PC4Media: Balancing Sales and CEO Roles

February 03, 2006

Balancing Sales and CEO Roles

I just had this realization this morning while thinking about how I could close a handful of prospective clients. In sales, when at the stage of negotiating price, one of the most important things in a salesman's bag of tricks is to say is, "I'll have to check with the boss to see if that is an acceptable price." Most price negotiations that I've been in, start with a quote from the salesman. Then, the customer gives a lot of excuses and either offers a lower alternative or the salesman asks for one. The salesman is then on the offensive a bit, justifying the price and giving excuses why they can't quite reach what the customer needs. The conversaion can end there and say, "I'll have to check with the boss to see if that is an acceptable price." This gives the salesman the opportunity to come back with a price somewhere in between the high quote initially given and the lower quote that the customer requested. With this, the salesman can ask for the sale. And the customer can say no or yes. But, the salesman most likely knows what the answer will be in advance, assuming they know what the customer's options are.

As President of the Company, I don't really have this luxury.

Even worse, I can never sound desperate. The role of a CEO is to project stability. A CEO should be willing to walk away at anytime. A CEO wants the customer to believe that they can walk away from them at anytime. They don't need their business. They are the bigger swinging dick and the customer needs them.

A salesman is paid to be desperate and that is acceptable. They are paid based on the volume of profitable business they bring in. They are paid to meet quotas. They are paid to call the customer 6 times in 2 days, walk in, work their network to get endorsements to the ear of the end customer. In other words, they are paid to do what it takes to make sure that they get the business. They don't manage profitability. They just manage price; as much of it as they can get. So, it is perfectly fine when a salesman explains the ins and outs of why their product or service is priced the way it is. But, they don't have to accept the price. They can posture. They can check with a superior to see if a counter-offer is acceptable. For them, walking away isn't an option. It doesn't have to be for them to win. They don't have to be the big swinging dick. They are getting paid if and only if they make the sale.

I just realized this conflict today. Almost out of necessity. Cash is tight and I need to close sales. I had made a referral to a young[er] probably smarter, certainly less desperate, entrepreneur than I a few months back. I took the time to learn his margins, his sell and I presold the sale before he even knew about it. I had the relationship with his prospective client to presell it and it really was an ideal customer for him. When I turned over the referral to him, he gave up after a few attempts at connecting with the prospective client. I'll admit that it was certainly difficult to get through to the person. But, I was pissed that he had given up so easily. At the time, I dismissed him as not being very aggressive. But, he explained to me that he is done chasing business that doesn't want to do business with him. I again, at the time, dismissed that he didn't have enough sales experience and wasn't really cut out (or committed) to what he was doing.

Now, I realize he had just chosen to play the CEO. Necessity didn't require that he play the salesperson.

Posted at 08:50 AM | Permalink

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Listed below are links to weblogs that reference Balancing Sales and CEO Roles:

» CEO or Sales? from Dan Pickett's Blog
Pete just posted a great article on the conflict of being a small business' CEO and salesperson. A CEO is someone that acts as a figurehead, and really should help promote leads, regardless of how large your business is. I can completely agree with P... [Read More]

» Balancing Sales and CEO Roles from Business Opportunities Weblog
Pete Caputa hits on one of the best reasons to employe a salesperson in your small business: The role of a CEO is to project stability. A CEO should be willing to walk away at anytime. A CEO wants the customer to believe that they can walk away from ... [Read More]

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February 03, 2006

Balancing Sales and CEO Roles

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