Sales for Small Business Owners
Sales | Written by Wendy Connick
An appropriate title for this week’s Small Business Advantage Brief, this article strikes a nice balance between running a small business and growing your small business pipeline (so as not to experience famine a few months down the road).
- Do a little bit of selling every day. You’re not going to land deals immediately after cold-calling someone… sometimes it can take months to mature an opportunity into revenue.
- Don’t spend time doing sales-related busywork… delegate or outsource things like contract paperwork. Set up a CRM system (I highly recommend Pipedrive, Hubspot is an up-and-coming system, and SalesForce is the 800-pound gorilla in the space).
On Selling, Sales, and Landing Business…
- Sales for People Who Don’t Like Selling >> Some people compare sales to that of a used car dealership… slimy, underhanded, and generally despicable. If that’s you, give this article a read. It takes you through the five steps of selling just about anything and has a few good questions to ask potential clients along the way.
- Sales and Passing the Pen Test >> Don’t bother reading this article. It’s too long and struggles to make its point. However, this one quote I gleaned from it hits the nail on the head: “If your pipeline sucks you will fail. If your pipeline is full with quality and quantity, predictability improves and the industry statistical norms will at least be achieved. Also, it makes it a lot easier to end all price negotiations. Clients like hearing no because it is precise. Decision makers always need the most precise information, if they feel they can negotiate then it is an unknown and the unknown is troubling.”
New From moderndavinci.net This Week
Seth Sinclair ran a webinar this week on creating a purpose and strategy statement for your business, helping you focus on the right goals for success in 2017. You can find a recording in the Members Area here if you missed it.
Are You Building Trust With Your Marketing?
Marketing | By Katie Sullivan
Most Valuable Insight?
Trust is a fundamental feeling your customers have (or don’t) about all parts of your business. Without trust, they won’t buy or share your product with others. Look deeply at the relationship you have with your customers. Evaluate this relationship from their perspective. Even if you don’t like the answer, knowing how much or little your customers trust you is critical to influencing them to buy.
- Consumer surveys show that a buyer needs at least 6, and as many as 20 positive reviews to convince themselves you can be trusted enough to buy.
- How do you gain consumer trust?
- Be transparent – Share the good with the bad. Customers will appreciate the honesty and trust will build because of it.
- Be human, personal, nurturing – Don’t market to your customers, talk to them. Show that you appreciate them. Get inside their head and truly help them solve their problems.
- Be social – Use social media, but not to influence the masses… help your loyal customers and watch them do all the talking.
- Be a good listener – Take your customers seriously, understand their perspective, and act on what you’re hearing.
Just check out this graphic on the most likely marketing activities that influence buying…
The Ultimate Product Launch Checklist >> Launching a product (or service) is a massive activity. If you are launching one soon, you’ll want to check out this checklist. It’s a pretty awesome infographic that will, at the very least, get you thinking about what all needs to happen to make your launch successful.
The Best Online Marketing Tactics for 2017 >> Have you heard of “unicorns” vs. “cockroaches?” It’s generally talking about being a business that is magically successful vs. being un-killable (you want to be a cockroach, in case you’re wondering). This applies the concept to marketing campaigns. It’s worth the read if you are deep into online marketing right now.
New From moderndavinci.net This Week
In case you haven’t seen it, we created a video on staying focused and productive each and every day. In it, we review a simple tool called the Eisenhower Priority Matrix to help you work on the important tasks (instead of being pulled around by the urgent ones).
When Giving Critical Feedback, Focus on Your Nonverbal Cues
Leadership | By Emma Seppala, Harvard Business Review
Most Valuable Insight?
Giving feedback can be difficult for many leaders, but it’s essential in any business that aspires to have a healthy culture that fosters growth and engagement. We posted a strategy for providing feedback on Modern da Vinci (see “Effective Feedback Made Simple)” that included a video, podcast and Process Guide. This post from HBR provides additional insight on the importance of Nonverbal Cues as a critical aspect of the feedback process.
- By using a positive, open, and supportive feedback style, you end up establishing trust. Employees are particularly sensitive to signs of trust in their managers. Our brains respond more positively to empathic bosses, as neuroimaging research confirms. In turn, employees who feel greater trust show improved performance.
- Whether we realize it or not, we are always reading each others’ facial expressions and body language. The nonverbal cues to which we pay the most attention are:
- Facial expression
- Eye contact
Rather than seeing the feedback situation as “work” or something you need to just get through, see the conversation as an opportunity to connect with another person. If you are giving feedback, you will probe into what has prompted your employee to act a certain way and you will find the right words to encourage a different type of behavior. Research shows that employees feel greater loyalty and are inspired to work harder for managers who are compassionate and kind.
- You Owe Your Team Better Feedback >> Building off the summary and post above, this post underscores the importance of providing feedback and provides a 4-step model for delivering feedback effectively.
- Do You Have These 7 Important Leadership Qualities? >> Giving feedback effectively means having some other essential leadership qualities, like empathy, outlined in this article. Even if you just read the bullets, it’s a good list for any small business owner to keep in mind.
- What if being a good leader is simply being a good communicator? >> Read the whole article if you want (it’s short), but the main takeaway is this: “…leading is about having an idea worth following and the ability to communicate it.”
One Final Thought
You can be a great leader, marketer, salesperson. You can build great teams, and work your tail off to be successful. But one thing all small business owners have is a lack of time…
So when I saw this article, I had to give it a read: This Morning Routine Will Save You 20+ Hours Per Week >>
Whether saving 20 hours (half a workweek!) per week is possible, I like the tips they propose:
- 8-hour workday? Not the most productive according to the author. Find your rhythm, mix intense work with resting and relaxation, and be shamelessly “results oriented” with Every. Single. Thing. You. Do.
- Working on a tough problem? Go for a drive. The scenery will prompt different memories, making connections you couldn’t make while sitting in front of your computer.
- Do your most important work when you are most creative, alert, and have the most willpower… the first three hours of your morning. After a good breakfast and reflection on your goals for the day, of course.
- Protect your mornings. Don’t let anyone take your creative, productive, most important work-time from you with unnecessary (or even necessary) meetings.
- Don’t forget to stay healthy, and play. It’s all about staying balanced to maintain “peak performance.”
PS. I read all of these articles twice as fast using Instapaper. Don’t know what that is? It’s a reading and learning productivity app. Check out our short video on it here: How to Get Superhuman Productivity with One Remarkable App.
The Downsides of Being Very Emotionally Intelligent
Leadership | By Tomas Chamorro-Premuzic and Adam Yearsley
Here at Modern da Vinci, we are firm believers in the benefits of developing your Emotional Intelligence (also known as “EI,” which is generally defined as having strong self-awareness, emotional management, and intrapersonal/interpersonal skills). This article supports our position when it states that:
“thousands of scientific studies have tested the importance of EQ (note – EQ stands for Emotional Quotient, which is a way of measuring EI) in various domains of life, providing compelling evidence for the benefits of higher EQ with regards to work, health, and relationships. For example, EQ is positively correlated with leadership, job performance, job satisfaction, happiness, and well-being (both physical and emotional).”
However, the article goes on to question the limitations of having a high EQ, asserting that “most things are better in moderation, and there is a downside to every human trait.” They specifically cite the following potential tradeoffs:
- Lower levels of creativity and innovation potential
- Difficulty giving and receiving negative feedback
- Reluctance to ruffle people’s feathers
- A well-developed ability to manipulate others
- An aversion to risk
I don’t fully agree that all of these “weaknesses” are associated with high EQ. For example, the ability to give feedback is typically associated with strong EI. However, I do think the article is worth a read as it provides in interesting perspective on EI and potential areas for reflection and self-awareness.
Tips For An Entrepreneur To Exit The Business Successfully
Business | By Aileron
“Leaders need to prepare for the future of their company. “If that company is part of your identity, why not do succession planning?”
“We realized that before we could really move forward with strategic planning, we needed to know what was going to happen with the company. Once that was communicated to the company, it was like a weight lifted.”
The article goes on to highlight the 3 main types of transitions to second or third generation owners:
- Internal transaction (handing down a business from one generation to the next, or it could be an internal sale where control is transferred within the company among its leaders);
- External transaction (A strategic buyer is typically a buyer in the same industry); or
- Private equity groups: (PE Firms are buyers outside your industry).
“It’s never too soon to start planning, even if a business owner is unsure of what the exit will look like. “If owners can acknowledge that they do not know which of those 3 options they are going to choose when they do make the eventual transition, they can at least understand what those 3 types of buyers are going to look for, and what they—the owner—needs to get ready for.”
A New Tool for Stress Management in the "New Year"
Work/Life Balance | By Ryan M. Niemiec Psy.D.
We need to “get good at stress.” This means to cultivate a mindset that stress is not a bad swarm of negativity that’s going to overpower and crush us. Rather, stress is energy that we can harness in the moment. We can direct the energy toward something productive.
Stress resilience is about having “the courage to grow from stress.” This does not mean we should be unaffected and untouched by stress. It means we can use stress to awaken our core human strengths.
Instead of telling people they need to learn to “bounce back” when a stressor occurs, we might encourage them to acknowledge and learn from the stress and discover how they might use their strengths to grow from it.
Outlook 2017 : Gauging Market Milestones
Our friends at Fellows Financial Group share three market expectations for the year ahead.
Building a Great Startup Culture Starts with the Founder
Leadership | By Larry Kim
Most Valuable Insight?
“One thing that absolutely blew me away as a founder was how much an organization mimics the characteristics of its founders.”
- You, the founder or owner, set the tone in your organization through how you dress, the way you treat people, that way you act, and the actions you take.
- Positive energy is infectious. So is negative. Be mindful of your behavior as it will affect your culture.
Five Questions That Make Strategy Real
Strategy | By Jack and Suzy Welch
Most Valuable Insight?
“The first step of making strategy real is coming up with a big ‘a-ha’ for your business – a smart, realistic, relatively fast way to gain sustainable competitive advantage. To do that, you need to debate, grapple with, wallow in, and dig into – and we mean dig deep into – your playing field (that is, your competitive situation) and its players.”
- Strategy works when your employees strive to be more effective every day. Build a “learning organization” where everyone learns from within and outside the organization.
- Find your “big a-ha,” define your path to victory, add the right employees to get it done, and get to work while constantly learning and improving.
7 Reasons the Best Employees Quit, Even When They Like Their Job
Team Building | By Lolly Daskal
Most Valuable Insight?
“There's nothing more frustrating than a workplace filled with visions and big dreams, but no translation of those aspirations into the strategic goals that make them achievable. People like to know that they're working to create something, not just spinning their wheels.”
- Employees need to feel like they can grow professionally. Without professional goals (which are very personal to them), they’ll place their aspirations elsewhere.
- Overworking your staff the fastest way to lose them… be careful too, as it’s many times your A-players (the best and brightest) that are most often overworked.
- If your bottom line means more to you than your people, your best performers will leave and your worst will stay.
- Recognize your employees, lest they leave because they don’t feel noticed.
- Your best, most trusted, principled employees will notice the way you deal with clients, partners, vendors, etc. If they don’t like what they see, they’ll leave.
- Your employees need to be able to contribute. They need to be empowered. If titles matter more to you than their expertise, they won’t stick around for long.
How to Find a Distributor for Your Product
Product Development | By Christopher Pilny
Most Valuable Insight?
“The internet has made selling direct to consumers a viable option in lots of different categories from fashion to industrial products. To do this, you will need to have ecommerce capabilities and the means to ship your product to consumers. Such “fulfillment” facets of selling products can also be handled by companies like Amazon, that are seeking to be a one-stop solution for small businesses that want to sell through their channel and also need ecommerce and fulfillment services.”
- Join an industry association. The access to other small business owners who have done it before and word-of-mouth recommendations will help you find the right distributor.
- The right trade show will connect you with thousands of people on all sides of your industry, vendors and distributors.
- Visit the National Association of Wholesale Distributors.
8 Common Ways Small Businesses Waste Money Marketing
Marketing | By Brian Sutter
Most Valuable Insight?
Use the 80/20 rule when searching for new customers. 20% of your customers likely account for most of your revenue. What tactics did you use to land those customers? Use them again.
- Paid advertising is falling more and more on deaf ears, and is getting more expensive. You have social media investments? Use them to grow your email list.
- Before you build a strategy, buy ads, or create new marketing collateral, know your audience! Know what to say, when to say it, how and where to say it. You want to be on the social media platforms they are… you need to be on the websites they visit.
- Don’t put all your eggs in one basket with a huge, one-time ad campaign. It’s too risky. Test your marketing idea with a small, short, focused budget. Adjust and refine before spending the big bucks.
- Set up conversion tracking for whatever advertising system you are using (Facebook, Twitter, Google AdWords). It takes time and effort, but if aren’t tracking your ad performance you don’t know what’s working and what isn’t.
Many small and medium-sized business owners kick the can down the road when it comes to financial planning. That’s understandable since business owners are preoccupied with short-term responsibilities and dealing with fires that inevitably pop up daily.
Unfortunately, this leaves the business owner and his or her partners and family members exposed to tremendous risk.
What happens if conditions change and the business fails? How will the business respond if a partner falls ill? What is the business exposed to as the market fluctuates? How can the business be financially responsible while offering competitive compensation and benefits to employees?
In this interview, business finance expert Blake Fellows explains why it is essential for business owners to be proactive about setting goals, determining ranges for spending and saving, ensuring that foundational agreements are in place, and having specialized support in all aspects of financial planning.
If you wait too long, then your options become less and less.
A couple of years goes by, and maybe the fork in the road took you left, when you thought it might take you right. Next thing you know, you had a plan, but all of a sudden your plan is obsolete. That comes back to the proactiveness…updating your current plan and looking at it from a comprehensive nature that incorporates always starting with the end in mind.
Most of our clients, their biggest asset is their business, so one of the things we try to do is help them to diversify assets out of the business in a tax favored manner, and allocate them towards other goals. So something happens with the business that wasn’t quite planned, you got other stuff built up, and other nest eggs out there, rather than just all of it in one bucket.
Let your goals dictate what you’re doing, don’t let the markets dictate your goals.
If you’re not proactive about addressing these types of things, when folks really do address these, it’s typically too late. There’s degrees of losing if you don’t get ahead of it.
We are true advocates. We have built a team that are true advocates for small and midsized business owners, their employees and their families.
About Our Guest
For more than 15 years Blake has been a trusted advisor, planner and advocate for entrepreneurs, business owners and individuals seeking personal service and deep knowledge. A Loudoun County native and graduate of James Madison University, Blake is an active Rotarian and heavily involved in coaching sports for more than 15 years.
Seth: Alright everybody, thanks as always for joining us here at Modern Da Vinci. We’re always looking for ways to help small business owners grow and thrive. Today we want to look at something that we know can be a real pain point for many small business owners, and that’s getting a grip on their financial planning and understanding how to maximize resources and reduce risk, both in the short term and the long term, and personally I know that’s something that can cause a lot of consternation and worry for small business owners, and has definitely caused some sleepless nights for many small business owners out there. So on that note, I’m very pleased to introduce our expert for today’s interview, Blake Fellows, of Fellows Financial Group. Blake has over 15 years of experience as a financial adviser and planner, especially with a focus on working with entrepreneurs and business owners. And through his company Blake and his associates offer customized and integrated planning that spans across everything from traditional financial planning to succession and estate planning, investment management, benefits and insurance planning, the whole continuum. And Blake’s also, I know, very active in the community out here in Northern Virginia. So Blake, great to have you on, thanks for taking the time to do this. How you doing today?
Blake: Doing great, thank you Seth, thanks for having me.
Seth: Yeah, my pleasure. Well I know this is an important topic for many small business owners and I kind of want to tap into the fact that we know that there’s a lot of business owners out there who know they probably need to pay more attention to their financial planning, and they really want to secure all the hard work that they’re doing and have clarity in the future. So with that in mind, when a small business owner first walks into you, what are some of the biggest questions and challenges that are usually on their mind?
Blake: That’s a great question. Typically, with small and mid-sized business owners, these folks, they’re usually well versed in their craft, whatever that may be. Whether they are farmers, plumbers, law firms, accountants, technology firms, what have you, restaurants. And these folks are typically very busy. They wake up with their list of 7 to 10 items they want to get done that day and then also a fire comes up, or somebody calls, and they have to drop everything and move over there and help this person, help this client, and by the end of the day, you know, they maybe got to the top 2 or 2 things on the list, but by then it’s 7:30, and they’re hoping to spend some time with their family. And you know what? I’m going try it again tomorrow, we’re gonna get back to that list tomorrow. And it’s real similar with planning items - they know, typically, that it’s very important, but what’s more important is the fire that’s burning right now that they have to take care of, and we gotta keep this business going, because the business, that’s their baby. That’s like another child, and that is their source of income, it’s everything. It’s typically the biggest asset or assets if they have multiple businesses. So, really what we find our team doing is putting track shoes, chasing down very busy successful individuals, wrestling them to the ground two or three times a year, and helping them to concentrate on things they’d rather get a double root canal than talk about. And it sounds kinda funny, but it’s true. It’s not that they don’t know this stuff is important, but it’s, I figured it out after almost 16 years of doing this. We specialize in the areas that people are going to get to next week, next month, next year, and that turns into next week and next month and next year, and it’s not as if they don’t think it’s important, it’s just easy to put off and address what’s in front of you. So to answer your question, “what are the biggest questions and challenges when someone comes to meet with us?” We have to be proactive to track these folks down, to get a meeting, and then talk to them about the different things they should be focusing on sooner rather than later, because if you wait too long, then your options become less and less. So there’s typically, rarely does somebody come in with a specific question or challenge. They usually say, “Ok, I’ll give you 30 minutes, what do you got?” By the time we go through introducing what we do and asking them some questions, they’re like, “yeah, you’re right. I need to address that.” So that’s typically the process. Anyone that deals with small business will probably be able to relate to that in some fashion.
Seth: Absolutely. So here they are - it’s like they know in the back of their mind, I need to be paying more attention to this stuff, I stand to lose potentially money, probably even as far putting their business at risk potentially if they’re not being careful enough with how they manage their resources. Potentially putting their retirement at risk. The value of the company. There’s a lot on the line and yet we kinda engage in this weird thing where we put it off. Like you said, just because the day-to-day becomes so busy, you don’t pay attention to this stuff. And then all of a sudden one day you wake up and you realize, “uh oh, I need to do something about this.”
Blake: Yeah, exactly.
Seth: So what’s the number one mistake then? Other than procrastinating I guess we’d say. What’s the number one mistake that you see business owners make when it comes to, hey I need to get into this financial planning - what’s something that they might mess up and then later regret?
Blake: Good question. And you know, mistakes aren’t always bad. A lot of times you learn from your mistakes and that’s good if you can do that and take it as an experience. So we won’t say that they’re all bad. But you know, 70% of all businesses exit without a plan. So, I hate to come back to the putting it off piece, but what ends up happening is, as far as being able to step away and look at the business from a comprehensive standpoint. “What is it that I really want to get out of this?” And a lot of times, folks will start with that. When they start their business this is, you know, and people get into business for a lot of different reasons. Sometimes you fell into it, sometimes you inherited it, sometimes you’re forced into it, and then sometimes you’re doing something that you love and that’s hopefully what you run into more often. But in the beginning you have a vision, what I really want to do, what I really want to accomplish. A couple of years goes by, and maybe the fork in the road took you left, when you thought it might take you right. Next thing you know, you had a plan, but all of a sudden your plan is obsolete. So really, that comes back to the proactiveness. The proactiveness of updating your current plan and looking at it from a comprehensive nature that incorporates, you know, always starting with the end in mind. What do I want out of this? That’s your business succession. Who are my key people that are gonna help me get there, and how can I help them, you know, achieve their life goals. That’s your employees. How do you take care of them, and make sure that they’re tied to the business and everybody’s best foot’s forward? And when you start with the end in mind, you can start to then visualize how to diversify risk away from your business, and there’s lots of ways to do that. And like I mentioned earlier, most of our clients, their biggest asset is their business, so one of the things we try to do is help them to diversify assets out of the business in a tax favored manner, allocate it towards other goals. So something happens with the business that wasn’t quite planned, you got other stuff built up, and other nest eggs out there, rather than just all of it in one bucket. So, back to your question as far as what’s the one mistake. It’s to not keep your eye on the comprehensive long term and help diversify away from your business over a period of time.
Seth: You know that’s funny, as I was listening to you, I kinda had like a flashback, going back when I was first starting this business. And it was happening kinda organically, you know. Not something that was super well planned, it was a good thing but it was sort of materializing almost accidentally if you will, the stars aligned. And at one point getting involved in a professional organization and had an adviser ask me a question, “what are you going do with this company?” “Is this gonna be a lifestyle business, is this something you want to grow and sell?” And I mean it’s kinda embarrassing to admit it, but I didn’t know. I’m like, I don’t know. And you know, even having some, like you said, vision, for what the future could look like is essential because that should be guiding the decisions that you make as you go forward. Fortunately, now over time and some maturity and some experience, I know I need to be mindful of these things. But it’s a real-life trap for business owners to get into this, even if it looks like everything’s firing on all cylinders and to have lost sight of, what is it we’re doing here? And how does that affect the other decisions that I need to be making.
Blake: Oh yeah. It’s normal, it happens easily. So you just have to stay on top of it.
Seth: Yeah, it sneaks up on you. That’s why people need to come to people like you, businesses like you. Like you said, sometimes you just need to be wrestled down to the ground and have someone work you through this process.
Blake: Yeah, that’s right.
Seth: There’s value in just having someone, you know, hold your feet to the fire sometimes. So here we are, the market today, obviously there’s a lot of crazy stuff going on out there. Politics are a big factor, global events are a big factor. What are some of the things and threats in the market that you would say to a small business owner, hey, you know, you need to be paying attention to this stuff?
Blake: That’s a good question. Well, it depends on the perspective you take. But really, holistically, first thing you gotta, back to diversifying away from your business, depends on what industry that business is in. We work with a lot of different types of businesses, some are affected by the markets more than others. Some do well when the markets do bad. Depends on the industry that they’re in. But really, it starts by taking a step back and truly identifying what your goals are. In relation to a few different areas. There’s the business, obviously. But then you want to look a little bit deeper. Where am I in relation to, how much money do I need and my family needs in today’s dollars, net after tax, indexed for inflation? How much do I need today ideally? I’d like to have, make up a number. And we ask folks to stretch on that number. And then, once you find that number, say ok, I’ve got that. But, what would be acceptable? That’s typically a lower number. And what you have there is a range. So you have, ok, well this is what I need. This is my spend. This is my range of spending. Ideally, but acceptable, anything below that is not really acceptable. We need to make sure that our plan, regardless of what the markets do, is insulated, that goal is insulated from the ups and downs in the market. How do you do that?
And then you go to the next piece. Saving. Well ok, these are my goals, and now I understand what I want to be able to spend comfortably. So ideally, you know, for me personally, ideally I’d like to save less. I’d like to save as little as I can to be able to achieve my goals. But, in reality, I understand I’m going to have to probably save more. So, then you have on the ideal side, a lower number. I’d like to be able to save this amount and achieve my goals. That’s ideal. But what’s acceptable, yeah I can stretch it. I could do a much higher number if I had to reach my goals. That’s acceptable. And again we’re back to that range. We’re creating a range. And we actually have a patent on this range called the comfort zone.
The next relation is risk. Ideally, I’d like my money in the mattress, to be as conservative as possible. But what’s acceptable, sure, given my age, I can be moderate to aggressive, I can live with that. I got plenty of time. So again, back to the range, back to the comfort zone. And then we take it even further, as far as legacy, you know. Ideally, and these pieces are going to become more important as the years go by. If I’m not here tomorrow, what do I want to have? Ideally, I’d like this to be passed on to my family. Or onto my church, or onto my whatever. My charity that I feel passionate about. But what’s acceptable is this. So when you get all that, sorry for the long-windedness, when you get that understood and a true plan around those core functions, then you can say, ok, now you have a plan that’s driven by your goals. Not one that’s reactionary to the markets. So, it almost doesn’t matter. Once you have that plan, and we establish a comfort zone, then that is your guide to tell you how to invest in the markets and how you should be going about navigating that. So I guess the quick sum up is, let your goals dictate what you’re doing, don’t let the markets dictate your goals.
Seth: Yeah. Well I mean, what I’m hearing you say is, you know, here’s a small business owner sitting there. Again, maybe they’re feeling some worry, some concern, or again, maybe they’re just completely checked out on, being mindful of these things. You’ve outlined a structure that would take someone who may feel very uncertain, like you know, “oh I’m subject to all these things that are going on out there. I don’t know what the future looks like. I’m not sure what would happen if something happened to me,” and you’re saying hey, you know, follow this process. Run through this structure with us, and you will be able to get some control over that, put some structure around it, and in turn, certainly build your confidence, and hey, you know, those things don’t always work out. We know that even the best businesses will hit some serious speed bumps, but you have something that gives you some parameters to work with, and gives you some confidence, hey I can make it, I can survive, and here’s the bottom limit and top limit of what I’m able to work with.
Blake: Yeah, it’s a great starting point. You can navigate from there.
Seth: So Blake I mean obviously you’ve been doing this for a long time. Do you have a favorite success story? I mean obviously, even if it’s just generic, but anyone where you’ve seen a business come in, and they were hurt, and you know, after getting a little bit more disciplined and partnering with you, was able to really turn things around?
Blake: That’s a great question. That almost puts me on the spot. So our business is in the town that I grew up in, so a lot of the cases are people I’ve known for a long time. So they mean a lot to me. And I have seen a lot. And they’re not all success stories. You can’t help everybody, and you can’t fix everything. And sometimes it’s too late, and sometimes it’s all about timing. Sometimes folks just won’t take action. So it’s not all success stories, but off the top of my head if I could, I could talk about a case we have right now. If that’s ok as an example.
Blake: There’s a company we’re working with right now, and they came to us and said, look we have four partners, and we really need to re-do our operating agreement. And we want it to encompass, if something happens to a partner, their shares go to their estate, or their spouse. We want to make that their spouses’ or estates’ financial future doesn’t depend, the financial success or failure doesn’t depend on the success or failure of this business. So if the remaining three partners run it into the ground, you know, the deceased partner’s estate doesn’t have to worry about it. And if the remaining three partners take this thing and double or triple the value, well, then they don’t have somebody that’s not contributing taking a quarter of what’s been grown. So how do we address that, and how do we address this other issue that we have? We’d like to be very competitive in our space as far as attracting the top talent. How do we recruit, retain, reward, the top people on our field and put a fence around them? Golden handcuffs, so they are incentivized to stay here. But at same time we don’t want to give away a bunch of stock in our company. We’d like to have other types of plans. So the reason I bring this up as a success story is, we did some digging, and I have a great back office. They are our technical folks, and they came up with some great ideas that not only helped with the business from a protection standpoint, in the case of death, disability, termination or retirement, one of the partners… If one of those triggers goes off, the operating agreement in a smooth fashion, there’s a separation, and all parties walk away, and there’s no room for lawsuits or potential issues. And on the other hand, we actually, we did some digging and not many people know this, but less than 9% of the population in America has a pension anymore. And if you remember, and people are more transient than ever, jumping from company to company to company. If you go back, several years, back when there was pensions, people stayed and worked there for 30, 40 years. They stayed at the same company their whole life because they wanted their pension, that’s what kept them there quite often. So what we actually were able to do is develop a program for this firm, for this company, that allowed them to have their business protected, their families protected, and as they are competing for new hires and talent, they can say, well, you can go to that other one, or you can come here and we’ve put together a defined benefit, a pension plan, in a very efficient manner that actually protects the firm and really benefits the talent. So I’d say off the top of my head, I got a lot of cases but that one right now, that one’s pretty cool, because they are really seeing the value in it. They’re already starting to tell others about it. Not their competitors of course.
Seth: Yeah. Well, what I love about that story Blake is, it talks to the fact that it’s not, hey you know, “I’m going to build my business and then once I get control of that and I feel good about it then I’ll worry about this you know, planning and financial planning stuff.” What it really illustrates is, the work that you do really touches the heart of the business, right down to the very relationships among the partners, and, I mean, we both know, I’ve seen it certainly, and not so much from the structural side or the legal side, but from the relationship side, that when you don’t have that foundation in place, everybody kind of takes it for granted, like, ah, “we’re partners, we’re friends, we’re brothers, whatever it is. If things go wrong, we’ll work it out.” Well, if you don’t have those agreements in place, terrible things can happen. We’ve all heard nightmare stories and seen very unfortunate things happen, in those circumstances. So you’re talking about helping a company really at its most foundational leve - have the infrastructure in place that allows it to survive what we know is going to happen, which is going to be some kind of either disagreement or some unfortunate health issue, whatever it might be, it is going to happen, and if you’re not prepared for it, it can really be disastrous for everybody involved.
Blake: Yeah, you’re exactly right Seth. Again, it’s back to wrestling folks to the ground. If you’re not proactive about addressing these types of things, when folks really do address these, it’s typically too late. It’s when they fire occurs, you have to put the brakes on and stop everything. Ok, how much is it going to cost us to make this problem go away, or is our business even gonna survive this? Or are employees gonna stay or they’re gonna go to competitors cause they know there’s turmoil? Are we going to lose our lines of credit with the banks cause they know that we have issues going on? So there’s degrees of losing if you don’t get ahead of it. So that’s really where a lot of our passion comes from. Getting to as many people as we can to try and help them before any of these pitfalls or fires come up.
Seth: Yeah, absolutely. Let me turn this just a little bit. This is all great stuff. As I’m listen to you it’s obvious, not only are you passionate about this, but you’re also extremely knowledgeable. But just to ask you a personal kind of question, what drove you to want to do this? Not only to be involved in financial planning and build your expertise, but also the fact that you started your own practice. What was the driver for you personally behind that?
Blake: Yeah. Another good question. So, let’s see. Actually getting into this business. This is all I’ve ever done, really. I got into this industry right out of college, and when I got into it, I really had no clue what I was doing. Like most kids when they get their first job out of college. But what I did, I ended up meeting with my mom. Of course low hanging fruit, you’ll meet anybody that will talk to you at the beginning. And my mom owns a small business, and she was a single parent, and again I don’t know how she did it as far as running a business and raising kids by herself, she did a great job. As you know Seth, I have a stay at home wife and two kids at home, I don’t know how we do it sometimes. So to do it by yourself, that would be a trick. That’s nothing short of amazing. So anyways, I got to talking with her, asking her some of these questions that we’ve been talking about to this point, and she, you know, she had nothing. She had nothing done really. I mean she had a nice business, great family, and great relationship in the community, she had a lot, but as far as planning, she didn’t have a retirement plan. I don’t think she had a will at that time, if she did it was really old. But I don’t think she had a will. If she had life insurance, it was minimal. She had no disability, and these are all things, if something were to happen to her, we’d have been in trouble, when we were kids. The business would’ve been shut down, and those employees would’ve just left and did something else, and who knows, I mean we probably would have had to go to live with our grandparents. So I realized, that’s when it started to hit me, and then I’d go and meet with another person that owned a business and it was the similar story. And then another one, and then another one. And you know, there’s lots of different variations. Some folks have some stuff done, some have nothing. I learned to never presume. Some folks think they got it all taken care of, they’re usually the ones that don’t. Oh they got all the money in the world, well, they must have all this taken care of. Well, I’ve been surprised more than many times. So, to actually get into this field, to answer your question, I just stumbled into it out of, I liked the idea of owning my own business, having control of my own hours, as any kid would. But then as I started to really meet with more and more people, starting with my mom, I realized, hey what we do is important. And we didn’t understand how important till I actually had my first client pass away. That’s when it hits you. What we do really matters, and it’s important. So don’t feel bad about following up and hounding people, because, you know, you might end up saving their family. So that’s kind of how we got into it I guess, to answer your question.
Seth: That’s a great story Blake. I think it shows, even if you kind of got into it, it was very quickly that it became very personal for you. That’s your family, your mother, respect you have for the work she put in, and to say, let me help you protect this. It would be such a shame to lose, especially for things that can be prevented when the planning is invested. So, that’s a great backstory. So just one last question for you. What makes Fellows Financial Group unique? There’s a lot of financial planning organizations out there. People may look around the market and say, oh you know, I can get this stuff from other places, but you know, what would you say, “no, you know, we’re unique here, come work with us?”
Blake: Yeah, sure. Great question. So, I’ve had the benefit of working now in two different partnerships, and from all that, and all those experiences, good and bad, right and left, all over the place. We blossomed out Fellows Financial Group. And what we wanted to do, was put together a team that felt like a family. We wanted to feel like a family atmosphere. And I think we’re accomplishing that. We’re still fairly new as far as this company goes. We’re only a few years old, but we plan on being here a long time. What we have developed is a patented planning process. We actually went and got a patent on our planning process that can help folks; from that we can take it in many different directions. Whether it’s business succession planning, incentivizing key employees, or attracting new employees. We break it down into different insurance products, retirement plans, health benefits. But what we did is, gosh, when I got into this business, I could walk in and one day I’m actually wearing all those hats. You could do that. You could be, one day you’re a health insurance guy, and I’m your estate planner, I’m your investment guy. You can’t do that anymore. The other benefit of the timeframe is, when I got into the business, it was right during the dot com bubble. So I got a taste of that right out of the gate. And then followed by 9/11, then followed by 2008, and then on and on and on. So the past 15 years, what happens when those big things happen, are laws change, and regulations instituted. So it has become so difficult. You have to be a specialist in these different areas now. So we have built Fellows Financial Group, we built it out with teams. We have a group that does nothing but group help, life, long term disability, short term disability, that’s all they do, all day long. They’re the specialists on our team. We have a gentleman that, he and his team do all the Medicare. Any Medicare questions, any social security questions, they go to that part of the team. It’s great. Cause you can’t do all this anymore. For retirement plans there’s another regulation that’s going to be finalized in April 2017. You have to have specialists that are doing that now. You just can’t have your health insurance guy doing your 401k anymore. You gotta have teams that are built out. We have a group that is very well acclimated into the estate planning, business succession planning realm. And gosh, the gentleman that heads that up, he’s been doing it for 35 years, and our team is CPA’s, tax attorneys. We don’t do documents, we work with your attorney for those. We don’t do tax returns, we work with your accountant. We try to all play well in the sandbox and come up with the best path forward based on what the goals are for the business owner and the company. So I’d say, it’s another long-winded answer, right? But when you put all that together, we are true advocates. We have built a team that are true advocates for small and midsized business owners, their employees and their families. And we feel that once we sit down and are able to just introduce what we do for 30 minutes, to really understand what it is you’re trying to accomplish, it starts to come out why we’re different. Above and beyond, actually having a patent on one of our process.
Seth: It comes through Blake, listening to you talk, I mean the passion, the expertise, and then like you said, I mean working with you guys, obviously they’re getting the full suite of expertise, not just the watered down version. And then that word advocate is pretty powerful. It’s like a true partnership it sounds like is kind of the mold that you guys are trying to forge there.
Blake: Yeah, absolutely. These are lifelong relationships we are working to build, it’s not just one-time and done. So yeah, that’s what we’re working hard for. We got a long ways to go, we’re building a pretty good family here at the company.
Seth: Alright, well people want to come learn more, your website, you guys just redid your website, and have it out there, right? We’ll make sure we post that along with the interview, so anybody can just go right on the navigation that goes with this interview and come find you, we’ll post a link to your LinkedIn profile so people can track you down if they want to talk with you, have questions, and want to learn more about what you guys do. So I want to thank you for taking the time to do this. I know I learned some stuff today and I’m sure anybody listening will as well. And Blake, we look forward to working with you again soon.
Blake: Yeah, thank you Seth. This is great.
Seth: Alright. And for the folks listening, you can always stick with Modern Da Vinci for more tips on not only the financial planning side of business, but leadership development, business growth and whatever else it is that we can help you guys be successful. Thanks and take care.
Glen Hellman is a business expert and strategist that writes and presents on the topic of “How To Pitch to the Reptilian Brain.” It’s an approach grounded in neuroscience that is designed to influence others and move them to action. In this interview, Glen shares his insights on how to use these principles to sharpen your business’s sales pitch and how they can improve your leadership and business in general.
"We talked, and I changed your thinking. Because when we had that conversation, I used neuroscience as an outline for how we discussed things. It was designed to change your opinion or to make you take action. An understanding of neuroscience helps to influence people."
"Without pain, there is no change. It's in our DNA and if we can't drive pain we're not going to drive change."
"We are very risk-averse and therefore if you don't cause pain, I'm going to stay steady state. And even if you do cause pain, the pain you cause must be greater than the risk of changing my behavior."
"Stay concrete, talk about real things that are important. Don't use jargon words. Talk to benefits."
"A well-constructed pitch is constructed around “hurt and rescue.” So you talk about the pain before you talk about the solution."
"You don't want to overwhelm them with all the things that your solution can do, you only want to present to the needs. So you don't “spray and pray.” You understand what their needs are, and you pitch to the need."
"Buying introduces risks. So sometimes we need to be pushed to make a better change."
About Our Guest
Glen is a Business Strategist who provides coaching, training, and facilitation services to businesses through his company, Driven Forward LLC.
He's founded companies, joined early teams, been a general manager of a Fortune 500, directed organizations to multiple IPOs including a $360M IPO of Progress Software in 1991, mergers, acquisitions including a 2001, $92M acquisition of Call Technologies by 3Com.
Hellman spent over a decade as a hired-gun turn-around executive in the employ investors who lost faith in portfolio company management, He founded Driven Forward to dedicate his time to preventing companies from requiring a "Turn-Around" of any kind.
Glen was trained as a certified Vistage CEO Peer Group Facilitator and Executive Coach and was a Vistage Rookie of the Year. He's a former board member of The University of Maryland, Dingman Center for Entrepreneurship, Angel Investor and advisor to CEOs all over the world. In 2012 Glen was voted the #1 Angel Investor by Tech Cocktail readers. He's a Top Rated, Global 100 Mentor out of 3,500 mentors for the Founder Institute, and is frequently quoted in print and broadcast for his views on business and entrepreneurship and served as a business analyst for ABC7, WJLA.
You can catch his musings on his blog, Forward Thinking.
Seth: Alright. Hey, everybody. Thanks for joining us here on Modern da Vinci for our latest interview. Our goal is to help our small business clients get unstuck and to grow with speed and purpose. And we recently did a post on that very topic talking about three places where small businesses get stuck. And one of the key areas we mentioned was flat-lining sales due to having a “stale pitch.” And for those of you that saw that post we shared some tips based on a very exciting and innovative concept called “How to Pitch to the Reptilian Brain” and lucky for us we have the expert behind that topic on here with us today. So I'm very pleased to introduce Glen Hellman.
Glen is a business strategist. Glen has done it all from founding companies to working in large Fortune 500 companies, to helping launch multiple IPOs, he's worked as a turnaround executive, and in the last couple of years has worked as an adviser and coach with Vistage where I met Glen, and now he's currently offering executive consulting and executive peer support through his company Driven Forward. You can check that out at www.drivenforward.com. We'll have links on the interview page on our site. You can subscribe to his blog Forward Thinking there, and Glen has been featured in the Washington Business Journal as well as on ABC channel 7 here in the area and just a few weeks ago had the privilege of seeing Glen when he presented on this topic here in the Northern Virginia area. So Glen, awesome to have you on, thanks for being here today. How are you doing?
Glen: I'm doing well. Thanks for having me, Seth.
Seth: My pleasure. So, Glen, I saw you a couple months ago maybe, and you started telling me about this topic, and immediately it connected for me. You gave me some feedback very specifically on some things related to the idea of a business pitch, and it really got my mind going. And it kind of fundamentally changed some of the things that we thought we were going to do with Modern da Vinci even in terms of, how do we tell people what it is we're trying to do and how do we draw them in? And so that was shocking for me, and then I actually had the chance to come see you speak on this again. So that's where this topic came up and got me so excited. So before we get into the details, let me step back. Why is having an effective pitch so important?
Glen: Well, in your introduction just now you underlined why it's important when you said: “we talked, and I changed your thinking.” Because when we had that conversation I used neuroscience topics, or I used neuroscience as an outline for how we discuss things. It was designed to change your opinion or to make you take action. And that's what understanding of neuroscience helps people do and influence people.
We are, while we are logical beings, we do not make decisions logically. There're tons and tons of studies about this, much of our behavior is guided by the same part of the brain we share with reptiles. It was developed 280 million years ago, it has no capability for abstract thinking, for logic, for language. And therefore, if we understand that we have a much better chance of influencing people. And the main thing in the brain of reptiles, of all vertebrates, is we avoid pain because pain means we're going to die. Without pain, there is no change. It's in our DNA and if we can't drive pain we're not going to drive change.
Seth: So when we sat and talked, Glen, I mean you tapped into that concept of fear both in terms of talking about how this could work with any potential client or somebody we want to influence, but it also tapped into the fear for me that, "Oh, my gosh. If I do this wrong, this entire business venture is at stake, and my livelihood and our interest in serving small businesses through this vehicle are all at stake." I felt that fear, it became very really for me in that moment.
Glen: And the other thing I try to do is ... we're also programmed to avoid risks, to avoid new things, to avoid new concepts. So our two major directives that are programmed into our DNA is 1) avoid pain it may kill you, and 2) avoid new situations because if you haven't seen it before, it may kill you. And therefore because of that, we are very risk-averse and therefore, if you don't cause pain I'm going to stay steady state and even if you do cause pain, the pain you cause must be greater than the risk of changing my behavior. So you've got to mitigate risk, and you've got to create pain.
Seth: So Glen, so if we're thinking about ... we're looking at our clients or potential clients, we want to move them to action, you're touching on two really key topics - one – we’ve got to decide what's painful for them so we can speak to that, and we also have to understand how do we make this something that, from that risk proposition, becomes more valuable to them than staying where they are today. So these are two sorts of core concepts to this pitch.
Now before we go further to the pitch, if we kind of take the traditional approach of coming up with a sale pitch, and we aren't mindful of these sort of tactics or strategies, and we go to the logical brain, which what we maybe naturally think we're supposed to do, what are some of the mistakes that you see businesses make when they take sort of that old school route?
Glen: So number one is being too abstract. So remember our reptilian brain, that non-human part of the brain that's going to make the decision doesn't understand abstractions. So for instance if I go into a hardware store or somebody, Black and Decker's trying to sell me drills, if they're selling me features, e.g. “that it's the best in class construction tool,” if they're selling to abstractions, well, I don't need “best in class, I don't need it to rotate thousands and thousands of rotations per second." Those are abstract thoughts.
When I go in to buy a drill, I'm buying holes, and therefore taking an engineering solution and just pitching to the abstractions, the features of this product, I'm not going to motivate somebody because they don't need a handheld device that can turn a drill bit around at X amount of rotations per minute. They just want to know, "Can I drill holes? Will it be fast? Will it be easy?" It's not being at that abstractions level or pitching to the abstractions level. That's one thing. So stay concrete, talk about real things that are important. Don't use jargon words. Talk to benefits.
The next one is people tend to prematurely prescribe a solution. So if I start telling a customer for instance or a prospect what they need; this is what you need a drill that does this, this, this. Then I am prescribing before I've uncovered or actually confirmed what their pain is. So a well-constructed pitch is constructed around hurt and rescue. So you talk about the pain before you talk about the solution. So what I would do is say, "Hey, you've got a new home, you're putting up shelves, you're doing a lot of work. It looks like you're going to need to drill a lot of holes, you're going to want a lot of holes. And the kind of work that you're doing, is it so much work that you're going to need a lot of time, can you afford to plug it in or does it need to be battery?" It's probing for the pain, making them think about it, and understanding.
And if you walk into a doctor, and the doctor says, "You know what you need? -Aspirin” before they ask you any questions or discuss with you your problems, then you're going to believe, "Hey, this doctor must be an Aspirin salesperson." You want them to ask you a bunch of questions, even if they're going to go back to Aspirin, so that you feel better that Aspirin is the solution.
When you're pitching you want to ask people and probe for pain, and even if they've come in to buy your product you still want to ask them those question before you make a recommendation and talk to them about what those solutions will be. So being abstract, premature prescribing and the last thing is spray and praying. So you haven't done any needs analysis, you don't really understand what the customer wants, and you talk about everything your product can do.
So back to Aspirin, if the customer has a headache, you don't need to tell them after you've found out they have a headache, and that's their only problem and their head hurts, and they can't work, and they can't sleep. You want to talk to them about why Aspirin is going to be good for the headache. You don't want to go in there and say, "Oh, and it also will thin your blood, and it will reduce inflammation, and it will reduce your possibility of a heart attack." You don't want to overwhelm them with all the things that your solution can do, you only want to present to the needs. So you don't spray and pray. You understand what their needs are, and you pitch to the need.
Seth: Alright, so I mean a lot of this does run counter to what I think people assume is the right way to pitch, that you go on a traditional website or even see marketing that shows up in print or on TV. There is not a listening aspect to it. It jumps right to a solution. It tries to overwhelm you with all these different features, and a lot of those like you said are abstract. “It will make your life better; it will make your business faster,” whatever it is. And so what you're telling us is it just does not compute, it's just in the brain of the person that's receiving that message, it's not going to hit those aspects that actually get them excited or ready to actually take action.
Glen: Great point. And that's why a well-constructed website will have... you'll go to the website it will have a short description of Aspirin, and then they'll be three boxes underneath - one says Aspirin for your headache, Aspirin for swelling, people who have inflammation problems, Aspirin for people with heart problems. And so that the user can say, "Oh, wait, heart problems, that's me. Go to that page and get a heart problem pitch. Not a pitch about all the other things I don't need."
Seth: Right. Okay, so we're honing in on a couple key things, listen for the pain, provide a solution that helps alleviate that pain in a very tangible way, try and reduce the risks. Now there's another aspect of this that I know you'd talked about which is making things relative, so people understand, “what is the scope of what's being offered?” Can you talk about that a little bit?
Glen: Right. So actually the way our brains work, we see things really black and white. And when our brain tries to put them together and describe relative differences, we contrast one solution over another, and it gets closer and closer. Maybe a good example, and this is a good way to manipulate people, maybe unfairly. But if any of you have seen the movie Fried Green Tomatoes, classic chick flick, one of my favorites. That chick flick thing.
So in the movie, one scene that highlights the power of relativity is, there's a young boy maybe 13, 14 years old. We know the kid, we watched him be born and grow up, we love the kid. His foot gets stuck in a train track. And as that happens and you see him pulling his foot and not able to get it out, you hear a train whistle and all of a sudden you see the train barreling down on him. And the whistles keep blowing and the train is getting closer, and you hear the wheels screeching against the track, iron on iron, and everything gets quiet, screen fades to black.
Next scene, there's a funeral going on in town, and that's very sad. We're thinking how sad this is, and the camera zooms in on the coffin. The coffin is too small to hold a person and, what has transpired is, the boy lived. He lost an arm and everybody in that audience says, "Wow." Breathes a sigh relief. Cause the kid only lost an arm, which in relations to losing his life, which is the alternative, in that scene was a horrible thing. But as a parent, I can tell you that if you told me my son was going to lose his arm, that would be a horrible thing to me.
Glen: This parent, thought they were blessed. That's the power of relativity. And it's something that you must use when you're presenting in terms of ... if you're talking about pricing, maybe ... so a men's clothing store might sell a $2,000 suit and give you two suits for the price of one. And that's a great deal. And they'll make a little bit of money off of that. But where they're really going to make money is…because you just spent $2,000 on two suits, when they show you a $200 shirt, you're not going to blink; you're going to pay full price for the shirts, the ties, the other things because relatively it's not much difference in money.
We have time for another example?
Seth: Yeah, sure. Absolutely, yeah.
Glen: Here's another one. Let's say that you are buying an expensive car - a $70,000 vehicle. And you had the options of driving to the dealership to pick it up for an hour and driving back or having it delivered to your house. When you get it delivered to your house, it's $70,000. When you drive to the store, it's $69,500. Most people surveyed, over 90% will say, "Heck, $69.5 and I got to drive an hour and an hour back. Bring it to my house. I'll pay $70,000."
Seth: Right, yup. So would I.
Glen: Now would you drive an hour for $500? Yes.
Seth: I sure would.
Glen: Yeah, two-hour drive, there back, $500, yeah. It's the same $500.
Seth: It all comes down to how my brain is perceiving the value of that in the context of where you're showing it.
Glen: Yes. So and a business example of that is, if an employee thinks they're going to be losing their job, but what you have to do is reduce their salary they much rather have a 10% salary reduction than a 100%, which is what they thought they were getting.
Seth: So as a business ladder both in terms of pitching or even just understanding this result, you're taking on the responsibility of coming up with a strategy to say, "Okay, for what it is that I am offering you I need to make this relative for you in a way that the value is on the side that's going to move you to action." As opposed to just in a vacuum what we might traditionally do is just say, "Hey, here's the price on this thing."
Glen: Right. So how you price it competitively against your competition, you may want to take out some features so that your less money, that are not valued, and sell them separately at a higher ... so that the total cost might be higher or you may want to offer a make your own ... you may want to develop a very high priced offer while you're talking to people and talking about the high price offer. So you may have, my solution normally as a $30,000 solution and you talk about $30,000, $30,000, $30,000. But that thing is so loaded that you know they don't need everything in it. And so when you show them the $25,000, solution they'll like it.
Seth: All of a sudden it seems like a great deal.
Seth: And now, so Glen, there's another ... this was really interesting when I heard you talk. This was something that stood out to me; I think it's related to this. But it's also related to the abstraction piece, and it's how you can use analogies to help people feel more concrete and reduce risk and also this whole relative thing. And you used a really neat example about, you have a choice to get on two airplanes, and you were talking about the idea of a company that would pitch something that was like a preventative solution. Was it a company that would do like a cyber security and it's the kind of thing that, "Well, you only need that if something bad happens and why do I want to pay for something unless I know something bad is going to happen?" You're trying to convince somebody that. And you used that airplane analogy. Do you remember that? Do you mind talking about that for a second?
Glen: Yeah, this takes a lot of sort of neuroscience concepts and puts them into one. One is to take something that's abstract and make it personal and understandable so that I can relate to it. The other concept though is to make something that's totally new, we're programmed to avoid new. If we haven't ... if we've seen something before, there is a good chance it hasn't killed us. And this is in our programming to avoid new. So when you're presenting something new like this cyber security company was presenting in a new arena they need to make it seem more familiar, less risky.
And the way to do that is ... so what their product does is it basically creates a fire drill for a cyber security attack. And it simulates all different ways that a company can be attacked so that the staff can ... we can test and see how they operate together, they can recognize patterns, they can do things better. But selling that to an IT director or a chief security officer who are risk-averse in this new concept may not get that. But what they will get is, they have been on airplanes, they understand the threat of being on an airplane and some of the things that can happen.
So instead of talking about what your product does, start with ... make this person feel the pain of being in a similar situation. You're on an airplane and it's just gotten hit by a lightning. Three of the four engines have gone out, the electricity is out. Would you rather be in a plane where this has never ... where the pilot has never encountered anything like this before, or would you rather be in a plane with a pilot who has had thousands and thousands of hours of simulation training and has seen this exact situation three or four times so that when it happens just like motor memory they just go in action, they know what to do. Which plane would you rather be on?
Seth: Well, considering that I'm already a slightly skittish flyer and I'm going to be traveling this weekend, I can tell you a thousand times out of a thousand I'm getting on that plane with the guy who's prepared.
Glen: And that's why the FCC requires pilots to go through thousands of hours of simulation training and testing, so that you feel better. Well, as a CSO, as a chief security officer, an IT manager, your career is at stake, just like when you're on an airplane. If you want to be the next cover of the Wall Street Journal as the company that's been hacked and ruined the reputation of the company and canned your career then you can't afford to not have the kind of pilots or a security team who can recognize these patterns quickly and go into action.
Seth: Yeah, so I mean, this is a really good example because I'm sitting here I'm trying to imagine myself sort of in the chair of this person that's being pitched to, and if you come in in that traditional method and say, "Hey, we sell this product. It's got all these great features. It's world class in terms of its ability to simulate attacks." I nod my head. That sounds interesting, maybe I'm interested, maybe I'm not. But you're hitting me really where it hurts when you have me literally imagining myself choosing between these airplanes that I had to get on. I mean, it is evoking a real emotional reaction and then the example of being on the front page of the paper as the guy who was the one who dropped the ball, I mean, that right there is hitting me in the pain point.
Glen: Right, so it's taking a very ... everybody knows about airplane simulation and everybody can easily understand the value of it and now we're just transferring that to this person's career. So an old recognized concept for a new one. Because when you go into that person to sell a simulation system what they're going to tell you is, "We have a firewall, we have all these anti-threat software, we have the latest and greatest of all the software." And you're going to hear that and you're going to listen to it in that probing part, in the discovery part - the part where you're probing for pain.
And then you might ask, "You know those are the same tools that the CEO of Walmart had or the CSO of Walmart had. And they're great tools and they work only as good as the team who can react and understand what's going on and how quickly they can react. So 15 minute reaction time may be the difference when somebody has hacked in. So finding out you've been hacked is great, but being hacked and finding it out and not being able to shut it down for an hour is a threat. And having a well-coordinated team that understands exactly what happens and what to do once you have been attacked." So they are feeling safe usually. If you're in a Fortune 500 selling a solution like that, they're feeling safe. But I guarantee you every single other company who's been hacked felt safe.
Seth: So yeah, so I mean at that point you're doing a couple different things, you're making it feel real to them and tapping into that feeling of, "Ugh." I mean, you're making them uncomfortable and then you're rescuing them.
Glen: And I know I had demonstrated this to you and others, but anybody who's been caught in traffic, going to be late for a meeting, and traffic's not moving has that irrational fear and feeling where they start hitting the steering wheel, yelling, sweating, breathing hard, in the animal kingdom that's fight or flight response. That means that while you're sitting in that car you believe you're going to die and what that means is that you've made this transfer, "If I'm going to be 15 minutes late for this meeting, customer going to be mad at me, customer's not going to buy, I'm not going to win the deal, my boss is going to fire me, I can't get another job, I won't be able to afford food I'm going to die." We equate our careers, money, these things; we actually take that and illogically turn it into life and death situations, subconsciously.
Seth: So our job being able to pitch effectively is to really be willing… it's interesting you said something earlier, almost like you could use this to manipulate people and I think this strategy is powerful and when you spend time thinking about whatever your own business is and how you solve problems for your customers…when you run through this it brings up so much. Do you feel like there is a little bit of a manipulative aspect of this, I mean, kind of are you treading into dark territory when you seek to tap into the fears of people in order to move your product?
Glen: Absolutely. But you know it's like any superhero, you can use your powers for good or you can use your powers for evil. And I mean that. When we look at things like Trump University which appears, I'm not going to say it is, but appears to have been taking people's money. If you're working for Trump University and using these things, that's evil.
Seth: Right, cause the product you feel genuinely isn't serving your clients well, so you're using it to manipulate them to sell them a phony solution.
Glen: That's right. But if you're selling, for instance let's go back to this fire drill product which there's nothing like it in the market and it is the ... relatively it's not expensive versus the alternative of getting hacked and if it truly can make your team work better and close down breaches more quickly then the problem that humans have, all of us have is ... You know, every single person listening to this has a product that you really want, that you thought about buying, and that you haven't bought.
Glen: And not every one of those products should you buy. But buying introduces risks. You may not be happy, it's changed, I have it now and therefore I don't buy it. So sometimes we need to be pushed to make a better change.
Seth: Absolutely. Okay, so I'm with you. I mean, it's like what you're saying is if you have a genuine belief that you have something that will help that client or assuming most people in business do have that intention and that purpose driving what they do and that they're not in the business of pitching scams. And so therefore this is important because it's just a set of tools that allows them to tap into what really does motivate the client, not manipulate them so much but open their eyes through a way that otherwise we might not know to do to the value of how we can help and then of course the conversation continues from there.
Glen: Exactly. And it's very similar, you coach people, I coach people. We know that we will not get them to change harmful behavior unless they recognized that it's harmful, unless they're feeling, unless it's causing pain. And therefore to get them to change a good coach probes for the pain and gets them to admit. The first step of a 12-step program is to admit you have a problem. That's what driving pain is, is getting them to admit they have a problem. And you know what? If you don't have a problem, it's going to be harder to use this for evil.
Seth: Yeah, Glen, that actually really resonated with me what you just said. Because it's true, I mean, if I'm coaching someone on leadership and they come in with the mindset of, "Hey, things are pretty good. I'm a little curious about this coaching. But things are good." It really is hard to inspire that person or connect or to create change cause to them, things are fine. There is compelling reason. Now things become very different when they come in with either, "I'm nervous about losing my job or I've gotten some feedback," kind of what we say like a slap upside the head, a wake up call.
And maybe even if it's not negative there's something they really want, maybe a promotion or to grow a business, whatever it is and they can't see the path to get there, and that also gives them that same feeling of discomfort. You're right that's what we kind of latch onto and say, "Alright, now that you're serious, now there's something that you want to accomplish, there's pain point. Now we're ready to work." And that's the exact type of thing I feel like you're describing that we can tap into with the pitch.
Glen: Exactly. And I've been fortunate; I've never had to sell for a company a product that I didn't believe in. And if you believe in your product then getting people just as if when you believe in the ... a coaching solution or an action that a mentee needs to take, getting somebody to move off of steady state, the no change mode is a good thing. But it is we are programmed without pain there is no change. I don't need to change unless I feel some pain.
Seth: Yeah, we take the responsibility to help create that. So in some way it's like ... it's not manipulating it's just helping tap into a different perspective in a new level of awareness over what is that pain and oh, by the way, I can help with that.
Glen: Yeah. And you know if there really is ... I don't believe you can create pain where there isn't pain. Now unfortunately for the Trump University people, most of those people were out of work, were worried about their careers that didn't have marketable skills they thought, and therefore they were susceptible to an “evil” pitch of this will change your life, this will make you money. There it's completely used wrong.
Seth: Yeah. What was the ... there is some famous psychic that was ... there is a whole series of articles on her. I can't remember her name of course. But it ended up being a multi-million dollar scam where they mail people, they tap into their fears and of course ask for money and then the reason you know it's a scam is they never provided any follow up service whatsoever. They just scared you, took your money, and that was the end of it. That's the evil version of using a tactic like this.
Glen: Right, exactly.
Seth: So let me ask you this. So Glen, I mean, kind of a quick recap here, I mean, we look for the pain, but we listen, we want to understand the pain point, we want to speak to how we help them move away from that. We want to de-risk what it is so that it doesn't feel like it's something new, so they feel safe with it. We compare it to other things they understand so it makes it relative and they can see the value in that. You've done so much in terms of working with businesses, consulting, working with leaders, but what drew you to this? I mean, why does this stand out for you and something you really embrace now, kind of featuring in the way you work with your clients?
Glen: So I'm 60 years old. I started working in 1978 and as a salesperson, and from that time for the first 20 years of my career I'd noticed patterns and I could learn from those patterns and I could ... a lot of these things I sort of knew intuitively that they would work. And then after about 20 years I started doing turnarounds, working for VCs, going in the companies - venture capitalists, going into companies that had the staff were completely demoralized, everybody's worried about their jobs. And it was my job to turn it around. And I was able to use some of the things I learned, patterns I saw, and things I intuitively figured out overtime to make things work.
But it wasn't perfect. And I stumbled onto a book by a Dr. Cialdini called Influence. And it fascinated me because what it did was take these things that were mythical and intuitive and started to codify them as fact. And so I started reading more and more about neuroscience and the science and influence. And science moved on so much that we really have an understanding of the human brain and why things work the way they are.
And the best way to give you an example or analogy which is a neuroscience technique of what I'm talking about is before when ancient man look at the sky and thought that the earth was the center of the universe and the moon and the son and the stars revolve around the earth, that was based on what they could observed. And they could make some predictions based on behavior but they weren't 100% accurate. Once we understood the actual way the universe was constructed and we in the solar system, the solar system worked, then all of a sudden we could predict and understand lunar eclipses, we don't have to start prescribing them to one of the gods.
And when I found neuroscience it was, "Oh, okay. That's why this happens." And what it allows you to do is instead of reacting to a pattern that you've seen before, and only patterns you've seen before, you can use this science and apply it to new situations. So you see something new and you say, "Why did that happen?" You could say, "Well, because the moon is over here on the earth and the sun is over here and therefore ..." The same thing with the brain, you can say, "Oh, I know why that happened. I know why this person will not make the decision even though I know this is a great decision for them. They won't do it because they're only thinking about how much it will make them versus how much they lose each day that they don't move forward." Because again, one of the things we're programmed for is we're really programmed to avoid lost so much that the risk of lost is why we might not move towards the game.
So an example of that would be if I have a product that will save a company $12 million a day, if that person's thinking, "Oh, I can make that decision tomorrow and get that $12 million a year." That's one thing. But if they're thinking, "Oh, wait. Every month I don't do this cost me a million dollars?" They'll sweat more. They'll feel some pain about not acting.
Seth: Yeah. It's a subtle difference. But what I'm hearing you say is after observing in all these different business settings over time, that subtle difference and the fact that science has sort of validated that there is something to do this, it's not just an intuition is that it could be the difference for a business owner or whoever leader in, do they influence people? Do they get what they need? Are they able to put their product and message out there? Or are they just out there spinning their wheels and sort of never quite being able to take things to the next level cause they're lacking the understanding of this core concept.
Glen: Yeah, in the way I define this there are eight core stimuli to get somebody to move. And if you understand what those eight stimuli are you should be able to devise a strategy to get people to move in any situation. And you know what? If you can't devise a strategy using these eight stimuli, then you probably don't have a prospect who will move.
Seth: Yeah. Right, so there's a way to look at this. I mean, not everybody is a prospect.
Seth: So Glen, let me ask you this. This is all exciting, I know you're incorporating this again with the way you work with your clients, what's next? Where do you go next with the reptilian brain concept?
Glen: So I'm going to finish the book on pitching to the reptilian brain and I've started a series of presentations on using that too for leadership and developing a culture of high performance. And the reptilian brain and how it works is evident in how we choose our leaders. In the last 150 years we have had only one president who was shorter than average, every other one was taller. Does that mean tall people make good leaders? No, that means that in our tribal brain alpha males who can lead a tribe in a kind of battles that we don't run anymore, we pick leaders through the same bias reptilian brain for a world that doesn't run that way. And so short ugly people like me who don't have square jaws are at a disadvantage.
And so what we need to do as short ugly people to make up for the rest of the world is we need to be able to model behavior and put systems in place that make people feel like, "Oh, I am safe with this person. Oh, I will go to war with this person. I do share his values." So it's how do you develop that persona and a consistent message and a culture where you can lead a high-performance culture.
Seth: Wow, okay. So now you're taking this and really transferring it not just to the sales pitch. I mean, that's one sort of narrow application of this, but that entire domain of leadership. The impact of this is huge not only ... I heard you say almost like crafting leaders, but in an organization how it creates a leadership culture.
Glen: Exactly. Yeah, I mean, because management culture ... I've always compared this when we have ... and you have children more than I. When you have kids that are under five you're a manager, and that's hard, arduous work. When they get older, start driving, not under your purview all the time, we can't protect them, we need to become leaders. We lead them. It's a lot easier. Well, that same concept of how we model those behaviors and what we want to get out of our children so that when they are driving late at night we know they're not drinking, that they're responsible.
That kind of behavior we do with our children, we need to figure out how to do that at work so that being the CEO of a company is easy because my managers know what I would do if I was in ... If I'm not there and they don't have me to ask, they know exactly what I would do and they're on the same page, they agree with it, they buy into this system, and they can do it without me. And the more you spread that out, the more easy being a CEO is and the more fluid and effective your organization will be.
Seth: That's a great sort of point to put an exclamation point on this entire discussion. Because one of the major things, I mean even going back we said I was excited to talk to you because this was an area where businesses get stuck and this was a strategy that could help reenergize them, and one of the other areas we talked about getting stuck especially in a small business setting is you as a leader are unable to transfer what you're talking about which is a set of values and understanding of purpose, a belief and accountability to a certain set of behaviors.
When the leader is unable to do that they become the one who has to do everything. They can't trust other people to basically act on their behalf or in the best interest of the organization. So this is really at the heart not only of, "Hey, improve your sales pitch but you have to adapt this entire mindset if you really believe that “I want to grow my company. Otherwise you really do hit a ceiling and you can't break through it."
Seth: Well, Glen, I want to thank you for your time. As always it's fun and entertaining. Maybe we could do another follow up sometimes cause there's so much here. I know we probably could have kept going and covered it even more. What we'll do we'll have the page on the site to go along with this interview, we'll have your website up there where people can come over and check you out at Driven Forward. They can come sign up and subscribe to your Forward Thinking blog where they can keep up with your latest. And any other plans to do speaking in the area where people locally might be able to come see you?
Glen: I have no short terms ones. I just did one yesterday at GW, but nothing in the short term. I really have to hunker down and get this book finished.
Seth: Okay, which is not an easy thing to do.
Seth: Okay. Well, I just want to thank you again, Glen. This has been great. As always appreciate your wisdom but also the insight on this and look forward to staying in touch.
Glen: Well, thank you, Seth. I always appreciate your help and anything I can do to help you, I'm on your side.
Seth: Alright, man. My pleasure.
Glen: Talk to you later.
Seth: Talk to you later.
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