Today while talking with Ben Cook, President of Acumen Learning, we dive into the critical
components that all companies think about – the 5 drivers! Ben gives us great insights into the drivers and why they’re important. Let's review the Q&A:
Question:
Hi Ben! We talk a lot about the ‘5 business drivers’. Can we start with what the 5 drivers are and why they’re important?
Yes! The 5 drivers are what all successful companies think about in order to
succeed! Those 5 drivers are: Cash, profit, assets, growth, and people. We believe you
can’t be successful without being extremely mindful of each one of these. You obviously
need customers and employees to run a business, you need to be balancing both the
growth of the business while also attending to its profitability, which then should
generate strong cash flows, you get the idea. Each one of the 5 Drivers are intertwined
with the others… too little focus on one can hurt the others. And Vice versa.
Question:
How do the five drivers - cash, profit, assets, growth, and people – present themselves within a business, particularly in terms of sales strategy and execution?
The five drivers are interdependent components that businesses, and
especially sales teams, need to balance effectively. For instance, sales teams are
typically intensely focused on driving growth of the top-line (sales). But without an
attention to disciplined pricing of the products or attention to the costs to sell and
distribute the product…then those sales won’t translate to profitability. And the less
profitable the sales are, the less cash flow the company then makes on each sale. And
that then impacts the available resources to invest in new assets such as products,
technologies, and other necessary resources to generate those sales. And without great
products or an ability to get the products effectively to the customer, then marketshare
(people) then gets compromised and your ability to invest in further demand generation
efforts or invest in your people internally gets further challenged.
Question:
Could you elaborate on how understanding the priorities of businesses in terms of the five drivers can inform a company’s sales strategies?
Certainly. Recognizing which driver holds the greatest importance for a
particular business should guide the sales professionals in tailoring their solutions to
what the customer most wants. For instance, if a company is most focused on its
growth, then your approach about be to link your products/services to how you can
help drive for your customer better products, more customers, better innovation,
clearer product differentiation, and more pricing power. However, if your customers are
most focused on profitability, your value statements should then focus on
demonstrating how your products can help your customers be more cost effective, have
better operating efficiencies, and a batter ROI to align with their top priority. If you
aren’t customizing your sales approach to the customer, you won’t get very far in closing deals. An easy way to find their top priorities is listening to their earnings calls
where you’ll quickly notice what they’re focusing on and what they care most about!
Knowing and understanding these 5 drivers will help you have better sales
conversations, connect with prospects and customers better in a language they most
care about, and drive more sales for your company. And just to reiterate, the best sales
professionals carefully align their offerings with the client's key drivers to maximize
relevance and value. Otherwise, it’s like selling baby items to somebody without a baby.
You don’t even know what they need!
Question:
In your experience, how do the five drivers manifest differently across various industries. And what implications does this have for the sales strategies of the company?
This is a great question because what is relevant for one industry could be
completely irrelevant for another. Different industries exhibit unique dynamics in terms
of the five drivers. For instance, retail firms need to prioritize asset utilization, cost
efficiencies, and operating scale due to their thinner than average margins. Now, a very
different industry like pharmaceutical companies have higher-profit margins driven by
patent protectedness, product differentiation, and innovation. Their success is
determined by their ability to translate R&D to new products than then drive
marketshare. Your sales strategies must adapt accordingly, tailoring value propositions
and solutions to meet industry-specific challenges and objectives. Back to the original
point of customizing solutions for every individual’s priorities, it’s important to
understand your clients before talking with them. Understand what their industry
focuses on, what their role deals with, and what their company is hyper-focused on.
Keeping the 5 drivers in mind will keep your research clear and concise.
Question:
For sales professionals engaging with publicly traded companies, how can they leverage publicly available financial information to better understand the client's priorities among the five drivers?
Oh, this is my favorite question. I briefly mentioned in question 3 how
important this is. Publicly available financial statements and investor relations materials
(such as their quarterly press releases, presentations they are giving to investors, etc.)
offer valuable insights into a company's emphasis on the five drivers. Analyzing trends in revenue growth, profitability, investment patterns in assets such as infrastructure or
acquisitions, and trends in cash flows provides sales professionals with a deeper
understanding of the client's strategic focus. They’re basically giving you a road map into their company – utilize it!!! This information enables more targeted sales pitches and
alignment of your solutions with the client's priorities.
Question:
Those are really great tips! If that information is so crucial to tailoring the sales process, what happens if a company isn’t public? What strategies can sales professionals employ to gain insight into their priorities?
This part is tough but definitely possible. While financial data may be limited
for privately held companies, sales professionals can gather information through
broader industry analysis or research of your customer’s competitor who might be
public. By understanding industry trends and benchmark companies, as well as studying
competitors positioning and messaging, sales professionals can infer the priorities and
challenges of their target clients. Each industry tends to have common themes and
pressures so where one company might have a specific profile, others in the same
industry will likely be thinking in similar ways. However, it is important to engage in
open dialogue with your customer and ask insightful questions during your client
interactions! As you demonstrate that you have put in the work to understand the
industry and its typical priorities and challenges, then your customer can provide
additional answers and insights that will play even more of a valuable role in your
positioning. This can uncover valuable insights into their business drivers and strategic
objectives. It will also help your clients to feel valued and show them that you genuinely
care about positively impacting their performance and to ensure you align with their
priorities.
Question:
Last question for you Ben, how can sales professionals continuously refine their business acumen to better understand and address the evolving needs of their clients in terms of the five drivers?
What a great question. Developing strong business acumen requires ongoing
learning and adaptation. Sales professionals can stay informed about industry trends,
economic indicators, and emerging technologies relevant to their clients' businesses.
Additionally, actively seeking feedback from clients, peers, and industry experts can
provide valuable perspectives to refine sales strategies and approaches. By continuously
honing their understanding of the five drivers and their priorities for their clients, sales
professionals can enhance their effectiveness as trusted advisors and partners to their
clients. Like I mentioned before, all companies think about the 5 drivers – cash, profit,
assets, growth, and people. So, determining which is most prevalent in the beginning is
key to relationship building in sales. When they realize you’re knowledgeable in their
field and role, they will more fully trust that what you offer is for the betterment of their
business.
ACTIVITY:
Now that you've explored the critical components of the five business drivers and their significance in sales strategies, let's engage in a learning activity for your next team meeting:
Exercise: Customer Priorities Mapping
Divide participants into small groups and have them each represent a sales team for a hypothetical company. Focus on diverse industries like retail, pharmaceuticals, and technology.
Each group will discuss and identify how the five business drivers (cash, profit, assets, growth, and people) manifest in their industry. Identify key challenges and priorities their company might face.
Develop a customized sales strategy that aligns with the identified priorities of their industry and company. Consider how their products or services can address these priorities effectively.
Have each group present their customer priorities map and sales strategy to the entire team. Have a discussion around what works and doesn't work for each strategy.
This exercise bridges theoretical knowledge with practical application, helping teams understand how to tailor sales strategies to different industries by focusing on the five business drivers. It fosters a deeper appreciation for the nuances of customer priorities and the role of business acumen in successful sales execution.
Continue your learning…
The Impact of Business Acumen
on the Sales Process
Benefits of Business Acumen for Sales
The Five Business Drivers of Sales
Next Steps…
Why Do We Teach the 5 Business Driver Model Article:
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