#208 – Sales models and strategies that work (Part 1) w/ Frank Cespedes

Full episode transcript: 

​Please note that transcription is done by AI and may contain errors.

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George: Hi, everyone. George here, the editor of the Sales Transformation podcast. Just popping in to let you know that this week's episode is the first of two featuring returning guest Frank Cespedes. Frank is a senior lecturer at Harvard Business School and author of many books on business and sales, including Sales Management That Works: How to Sell in a World That Never Stops Changing.

Phil and Frank had so much to talk about that we've decided to split the interview into two parts, so don't be too alarmed if this episode ends a little abruptly, and make sure to tune in next week for the second part. For now, though, please enjoy the first part of Phil's conversation with Frank Cespedes ​

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Phil: Okay. Well, it gives me great pleasure to, uh, invite back to the Sales Transformation podcast, Frank, uh, Cespedes. Um, I've just had a brief conversation with Frank, but I was telling Frank how much I enjoyed the first one that we did, uh, a number of months ago now, Frank. Um, and, um, I'm, a- a- and, uh, essentially this is an opportunity to, to follow up in more detail on Frank's amazing book that, um, he's had published called Sales Management That Works.

But for those of you who don't, uh, uh, have not listened to the first, uh, podcast we did, um, Frank, I wonder if you could just say a few words by means of introduction.

Frank: Sure. Uh, and Phil, first of all, always a pleasure to speak with you. Much thanks for the invitation to come back. Um, who am I? I don't have a particularly exotic background.

I, um, uh, started teaching at Harvard Business School years ago, made my way up the hierarchy, left, ran a business for about 10 years, got lucky. Uh, you know, when need be, uh, I can spin it a different way, but it was luck.

Phil: Yeah.

Frank: Sold the business at the right time, came back, uh, became an academic again, and, um, you know, have been a scribbler.

Have been writing books about- I can believe that ... sales and strategy over the years.

Phil: It's quite interesting. I, I, um, uh, I was at, um, a sales academic conference, um, in Italy, um, just two weeks ago. it was a really great conference, and I remember jokingly said, "I wonder if anyone has done a research project on luck." Um, and, uh, has there been, Frank, to your knowledge, the role that luck plays in sales? Have there been any research projects done on that?

Frank: Um, um, yes. In fact, uh, there has. You know, it's, um, uh, m- basically what people do is look at what's continuous, what isn't continuous. Okay. How much can be explained by, you know, the statistical variance you would expect. Surprise, surprise, surprise, there is luck in business, but it's hard to forecast and sustain luck.

That's the way it works on this planet.

Phil: Yeah. It was, uh ... Yeah, we had some fun with, uh, with the conversation at least. But, um, so thank you for the introduction. I think what makes Frank, um, sort of rather, rather unique in this sense is that Frank has spanned both the academic world and also the business world, and I, I know that Frank has talked on the previous podcast about the luck of selling the company at, at exactly the right time.

Um, but I'm sure that, um, there was more to luck involved in, in, in that process. Um, but moving, moving on to the podcast and, uh, a- and again, in, in Frank's book he has different chapters. On the first podcast- Yeah ... that we ran, we focused on, um, we focused on hiring and compensation. You know, we focused in, in, in, in, in these two topics.

Um, on this podcast, um, I've asked if we could focus on two further chapters in Frank's book, um, which is about, um, sales, uh, sales models and performance management as well. So we've got these two themes that we'd like to kind of follow on, uh, on the pod- on the podcast, uh, today. Um, so, um, I, I'm gonna ask Frank a question at this stage.

Uh, you know, I've asked if we could first of all focus on, um, sales models, you know, to begin with. And so Frank, um, I mean, uh, just talk me through, you know, your thoughts about sales models, their importance. Um, I've got some questions I'd like to follow up on but- Um, just like to get your take on the reason for focusing on this in your book.

Frank: Yeah. Well, I mean, I, um, a couple of reasons. Um, you know, you, uh, before, uh, the, uh, podcast asked me to think about a question that I think is an excellent question. Yeah. And, and it's basically, you know, you, you point out that, um, we live in an ever-changing world. Uh, I certainly- Yeah ... agree with that. That's the subtitle, you know- Yeah

of, of the book you're kind enough, uh, to talk about.

Phil: Yes.

Frank: And, uh, you know, you raise, I think, the question, do we really need a sales model, especially because it takes so much time- Yeah ... money, effort. Yeah.

Phil: Right.

Frank: My answer to that is an unqualified yes. You- Yeah ... companies need a coherent sales model for a couple of reasons that will never go away.

One is sales is a tool for profitable growth, for increasing- Yeah ... enterprise value. In order to do that, you've gotta have a sales model that aligns with a coherent business strategy, and you cannot leave that to luck, uh, or, uh, to chance. Secondly, uh, you need a sales model in order to scale. Uh, you need some consistency around what are we, uh, tracking in terms of metrics, uh, and why.

And the third thing I would point out, and, and I, uh, you know, it's... During the course of my bolding career, it surprised me how many, uh, smart, well-educated executives don't get this. The reality is you're going to expend a lot of time, money, and effort on business development and sales whether or not you have a coherent sales model.

And I guarantee you the ROI will be higher if you have a coherent sales model.

Phil: Yeah.

Frank: So, you know, is it a pain in the neck? Of course it's a pain in the neck. Yeah. But it's worth the effort.

Phil: Worth the effort, yeah. But you make the comment, which is, I, you know, um, sort of a fairly, um, sort of provocative comment in a way, uh, where you talk about the, the failure of many sales, uh, models from your experience, is that they, um, they fail to respond to the current buying kind of landscape.

And I, I, I just wonder if you could maybe illustrate that with some, you know, stories or cases that you've looked at or from your, your experience.

Frank: Yeah. Well, I mean, you know, uh, why do sales models, uh, fail? I think there are a couple of reasons. Uh, most sales models in most companies that have been in existence for any length of time, and by any length of time I don't mean decades, I mean, uh, usually a couple of years.

Phil: Yeah.

Frank: Most sales models are really the ad hoc accumulation of a series of reactive decisions made by different managers at different points in time in order to deal with whatever were the current market competitive buying realities at the time. But over time, those barnacles accumulate and fragment- Right

the sales model. So that's one very common reason for failure. Uh, the second is what you've pointed out, uh, the, the whole purpose of any sales model is to respond to buyers and to- Yeah ... buying behavior, and we are in a period of time where that behavior has changed and continues to change- Right ... quite significantly and, you know, very, very fast.

We're in an omni-channel buying world. You and I are both old enough to remember, uh- Yeah ... I think these silly academic arguments that many companies had, should we, uh, be, uh, in person? Should we be online? 98% of the time the answer to that question is yes, you need to be both because your buyers are both.

So it's an omni-channel buying world. And secondly, uh, we're in an area, uh, uh, where technology's making a big difference. Just think about what AI-driven search has done-

Phil: Yeah ...

Frank: basically in about- Yeah ... a year, right? It, it's upended, uh, search. I... Last time I looked at the data, something like 70 to 80% of searches are now AI-driven, and it's made digital marketing, which was already, uh, a good example of diminishing returns, even less effective.

And then the third thing, and this is something we should expect in any- Yeah ... competitive market. I always like to use a grocery store analogy. Every sales model has an implicit sell by date. You know, you go in, you buy milk, sell by this date or it goes- Yeah ... sour. That is true in sales, but it, you know, your model doesn't come with a sell by date, uh, imprinted on it.

You don't get an email from the market saying it's obsolete. Yeah. That's why we have managers. Um- Right ... so, you know, it, it sh- it should not surprise us that many sales models become obsolete. The world is ever-changing.

Phil: Yeah. Okay. Um, so, um, I know you talk in the book about, you know, the sort of key building blocks for, you know, a, a sort of sales model.

Um- Uh, what would you describe as the critical things, the process that organizations need to go through in order to build a sales model that will be fit for purpose?

Frank: Yeah. You know, one thing that I, I learned, uh, very quickly when I moved over to academia and- Yeah ... the rental business Yeah, in academia, you're rewarded for the new, the innovative, the cutting edge.

Uh, and I think that's useful. But what I learned running a business is how far you can get by doing the fundamentals- Yeah ... a little bit better than the others. So, uh, I always get back to the fundamentals. What are the fundamentals, the key components- in any sales model? First and foremost, clarity about your customer selection criteria.

Phil: Yeah.

Frank: In strategy, the jargon for this is scope. What's the scope- of the business? Where do we play? Where don't we play?

But strategic scope only becomes real in sales. Your scope is not what a couple of senior people get off in a room and talk about. It's the call... It's the aggregate result of the call patterns of the- sales force. Are they calling on our target customers? Do we know who our target customers are? Now, that may sound obvious- but it's something that many, many companies either don't do or do sloppily. And quite honestly, I think AI is making it worse. AI, you know, the tools for AI are pretty amazing.

They're gonna get- better. And, you know, they open up lots of possibilities. And without customer selection criteria, what I see many sales organizations doing, driven by AI tools, is chasing all those possibilities. The inevitable result is that the company becomes what I call a global mediocrity.

It's pretty good at lots of things. It's not really good at any subset of those things. Competitive advantage is being good at things that count for your target customers. Begin there. Who are our target customers and why? Second component, uh, you know, buying drives sales, or at least should drive sales.

Not the other way around. So the second component is knowledge and a sales model that responds to buying, buying processes and buying criteria as they exist today, not yesterday. Uh, and then the third part, and this is where you get into very company-specific issues, the go-to-market economics. Uh- Yeah

what's the impact on our working capital? And in sales in particular, you know, most companies' working capital requirements and funding needs are driven by the selling cycle. Time to cash correlates very, very highly with the selling cycle. Well, guess what? Different customers have different selling cycles.

So you can see the loop among these three things-

Phil: Yeah ...

Frank: the go-to-market economics. Those, I think, are the fundamentals.

Phil: Yeah.

Frank: And that's, that's where you start. So much else in sales- Yeah ... follows from those three decisions.

Phil: From those three decisions. Yeah. It's, um, it's... You know, I love the way you sort of start from the buyer and, and, and kind of, um, and kind of work back from that perspective.

And, uh, just to share some research we- we've- we've- that, that we've done that touch upon some of the things you've, you've spoken about. So, um, we conducted a piece of research that followed up on my doctorate that was done 15 years ago, where we interviewed buyers about how do they want to be sold to.

And, um, so, you know, sort of fairly simple question, and we wanted to get a kind of benchmark, uh, between how they answered the question 15 years ago and, and how they answered it now. Um, and a lot of the buyers spoke about, um, the role of AI in the whole, in, in, in the whole of the process. And they, um- Uh, in, they were th- they were concerned about what they call the dumbing down of the sales approach influenced by AI because they, they get so many sort of outreach kind of programs trying to market to them.

You can, you can sense when it's a rather generic, um, sort of outreach to them. Mm-hmm. And, you know, that's an immediate, uh, kind of turnoff, you know, for them. So, um, I think, I think AI is a two... I think we, I, we, we see it as a two-edged sword and on the one hand, it's a source of immense, uh, information, knowledge, and creativity.

On the other hand, if you rely on it too much, you know, you lose that, that, um-

Frank: Yeah ...

Phil: you know, that human, human touch. So-

Frank: Yeah.

Phil: Um, so, so that's, that is, you know, sort of having defined who the buyer is or your ideal persona, 'cause I know you talk about personas in, in, in your book. Um, but it's then how are you going to reach them with relevant, uh, sort of messaging, uh, to initiate- Yeah

a sales cycle that may be part of your sales model is, is quite hard. And I, I think, um, it's quite hard to, to do that. You've, yes, you've got tools like AI, but it's, it's sometimes extremely difficult to know who the buyer is because in complex B2B selling You know, there's so many people involved in making a decision around your solution potentially that you rarely get the chance to meet them all, you know.

Um, so I think it's become quite a complex world, you know, for salespeople to really figure out, yes, I know what my scope is, I know what my product and services are that we want to sell, but how do I get, how do I get that message out, you know, to the right people? Yeah. You know? Yeah. It... I don't know if you want to comment on that, Frank.

Frank: Yeah. Well, I mean, you know, um, in the spirit of tough love, what I would point out-

Phil: Yeah ...

Frank: is that B2B enterprise selling has always dealt with complex buying units, right? It's always- Yeah ... been the case that- Yeah ... in most companies, you're dealing, you know, I'll use the standard, uh- Yeah ... sales jargon fill, gatekeepers, influencers, people- Yeah

that sign the check, but then the decision makers, et cetera. That has always been true. It's been true- Yeah ... you know, for a century. The difference, I think, today, and you alluded to this, it's getting more complex because buyers have more data and information available to them about sellers, and they have much easier access to that information.

Now, what that does, I think, and, and this is, you know, quite honestly what one should expect in a competitive market, what it does is raise the bar for salespeople, especially- B2B enterprise salespeople. By the time they have access to the right people at their target accounts- those people have already online access to information about products, competitive products, pricing, et cetera.

Yes. So if, you know, you are what a salesperson in many industries was for years, a kind of walking, talking, organic version of product- and price brochures, that doesn't cut it anymore. All right? You, Because the buyer already has that. I would argue what it does is double down on what good salespeople have always done, understanding the business at that customer Being able to curate information coming up with possible options and solutions that make sense at that customer. Yeah. I think those things have not gone away, but they've become even more important because so much of the other stuff- the buyer doesn't need a human being for.

Phil: Yeah,

Frank: yeah. Uh, the, the only other thing I'd point out, and, and I think about AI and, and it's clearly we're at the beginning of a technological revolution-

Phil: Yeah

Frank: but we've been through technological revolutions. Uh, it's not the book you're alluding to, but in an earlier book, you know, I, I showed this. H- here, here's an historical perspective If you go back to the 1930s in England and America, you'll find in the business publications many, many articles about the demise of the salesperson.

And the reason is that there's a new technology diffusing through those societies. It's called the telephone. Yeah. And the reasoning was that once you got a phone and I got a phone, you know, why do we need a salesperson? Let's just call each other up and make a deal. Didn't happen. In the 1950s in America, the National Highway System is being built.

Same set of articles, and the reasoning was, look, once we've got these highways, people can just go on their own and shop for the lowest price. Didn't happen. 1990s, the internet, the information superhighway. AI is a big deal, but it is a continuation of that, and salespeople are still here. And the reason is that they perform an important task, uh, you know, B2B selling in particular.

Phil: Yeah.

Frank: You know?

Phil: 100%, uh, sort of I'd, I'd smile. I haven't, uh, thought about going back as far as the telephone, um, in, uh, example that you, you've used. But, um, yes, I remember being on, on a plane once and chatting to a lady who was at McK- I think she was at McKinsey, uh, flying back from somewhere in Europe to London.

And, you know, you, you finding out, you know, "What do you do for a living?" And I said, "Oh, I'm, I'm a, a sales consultant," uh, you know, sort of advising companies on sales training. She said, why on earth would you want to be in that sector? It's going to be dead soon."

Frank: Yeah. Right.

Phil: And it was so funny. We had this rather amusing conversation on the flight.

And, um- Mm-hmm ... um, but, you know, sales is still very, very strong, and-

Frank: But, but it... And we see this every time. I mean, for example, since you and I spoke on the last podcast- Yeah.

Phil: Yeah ...

Frank: um, y- you know, I've been unfaithful, Phil. I've been on lots and lots of podcasts.

Phil: Oh no!

Frank: And in the last-

Phil: I thought we were the only ones, Frank.

Frank: In the last two years, by far the most common question I get is AI and sales. "Frank, what do you think this means for hiring? How do we hire people- uh, that have AI capabilities?" And my response is, it's a little bit like 40 years ago. You're running a, a call center. Should you hire people who know how to use the phone?

No. You should hire people who know how to sell. The same is true with AI. I mean, you know, the, the- so remember when we talked a year ago about prompt engineers? Who the hell wants to hire a prompt engineer, you know? It's- this is getting more and more user-friendly- as the tech always does.

Phil: Yeah. Again, to, to partly sort of reinforce, um, what you've just said, as part of the research it's, it's very interesting hearing some of the words that some of the buyers have used. And they talked about, um, we had two different buyers using similar words but in a different way.

One talked about intellectual dishonesty, um, in terms of, um, sort of being concerned with how selling organizations might manipulate information in order to try and sell, you know, solutions that they want. And they felt that the issue connected back to AI is that they're, that, that they are more wary now with potential intellectual dishonesty, as they've called it, given, uh, the power of what some of these technologies can do.

And then we had a different buyer, who happened to be the chairman of one of the world's largest software companies. He talked about intellectual honesty as what he looked for in smart salespeople. And, uh, this is really to your point, you know, and, um, which is that I think the quality that you're now looking for in salespeople of today, I know we're di- d- digressing a little from sales models here , but um, was the ability of salespeople to be able to intellectually look at problem, a problem that a customer may have or a situation a customer i- is in, and, um, process that problem in a, in a constructive way and in a very authentic way.

And so we see a, a kind of balance between intellectual authenticity, as we call it, as a key trait of top performing salespeople, as a counterbalance to artificial intelligence. So you have the human side working well with AI, I think is, uh, you know, potentially a superpower. Um, but this is, this is just based on, you know, this most recent research, uh- Yeah

which I th- I, I think is interesting 'cause it's a slightly dystopian society we live in, world, you know, with, with, with AI. So what's a human? What, what do we do as humans? Well, you know.

Frank: Yeah. Well, let, let me, but let me make some observations about the intellectual honesty, dishonesty issue from- Yeah ... the seller's perspective.

Yeah. But let me first say that as a business person, uh, I do not place my bets on honesty. I, I'm with, you know, the old Ronald Reagan quip, uh- Right ... trust but verify. Yes. And this is where AI can really help buyers. Now let me- Right ... address this from the seller's, uh, perspective. Yeah. From the seller's perspective, AI does not promote intellectual dishonesty, but exactly the opposite.

Phil: Yeah.

Frank: And, and again, let's get back to AI driven search. It, you know, it's become 80% of search in- Yeah ... just a year. I'm on the boards of two companies where that development has dramatically affected our business.

Phil: Yeah.

Frank: And the reason is that what these large language, large learning models do with AI driven search Even if your company has a 90-plus percent, you know, positive customer satisfaction, net promoter score, whatever you wanna call it, the model just searches the entire web.

And among other things, it finds that 1 out of 10 customers- Yeah ... who is dissatisfied and weights it the same as the other nine. So, uh- Right ... you know, if, if you have a, uh, if one of your, uh, research subjects- Yeah ... is complaining about intellectual dishonesty, you know, to be blunt, he or she is lazy. They're simply not looking at the data that is available to them.

So that's comment number one. Comment number two from the seller side, and this is the good news.

Phil: Yeah.

Frank: How do I learn more about my customer? How do I get into the details? This is exactly what AI was made for.

Phil: Yeah.

Frank: Whatever else AI is good for, it allows salespeople to do research that used to take days or weeks- in minutes. There is no excuse for showing up at the customer- not knowing the basics and then some about their business and how they conduct business in your category. And if salespeople aren't doing that, shame on their sales manager. So again, honesty, dishonesty, trust but verify.

But as always with more information, uh, y- there, there's more... y- you can catch, you can catch the liars easier. But, you know, again- you gotta work at it. You can't just sit there and say, "Gee-" how come you told me X when it was Y?" Well, I, you know, guess what? I'd like you to buy my product, n- not my competitor's.

Do I have to educate you about that? I, I- find that glaringly naive, quite honestly.

Phil: Yeah. Interesting. Okay. Um, I'd just like to, coming back to the sales model, um, sort of one more question, uh, which is around territory management because, um, uh, uh, uh, and the importance of managing portfolios of accounts in the right way.

Um, so I, I don't know if there's anything you'd like to share about your thoughts on territory management and the sales model context.

Frank: Yeah. Well, I'm assuming you know that, you know, in the year 2026, when you talk about territory management, Phil, you're not limiting it to the old school version of territory management.

You know, here's your region. Territory management now means among that spectrum of, uh- possible target accounts-

Phil: Yeah ...

Frank: who buy omni-channel, we sell multi-channel. Yeah. What should our priorities be? The, the, the only thing I wanna say there, and again, I get back to the fundamentals, all customers are not created equal.

Yeah. In any market, they vary not only in terms of how much they buy, the profitability of the, uh, purchases, you know, the product mix, but also their cost to serve. And again, th-this, this is something that, um, many smart executives don't get, and it's not because they're not smart enough to understand the concept.

It's the way business works. The inevitability of opportunity costs in business, especially in sales. The reality is that time, money, and effort spent- on account A is time, money, and effort not available for accounts B- C, D, et cetera. And it's not the customer's responsibility to tell the seller, "You're barking up the wrong tree."

It's the seller's responsibility to figure that out. That is the single most important thing in territory management, and by territory management, I ultimately mean how do we allocate our finite sales resources- for the biggest bang for the buck, right? You know? Yeah. Uh, and again- that's something the seller has to decide. That's part of strategy.

Phil: Yeah. Yeah, it is. And I, I know that it's one of the sort of biggest challenges, I think, sales, sales managers, sales leaders kind of face, is how to be able to fairly distribute, um, the accounts. You know, the portfolio of accounts that they have, such that- Um, you know, the sales force have perhaps equal, um, opportunities to develop the territory because you, you know, like you say, not every account is going to be a big account each year.

You know, they wax and wane, and so, you know, having a portfolio of ac- uh, and you talk about this in your performance management kind of section, uh, which we can come onto. But it is just a very important part of kind of what goes into the sales model is, is, is a territory management system that, that kind of is fair, it works, it covers the right accounts in the right way, you know, using the right channel.

Frank: Yeah. And, and it is complex, but I'd say a few things about that, Phil. One is you're never gonna get it right. All right?

Phil: Yeah.

Frank: The, y- you're never gonna get it perfectly right. But what you want is processes, data, information that can help you instigate a continuous improvement cycle.

Phil: Yeah.

Frank: The second thing, and this is where, this is where it really gets complex.

Phil: Yeah.

Frank: On the one hand, what does fairness mean in territory management? You know, the- Yeah ... the, the scenario I always like to pose to sales, uh, executives when they pose this issue is, look, you know, I'm a magician. I can make anything happen. Let me give you this prospect that you really wanna close. I mean, there's, it's got great opportunity.

This, you know, it, it's really something. Yeah. You want this deal. Do you allocate your best salesperson to that, or do you allocate it to someone that you think needs more leads? I can tell you what the answers are 90% of the time. Yeah. It gets complex because while you do allocate your best, most capable people to your really juicy targets- Yeah

salespeople, as you well know, are very, their, it's in their DNA. They're finely attuned to fairness issues. Yeah. So on the one hand, we gotta serve the business. On the other hand, guess what? We have human beings that act the way human beings act. Yeah. Uh, hey, I, I, you know, I always quote the gangster movies to sales executives.

"You chose this life. That's what you chose to manage."

Phil: I mean, it's interesting. Some companies have a deliberate policy of reallocating accounts every year. you know, across the sales force. Uh, there may be some negotiation with certain opportunities where the kind of case is to keep the same salesperson on the account.

Um, uh, and the rationale behind that is that it can, can sometimes be dangerous. You know, people can become complacent, uh, you know, with different accounts, and a fresh pair of eyes supporting an account could be, uh, really important, um, as well. Do you, do you have a point of view on that, uh, uh- Well- ... as to the logic of, you know, deliberately- Yeah

churning, or not changing rather than churning, uh, account managers?

Frank: Yeah. Well, as usual in sales, which is a very context-specific- Yeah ... activity, I think it depends on the business. I think a blanket approach to either maintaining, uh, the account assignments or changing them annually, in the absence of the context, I think- Right

either approach is stupid. Yeah. The cost of changing them annually is disrupting relationships. Yeah. Now, the issue then becomes when is the relationship important for upsell, cross-sell- Yeah ... access to decision-makers? And when does it not matter much because we have a product or brand that- Yeah ... can shine independent of- Independent

the relationship? As a blanket approach, um, I, I, uh, am not in favor of it. Yeah. There is a, a, a school of thought which I think has some truth, that over time, you know, I'll use the old jargon, Phil. Over time, most hunters in sales tend to become farmers. You, you, you see what's behind that. Yeah. Yeah. Uh, but I don't think the issue there is account assignments.

I think the issue there is the compensation and reward system.

Phil: Yeah. Yeah.

Frank: So, you know, it, it's, uh... M- my answer is not a yes or no because I don't think it's a yes or no- Yeah. Yeah ... uh, approach. But I, I would not rely on philosophy to make that decision. I would rely on what we know about the buying, uh, process and- Yeah

where relationships count and where they're not as important.

Phil: Yeah. Yeah. I remember one of the, um, buyers that we interviewed was a CTO of Vodafone, and, um, he described a relationship with one of their core suppliers as not being ideal. He was quite negative actually about the relationship, and he spent about 40 minutes just describing what he really wanted and what the gaps were, and, uh, and, and, and, and that, uh, recorded conversation, um, was, was shared then with the account manager, uh, with the permission of the buyer of course.

Um, uh, and, um, it was amazing how the account manager then responded to what was being said, you know, by this particular buyer. And this was a huge account, you know, couple hundred million dollar account. Yeah. So it's fairly significant. And then what was interesting shortly, and, and did a fantastic job in completely transforming the account relationship.

Um, and then a few months later, um, the company was acquired by another company, and the other company came in and said to the CTO of, of Vodafone, uh, "You're now gonna have this person as the account manager, not the previous one." And, uh, and the guy at Vodafone said, "There's no way you're gonna change the account manager.

You know, it takes a long time to train- Yeah ... and develop an account manager according to what you want, and, um, there's no way you're going to make that change." So the importance of relationship and continuity, um, in hi- i- in his case at least, was, was huge, and particularly when he now found the account manager supporting him in, in, in, in such a s- Yeah

a strong way. But yeah.

Frank: Yeah.

Phil: I tend to

Frank: agree with you. Well, anyway, just- Yeah ... just two quick observations. One is both you and that customer did that account manager an enormous favor by sharing that info- By

Phil: sharing the data. You bet. Yeah. Yeah, he was,

Frank: uh- And, and the, you know, the issue is how come he wasn't asking these questions?

Yeah. And secondly, you can understand why the CTO of Vodafone resists the change. What does a relationship mean in a, uh, buying/selling context like that? It's not just that the account manager shows up and is pleasant and is nice. Yeah. You know, "Here's the football tickets." That account manager presumably is not only fighting for that account back at his company-

but also knows what to fight for. Yeah, yeah. And that's what the CTO values. You know, I- That's- ... you know, I finally got someone who's my champion there. You're telling me I've gotta- Yeah ... groom another one?

Phil: Yeah. Okay. Just to support Frank, yeah, I, I, I find that you've got so much knowledge of the business and so on when we speak, but, um, I'm going to quote now what the CTO said because, and this was, uh, from many years ago, and he said, "I want a salesperson, but I don't want him pointing at me.

I want him pointing back inside his own company so that he can leverage my power and, and my weight back in his company, so yeah, I can get a better deal across all points of engagement." Right. And, you know, it was, um- It was a, it was a very, you know, I just remember, I can quote him all the time. Yeah. And it's just what you've been saying, Frank.

Frank: Yeah. The- Yeah. Yeah. Also, as a, as a general rule, now this violates my earlier rule about how context- Yeah ... specific sales is, but one of the impacts that technology, uh, is having is that the, the role of the salespeople, especially in many B2B sales situations- Yeah ... there, the necessity for the salesperson to be able to cross those internal organizational boundaries- Yeah

is increasing quite significantly. And the reality is many sales organizations have been managed as silos. Yeah. You know, I've, I've been in board meetings where I've seen this happen. S- you know, s- head of sales has to make a presentation. Um- Yeah ... you know, then the board goes into executive session. As you know, Phil, that's where they- Yeah

really talk. And the comments are, "Well, I'm not sure he understood the question. I'm not sure she understands how we expect to, uh, accrete enterprise value." Yeah. But they, you know, he, she makes their numbers every quarter, leave them alone. That, those days are passing. Yeah. And that's an important skill, and I would argue a more important skill than knowing how to use the AI tool.

That- Yeah ... that'll just get more and more user-friendly.

Phil: Yeah. Yeah. yeah, that's so interesting.

 

 

George: Hi everyone, George again. I hope you enjoyed that first part of Phil's chat with Frank Cespedes. Just a quick reminder to come back next week for part two. See you there