The Last Dollar of Profit Starts on The First Day of The Fiscal
It just happens that I have a client in the final throes of their fiscal year end on the coincidental same month that most humans in general begin to saw off their personal accountable time frames and declare an annual fresh start to everything; December.
Any date can be a year-end of course, and regardless of when it arrives, a ritual begins to play out just a day or two after the third quarter internals start to circulate. For a brief time, this will all be high level swirling…as a sales leader, no one has pulled you aside yet, but it’s coming. You know something’s brewing because you’ve noticed the bean counters wearing a second set of readers perched on their heads augmenting the one’s dangling from neck cords. They’ve been boring into the numbers. Ha! Boring …ah… And they look concerned.
I’ll just pause for a quick second to recognize that the “numbers” folks always look concerned no matter what the year is shaping up to look like…but you are a leader of the people who actually make the numbers, and the margin minimums and the EBITDA in many cases, and no matter how comfortable you may feel about your standing at Q3, that bean counter concern is going to manifest itself into a meeting known as a MFQ and you are the guest of honor. Oh sorry, MFQ stands for “Modified Fourth Quarter”. Having a great year? This is where you find out you are about to have an even greater year..’cause your numbers just went up by X%. Having a regular year? Horrible year? Doesn’t matter. You and your team will need to throw the afterburners on and get the recalculations done. The good news that I’m happy to report is; complaining about the rank unfairness of the new marching orders does, in fact, make a difference. Perhaps though, not the difference you’d like.
If you are rubbing your hands together in anticipation that I am going to give you the silver bullet answer of how to manage your team through the dilemma of the fourth quarter, you are going to be sad. Because the solution to the tragedy of Q4 starts on fiscal day one. And it begins with answering honestly, for yourself, this Q4 question; “Why do the bosses think there is any extra business in the market that we can get now”? Sit down, this is going to hurt. Because there is.
The tragedy I refer to is weighted to the burnout on the sprint, the need for a physical Q1 recovery and the nagging reality that a goodly portion of Q4 incrementals that nearly killed the entire front line are just next Q’s actuals. Goodly is not a real word but you get my drift.
Stop the crazy cycle. Here’s how. This is what they teach at Boss School, that they don’t teach at Sales Reality School. There are three ways to evaluate a market sector in which all competitors fight to snag their pie wedge. You are no doubt intimately familiar with two of these…the actual year and the budget year . The first is a defined and accurate measurement and the probable basis of your bonus check, the other is someone’s idea of what a collection of super-hero salespeople can achieve in the absence of any market kryptonite.
The third is the far less known “True Market” and envelopes a multitude of measurable and immeasurable dynamics…mostly things that you would argue, but nonetheless, frustratingly for bosses who are clued into it, really does exist. It’s a surprising amount of money and it was all near someone’s fingertips at some point throughout the past fiscal. In its most simplistic definition, it’s all the deals we could have done, created, expanded, invented, bogarted away from a competitor or otherwise conjured, but did not for reasons ranging from straight up laziness to no time left in the day.
Before you flip out I’m going to give you an example. I have a client in the national newspaper business…yeah, I know…it’s like they have a built in excuse for diminishing revenues, except the company leader thinks otherwise and at a recent meeting when eyes begin to roll as he starts to yammer on about missed opportunities, he parades out a report that quantifies in actual real dollars that $35 Billion of unclaimed coop marketing funds evaporated in the last fiscal. That’s not a wishful thinking number, that’s an actual earned money pool that really existed on budgets all over the place just waiting to be picked off by someone. Don’t believe me? Google-Unused Coop Marketing Money.
Every single industry has a True Market, including yours. Accepting that existence gives you an advantage over your competition in 80 different psychological ways from Sunday. Steering your team into a True Market regiment … well, that just means you’ll be forging an elite group of sales masterminds that will be the awe of your industry sector…ain’t no thang.
It doesn’t matter if today is the first day of your fiscal or your six months in, you need to direct your leadership towards bolting a True Market strategy onto the hood of your fiscal budget strategy.
Now it’s been pointed out to me that I come from an era when you could just tell people what’s what, but according to the HR specialist, it’s better to recruit “buy in”. At least the word “buy” is there. So do this. Er… I mean, buy into this.
Facilitate a team meeting with one topic of conversation: True Market
Hustle your team onto a call or carve out an hour at the beginning of a sales meeting and introduce True Value. Prove it exists by giving examples relevant to your business of dollars that just vanished into thin air. Stay on this topic until everyone agrees that with some attention, a bit of a plan and some elbow grease, fresh dollars can be added onto the actuals.
Create a team list of True Market operating Rules and Guides As a group come up with a list of items that your team thinks is relevant to True Market in their territories. Here are some examples. Rule One: Acknowledge, embrace and own this market truth: Deals exist even if your can’t see them. Rule Two: There are more dollars in the market than you think there are. Rule Three: There is never a bad time to make a sale. Rule Four: Excuses make you weak. Rule Five: Every possible sale gets sold everyday. Rule Six: Not a single opportunity slipped through my net today…not one.
Whenever you review sales progress, be it daily, weekly, monthly or whenever, incorporate True Market questions into that conversation. Did we leave opportunities out there? Yes, No Did we somehow allow productivity to leak out? Did we maximize every single customer relationship? Did we discover new pockets or boutiques segments? Did we outsmart our rivals?
This focus is going to achieve a multitude of pile-able rewards, but the two that will run deep inside you will be these; this is going to make your competition nuts and the boss you never see is going to have a team picture of you guys on his desk right beside his granddaughter’s softball championship pic.
Sales legends begin with sales leaders. Drive your team to the riches that blind your competitor.
Sample segment intended for informational review only. All segments are copyright © 2020 Douglas Martin and WSB Corporate Learning Initiative