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Episode 79  |  42:39 min

Perception versus reality in the consumer world

Episode 79  |  42:39 min  |  05.10.2021

Perception versus reality in the consumer world

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This is a podcast episode titled, Perception versus reality in the consumer world. The summary for this episode is: <p>Sales excellence today relies on data. That’s why we asked Frank Cespedes, Senior Lecturer at Harvard Business school and the author of Sales Management That Works, to join Reveal. His newest research outlines how you can improve your sales model by focusing on facts instead of assumptions. You’ll also hear tips for better hiring, myths regarding sales, and ideas for evolving your sales model for today’s market.</p><p><br></p><p>Key Takeaways:</p><p>06:12 - What Inspired Frank to Write His Book</p><p>11:47 - Unexamined Assumptions with Sales</p><p>13:43 - Data Break Out</p><p>15:34 - The Buyer is the Most Important Thing</p><p>17:02 - Buy As You Operate Now</p><p>22:06 - The Domino Effect</p><p>26:45 - What Do We Need to Measure?</p><p>32:56 - Hire For the Task</p><p>35:42 - Frank's Advice About Hiring</p><p>41:34 - This Week's Micro Action</p><p><br></p><p>Want to explore Revenue Intelligence for your org? It starts here: <a href="https://www.gong.io/revenue-intelligence/" rel="noopener noreferrer" target="_blank">https://www.gong.io/revenue-intelligence/</a></p><p>Connect with Devin Reed: <a href="https://www.linkedin.com/in/devinreed/" rel="noopener noreferrer" target="_blank">https://www.linkedin.com/in/devinreed/</a></p><p>Connect with Sheena Badani: <a href="https://www.linkedin.com/in/sheenabadani/" rel="noopener noreferrer" target="_blank">https://www.linkedin.com/in/sheenabadani/</a></p><p>Connect with Frank Cespedes: <a href="https://www.linkedin.com/in/frankcespedes/" rel="noopener noreferrer" target="_blank">https://www.linkedin.com/in/frankcespedes/</a></p>
Takeaway 1 | 00:54 MIN
What Inspired Frank to Write His Book
Takeaway 2 | 01:00 MIN
Unexamined Assumptions with Sales
Takeaway 3 | 01:14 MIN
Data Break Out
Takeaway 4 | 00:19 MIN
The Buyer is the Most Important Thing
Takeaway 5 | 00:29 MIN
Buy As You Operate Now
Takeaway 6 | 01:07 MIN
The Domino Effect
Takeaway 7 | 01:15 MIN
What Do We Need to Measure?
Takeaway 8 | 01:07 MIN
Hire For the Task
Takeaway 9 | 01:01 MIN
Frank's Advice About Hiring
Takeaway 10 | 00:29 MIN
This Week's Micro Action

Sales excellence today relies on data. That’s why we asked Frank Cespedes, Senior Lecturer at Harvard Business school and the author of Sales Management That Works, to join Reveal. His newest research outlines how you can improve your sales model by focusing on facts instead of assumptions. You’ll also hear tips for better hiring, myths regarding sales, and ideas for evolving your sales model for today’s market.

Guest Thumbnail
Frank Cespedes
Senior Lecturer, Harvard Business School
Frank Cespedes is the MBA Class of 1973 Senior Lecturer of Business Administration at Harvard Business School. He has run a business, served on boards for start-ups and corporations, and consulted to many companies around the world. He is the author of six books and many articles in Harvard Business Review, The Wall Street Journal, California Management Review, and other publications.
Frank's LinkedIn

Devin Reed: Welcome to Reveal: The Revenue Intelligence Podcast powered by Gong. We're your hosts Devin Reed.

Sheena Badani: And I'm Sheena Badani. Revenue intelligence is a new way of operating based on customer reality instead of opinions. Making data driven decisions based on facts instead of opinions or guesswork.

Devin Reed: And it's made up of three success pillars: People intelligence, deal intelligence and market intelligence. You know, the things all revenue teams need and care about. Every week we interview senior revenue professionals and share their stories and insights on how they leverage revenue intelligence to drive success and win their market.

Sheena Badani: You'll hear how modern go- to- market teams win as a team, close revenue with critical deal insight and execute their strategic initiatives. Plus, all the challenges that come along with it.

Devin Reed: Sheena, I have a confession. It's not really that much of a secret to be honest. I never went to Harvard Business School. So, today's interview felt like my crash course. I was really happy about it.

Sheena Badani: Oh, yeah, kind of. It was a bit of an intro to sales and what may be taught there. So, you're kind of on the right track there.

Devin Reed: Maybe a crash course pending your tone right now was a little bit of a overstatement. Maybe it was a introductory touch point to the fellowship that is HBS. But I enjoyed it all the same.

Sheena Badani: Yeah, to make it a true business school type of class, there would have to be cold calling. You would have read a case a head of time. There'd be a lot of preparation. There would be some chalk boarding going on which didn't happen virtually, so, there were some things missing but halfway there.

Devin Reed: I've done those things in my sales career without the... so, maybe I've kind of had a crash course just not directly. But, in all seriousness, we had a fantastic guest. I really liked Frank he was a funny guy. But you and Frank go, I won't say way back, you go back.

Sheena Badani: Yeah, we do. He was one of my professors when I was at Harvard Business School specifically teaching marketing and sales in the B2B landscape. So, it was nice to catch up with him and especially since he just wrote a book exactly on that topic of sales management so we get a bit into that in the conversation.

Devin Reed: If perception verse reality was one human being, it would be Frank. Because he had like, " Here's what people think. Here's the data." He was fact checking on the go like percentages. He was really impressive and yeah, he has a new book out which we talk about here. So, for anyone in sales management looking to get 1% better at least this interview will deliver. And if you want to check out the book, we've got the book in the show notes so you can go grab a copy.

Sheena Badani: Let's do it. Frank, welcome to Reveal. We're super excited to have you on the show today.

Frank Cespedes: It's my pleasure to be here, Sheena. Good to see you again after a few years and thank you very much for inviting me.

Sheena Badani: Of course. And for those who don't know, Frank was actually one of my professors when I was at HBS so it's nice to see him although virtually after many years which we'll not put a number on. So, just to kick it off, can you tell us a little bit about your work as a senior lecturer at Harvard Business School. What does that entail and what kind of topics are you specifically focused on these days?

Frank Cespedes: Well, look, my background is not particularly exotic. I joined the HBS, Harvard Business School faculty as a marketing professor a number of years ago. And my research always focused on distribution sales, other go- to- market issues. I then left academia and ran a business for 10 years and I can tell you that the need to meet payroll monthly only increased my respect for an interest in sales. We then got lucky in the business. I could spin this a different way, but it was dumb luck. We sold at exactly the right time. Harvard Business School called me back up. " How'd you like to come back and teach." I've been doing that for the last eight years and I can assure you, Sheena, that being a professor at a good university after you've made money is the closest thing to Downton Abbey that this country has to offer. It's a good life.

Sheena Badani: I love that. I love that. But it's not a slow- paced life. You still are doing new and innovative and fun things. You recently just published your latest book so congrats on that. For those who don't know it's called Sales Management that Works: How to Sell in World that Never Stops Changing. So, why write the book and why now?

Frank Cespedes: Well, basically I had two motivations in writing this book. The first is quite honestly a professional motivation as someone who's done research in this area for almost 30 years now. Of all the business functions, sales is the most contact specific. Selling software is different than selling professional services. It's different than selling durables, etc. Selling enterprise software is different than selling software as a service so it differs by product. It also differs depending upon to whom and where you're selling. Selling in North America is different than selling in Latin America. Different than in Asia, the Middle East, etc. But of all the business functions for some reason, sales is that area where people feel most comfortable making these huge generalizations usually unsupported by any empirical data or as we say in academia, N equals one. " When I worked at Google. When we invested in PayPal," you know, that kind of thing. So, basically I wanted to write a book that explains, look, here's what research does and doesn't tell you about this core activity in business. I also think it's a particularly good time for a book like that. There is no doubt that digital, the data revolution that will continue throughout our lifetimes, is having an impact on buying and selling. But my reading of what people say about those things is that they systematically misunderstand the managerial implications of what's going on. And I think the pandemic raises the stakes for getting this right. It raises the stakes for ventures, for established companies and certainly for people who think about marketing and sales as a career.

Sheena Badani: It's still honestly really shocking to me that sales is not consistently taught at any point in one's education whether it's even in high school. Honestly, I think folks should learn how to spell because regardless of where you're going to go in life, that's part of it. Definitely in university and beyond. We end up having to rely on just trial by fire and/ or reading from great minds like yourselves who put out this knowledge in the form of books.

Frank Cespedes: Well, I don't know about the great minds, but you're certainly right about the area. And the data tends to shock people. Just couple of quick factoids. Of the over 5, 000 colleges and universities in the United States, the last time I looked which was last year when I wrote this book, less than 200 even had a sales course let alone a sales program. All right? So, what's the implication of that? This is a line of work where the vast majority of people enter this line of work knowing virtually nothing about what they're going to bet paid for and that leads to the next factoid. Companies already spend 20% more per capita on sales training than they do on any other function. So, there's a huge amount of money that goes into this. The orders of magnitude of the issue you just pointed to, Sheena, are really there. The data tells you that.

Devin Reed: I'm interested, you kind of touched on it just now, Frank, but in the book you say there are many myths, unexamined assumptions and fads regarding sales. I would love to hear what some of those are.

Frank Cespedes: Well, let me begin with two that I think are particularly timely because I don't know about you, but I literally get three to five emails a week talking about so- called new normals after the pandemic. And by far, probably the most common one I get is that e- commerce online media mean the elimination, or as we now say in the academic jargon, the disintermediation of the sales person. And the pandemic has accelerated this and made this a new normal. I think that's a very, very common assertion. Here's the data. If you look at e- commerce as a percentage of total retail sales in the United States in the year 2019. In other words, just before the pandemic. The number, the fact is that it was about 11 1/ 2%. Now, Sheena, you may find this interesting. When I ask MBA students what do you think that number was, I typically get estimates between 30 and 60%. In other words, not a little bit off. Orders of magnitude off. Now, let's look at what's happening in the pandemic because we now have this data. It was just released last month. If you look at the second quarter of 2020, and I focus on that because thus far, let's cross our fingers, thus far that was maximum lockdown conditions in the United States. Now, I think, obviously, or at least it's obvious to me, that when stores are closed, when capacity is constrained in any store that's open, when people legitimately feel that if they go into a store they may catch a virus and die, obviously there's going to be more buying and selling online. You don't need a professor from an Ivy League school to tell you that although some people talk about it as though that's news. But even in the second quarter of 2020, e- commerce as a percentage of total retail sales, 16%. In other words, even in those conditions it went up less than 5%. It was down to 14% by the end of 2020. So, that's one of the myths. And it leads, I think, to a fact that virtually all these new normal predictions ignore. The reality is that social media as a marketing and selling medium, even before the pandemic, but now obviously accelerated by the pandemic, was not a very good marketing medium. It just wasn't. It was a classic example of the law of diminishing returns. It was increasingly cluttered, distrusted not just by consumers but also by advertisers who saw less ROI and were afraid of having their content put next to objectionable content. And just a factoid, I think, that brings us home, Facebook. Good example. The number of ads on Facebook has increased 30% per year since 2016. Yet, Facebook ad prices have declined since 2018 and continued to decline through the pandemic. Now that's not because Mark Zuckerberg and Sheryl Sandberg don't want to raise price. It's because advertisers are seeing less ROI. So, again, if you follow that unexamined herd assumption, you're going to do something that's really bad for a business or a venture. You're going to misallocate resources. You're going to get better and better at things that customers value less and less. Social media marketing, I would argue is a good example of this. And then in any competitive market, you're eventually going to fall to victim to people who do separate facts from hype. So, those are a few that I would suggest, Dev.

Devin Reed: We have, our tag line is opinions verse realities and I think you just gave us a lesson in perception verse reality in the consumer world. Frank points out that the entire sales process is a black box of assumptions. And when you assume what your buyers want, you may be surprised when a go- to- market strategy falls short of expectations. Given Frank is a senior lecturer at Harvard Business School, it only felt fitting to take a look at his Harvard Business Review article titled Reinvent Your Sales Process While Still Hitting Your Number featuring Tiffani Bova, a sales leader at Salesforce. The article reveals that companies only deliver 50- 60% of the financial performance their forecast promises. This tells me that companies may not be basing their strategies off of actual information, and that getting data can help bridge the gap between promised and actual revenue. The article also shares that only 50% of employees understand their company sales strategy. This is concerning because as companies spend a fortune on sales training, they may be surprised to find out that the investment doesn't add up to the money generated. Data is the key in training your team on real ways to execute the sales cycle and win more critical deals. In the end, the winning companies on top don't just have a winning product, they're also using data to create a winning sales process. If we kind of focus down more to think of like a B2B sales team or I want to say sales floor but unfortunately, that's remote now. How are some of those misconceptions impacting sales leaders today? Like your example was it seems like almost all of commerce is done online. In fact that is not at all true. What are some examples that sales leaders might have similar false perceptions and how is that negatively impacting them?

Frank Cespedes: Let me generalize your question a bit because it gets at in many ways the core thesis of the book and where any responsible sales leader has to start. The most important thing about selling is the buyer not the seller. Most important thing is the buyer. Who buys, why and how. And that is changing big time because of technology, the data revolution, etc. I'm going to get academic for a bit but bear with me. If you look at most sales models, they basically... and by the way, virtually all CRM systems also fit into this generalization. They basically have the following assumption about buying that buying follows a sequential linear process. Academics call it a hierarchy of effects model. And probably the most common one is moving the prospect from awareness to interest to desire to action. A- I- D- A, Aida as in the Verdi opera. But in the third decade of the 21st century, that's simply not the way people in more and more markets buy. They are online and offline simultaneously throughout their buying journeys. It's not a funnel it's not a pipeline which is the rhetoric of 90% of the talk about sales. It's much more complex than that. So, the first issue that any sales team needs to deal with is buying as it operates now not yesterday. Nobody ever made much money in business just singing about the good old days. When you're a manager unlike an academic, you get paid to manage today and tomorrow not yesterday. And that, I think, there's many sales models are simply built on obsolete assumptions about buying and the buyer.

Sheena Badani: In the book you also argue that in many businesses sales is a black box. Like it's mystery in other teams. Folks have no idea what's going on in those interactions stopping with sales. Can you give us an example of how that disconnect may play out, particularly in B2B selling?

Frank Cespedes: B2B selling is a very big category. I'll get back, Sheena, to what I said at the beginning. Sales is very context specific. Depends on what market you're selling. It depends on your strategy. But, in my experience, sales in many businesses has been a black box but it's changing. I think the best way I can get at this is to give you an anecdote. It's an anecdote. I have sat through what I'm about to describe four times as a board member on different companies. Sales leader makes a presentation to the board whether it's early stage or established company. And then the board goes into executive session. And people talk and someone says, " Well, I'm not sure that he or she really understood the question. I don't know that they're really in touch with the financials in our business. But, you know, Charlie makes his numbers every quarter let's leave him alone." That is what I mean by a black box. There are companies, especially many tech companies, where that is the status of sales and very often sales is literally invited out of the room when the leaders talk about the business because they don't want the children to know about their cost structure and pricing. But that is changing and it's changing because of the data revolution. What the data is doing is making sales a more transparent function. And in particular, people in finance get that data. For example, in a SaaS business, probably one of the fastest growing job categories is sales operations. And if you look at many, many of the people in sales ops, they've never carried a bag as we used to say. They've never sold. And in fact, their background is in finance and they report up through the finance function. And once finance gets that data, in my experience two things tend to happen. First, they go holy mackerel. We did not understand how much money on a fully burden basis we were actually spending on sales. And then as you know, finance people are annoying. Once they get data they start to ask questions of the sales leader. " Well, how do you allocate this money? Tell me about your costs to serve by different segment. What is your customer acquisition cost?" etc. And that has a big implication for sales careers. Among other things, the requirements for financial literacy in sales are increasing dramatically, very, very quickly. And most sales people can tell you about top line motion. They can't tell you much about those other elements that ultimately drive enterprise value. But, that is changing. The black box is opening.

Sheena Badani: I have to go back to one point that you made where you see in some companies where sales leaders are actually asked to step out of the room in those board conversations. Do you think that generally sales leaders, the most senior person, the chief of sales or chief of revenue, has an equal seat at the table today?

Frank Cespedes: Oh, empirically I don't know. I can only tell you about my experience. But, I don't know, this is an audio podcast. People can't see my balding head. But my experience is not that bad. It's pretty darn extensive. But, in my experience, it's very, very company specific. And I think tech firms are a good example. There are some tech firms, LinkedIn, at least before it was acquired by Microsoft was a good example of this. There are some tech firms where you have got to spend some time in sales or business development or whatever you want to call customer acquisition. It's the route to getting a job as a line of business head. But then there are others were it is the black box. They're primarily about product, about engineering. Now, if you're asking me how do I feel about this, look, I can tell you what the research says especially in an early stage business. Whether you like it or not, you cannot segregate business developing issues from strategy issues. Because when sales brings in an account, especially in an early stage venture, there's a domino effect throughout the business model of the venture. And you want to manage that proactively. You simply don't want to be the passive recipient of what that's doing to your resources.

Sheena Badani: Yeah, that was very well put. I think in the early days especially your first customers and your first strategy, that's like one and the same. You're learning from what's happening at ground zero with your customers. That has to flow to the rest of the organization. If you don't have access to that black box, how can you take your organization forward?

Frank Cespedes: I agree with that and I think there's another dimension. I think, by the way, not just in early stage ventures but in later stage ventures as well, customer acquisition is intimately connected to organizational learning. We like to use that phrase, it's become a fashionable phrase and I'm all for it. I think in business generally being smart is better than being stupid. But at a certain point we have to get real about this. How do organizations learn? They learn from their customers. They either learn to do what their customers value and they get better at those skills, or they don't and they lose those customers. So, it's important to be dealing with the right customers. The second thing to note is here, I think, I give you a specific example because it's not just about learning. It's about daily resource allocation in the venture. The number I'm about to cite has stayed remarkably consistent throughout my career. Given year it'll change maximum about 5%. If you look at the way sales people get paid in companies around the world, and you ask yourself how is incentive comp established? In other words, that variable component that usually depends on how much is sold. In 70% of the plans, it's basically tied to volume of sales. How much is sold? Not the profitability of the sale. Not the cost to serve or anything else. Simply the volume of sales. Now, notice what the message is to sales people in a plan like that. The message is basically there is no such thing as a bad customer. Go forth and multiply. And that's what they do. They understand how they're paid. And what they do is bring in, if you want diversity, you're going to get diversity in customers. Fragment product. Fragment customer success. Very soon it really doesn't matter what the founders and investors think their strategy is. The real strategy, the de facto strategy, is being established by the aggregate of those customer acquisition efforts in the field. And, by the way, that scales up. The problem simply scales up as the company gets bigger.

Devin Reed: Yeah, I can say from my sales experience that I've worked at one company that looked at something other than just volume of sales. And that was because there's a marketplace sale, it was kind of different than your typical B2B so they had to look at actuals versus projected and this was in the ticketing realm. Do you have any, I feel like I have to say data or an opinion, Frank, on a way that teams or sales leaders can combat that? If it's not just volume of sales, is there something else that they can comp sales teams on or maybe even like a secondary metric that should be a part of the equation?

Frank Cespedes: Yeah. Well, again, let's start with what it is that we need to measure. Then, I think, the whole purpose of sales comp is to do your best to provide incentives that encourage behaviors in line with those metrics. And here the big issue, and, by the way, increasingly technology is the seller's friend when it's used appropriately this way. But here the big issue is understanding the customer conversion dynamics in your business, in your sales model today not yesterday. And by that I mean, what are the cause and effect links in our customer acquisition process? What drives what? And, in my experience, when companies do this, when they do a good job of looking at this, there are typically two key areas that immediately cry out for improvement and as a result, either differences in metrics or deployment or incentives. The first of them is the amount of time that your sales people are actually spending in customer contact, right? Now, again, the data I'm going to cite obviously varies by company and by industry. But in the aggregate, if you look at how much time a sales person spends in customer contact, and, by the way, by customer contact I don't simply mean making a pitch either in person or virtually. I mean all customer contact. Emails. Web demos, etc. But, in the aggregate the percentage of customer contact time per rep, is a little bit more than 30%. Right? Now, think about that. Think about the impact in most businesses if you can make that 35%. 40, 45. It is not only a huge productivity gain, but in most businesses, again, especially early stage businesses, you're increasing your total addressable market usually significantly. Because segments that were uneconomic to sell to, now become economic and we can get that 10- 15% gain. And then the other area, and this gets us back to why the most important thing about selling is the buyers. The other area that these metrics are important for is managing online/ offline interactions. And a SaaS business is a good example. It's what they call the attribution issue and usually what happens in those businesses is the sale is attributed to quote the last click, whatever that happens to be. The email campaign, whatever. When the reality is that purchase was more often motivated by some combination of activities in marketing as well as sales throughout the buying journey. And in the third decade of the 21st century, you can't leave that to change because that is how the majority of buying journeys happen. And you want to put in metrics that provide an incentive not only to stay on top of that, but to try to manage that as optimally as possible.

Sheena Badani: Let's shift gear a bit, Frank. We've been talking about the importance of the buyer and the customer and putting that first. Another important step in all of this is hiring and who you hire on the team. And in the book you write hire for the task not the title. Can you tell us a little bit more about what you mean by that and why hiring for the task is a better approach?

Frank Cespedes: Yeah. Look, there are inherent challenges in sales hiring that simply do not exist to the same extent in other functions. And it gets back to something you asked me earlier about the lack of education in this area, etc. But, if you're a venture seeking to hire an engineer, you can go to an engineering school. And it's a little bit like walking into a buffet. What are you interested in? Electrical engineering? Chemical engineering? Mechanical engineering? Would you like it with ice cream because they all now minor in environmental engineering. If you're looking to hire someone in finance or accounting, you can find people who majored in those subjects the same is true for coders, programmers, but it's not true in sales. And yet, one other factoid to keep in mind give you a sense of the magnitude of the issue, the estimate is that 50% of college graduates in the United States no matter what their majors were, whether it as business administration or art history. About 50% will wind up working in sales or business development, whatever you want to call it, at some point in their career. And that percentage is increasing as we become even more and more a service dominated economy. So, there are inherent challenges here, but many, many companies including many early- stage companies who sort of go through this rhetoric about cultural fit, many companies make a tough task even harder. The next thing I'm about to say is as close to an established fact as anything you will ever hear from a management professor. Because it's backed up by over 60 years of consistent results in the research. And I want to emphasize consistent. The correlations between the evaluations people get during their interviews, and their actual on- the- job performance, tend to vary from about. 1 to.4. In other words, even in the best of cases, it's less than the. 5 rate of flipping a coin. And yet that's how most sales people get hired. On the basis of one or two unstructured interviews. All of that is behind what I mean by hire for the task. Sales is the ultimate performance art in business. It's about behavior. It's not about how well you or I smiled during the interview. It's not simply about attitude and, gee, am I going to be a good cultural fit, as they like to say for this job. It is about actual behavior. And the behaviors that are important versus not so important are a function of those sales tasks. And that's what I mean by hire for the task not the title. And I also want to point out one other thing here because especially in your part of the world, in the tech world, I see a lot of what I consider vacuous and dangerous platitudes that sort of cover for being what I would consider a good business person. When you look at what people say they're looking for in a sales hire, basically they're looking for Renaissance men and women. Now, look, my attitude is whenever you can hire Michelangelo or Leonardo da Vinci, do it. You're going to get good stuff there. But there are few da Vincis and Michaelangelos out there. And, your deployment practices. The way you organize the sales force. The sales model you use for different segments determine the tasks. Not everybody has to be Michelangelo or da Vinci, but a lot of that rhetoric obfuscates what it is that managers can do to make better hiring decisions.

Sheena Badani: Do you have any recommendations for leaders of sales teams who are trying to make this next set of hires on how they can define those characteristics, be more specific on the tasks that need to be completed? Is it kind of looking at who's done well internally? Is it looking at other great examples inside or outside of their space? Is it something else?

Frank Cespedes: Well, a couple of things. One is when it comes to the hiring process, simply don't rely solely on interviews. Now, I've got colleagues at Harvard who know about this research in hiring and they actually recommend that companies don't interview. My own feeling is only somebody who's never run a business can actually say that seriously. Of course you interview. People hire people. Especially in sales people have to work with people. But you don't make the interviews just by the sales manager. A good idea that I see many companies do, especially in tech, let's get the customer success people involved in the hiring process because they have to deal with the outcome of what the sales people do. Get product involved because as you said earlier, it's very often part of a customer discovery process that is going to affect the trajectory. So, that's comment number one. Comment number two is again, it's about behaviors. And if you think you can peer into somebody's soul and predict their behaviors even through the best interview process, 60 plus years of data says you're mistaken. So, whenever possible, and by the way, the pandemic is increasing these possibilities. Whenever possible you want to put in place internship- type scenarios. Scenarios where you can actually observe the behavior. So that's number two. And then number three is always remember that you're hiring for what it is that you want this person to do in the buying process today and how it's likely to evolve. So you're also making a bet on somebody's capabilities going forward. But it's not good enough to do what a lot of entrepreneurs do. Right? Because basically you talk to them you say well how do you make that judgment? They say, " Well, flexibility." Geez, I guess that's true, but can we be a little more specific about it? And that I think is what competitive markets require of companies to do here. So, those would be my three major messages about what is, again, an inherent challenge but don't make it even tougher. You know that old saying, " Life is tough it's even tougher when you're stupid." A lot of that happens in sales hiring.

Devin Reed: I hadn't hear that one but I will be stealing that amongst many things you've said today. I really like what you mentioned about adding CS and other supporting roles, we'll call them, into the interview process. I'd never heard of that. And going even further back, you put data to a phrase I hear all the time and I'm sure you have too which is... And Sheena, we've asked many sales leaders how did you get into sales. Number one answer? " I kind of fell into it." And that's what you said 50% of, I believe you said 50% or so college grads did not go to school to be in business but find their way there. And I'm kind of generalizing that statement. But, I find that really interesting. Frank, I went to school to be an English teacher. Ended up in SaaS sales not far after so can say that's true from my own experience. Frank, I like everything you're saying. And I have a feeling I'm really going to like your last answer here because we like to wrap up every interview with the same question which is, how would you describe sales in one word?

Frank Cespedes: Performance. Sales in many way ways it's the most meritocratic activity in business. And by meritocracy I mean, especially in the times we're living in right now, much more open to gender, race, ethnic differences. And one of the reasons is because whether they're right or wrong, there are metrics, right? Look, if she can sell let her sell. I don't care how you feel about that. So I think it's about performance. And my one final bit of advice to companies about how do you get better at this. Single most actionable thing you can do in the short term, make sure your people take performance reviews seriously. It's vital and by the way, it's not metaphysics. It is a trainable process. I waited five years in the company I ran to get people good training about that. That was five years too long. So, it's about the one word is performance and that has implications for performance management. It's more than a word.

Devin Reed: That's fine. One, as expected, I didn't know what the word you would pick but I had a feeling you would have zero hesitation. Because a lot of people think about it for a long time and Frank, you had the answer like ready to go which is the one question not in our prep notes. So, I always appreciate that. Thank you for your time, Frank. I'm really excited to get my hands on this book. Again, for listeners, you can check it out on the show notes. It is Sales Management that Works: How to Sell in World that Never Stops Changing. Thank you so much for your time again, Frank, we really appreciate it.

Frank Cespedes: Devin, Sheena, Gong, thank you very much.

Sheena Badani: Thank you.

Devin Reed: Every week we bring you a micro action. Something you can think about or something you can put into play today. Companies are constantly evolving their sales and go- to- market strategies. For today's micro action, think about some successful strategies that have worked for you and your company. Then take a look at the look at the data that supports why it was a success. Then, think about where you're focused on today and see if you have data to track if it's working or not. If it's working, can it be improved to generate more revenue and happy customers? And if it's not working as planned, perhaps the data can start to show you some insights or trends to understand why and where you should course correct. That's it for this week. See you next time on Reveal. Did you like today's episode? Subscribe now so next week's episode will be waiting for you on Monday.

Sheena Badani: And if you really like the podcast, please leave a review. Five star reviews go a long way to help get the word out there.

Devin Reed: And if you're not ready to give a five, check out another episode and see if we've won you over by then.

Sheena Badani: And if you have any feedback or you want us to interview one of your favorite revenue leaders, just email us at reveal @ gong. io.

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