Is it true that 87 cents of every dollar spent on Sales Training is wasted.

 

87 per cent spent on Sales Training is wasted.

Google shows: About 555,000 results (0.22 seconds)

The “87 per cent belief” is widespread,
it is quoted endlessly,

But, is it TRUE?

 

In “The Challenger Sales” Book they write:

“Research by Neil Rackham has shown that 87 per cent of sales training content is forgotten by reps within thirty days”   (location 2705 the Challenger Sale - Kindle edition)

What is this REALLY all about?

The 87% Statistic was first published in the “American Society for Training and Development Journal” November 1979 and is credited as a Huthwaite Study. At first Publication it was an “87% loss of a “New Skill”, later in Neil Rackham’s 1991 book “Managing Major Sales”, the Graph fig 5.1 Page 130 is titled as : “Sales Training without systematic coaching wastes 87 cents in the Dollar”. However, seldom quoted is the comment on the previous page 129:
“Some Sales people showed a skills GAIN.
Where this happened, they had been systematically COACHED following training.”

And in 2001 Neil Rackham published an impassioned white paper
“The Coaching Controversy”, where he puts the context thus:
http://www.ascenticg.com/hw_survey/hw.htm

“The Xerox Corporation carried out several studies, one of which showed that
in the absence of follow-up coaching 87 per cent of the skills change brought about by the program was lost. That’s 87 cents in the skills dollar. Knowledge training, on the other hand, generally shows a much smaller loss.”

So, now we have a clear view of what it is all about.
Neil Rackham uses the 87¢ (cents) statistic,
taken from a study made before 1979,
(Part of the “Newcastle” Study?)
at Xerox based on the SKILL loss post-Sales Training of Photocopier Salespeople.

Indeed it is qualified, to distinguish between
SKILLS and KNOWLEDGE,
the latter showing far less “Loss” than the former!
And, then it is further qualified (logically) to be
“The loss of the Skills ‘Gained’ during the Training”.

 

 

 

 

This is a long way from:

The '87cents' has grown and changed into a "proof".

“Research by Neil Rackham has shown that 87 per cent of sales training content
is forgotten by reps within thirty days” (The  Challenger Sale)

This “Proof” is used to support
“Sales Training doesn’t work!”
usually followed by the Hollow Claim
“Except MY Sales Training, which is the only one which works!”

Neither is likely to be true!

Here are some other Statistics from before 1979:

http://info.cancerresearchuk.org/cancerstats/types/lung/smoking/#percent

In 1979 40% of males smoked versus 20% today a 100% change.

If we used the 1979 Data we would be 100% WRONG in its usage!

Why didn’t we instead focus on the KEY Information
Published in Neil Rackham’s Classic book “SPIN Selling”. Page 12

“Potential Customers remember just over 5 key points from the 8 key points presented during the Sales Presentation.  Just SEVEN DAYS later,
they can only recall just over 2 Key points.
A 50% Memory loss and a drop from “likely to buy” to “unlikely to buy!”

And “statistically speaking” it’s not just Sales:

“The average organization is losing an amount equal to 7% of their annual sales because of poor leadership practices.
The three main side effects of poor leadership practices are increased employee turnover,
decreased customer satisfaction, and reduced employee productivity,
according to David Witt, Program Director at The Ken Blanchard Companies.”

http://www.kenblanchard.com/Business_Leadership/Management_Leadership_Newsletter/December2011_main_article/

Really I just will not leave without talking about MY own Sales Training Courses

By design, my Sales Training Design takes “Skill Loss” into account. The use of Aide-memoires and Practicing the new skills in Simulation with both Video and Observation feedback helps. I recently had a comment from a delegate whom I trained over 25 years ago, he remembered vividly the story I told so he could learn the Sales Skill of “Supporting” !  I haven’t trained that particular skill for some 20 years,
but it was a very vivid story!

 

However, I cannot stress enough that Sales SKILLS Training includes
BOTH Training and Coaching, you MUST do both.

I don’t call Sales Skills Coaching “On-the -job Training” because it IS NOT.
Sales Skills COACHING is the COMPLETION of what you learned during the Training Event.
On-the- Job ‘training’ is somebody showing you how
to fill in your monthly expense report!

 

The right way to Sales Skills COACH can be found at:

http://brianmaciver.blogspot.com/2011/10/true-secrets-of-sales-coaching-for.html
and
http://brianmaciver.blogspot.com/2010/09/how-do-you-make-great-sales-people.html

A Philosophical Criticism of The Challenger Sale

The Greek word “Mimesis”, from which the English word “Mimic” is derived,
literally it means “Representation” or Imitation.

The Challenger Sale describes five “imitations” of reality.

They are reflections of Salespeople, but in only a few dimensions and
not the full multi-dimensional Truth.

If the reader accepts the “Imitation” as a reality, then their minds are harmed, by confusing the “reflection” for the reality. Salespeople have to inoculate themselves by knowing the multi-dimensional true nature of Selling.
When a Writer depicts reality it is from their own perspective. If we view a bed from underneath it is still a bed, but its appearance is a distortion of the reality. Better to use a mirror if we want to examine or represent reality. But, it is still a reflection. If you had the only mirror then you would be a marvel who is able to “copy” everything!
The writer, looking in the mirror makes a representation. The less the Reader knows of reality the more “REAL” the Writer’s imitation appears. And, that is the danger, that an imitation or “Representation” is mistaken and believed to be a Reality.

The art and the science of the writer in depiction is
a long way from reality.

When we mistake a representation for a reality it is because of our inability to distinguish knowledge, ignorance and representation. This is like the child who tries to eat wax fruit and is surprised at its character.

  Seller→ belief→ collection→ analysis→ view→ report

Writer→ Seller→ belief→ collection→ analysis→ view→ report

Representations (like Hunter/Farmer) are easy to reproduce without any knowledge of truth, because they are “appearances” not realities. Suppose that we could make either the reality or the refection, then would we devote the same energy to both or would we focus on reality?

If instead of Salespeople, the five descriptions applied to Doctors of Medicine which would we choose to heal us? Or, if we were Doctors which would we chose to imitate? This leaves us with the question: From reading about a “Representation” are we capable of judging the behaviours to imitate this representation?

The final Validation or the final Criticism of The Challenger Sale will be resolved in results.
When companies change or reform to “The Challenger Sale”, in part or in full will the Sales Community be better off?
Or, can any success be attributed to The Challenger Sale or to the advice given? 

Have the authors proven its effectiveness by Selling using their own methodologies?

The final thoughts we have to ponder is
has The Challenger Sale brought real insight or does it merely represent it? 
Are we persuaded by their admirers and ardent follower or by their insight to truth?
Which assumption should be made,
that it is again no grasp of truth but instead a mirrored reflection –
the clothing but not the substance or the truth.

When the Painter paints shoes can he do the Cobbler’s job?
Or, when the Writer writes a recipe can they replace the Chef?
The Writer is no less, they depict what is seen but they do not reproduce reality! 

Describing the steering wheel, brake and accelerator, however accurately, does not meet the skill of those who manufacture the real thing. Yet, even those who build them are only pleasing those who drive. The real purpose is neither in description, nor manufacture but in use!
The Car Driver will know of the defects or merits of both description and manufacture.

Only the Driver feels the steering or the forces of Acceleration and Braking.
The Builder will have a belief about the merits of his work,
but the reality can only come from The User.

However, the Writer on Selling Skills has neither knowledge nor correct view of the function or dysfunction of the things that they represent.  Nevertheless, they write, Readers read and Sellers adapt and fit.

The five Sales “types” are metaphors, not reality. 
Any “type” is a reflection of a stereotype, not a prototype.

We are all parts of all types, and the better for it!

In Sales we aspire only to do the right thing, in the right way,
at the right time in the hope of the right outcome.

If you want to sell VALUE, then you had better know what Value Is!

Value is in the “Eye of the Customer”,

Whether we Sales and

Marketing believe it or not.

 

 

Customers assign Values to the attributes of our product or service, every Customer assigns different VALUE.

Anyone, who expresses their belief through “Gut Feel” or worse still “Experience” which Product or Service attributes are most important or Values which they ascribe are almost certainly WRONG.

If you want to Sell VALUE then you must first DISCOVER it.

 

YOU CANNOT CREATE VALUE

 

Nor, can your Sales Managers, nor your Marketing Guru, ONLY Customers perceive Value.

And, what your Customer perceives as Value
and how much Value they perceive must be DISCOVERED by you to offer back to them.

Crucially, Value is always expressed in the Customers own words –
hence it can never be written in a Marketing Brochure or Sales Playbook.
Leave the playbooks where they belong – in the playground!

Value, Real VALUE as Customer’s perceive it is first discovered,
and then it is developed by the Salesperson AND the Customer.

This interaction by Sales and Customer is called:

VALUE CONSTRUCTION

Initially, Value Construction is both soft and subjective research in the Customer’s own world, their REALITY. Using one-to-one or one-to-few meetings which identify as many attributes and ideas as possible. These Attributes are “Constructs” which having been sorted, combined as a synthesis produce a Customer Sourced VALUE PROPOSITION.

A frequent Marketing mistake is to take old Value Propositions from existing Customers and PUSH them as Value Statements to New Customers.

DON’T DO IT,
it simply does not work.

Value ‘Reviews’ with Lost Sales and Current Customers
find “their” Value NOT “True” Value,
which can only be found with the actual Customer.

Experience has given Salespeople the realisation,
that Requirement, Expectation and Want all have different Values.

Customer’s Expectations change, Value is NOT a predetermined significance.

The more difficult it is for a Customer to EVALUATE a Product/Service before purchase,
then the more important EXPLICIT VALUE becomes,
the more important Value Construction becomes!

BMAC Consultants offer Value Construction work shops

as part of their Customer Engagement Process.

Sales survival of the fittest

Does Darwinism (Survival of the Fittest) apply to sales?

Salespeople today are very diverse, young and not so young, male and female, of every creed,
colour and educational achievement – so, who is going to survive?

It has been predicted that 80% of Salespeople will be without their jobs by 2020.
Who are the fittest? The business environment, the habitat where salespeople live
is in constant change and the rules of the buying game have change dramatically.

The fittest are those who develop the ability to change, to evolve at least as fast as their environment changes.

It is ADAPT or become unemployed and a part of the archaeology of Selling and Sales.

Globally, business is changing, continuous variation. Some change is good bringing fresh opportunity and some change is threatening bringing extinction. Some Sales jobs will disappear due to poor Management Practice. Many Sales jobs will disappear due to Sales Training of ‘dysfunctional’ Selling Skills. Wherever you sell and whoever you sell to; you no longer enjoy geographic isolation.
We salespeople now live in a competitive environment where the best adapted sell, and those who can’t or won’t adapt – Fail!

 

Dramatic “Silver Bullet” change will NOT save you, nor will “big bang” Crash programs.

Please don’t wait for messiahs, Gurus or Experts they can’t save you either.

The only thing that will save you is FITNESS, and the fittest Sales People and Sales Organisations are those which opt for flexibility and adapt to a constantly changing environment.

Continuous Learning, EVIDENCE Based Selling Skills will develop their fitness to be part of the fittest who survive. Continuous Learning means never ending Continuous Improvement, which is a career long journey of adaptation to your Product/Market and Competitive Environment.

How do you lose market share, with the best product and best price?

 

It’s easy, give Marketing control over Customer Relationships.

I have just finished a long assessment for Big IT, they told me to find a problem with Sales.

I did, they were losing deals to a ‘softer’ product and the customer was paying the same or even more.

When I made my initial report, they asked me to recommend a “Sales Training”. I could have said anything. But, I replied that I knew what was wrong, but we didn’t know what caused the problem.

They agreed reluctantly to fund some more Sales Consultancy, but they really wanted “Sales Training”, a good two day event that would ‘energise’ the sales force and bring the lost business back!

 

 

My role as a Sales Consultant is to eliminate mistakes.

That is it. Simple!

Find the mistake, then eliminate it.

At BMAC we call it “error detection and error recovery”.
(At least one of us used to design, test and repair Hard Disk drives).

If YOU are not doing something wrong (or not doing something right) then your business would be booming!

At big IT, we did the usual lost business reviews,
with some remarkable and consistent results across a wide range of
Salespeople, Customers, Customer Segments and Geography.

· Did we lose on Price – NO?

· Did we lose on Product – NO?

 

We drilled down, what was the price difference, little or none.

What was the product difference little or none.

Several (sincere) Lost Customers, even admitted that they had bought more expensively and
they believed the product that they bought although good enough may not be as good as Big IT’s.

So WHY did we lose? We asked. It came down to RELATIONSHIPS.

Over the last three years Marketing has taken over ‘Customer Relationships’. Marketing were responding to incoming queries and contacting “quiet” Customers. Sales were told to focus on ‘Closing deals’.

“Show the Prospect that we have the best Product and the Best price”.

Marketing had installed, at great expense, a new CRM. It collated web landing, Social Media searches, recorded incoming and out-going telephone contacts and had hounded Sales for their “Black Contact Books” to be put in the system. The initial results were great; the sales ‘lag time’ had dropped from entry in the pipeline to Order from 7 months to 4 months. Sales were only working ‘qualified’ leads. Marketing was holding ‘pre-qualified’ leads and “nurturing” them.

So, what was wrong? Where is the error?

The Customers had interpreted Marketing’s new CRM approach as:
“We are Not Interested.”

 

 

 

 

The Customer wanted Sales Engagement!

So, they got it from the “interested” Competition.

 

Interesting?