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August 22, 2010

Bad customers, salesforce or products? How to improve selling by getting rid of the idiots

By Mark Faust

My son worked for one of the world’s top dog handlers who taught him one of the keys to her business success. When she was asked for what was a top strategy for continually growing her business, in a heartbeat she quipped; “Get rid of the idiots!”

Who are “the idiots?”

Anyone who robs your intended customer from any part of the value your business is meant to deliver is in this woman’s mind “the idiot.” This could be your worst customers, poorest performing salesforce employee, and even the poorest performing products or methodologies of your business.

We’ve all heard it many times, someone complaining about their “worst customer.” Frankly most businesses would have no problem listing out their top 20 worst customers. These customers don’t only cost your business profits by being high maintenance, they cost you business and profit in a myriad of ways. They are probably bad mouthing you and thus costing you potential referral business or lowering your salesforce’s closing ratio in their geography.

Improving Sales

Improving Sales

The “worst/idiot” customers probably negotiate the lowest margins and worst yet, they probably rob your sales and service teams a load of valuable selling and service time that other more valuable/profitable customers are warranting. Ultimately the idiots cost you valuable sales time and an exponential amount of growth potential.

There are also idiot products and services. These are the hardest to deliver, lowest profit margin dogs that are legacy products that should have been abandoned long ago. Yet because of the lack of a strategic abandonment process in your company or because of a nostalgic yearning for yesterday’s product and people, these profit drainers are still around.

Most companies also have “idiot” sales performers, teams, or employees who deliver abysmal performance or walk out horrid character traits, and thus your company is suffering a tremendous drag. Jack Welch grew GE for many years with significant results from firing the bottom 10% for a period of many years.

Here is a three step strategy that can help you “get rid of the idiots.”

1. Have every sales rep list their “worst customers” based on profitability, pain or overall “drain.”

2. Conduct topgrading throughout your salesforce team and employee base; A performers, B performers and those who ideally you’d like to replace…for whatever reason, but especially for poor character and poor selling performance.

3. Make a list of all products, processes and protocol in your company that if you were beginning anew, would not make the cut in today’s environment

Now create teams for each of the above lists. Strategically “fire” your idiot customers who cost you growth and who rob your intended ideal customer market. If you are afraid to make the step, just do it with a fraction of the idiot customers, choosing only the worst of the idiots and watch closely what happens in those territories.

Next, closely consider who you could replace with better talent. This current economy presents one of the greatest employer markets for finding and hiring top talent. It is almost impossible for companies with a salesforce of more than 20 people to replace the bottom 2 and not make a marked improvement in production.

Finally consider all of the worst products, services and procedures of your company and have teams systematically eliminate and replace as many as you confidently can. This is a heart of continuous improvement, innovation and profit improvement.

Great opportunity abounds for the companies who aren’t afraid to fire the idiots and focus on their ideal customer. With your ideal employees and your best products and services this is the market in which the “idiotless” will thrive.

1 Comment

  1. I’ve always felt that customers, prospects, and employees all have an utility level and an aggravation level and as long as the utility level exceeds the aggravation level, I’ll put up with just about anything. Once the aggravation level exceed the utility level, it’s time for a change.

    I have “fired” more than one customer in my over 40 years in business.

    Comment by Brian Jeffrey — August 24, 2010 @ 11:11 am

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