting rather than outcome-driven. It comes from broader solutions, more complex product that's being sold, service and product mix, and the pieces there.
I resonated with your opening, Frank, around the notion of business strategy and the accelerating pace. When I started my career, we could do a 5-year plan and be pretty good at hitting things 2 to 3 years out. With the pace of change, the data, the AI, the digital and global markets, and the different drivers that are at play.
It's hard to know 6 weeks out, let alone 6 months, let alone put a document together with a 12-month horizon. I’m curious. Through the next set of conversations, we can hone in on your experiences with how quickly people are reprioritizing and what the organizational strategies are to reset business strategy as you go forward, given the pace of change and velocity.
Thanks, Mike. We're going to come back to the strategy side of things. Trying to build on what's working out there, we hear all the same information about how buyers are pursuing their journeys on their own. It's getting more difficult to make decisions inside large corporations. They've got complex buying groups. They've got omni-channel research before they engage with salespeople.
What are you seeing top salespeople do, Frank? What are they doing well to try and navigate some of these new realities where the buyers are so well-educated and doing so much work? The buyers, in some cases, have a tough time making decisions. We saw, back in the day, in 2017, the Gartner Buyer's Journey, which you weighed in on. You helped them with what's known as the Spaghetti Diagram. What do buyers do in terms of making a decision? What are great salespeople doing to try to navigate that with their buyers? What are they doing well?
I don't know the right word, Mark, but trends and developments, I think they're all true. It is an omnichannel buying world. Buying units in B2B sales is more complex than they were. The pandemic hollowed out many middle management jobs, so you've got more top executives increasingly busy and you've got to get access to.
The fundamental issue is that we are in a very information-rich world. That gets me into what I think effective B2B salespeople and sales organizations are doing. They’re in an information-rich world where the buyer can get lots of information. There is an important curatorial role for salespeople. We can call that consulting, solutions, or asparagus. I don't care. A knowledgeable salesperson who can help the buyer navigate through that avalanche of information is as valuable as ever.
The second thing is to recognize a basic about B2B buying. Most products and services are components in a wider usage system for the customer. I'll use some of the classic sales jargon. Even when you have a champion in the customer, the reality in most companies is that the champion has to “argue” with their colleagues for their fair share of a limited budget.
That's an economic discussion. It is also a political discussion and an emotional discussion. It's naive to think that most of those buyers are going to navigate that complexity simply with AI or a bot. A knowledgeable salesperson helps. Here is the third issue. I'll add this to the trends because the academic research about this is pretty definitive. Do you know what we used to call the 80/20 rule?
Yes. The Pareto Principle.
That sounds fancier. It's remarkably common. A minority of our customers generate the majority of our sales and profits. What the research indicates is that in the last couple of years, those bigger customers have gotten bigger as a proportion of many companies' sales. What does that tell you? It tells you that account management is even more important than it ever was. Those are the things that I see going on that do or don't make a B2B salesperson effective. There is a role for training there, but training doesn't cure everything.
Attributes Of Great Salespeople
We're going to debate that aggressively before the end of the episode because I like a new house, Frank, and it comes from training. Let's get back to that. Let's park that for the time being. You bring up such a great point. With our limited experience, we don't have a sample size of 10,000 clients, but the consultant clients we have, they become the penultimate example of the Pareto Principle. It's not 80/20. It’s 90/10
That's exactly right.
You start to get into these things like key account plans and key account management strategies, still navigating levels of business acumen, being so important. I have to understand the industry and the client I'm working with to add value and figure out how we can help them achieve those desired outcomes. I'd like to talk a little more about that. Maybe we'll push on this a little bit before we get back to sales management. You did identify sales management as a tough thing, but that B2B sales role.
I don't like these broad definitions, but you’ve got an account manager and a salesperson. They're bleeding into each other a lot. You've got somebody who's got to add value to the market. In our book, we talked about hiring traits because we still see so many people having a tough time hiring B2B salespeople. We like intelligence, drive, humility, passion, and optimism.
What are the attributes you're seeing out there? What would you add to that list if we've got sales leaders out there building their team? In which they are. A third of salespeople still seem to be churning every year. What should we be hiring to take our businesses into the future with great salespeople?
Quite honestly, Mark, I'm not sure I would change very much. You've been, in an admirable way, beating this drum for years. Your fundamental message about the key criteria in hiring remains relevant. One of the things that I do see, and we'll get into this with AI increasingly, especially in the last few years, is I'll get calls from companies who say, “How do we hire salespeople with AI skills?” My comment is that it's a little bit like running a telemarketing center many years ago and saying, “I better hire people who know how to use the phone.” You hire people who know how to sell. Those are the criteria that you outline. That remains very important.
Hire people who know how to sell.
Having said this, there have always been challenges in hiring and sales that don't exist to the same extent as other functions. If you want to hire a programmer or someone in finance or accounting, you can go to a school and find people who major in the subject. That is rarely true in sales, but that hasn't changed. I don't think AI has changed that. You hire the folks that have the kinds of attributes, temperaments, and skills that you, Mark, have talked about, and then you enable them with the various tools and training that are available.
Frank, the skills we want to spike a little more on that we may not have in the past would be intellectual curiosity, passion for change, resilience, and collaboration. Especially as we see more agentic AI taking place where more things are being done as opposed to answers being created in response. That's going to require a real sense of even individuals having greater collaborative skills, so they can appreciate these digital teammates, some of the more “organic” teammates. It does change team dynamics a lot. The lone wolf no longer has a shot at making the kinds of successes they may have been able to make in the past.
First of all, I agree with you about the increasing importance of collaboration. When the customer has a problem, they call up the person who sold them the product or service. Sales then needs to go back to their companies and navigate across functions. That has become more important over the last couple of years because of the nature of products and so forth. AI will be one more thing. I agree with that.
When it comes to resilience, I have been amazed throughout my balding career at how many salespeople I meet who don't like to make cold calls. My response there is pretty blunt. If you don't like to make cold calls, become a plumber. Do something else. You chose the wrong line of work. That form of resilience, the ability to deal with rejections, has always been true or remains true.
I tie that oftentimes into optimism. We're going to talk about sales management in a few minutes here. One of the reasons we need effective sales management is that you're going to be working with salespeople. They have to be optimistic. They do have rose-colored glasses on their pipeline. They’re like, “I'm going to win more than I'm going to lose or things are going to go my way.”
First of all, you don't want to take that out of the salesperson. That's a survival mechanism to be in this profession. I need somebody who thinks that way, but I also need a sober set of eyes working with them to help them analyze and make sure we don't skip over sales strategy before getting a deal done by making too many assumptions that things are going to go my way.
I agree with you. In sales, it's very important to see that the glass is always half full. That said, the way you operationalize those eyes, and this is not fancy, is lead qualification criteria. That's an area where I see AI beginning to make an impact.
Do you? With the folks we work with, that continues to be tied into two of the biggest issues with companies we work with. One, believe it or not, guys, is the problem with CRM systems. They're too noisy. There's too much fluff in CRM. Executive management teams are trying to use this. Boards are trying to use it. They're not that effective because there's too much garbage in there that's not real at the core. It's because basic deal qualification is still a problem with most organizations.
You need that deal qualification at multiple levels. You need the sales manager to have a set of eyes, the first-line management, but then the VP of sales has to have a set of eyes on the sales manager, and so on and so forth. It’s not to talk us out of winning deals, but to make sure we're discussing reality instead of Shangri-La.
One thing to touch on before I lose it is, Frank, this might be a bit problematic, but why don't we teach B2B sales at Harvard and give somebody a degree in B2B sales? Why isn't this a formal profession like every other profession where there is a degree, you've got to be certified, and you need ongoing training to stay current? Do you ever see us getting to that point? I know about 1/5 of MBA schools teach sales courses. I know it's growing a little bit. What are your thoughts on that? You've seen this for a long time.
Harvard doesn't need me to defend them, but we do teach B2B sales at Harvard. I taught that course for years. We don't give a degree in it. We give an MBA general management degree. Why don't more schools do this? Fundamentally, it's a supply-side problem. If you look at PhD programs in marketing, for example. You're hardly ever going to see B2B at all. They're almost all consumer-based.
The way you make your bones as an academic in academic journals is by analyzing big databases. Historically, that was fundamentally consumer goods companies. Due to the data revolution, more B2B companies are there, but the issue is on the supply side. I want to be a little more provocative and maybe dissent. I'm not sure it would be a good idea for schools to institutionalize training in this area and grant degrees.
You know the old saying about the Military how they're always fighting the last war. The same is true in academia. If you get back to what we've already been discussing and look at the pace of change, it'll be a little bit like what universities have done with coding. What we heard for years was, “Your son and daughter better learn how to code.” Guess what AI is doing to those jobs? The same thing will happen in sales. This is an area where you may not want to entrust the future to the university, if I can be blunt.
Of all the conversations we've had on this, no one's ever taken that approach. We've had this conversation a lot on the show. It makes sense. It’s changing so quickly. In the commercial world, it's industry that's got to lead the way. When I originally fell into this profession, industry did its own sales training to a certain extent. It was a handful of companies you'd get started with, and they taught you how to sell, whether it was IBM or Xerox. I'm dating myself here, but you did get your ticket stamped in B2B sales if you could say you came from one of those companies. I don't see that in industry.
There were reasons for that, but one of them is a bad reason. If you look at hiring in sales, what I have seen again and again is this perception that there's a trade-off. It’s like, “I need to hire the experienced person from company A in my industry because then I don't have to spend time and money training and developing them.” That is an illusion. There is no such thing in sales as performance in the abstract. There's only performance in our company with our products, our prices, and our customers. That trade-off is missing, but that perception is very common.
Let's be a little more optimistic. First, I want to agree with you. I have met guys and gals like you throughout my career. They got their training, wherever it was, whether it was GE, HP, then they went everywhere. There may still be some of those incubators out there, but we don't recognize them until after they've reached their peak.
Hindsight.
It's a much fairer point. I have a little insight in terms of a couple of large ones that I thought would have picked up the mantle. What I've seen there, I wouldn't showcase the same. That's a much more gracious way of looking at it. If you don't mind, given the time here, maybe we change directions a little bit. I'll touch first on sales management, and then I want to talk about AI because it's one of the things everybody's asking us about all the time.
Sales Management That Works is one of my favorite books of all time for a good reason. It is the MBA in sales management. If you haven't read that book out there, you should. Let's talk about that role, Frank, and what you're seeing with the leaders out there. You said it’s a pretty challenging role because of high expectations.
The scorecard is black and white, too. You either hit your number or you didn't hit your number. You get a much tougher grade than anybody else on the executive leadership team. How we're measuring the head of HR and the head of operations is a little vague sometimes, but how we measure the chief revenue officer is black and white. Tell me a little bit about what you're seeing out there. Are you seeing sales leaders manage the way they always have? Are you seeing them trying to leverage these things like big data and AI and change the whole infrastructure and the way they lead the teams?
I see some of both. If I address the question of what some of the effective sales organizations are doing, ironically, one thing those sales leaders are doing is doubling down on the basics and instigating a continuous improvement cycle in those areas that I call the basics. Technology is helping them do this. Who is and who is not our target market or ideal customer profile, to use the jargon?
They’re clarifying and then training our people in our value proposition, not some generic methodology, and looking at our comp system. Whether we have incentives that support rather than contradict our pricing. Last but certainly not least, they’re improving in doing good and regular performance reviews and account reviews. They're motivated to do this because of what you said. The data revolution makes sales more transparent.
The data revolution makes sales more transparent.
A lot of this data flows up to the finance function, the CFO. They're very annoying people. Once they get data, they start to ask questions. They may or may not know anything about the realities of sales, but they've got the data. Sales leaders must respond. That's increasing the requirements for financial literacy. What they're finding with AI in particular is that AI does not repeal the IT law of garbage in, garbage out. You've already made this point. CRM is noisy. They're beginning to clean that up.
My last comment here is about the transformation. That I see going much more slowly than one would predict. The reason is not the technology. The reason is not AI or the AI tools. The reason is, A) The data, B) Fragmented siloed legacy IT systems, and C) If you want to use AI beyond ad hoc use cases. You've got to clarify and change your workflows.
All of those things, cleaning up the data and legacy systems work, are not things you take care of in 2 or 3 weeks. That's what is holding back so-called transformation. The fundamental issue there is change management, which is never easy in sales precisely because sales has to make the numbers every month, every quarter, every year.
Learning The Ropes Of Data Management
How well said. I want to touch on AI, Mike, and get your opinion on what you're seeing in terms of this transformation. Those three things, the data, the silos, and the making sure you've got your playbook because AI can't accelerate performance unless you have your full sales playbook down, Mike and I talk a lot about this, Frank. Let me pass it to you, Mike. What are your thoughts? What are you seeing out there first before I jump in?
Frank is spot on. One thing I've seen a lot of research on says that we've left the age of pilot. The CEOs, chief revenue officers, people reporting to boards, or the evil CFOs, as Frank put it, are not going to get rewarded for a pilot anymore. The expectation is that we're converting the investment into outcome. Yet, exactly the point with garbage in, garbage out or the CRM noise, getting the data to a place it can be consumed. Getting the infrastructure to a place where automation can play, and fitting in the regulatory and compliance framework such that the actions being taken are compliant with what the company wants to execute.
Sales Management: AI cannot substitute a flawed playbook or the lack of a coherent sales model.
People have to always remember that you are not able to transfer liability or responsibility to an AI or an AI vendor. What you put out there driven by AI inference or decisioning is your responsibility still as the organization. Understanding the liability, regulatory, and compliance envelope at something moving at the speed of light is much harder than bringing the reps together, sharing lunch, and talking about, “How are we going to remain compliant or this new law requirement has come in or this new system now needs to be updated.”
Frank, you're exactly right. That data accessibility and workflow redesign coupled with the fact back to our opening comments together, strategy doesn't have a lifespan much longer than lettuce or eggs. Where we put that together and the cycle times are causing a lot of churns in all industries. As Mark and I have talked often, sales is that tip.
It’s that point of engagement where the customer, the company, its products, its messaging, and its outcomes come together first through the sales channel. That means that all of this automation potential, but also expectation and investment, are justified in this space first. That's very heady and also challenging for the industry.
I agree with that, Mike. What I do think is different about AI is if you compare what's going on in sales with AI to X years ago when CRM was relatively new, or before that, if you're old enough to remember re-engineering. With those things, many people in the company, especially salespeople, resisted those changes. With AI, I see exactly the opposite. Everybody's eager to get on board.
They play with ChatGPT to say, “Look what this sucker can do.” This is your point, Mike, about what you can outsource. Ironically, the biggest mistake I see is the belief and attempt that, somehow, AI can substitute for a flawed playbook or the lack of a coherent sales model or strategy. It can't. It's a tool. It is not a miracle drug.
How many times have you got an email and it's full of M dashes or other tells that an AI generated it? But I got one. It was a salesperson doing a reach out. They forgot to clip the little paragraph at the bottom that said, “What would you like to do next? I can make this more personal.” They took it straight out of the chat window and pasted it into the email. Bless their hearts. They were doing it to try and personalize something with some LinkedIn data, but they ignored the other tells. They forgot the most fundamental tombstone at the bottom. You sit there and say, “Now I know what I'm dealing with.”
You're going to develop a relationship with that bot.
One of the great tips I picked up from Mike was he suggested that I start having conversations with AI when I'm commuting. Living and working in Downtown Toronto, I commute. I spend time in a car. He said, “Rather than asking for one answer, have a conversation and see how it might change your way of thinking about something.” It enables me to get a little deeper. To those reading, no matter what ends up coming from this, you have to get a little deeper. It's one of those things. We've got to continue our learning.
Frank, to touch on it, you talked about how deal qualification was something that AI could help with a little bit. What would be a couple of other areas if a leader was trying to get started? I'm with you, Frank. I don't see a lot of companies, deep down the pipe, leveraging AI in a meaningful way yet. Although, it is embedded with many of their sales enablement technologies. What are a couple of other areas that you're seeing out there where it is being leveraged to make the sales organization more efficient or effective?
My advice to companies is, don't ignore the low-hanging fruit. Pluck it. The fundamental value proposition at the heart of AI is that these large language models can do many things. If not as good as human beings, it is almost as good, freeing up time for things that human beings can do that the machine can't do. In sales, that's a very big deal.
What does that mean for the low-hanging fruit use cases? Do research about customers. AI was made for this. Establish a cadence of communications, whether it's with email, demos, webinars, etc. A big issue in virtually every sales organization on this planet is accelerating and saving time for reps with the massive reporting requirements that they have so they can get out there.
An application I see more commonly is you feed in your data to the AI, Claude or whatever it is, and say, “These are the kinds of customers that buy from us.” Through iterations, the prompts are, “Who's like this that I'm not calling on?” What I see 80% to 90% of the time with the model simply searching publicly available data is the company gets back useful information, and they almost always say, “My addressable market is bigger than I thought it was.” If you add up the things I mentioned, that is not only a very big productivity increase. It also increases the addressable market because you're making better go-to-market utilization in your organization. Start there. Transformation and the future of humanity with AI, don't worry about that.
That's another episode. We need another hour for that one.
Using AI Tools In The World Of Sales
Can I maybe add one more to your list, Frank, or get your thoughts on it? The other one low-hanging fruit, the power of the machine in a way that was inaccessible before, is it unlocks signal detection and anomaly detection. To Mark's point about having a conversation and asking what you don't know, you bring that data together and say, “Who are other customers that are like this I can reach to? What do I need to do to sell something to Mark? What are these things that I can do which are general trends? What are these signals telling me? What are the anomalies I'm not seeing or should be noticing?”
That pattern-matching cadence of the LLMs is something that historically, you may have gone down to the 9th floor, found a data scientist, gotten in a queue and waited, and got a static report months later. That wasn't all that helpful because everything else had changed. If you're intellectually curious and willing to ask those questions, those patterns that can be surfaced are exceptionally powerful.
I agree. On the selling side, the AI is not only very good at what you said, Mike, but what I find remarkable is how it can transform that insight about anomalies into a first draft action plan. A good salesperson or sales manager can deal with it. At the same time, and this is an area of AI that people aren't talking about much yet, but I predict they will. Think about what you said with the anomaly detection and think about what's happening on the customer side as they do the research about products, prices, etc.
I'm on two boards where this is affecting our business. Let's assume that as a seller, you've got 90% customer satisfaction, which is a great net promoter score. What the AI model does is it searches the World Wide Web and brings back to the person doing that search on the customer side everything. In effect, it's weighing one dissatisfied customer as much as the nine satisfied customers.
I know a lot of marketing people around the world because of the boards I'm on. I've called them up, asking, “Are you seeing this?” They’re like, “Yes.” I ask, “What are you doing about it?” The bottom line here is no one yet knows what the heck to do about this. It's a big issue, and we're going to start to hear more of how it's affecting not the selling, but the buying.
That’s very astute.
This is another episode for us. There's another hour on this. With the speed with which things are changing, we'll have to make sure we get you again, Frank, in the next 6 to 9 months if it serves your purposes and is helpful. It's a great conversation. I have one question for you. As we look at the time and wrap up a little bit, what are you most excited about for B2B sales, Frank?
You've had a great line of sight into this for decades, as I have and Mike, but you've seen so much more. What are you super excited about moving forward? Why are sales a great place for a graduate of one of your MBA classes to jump into instead of going into consulting or finance, which is where they're likely going to land?
Mike, do you want to begin or I can?
I'd love to hear your thoughts on it, Frank.
The truth, Mark, is I'm very bullish about the future of B2B sales. With all the issues we've discussed, fundamentally, B2B sales in many companies was a silo, and with the requirements of the market, it is more a route to the general management line of business. That gets me to the advice I give my students, and have for years. Sales is often an excellent career choice and often not. It’s very company-specific.
You know the old phrase the culture eats strategy for breakfast. It's not true. Culture eats strategy for breakfast, lunch, and dinner. There are many companies where sales is a great route to doing what you ultimately want to do in business, which is to run a business. Not necessarily start it, but run a line of business and have P&L responsibilities. There are many tech companies where sales is invited out of the room when they discuss pricing because they don't want the children to know their cost structure.
That's always my advice to the students. Choose carefully because, at the end of the day, what you're presumably optimizing for is that larger role. What's the best way to get there? Sometimes, it's sales. Sometimes, it's not. That's what I've seen. In general, in B2B sales, it's more a job where because of the cross-functional requirements that Mike talked about and because you do have to be up to speed on data analytics, it's looking more like a place where we groom some of our future leaders, and it was not for many years.
B2B sales is more than a job. It is also the place where we groom some of our future leaders.
Discussion Wrap-up And Closing Words
Anything to build on there, Mike? What a great thought.
It's a phenomenal observation. There are examples of where sales leadership is taking broader corporate leadership. It's because that understanding of the dynamics of the business is happening closer to the customer than ever before. You have to be a bit of a polymath and be able to be sales, analytics, strategy, and some of the other pieces. A lot of that I would agree 100% with, Frank. That would play to the point I would make, Mark, to your original question. What's the most exciting thing? The ability to personalize at the individual level has never been as strong.
One of the things that working with a consistent AI for outcomes is building that long-term memory. It's very easy for you to say in the car as you're thinking with your AI, Mark, “I want to remember the next time I reach out to Frank, we want to talk about this particular topic.” As long as you come back and say, “We're reaching out to Frank. How do we assemble our current goals, Frank's current research, and personalize the outreach?” the long-term memory will come back and say, “Remember in the car, Mark, you said this is a key point we want to work with. We weave it into the conversation.”
That customization and personalization is already at a scale, notwithstanding the message I got with the tombstone at the bottom. That ability to truly personalize the individual with long-term memory has probably never been there except in the minds of some of the most disciplined salespeople who have worked before. This opens that discipline to many more people. That, to me, is very exciting.
Well said. We could keep talking for hours, but I have to be respectful of both of your times. We're going to wrap now. First of all, to you both, thank you so much for joining. What a pleasure having this conversation. It's so great to reconnect with both of you.
My pleasure. I welcome it, Mark. It keeps me on my toes.
Thanks, Frank. Thanks, Mike. Team, thank you. We run the show to help improve the performance and professionalism of B2B sales. We think in doing so, we improve the lives of professional salespeople. Thanks for joining. If you liked this episode, please like and subscribe to the show and tell your friends. That's how we get great guests like Mike and Frank Cespedes.
If there are things we can be doing differently, we love constructive criticism. My email is MarkCox@InTheFunnel.com. The way we run the show is a function of some of the feedback you've already provided. Keep it coming. That's my personal email. If you give us some constructive criticism, I personally respond to every piece of feedback. Thanks for sending it. In the meantime, thanks for joining. We'll see you next time.
Important Links
About Frank Cespedes
Frank Cespedes teaches at Harvard Business School and for 12 years was Managing Partner at a professional services firm. He has worked with many companies on go-to-market and strategy issues, and has been a Board member at consumer goods, industrial products, and services firms. He has written for numerous publications including Harvard Business Review, European Business Review, Organization Science, and The Wall Street Journal; and he is the author of six books including Aligning Strategy and Sales which was cited as “the best sales book of the year” (Strategy & Business), “a must read” (Gartner), and “perhaps the best sales book ever” (Forbes). His newest book is Sales Management That Works: How to Sell in a World That Never Stops Changing (Harvard Business Review Press, 2021)
He has also written more than 50 case studies about companies and numerous technical notes on various business topics, including strategy development and implementation, sales and marketing, leadership, pricing, and start-up issues.