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6 Keys to Change Management: VitalSmarts Bestsellers ‘Influencer’ and ‘Change Anything’ Even Explain How to Lose Weight!


(This is an expanded version of the second article on managing change and business transformation… and weight loss! — Ken

Why is it so hard for companies and people to change?

My long time neighbor Ron McMillan recently co-wrote two amazing books on change: Influencer: The New Science of Leading Change, and most recently, Change Anything: The New Science of Personal Success.

Ron helped found Vitalsmarts and he and three other colleagues are probably most known for writing the New York Times landmark bestsellers as Crucial Conversations and Crucial Accountability. Ron was unavailable for an interview but his co-author David Maxfield joined me for half an hour on the topic of change management for companies and individuals.

I was sitting on my phone, taking notes in Evernote at a table at Roxberry, drinking a green smoothie to lose weight as I listened to David.

I had already heard he and his colleagues speak several times on these critical topics at BYU Education week every August.

The book Influencer is already on it’s second edition and is currently ranked in the Top 20 on Amazon in three categories.

Influencer stresses the importance of leadership in helping others change.

Change Anything is about changing yourself.

I asked David, “Why did Vitalsmarts choose the topics of change leadership and changing oneself?”

David responded, “Because change management isn’t working.”

“The Standish Group says 9 out of 10 large scale IT engagements don’t deliver on time, within budget, or to the specs that were promised.”

“At the more mundane personal level, we spend $2 billion a year on diets, but 19 of 20 people lost nothing but their money. Stanford studied the top 3 diets available and found that they all work… if you stick with them. But almost nobody does. We can’t live up to the change commitments we make.”

I said, “Wait, don’t call weight loss mundane! I represent that remark!” I at least lost 13 pounds on my last very expensive dietary adventure.

I go on, “So let’s attack both directions; how to change an organization and weight loss. Every day we have leaders in companies come to us to help them change their technology, but they don’t want to change their behavior or their culture. They’ve been working under the traditional sales model for decades. They have salespeople going face-to-face all over the country. They are faced with competitors who are generating web leads and inside sales people on the phone and they are getting hammered. They pull me aside privately and admit they don’t have the skills to actually change.”

I continue, “They buy salesforce.com, they hire sales trainers. They try to get marketing to stop worrying about un-trackable advertising and branding and start generating web leads, but nobody wants to change. They can’t get the reps to make the calls, to use the CRM, to follow the skills training. They can’t get marketing to focus on all that matters… leads!”

He laughs. “There are two forces at play here. Those things like technology, tools, and skills are above the water line. You can see them. But then there is everything below the water line: The cultural norms, what people do, the internal politics, the things you have to do to get things done. Change stops when it hits the iceberg below the waterline.”

“Here’s an example,” he continues, “Hospitals in the US are all trying to get 100% hand hygiene. There are 100,000 deaths a year in the US alone because people don’t wash their hands enough in hospitals. We stress what we call 200% accountability; for you, and for everyone else.”

“If you are a housekeeper cleaning the window, you wash your hands. And you better speak up to the surgeon who hasn’t washed her hands who walks in the room with the patient.  But that is hard, very stressful. That is countercultural. Housekeepers don’t speak to surgeons, nurses don’t even speak to surgeons.”

“Unless you change that norm you don’t get hand hygiene. Putting up posters doesn’t work. But if you can change this one thing, you change all other areas of patient safety and cost control because you address personal factors, social factors and the environmental factors of change.”

I joked about drinking my Roxberry and my own crazy cycle of weight loss in a high stress environment. I asked David next, “So tell me about these six sources of influence.”

He responded excitedly, “Before the six sources of influence you ask two questions: Can I change? And, will it be worth it?”

He goes on, “Then you dive into personal motivation and ability, whether others around you enable or disable you, whether there is a system of incentive and if your environment makes it easy to do the right stuff, or tempting to do the wrong stuff.”

From his book, “Influencers do three things better than others. They are clearer about the results they want to achieve and how they will measure them. They focus on a small number of vital behaviors that will help them achieve those results. They overdetermine change by amassing six sources of influence that both motivate and enable the vital behaviors.”

The Influencer teaches how to master six sources of influence from psychology, social psychology, and organizational theory:

Personal

1-    Personal Motivation: Help Them Love What they Hate. Work to connect vital behaviors to intrinsic motives.
2-    Personal Ability: Help Them Do What They Can’t. Build personal ability to do behaviors through deliberate practice.

Social

3-    Social Motivation: Provide Encouragement.
4-    Social Ability: Provide Assistance

Organizational

5-    Structural Motivation: Change Their Economy. Attach appropriate incentives or sanctions to motivate people to pick up or stop vital behaviors.
6-    Structural Ability: Change Their Space. Things such as systems, process, reporting structures, visual cues, work layouts, tools, supplies, and machinery support vital behaviors.

Combining all six of these sources of influence help an Influencer overdetermine change.

I ask, “So tell me about your newest book, Change Anything.”

He responds, “We challenge you to escape the willpower trap and evolve a plan that works perfectly for your subject: you.”

He goes on, “When people can’t change, it’s rarely because they lack the will. They are blind and outnumbered: They’re blind to all but 1 or 2 of the 6 sources of influence… and there are far more sources under the waterline working against them than there sources acting for them.”

“People who see and use all six sources of influence are 10 times more likely to change and create change.”

“We all think we have the power to change just through our force of will. We know we should change. We want to change. But we don’t change!”

“That calls into question the belief that we actually do have power to change on our own. We call it agency.”

“The numbers say we don’t have as much as we think we do!” I pipe up.

He continues, “In the book we quote research that shows: 85% of efforts to drive new behavior in organizations fail. 87% of employees have suffered economically because they didn’t change. Only 1 in 5 American adults are financially prepared. Only 1 of 10 couples in marriage counseling actually stay together. 90% of those getting coronary bypass surgery are back to the same behavior within 2 years.”

Then his tempo increased, “4 years ago we studied 5000 people who tried to change. 4400 failed. 600 succeeded. How much more successful were the 600? As I said, they were 10x more likely to change. Why? They did 6 things better.”

He lists them, so I number them:

  1. They learn to love what they hate.
  2. They learn skills to do that they couldn’t.
  3. They recruit accomplices to help them change.
  4. They remove the accomplices that stop them from change.
  5. They use or lose incentives to help them change.
  6. They control their space, their surroundings, to make it easier to change.”

“They focus on the 6 sources of influence, 6 levers they can pull, rather than endlessly tugging on willpower alone.”

So I stop him, “So where do you begin? How does a business leader start?”

He responds, “Ask first… is the problem worth solving?”

He laughs, “My dad always said, ‘If something’s not worth doing at all, it’s certainly not worth doing well!’ So build a business case. In the hospital example we call it a clinical case. Is it worth it? Or more important, what happens if you don’t change?”

“Ouch!” I say, “I better stick with my green smoothies! So teach me to lose weight, what would you tell me to do?”

He eagerly responds, “Start with what we know. Calories. Eat right and exercise. Track progress. If you are normal you will encounter setbacks. Instead of being frustrated, turn a bad day into good data. You are a scientist. What were the ingredients of the setback?”

“Let’s say you stop at Starbucks, you are late for  a plane, you order a beverage with 3000 calories. Then later you say, Dang! That was a horrible thing to do for my diet. What was I saying to myself? I skipped lunch. I’ve been standing all morning, I deserve it. I’m worn out, I’m tired.”

“Should I say something else to myself?

“Identify crucial moments when I fail. The 6 sources come in when I light up an exercise strategy. Are there obstacles that I can turn into advantages. My plan is to run an hour for 3 days a week. Personal motivation. What do I dislike most? The place I run. Indoors? Go outdoors.”

“Do I love music playing? Download your favorite songs to your iPhone 5s. Get a carrying case to strap on your upper arm. Maybe there are a new pair of shoes to make it more pleasant.”

“That us Personal motivation.”

“Personal Ability? Learn more about running groups. Learn a new exercise for when it’s raining or my knees are sore.”

“Social motivation. Partner to run with, email a partner when you run. Have them email you also.”

“Social ability side. Maybe I need to work with my spouse to free up time with me in the morning, she fills in, then I help her out in another time…”

“Structural. Incentives work. If I can find short term rewards for myself it makes a big deal. Also, put skin in the game. Put something at risk.”

“My neighbor is on the Olympic Nordic combined team. His coach asked him to lose 10 pounds. Strict diet. Weigh food. Exercise. He decided to put a pile of $20 bills on the mantle. Every Friday his wife and daughter would evaluate whether he did good. They would so something fun or burn the $20 bill in the fireplace. Yale expert Dean Carlin studied that and found it is very effective.”

“Structural Ability. How about a heart monitor. New shoes. Identify more trails. Moving to a location on a trail. That is changing your environment to help you succeed.”

I interject, “So I’m stacking the deck every possible way for my success! Where does building a predefined plan fit in?”

He responds, “It would fit into defining Vital Behaviors. We often map out a plan, it really starts getting meaty when you get setbacks. Here is a crucial moment when you combine 6 sources of behavior.

“Who is the german general said there is no war plan that withstood the first battle? You have to extemporize. It was often cited by Henry Kissinger.”

“No plan of operations extends with any certainty beyond the first contact with the main hostile force.” – Helmuth von Moltke the Elder

I’ll try and find the quote. With the interview coming to a close, I ask, “Of the 6 variables, which is the one they don’t do? And what are the easy ones?”

He chuckles, “Couple of different answers. Easy answer, people are different. That is a copout. I was working with the leader of an addiction center. He said he  can put all sources in place for a Hollywood starlet, but they have to want to change.” Personal motivation is first. Agency, or what little they have.

He went on, “The ones they underplay the most is the social support. Adding a social element, getting a partner. Many times the people you think of as friends, are accomplices. They enable or discourage the wrong stuff. Your friends won’t tell you to lose weight, if you give them permission they will help you. If you don’t, they won’t.”

It finally dawns on me, “So I guess I get my friends involved, especially my wife Crystal. So what’s first, how to get started? Where do you begin?”

David concludes, “Is it worth it? What is your default future? If you don’t lose the weight, what will happen? Where do you want to be? Can you visit it and make it tangible?”

I start thinking that it’s hard to lose weight. But it’s also hard living life without losing weight. Which life do I want?

“Ok,” I respond, “I’m in.”

Long interview, breakfast is over. I order another green smoothie for lunch. 132 calories, light and lean. Fresh Pineapple, celery, other green stuff.  I wonder if I can do the same for dinner.

Time to change.

Author: Ken Krogue | Follow me on Google+
Summary of Ken Krogue’s Forbes articles

The Seven Trends of InsideSales.com


I get asked all the time what makes us so successful… As I’ve thought about it, We find, ride, and sometimes even cause trends. We need all the leverage and help we can get. Always build a new business on upward trends. The first article I wrote for Forbes shared a few ways we look for trends: 3 Google Tools to Check Before Starting a Business.

My favorite sales and marketing maxim is Divert a River, Don’t Dig a Well. What does it mean? Think about it.

We are told a good company rides one trend, a great company rides two; we are trying to ride and drive seven notable trends at once.

  • Cloud Software and Telephony: We were the first company to combine CRM software with dialer technology in the cloud. When Dave and I founded InsideSales.com together he had a web development shop, I was at the last company I helped found called inContact. He had hosted customer database technology, I had hosted dialer telephony solutions. We blended the two together in a new kinds of hybrid application that opened up all kinds of new synergies. Thanks to salesforce.com, who really put cloud computing on the map, and who is our favorite and best business partner, we have enjoyed riding this extremely powerful trend. We also new this new combination of technology would play best in the emerging new world of inside sales.
  • Inside Sales: 10 years ago we new we wanted a very powerful name. We went out to Google and typed in the phrase ‘inside sales’ and found 40,000 companies hiring people, but not a single competitor, not a single ad. We knew we wanted our company name to be the name of the new category of business that was emerging. Everyone else saw it as the name of a department in a company, we saw it as a new industry emerging out of a profession. We are now the leader in automation technology for professional sales people who sell remotely. Inside Sales as an industry is growing 300% faster than traditional sales. Right after the crash of 2008 a research study done by infoUSA and Dr. James Oldroyd showed that what was now the emerging inside sales industry was growing 15x faster than tradition outside or face-to-face sales. it was counter-recessionary, actually growing in the worst economy of our lifetime. Now it is still the fastest growing segment of all of sales and marketing.
  • From the Short Life of Online Leads, Harvard Business Review

    From the Short Life of Online Leads, Harvard Business Review

    Internet Lead Response: Google and the Internet has changed the way leads are generated for business and we invented and patented the ability to respond to web leads within seconds instead of two days like companies do on average. We found through research that there are incredible benefits to be gained by responding very fast to web-based inquiries. This trend came after the landmark 2007 research study by InsideSales.com and Dr. James Oldroyd while working at MIT. It was done again by he and our own CEO, Dave Elkington, and a brilliant professor at Harvard Business School by the name of Kristina McElheran. It was called the Short Life of Online Leads. We were excited when the research was again published by Inc. Magazine. Eric Markowitz is a well known writer for Inc., Vanity Fair, and the Washington Square News and summarizes the research of Dr. James B Oldroyd and our own CEO, Dave Elkington. His Inc. article on July 6th, 2011, is entitled “How to Best Harness Inbound Marketing Leads.”

  • Gamification: When Dave and I started the company we were both enamored with the book called The Game of Work by my friend Charles Coonradt, who I call The Grandfather of Gamification in a fun Forbes article I did. We have helped turn sales work into a game for nearly ten years and were recently ranked the 7th best platform for Gamification overall and the only one focused on helping sales people specifically. We find sales increases nearly 10% using gamification principles, but engagement in system usage increases upwards of 50%. The Millennials and surrounding generations grew up on video games, World of Warcraft and Mario Kart. Make work fun, keep score, provide immediate feedback, display personal and team achievement, and good things happen.
  • Predictive Analytics: We have used predictive analytics for 7 years to help sales people know who to call and when to call to dramatically increase results. After the research by Dr. Oldroyd, we wrote algorithms that moved the predictive capability out of the old predictive dialer model and into the database. Instead of predicting how many lines to call at the same time to annoy people at home during dinner time, Dave and I felt we would rather move use predictive analytics for professional salespeople and help them know who to call, and when to call. We knew we were on to something when our Predictive 2.0 model tripled sales against the leading saas predictive dialer at the 2nd largest home security sales company in the world. Since then we have added machine learning and even artificial intelligence capabilities and things are getting more predictive all the time.
  • Big Data: We not only use internal data to predict but we now tap live feeds from incredibly huge external data sources like the weather, stock markets, gas prices, and much more to increase our predictive capability as well. We hire PhD’s in areas usually reserved for think tanks and academic circles to feed Dave’s passion for data and the need for smarter technologies in the world of sales. Sales has been slowest of all to bring in these new technologies, but sales is the last to shut off the light when things struggle, and the key to success for every business. So when sales engages, look out.
  • Sales Acceleration: Several disruptive trends in the market have combined to create massive demand for InsideSales.com sales acceleration technology. There are dozens of software applications in nearly 20 categories of sales automation that has been called the sales acceleration category. We are the only sales platform in that space that ties together many of these different applications in one place to dramatically increase the velocity of selling.

One of my favorite thinkers, Clayton Christensen, tells of an eighth trend surfacing that we are now gearing up for. I call it Disruptive Consulting. Read about it in his awesome article called Consulting on the Cusp of Disruption.

 

Author: Ken Krogue | Follow me on Google+
Summary of Ken Krogue’s Forbes articles

 

Brad Pitt, Oakland Athletics, And Moneyball: Still The Model For Change Management, Business Transformation And Predictive Analytics


This article about the winningest team in Major League Baseball this year made it to #5 on the Forbes Most Popular list. – Ken

Brad Pitt, Oakland Athletics, And Moneyball: Still The Model For Change Management, Business Transformation And Predictive Analytics

Brad Pitt, Oakland Athletics, And Moneyball: Still The Model For Change Management, Business Transformation And Predictive Analytics

I started writing this article from a hotel room in Oakland, California. I’m within walking distance from the stadium used by the Oakland A’s, the only professional baseball franchise that shares their playing field with the local pro football team in the country.

The Oakland A’s changed the way the game of baseball, and all professional sports are played. They transformed an entire industry forever by using math and statistics to choose players and make decisions.

Science over 150 years of art.

They figured out they are in the business of winning.

Just how good are they?

Moneyball by Michael Lewis inspired the movie by the same name, starring Brad Pitt

Moneyball by Michael Lewis inspired the movie by the same name, starring Brad Pitt

Billy Beane, who was played so convincingly by Brad Pitt in the movie Moneyball, is the General Manager strapped with one of the lowest budgets in the country out of 30 teams, yet they are tied for the most wins of any team in the 2012 and 2013 seasons combined (94 + 96 = 190 wins.)

As of today, half way through the 2014 season, they have 59 wins and 36 losses, the top record in all of Major League Baseball.

Is it working?

Results over time don’t lie.

A decade after the original Moneyball book written by Michael Lewis shared the secrets of using math to make decisions, the strategies are still paying off.

I loved the movie when it came out in 2011.

It told the story of the 2002 Oakland A’s, with a payroll of $41 million, who had to be competitive with larger market teams like the New York Yankees, whose payroll topped $125 million the same year. They were not only competitive, they tied with the Yankees at 103 wins, won the division and 20 straight games that year, and forever changed the world of professional sports.

In 2013 the Los Angeles Dodgers started the season with a payroll of $213 million, the New York Yankees close behind with a payroll of $210 million. Oakland paid out 60 million.

If you own or run a business, watch Moneyball. If you’ve seen it, watch it again.

The Oakland Athletics, led by Billy Beane, have mastered the concept of change.

We invited Billy to keynote our 1st annual customer conference in Park City at the end of May this year. He held us spellbound for over an hour. He swore us all to silence, so I won’t breath a word about the amazing stories and strategies he told.

Not a word…

Suffice it to say he is the real thing. Business, and entrepreneurs in particular, can learn a lot from Billy Beane and the Oakland A’s about change.

A lot of skeptics have come and gone. In 2011, Sports Illustrated ran an article, “The Art of Winning An (Even More) Unfair Game” with the introduction:

“Eight years after it forever shifted baseball’s tectonic plates, Moneyball is a Brad Pitt movie, but its ethos has changed. Intellectual firepower is mandatory, but no guarantee of success now that the game’s financial giants have cracked the code. Competitive advantage: Red Sox.”

Let’s see, hmmm, Red Sox 43 wins and 53 losses so far in 2014.

Billy Beane has changed things again.

What is change? It is to make a difference, to become different.

A person changes.

A team or business transforms.

When a consultant helps a business change they call it transformation because they can charge a lot more the bigger the word or phrase they can coin. You can’t copyright and trademark simple and clear concepts.

In education change is called learning.

In religion change is called repentance.

Same concepts.

Youth want to change the world and still think they can. Their elders worry they are too old to change, yet they often have the power and wisdom to effect big change, though young entrepreneurs who are successful often gain the power to affect big change, we just hope there is some wisdom also.

Technology is the lever of young entrepreneurs to make change. Science tries to explain why the technology actually works and whether it can continue to work.

The predictive analytics model that Billy Beane and staff use they call Sabermetrics. They find undervalued players who are much better than their paychecks indicate… using math.

Now I know what to tell my kids when they don’t like doing their math homework.

It pays…

Stay tuned, this is 1 of a 3 part series on Change Management and Business Transformation

Author: Ken Krogue
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The Two Riskiest Things I Ever Did in Business


This article just appeared on page 33 of the Summer Edition of Business Q Magazine, it was an interview I gave to Brianna Stewart.

The two riskiest things I ever did were two sides of the same coin: working for myself, and working for somebody else… let me explain.

From an interview I did for the Summer edition of Business Q Magazine

I have always been a serial entrepreneur, but in one early company I went out on my own way too early, before I knew how to run a company. I lost a lot of money. My first big adventure was when I worked with a partner in a computer consulting company and we bought out the previous owner, only to find my new business partner was not honest. I lost $70,000; about what a nice graduate degree in business would cost me.

I call it my MBA from the school of hard knocks.

Big mistake.

I wasn’t ready.

I didn’t know what I was doing. I should have learned my strengths and weaknesses on somebody else’s dime. I figured out later that I excel at the strategic side of sales and marketing, not managing business. I went to the Naval Academy and I love military strategy. It took me a while to translate that knowledge by mapping it onto sales and marketing strategy.

It’s like when I coached 9 years of youth football. 8 of those 9 years I coached the defense, my love, my background, and my skill. I can count the games we lost in those 8 years on both hands. The year I tried being a head coach I don’t think I even had a winning season. Find your strengths and bet on them.

This is the cover of the summer edition of Business Q Magazine that just interviewed me. This is Jayson Edwards, the Founder of JDawgs, the best hot dogs in Utah.

This is the cover of the summer edition of Business Q Magazine that just interviewed me. This is Jayson Edwards, the Founder of JDawgs, the best hot dogs in Utah. Read his story, it’s pretty awesome!

My second big mistake was working for somebody else too long. I started the original inside sales department at Franklin International Institute. In the early 90’s we were the 2nd fastest growing company in the US, before they merged with Stephen R. Covey’s company. I built a massive organization for them and didn’t have enough ownership equity to buy a car. I risked all of my hard work for very little. To me the biggest risk is to have somebody else in charge of your future.

My dear friend Oliver DeMille reminds me that a hundred years ago 90% of Americans owned their own farm, shop, or business. They were entrepreneurs.

They were owners.

Now 90% of Americans work for owners and entrepreneurs and control very little of the variables that affect their lives.

They are employees. To me that is very risky.

The next opportunity came and I co-founded what is now inContact. I gained enough equity to launch my future, and I was in a position to help control the variables that put that future at risk.

After that Dave Elkington and I founded InsideSales.com. I learned to join forces with an absolutely brilliant business partner that was world-class great at the things I was not good at. While I was able to bring my strengths into focus and really excel at what I am great at. It was very little risk. Being an owner when you know what you are doing is very little risk. And having a little help from upstairs is the least risk of all!

Author: Ken Krogue
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Cloud Computing, Predictive Dialers, Gamification, and How We Got the Name InsideSales.com


This is section 2 of The Story of InsideSales.com

CLOUD COMPUTING AND TELEPHONY

One of the very first things we did after we started InsideSales.com and built out our technology was that we calculated how much it would cost a company to purchase this technology in-house, it came to nearly $650,000; we offered it for rent for $135 a seat plus 2 cents per minute. We handled all the headaches and hassles of security, maintenance, upgrades, and uptime. We brought enterprise class technology to any size business without an enterprise-size IT staff. We soon found that IT loved to wash their hands of those pesky salespeople and turned it over to us who do it for a living so they could focus on the core of what they do for a living.

In 2004 we partnered with my old company inContact but they had their business to run which focused more on inbound call centers rather than sales, so we decided to build everything we needed from the ground up. Dave had Thomas Purdy and Rob Christensen who pioneered a rapid application development platform that completely blew my mind. We got projects done in days and weeks, not the months and years I had seen it take at my previous companies. I would come up with an idea and Dave would have it in production in a couple of weeks. Within six months the whole platform was working.

Tom Pilkington, the VP of Sales at PeopleWise, a subsidiary of LexisNexis that was our Founding Case Study.

Tom Pilkington, the VP of Sales at PeopleWise, a subsidiary of LexisNexis that was our Founding Case Study.

We showed it to 5 companies, 3 of them bought it, 1 was PeopleWise, a subsidiary of LexisNexis.

Dave and I both agreed on a few main things, we hated telemarketing, and we loved the Salesforce.com model.

 

PREDICTIVE DIALERS

Telemarketing used a 30-year-old technology called predictive dialers. Aggressive marketers abused it so bad the FCC had to dramatically limit it’s use and we wanted no part of it. You know, it’s that call you get at dinner time with a pause, click, and voice comes on and says, “Please wait for the next available representative”, and you think, “Wait a minute, you called me!” It’s that call where you have to say “No!” seven times before they let you hang up.

It’s why Do Not Call was implemented. As I mentioned, “Tele” was and still is a four-letter word.

We decided to take a different approach.

We wanted to call businesses.

There was no dialer technology at all for for B2B.

We wanted B2B and large ticket B2C only, no telemarketing.

So instead of using the brute force predictive technology that predicts how many calls to make at a time in hopes of getting a live answer to route to a rep, and hanging up on anyone else who happens to answer, we decided to use a more elegant Power Dialer strategy that puts the salesperson in charge of the experience, and moves the Predictive Analytics into the database. We called it Predictive 2.0.

Then we would build all kinds of little “power tools” we called them, to leverage everything they did.  Our favorite was a voice messaging tool where a salesperson could record their own voice in a library of messages for every situation, and when they got to an answering machine, they would wait until the “Please leave a message at the tone” and with a single click of a button, leave their 30 second message and already be on to the 2nd or 3rd call before it even finished. And the person at the other end didn’t realize it wasn’t the salesperson who took the time to leave them a message.

Dave and I firmly believed we could build a whole new kind of experience that didn’t burn out salespeople or their prospects.

 

Chuck Coonradt was the author of The Game of Work that dramatically affect Dave Elkington and I when we started InsideSales.com.

Chuck Coonradt was the author of The Game of Work that dramatically affect Dave Elkington and I when we started InsideSales.com.

GAMIFICATION

We also decided that we loved the Inside Sales way of life: Work hard, play hard.

Put in a good day, then go home and have a life. It fit who we were, and all the Millennial’s who we were hiring. Dave and I love a book called The Game of Work. It was the story of Charles Coonradt, who consulting with companies to increase their productivity and employee morale. He noticed that the same employees who plodded their way through the day at work, would all scramble out to the parking lot during lunch hour and put their heart and soul into winning a pickup basketball game where they didn’t earn a dime. Then come back to work and trudge through the end of their day.

I had done some research while at Franklin where we were trying to find what made our best performers. I had interviewed nearly 400 people and had 70 great performers: A background in athletic achievement. Great athletes turned into great salespeople. I think it is the practice, the repetitions, keeping score, watching the numbers.

So from the very beginning we tried to use these principles to Gamify our software solution. We tried to give the data to the salespeople long before the Gamification craze came into being in 2010. We started with the Athletic model from the Game of Work, and folded in the Game Mechanics model when we realized every Millennial on the planet grew up playing Mario Cart, Starcraft and World of Warcraft.

Charles made quite an impact on our company! I recently wrote a Forbes article calling him the Grandfather of Gamification.

 

One of the original logos of InsideSales.com

One of the original logos of InsideSales.com

INSIDE SALES

We needed a name.

I told Dave that the best possible name would be the name of the web category we were creating… InsideSales.com. We tracked down the guy who owned it, he first wanted over six figures. Dave put his negotiating chinese water torture techniques to work and the guy called us back right before Christmas and said, “I need $3000 today, if you can get it to me, it’s yours.”

We went out to Google and typed in “Inside Sales” and there wasn’t a single ad, it was blue ocean.

There were 40,000 companies in a row trying to hire professional inside sales people, we knew there was a serious trend building. The 1st week of January in 2005 we brought up the website and got 8 leads the very first day. Today we get 750 inquiries a day. We had built the ultimate cold calling technology, but never made a single cold call the first several years of the company, we were to busy responding to leads from the web.

Inside Sales was already a profession, but it wasn’t an industry. People like Trish Bertuzzi, Anneke Seley, Art Sobczak and many other notables had already spent years solidifying the inside sales profession.

Bob Perkins is the original founder of The American Association of Inside Sale Professionals that helped make Inside Sales and industry

Bob Perkins is the original founder of The American Association of Inside Sale Professionals that helped make Inside Sales and industry

There were people making cars by hand before Henry Ford built his assembly line and put a conveyor belt on it. But he built the profession into an industry and built the American middle class.

Our strategy was to help form an industry out of what was still perceived only recently as a 2nd class department that was taking the scraps off the table from the old timer field salespeople who had been in power for 100 years.

We saw change coming. We didn’t know that the crash of the economy in 2008 would be the biggest catalyst for change of all.

Larry Reeves is CEO of The American Association of Inside Sale Professionals that helped make Inside Sales and industry

Larry Reeves is CEO of The American Association of Inside Sale Professionals that helped make Inside Sales and industry

A few years later we got fully behind Bob Perkins and Larry Reeves, the founders of The American Association of Inside Sales Professionals. Their isn’t anyone with more passion and care.

We believed if there was a trade association, inside sales was an industry.

We had no idea.

***

Author: Ken Krogue | Follow me on Google+
Summary of Ken Krogue’s Forbes articles

 

Go back to read Section 1 of: The Story of InsideSales.com

 

 

 

Dave Elkington, Marc Benioff, Salesforce.com, Philosophy, Hyper Growth, and Shrimp Tacos


The first company picture of Dave Elkington in August of 2005.  No grey hair at all!

The first company picture of Dave Elkington in August of 2005.
No grey hair at all!

Dave Elkington and I met early in 2004.

He had graduated from BYU with a degree in Philosophy and had already been working at Deutche Bank Alex Brown, an investment bank and a venture capital firm through the dot com era. He had a strong sense that web software, and especially software-as-a-service was a huge opportunity. He had tasted a small win or two and had dipped his toes in the entrepreneurial stream with an early Bluetooth company. He went through the dot com crash and saw the future of internet-based companies but knew they would need to have a strong financial model.

We often would laugh at companies with great ideas but no way to monetize them.

He wanted to start his own company in that space but wanted to grow it out of revenues, so he went back to BYU and started a graduate degree in computer science. He had already seen ignorant founders of companies who didn’t understand enough of the technologies who couldn’t guide the outcomes of their IT staffs and who sold their souls too early to raise money and then had new bosses before they even hit critical mass.

While doing this he started a web development company and began doing all kinds of projects as he zeroed in on what he wanted to focus on.

Marc Benioff started salesforce.com with Inside Sales during the First 6 Years

Marc Benioff started salesforce.com with Inside Sales during the First 6 Years and pioneered the world of SaaS software for the rest of us. – (AP Photo/Ben Margot, File)

He knew he wanted to use machine learning, artificial intelligence, and what he called “set theory” to do things that had never been done before in business. He had seen many companies’ come and go and was especially watching Marc Benioff plow the deep snow in application service provider platforms (ASP) just when the phrase Software-as-a-Service (SAAS) was being tossed around from the waves being made by saleforce.com.

 

PHILOSOPHY

Dave would talk about his philosophy degree and how it had taught him to think. That was one of the strongest things we both held in common; philosophy, and how to think. I was amazed out differently we thought, but we agreed on many common areas. Though we disagreed strongly on others. Dave believes strongly in what he calls “pragmatic relativism,” he has some pretty compelling arguments and has almost convinced me… almost. :)

He and I have warmly debated that topic from about the first few days we met each other. I believe much more strongly in universals principles and laws; I worked under the guidance of Hyrum Smith and Stephen R. Covey during my days at FranklinCovey, and my philosophic mentor had been Dr. Chauncey Riddle since I was just out of college. I had moved my family to Provo, Utah, and audited his last BYU class; the only class I ever took without getting a grade. I remember I felt my brain hurting from the rigorous Socratic method and System Thinking and strategic methodologies he shared. I regard it as more valuable than everything I studied at the University of Utah and the Naval Academy combined to help me be successful as an entrepreneur.

It was from this that I distilled the Systems Model we use:

Analyze > Design > Implement > Evaluate.

Or in one word: Test.

Dr. Riddle challenged me to learn how to think, not just what to think and when to think.

Dave had gone through a similar level of rigor and the two thoughtful backgrounds combined to make very animated discussions. We found when we could both engage we would distill things down to almost their very essence and spent many late nights doing just that.

 

HYPER GROWTH

I had gone to the Naval Academy and when we started this company in 2004 I had already been in the world of sales and marketing for 16 years, I had pioneered the use of inside sales at Franklin Day Planners when they were the 2nd fastest growing company in the US. My plans had abruptly changed from being a Naval Aviator and flying the space shuttle to pioneering professional sales over the phone and through the web. I had learned through sad experience that hyper growth was a unique animal all it’s own. We would set appointments and invite training directors at 115,000 companies with 100 employees or more to see a Franklin seminar and turn it over to the field sales teams. Then we started proving we could close them ourselves.

Our department was gaining the nickname “Telesales,” but I recoiled at anything with the phrase “tele” in it. To me it was a four letter word. We coined the phrase “Inside Sales” which was just beginning to be used.

I told them I would stay 5 years or until we did a million dollars in a single month. I knew I had a long way to go, when my first month sales was just over $27k. I told them we would use college kids on the phone for 60k to sell what their 300k salespeople would sell. We started with six phone reps transferred out of the call center on old furniture out of the warehouse. I researched to see what new outside sales Account Executives would close in the first six months…

We beat it by 127% at a small fraction of the cost.

They closed at two to three times better ratios, but we made seven to eight times more contacts. Sales was a numbers game, and still is.

We made a ton of the old timer outside sales people very mad at us. They first tried to crush us, then control us, then cooperate with us. It was so stressful I would wake up in the mornings with what seemed like little pieces of rock in my mouth; the edges of my own teeth. But much of the problem was me, I needed to grow up and so did my people.

We were dialing by hand but still doing great. Franklin struggled so badly with technology at the time they actually made us dial a 10-digit account code in the phone system after every phone call to track and charge us for any personal calls. It was a policy of the accounting or “sales prevention” department and it drove me nuts. I initially wanted a dialer technology just to store that dang account code under a single button, but I remembered my earlier days at Quota Marketing Centers where we invented one of the very first “power dialer” technologies as we generated leads for Toshiba copy machine dealers all over the country.

I had all kinds of ideas to leverage inside sales, but no technology, just a big leather book. I would go to lunch with Mike Shelton, the Telecom Director at Franklin and we would brainstorm new ways to save time. Next thing I know, he had left the company with some developers and built many of the very things we had talked about. He sold it for millions of dollars; I never got my dialers.

I left Franklin four years later to the day when we did our Million Dollar Month. I left with my dear friend Paul Jarman, who was one of my first two sales reps at Franklin to start what became a long distance company. After being there about 5 years I went to a meeting one day to buy another company and there was my old telecom guy from Franklin seated across the table. He had already sold his first company and was working on rewriting the same code to be the first call center technology in the cloud. He wanted to launch the first SaaS telephony company.

He did.

We saw the possibilities and a year later we bought his 2nd company and eventually changed the company to what is now inContact, the top inbound SaaS contact center company in the world. But I hated inbound, I loved going outbound; causing sales… not catching them.

Talk about destiny, now we owned the very technology I had sketched on napkins in the Franklin cafeteria. Within weeks I started pulling together the single most powerful inside sales technology ever invented. The problem was we didn’t have a way to handle all of the leads. We tried embedding the dialer technology into Act!, then Goldmine, but it took them right to their knees. I had a consultant helping me and he called me and said I needed to go to Springville, Utah and meet Dave Elkington, who had just finished a massive lead management database in the cloud.

Dave Elkington and I first went to lunch at Bajios in 2004 when we decided to launch the project that is now InsideSales.com

Dave Elkington and I first went to lunch at Bajios in 2004 when we decided to launch the project that is now InsideSales.com

I called and we went to lunch at Bajios, we had shrimp tacos and horchata.

We soon realized he had the database technology, the drive, the financial expertise, a crushing discipline, and an ability to execute with charisma like nobody I had ever seen before. I had the dialer technology, the strategy, a clear vision for the future of inside sales, and way of buffering to hold it all together.

We soon decided to build the world’s first customer database with built-in dialer tools in the cloud (though the phrase ‘cloud’ hadn’t been used yet.) The database had the qualitative data, the call center tools had the quantitative tools and we had a feeling that the two together would open up a whole new world by letting us see things in a new light… the light of data.

Dave and I both knew this synergy of predictive analytics, big data, and artificial intelligence would change sales and marketing forever.

***

Author: Ken Krogue | Follow me on Google+
Summary of Ken Krogue’s Forbes articles

This is section 1 of The Story of InsideSales.com
Go to Section 2 of The Story of InsideSales.com

Social Nurturing: 7 Keys To Acquire Contacts Through LinkedIn, Twitter, Facebook And Google+


How do you get to know influential people using social media? We have developed a very powerful new model that does this very thing and brings amazing results, we use it at InsideSales.com.

We call it Social Nurturing. Think of it as the phase the comes before lead nurturing, where you build awareness and turn it to curiosity.

The term ‘Social Nurturing’ was coined by my dear friend Thomas Oldroyd.

Social Nurturing helps you get to know influential people using LinkedIn, Twitter, Facebook, and Google+

Is Social Nurturing just for prospecting or sales?

No.

It is a useful model whenever you want to get to know influential people whether they be entrepreneurial gurus, prospects for your business, influencers in your industry, partners in a business channel, readers on a blog or column, friends in the ‘cool’ clique at school, potential employers, or just followers on social media.

Is Social Nurturing the same as Lead Nurturing?

No.

It comes before lead nurturing, and by definition, uses social media only.

Lead Nurturing is the process of progressing interest into need, or leads into qualified prospects.

So what comes before interest?

Think about it, there are several stages somebody goes through before they are interested in you, what you do, or what you have to offer. Social media offers tools and access to people like never before in the history of the world.

How do you use social to meet influential people?

Here at InsideSales.com we have been testing the use of LinkedIn, Twitter, Facebook, Google+ , Blogging, Klout, and many more social media platforms in a model we call ACQUIRE.

The steps to ACQUIRE influential social relationships are:

  1. Awareness: They have to know you exist.
  2. Curiosity: They have to be curious about you and what you do.
  3. Qualify: You need to decide if it is worth building a relationship with them.
  4. Understanding: They need enough information to know roughly what you do.
  5. Interest: What you do must be intriguing to them.
  6. Relevance: Both parties should have meaningful value for each other.
  7. Engage: This is where active commitment begins: whether it be an influencer, a target prospect, a customer, a friend, etc.

We call this process Social Nurturing. And there are three best practices I’ll reveal later (when we have polished and tested them) that really make the ACQUIRE model work.

Social Nurturing is a cool phrase that Thomas Oldroyd on our team here at InsideSales.com coined to describe that process that sits in front of Lead Nurturing and uses social media to turn awareness into interest.

How do you actually use the ACQUIRE model to make influential contacts using social media?

We have lots of ideas and testing in process (in other words, this is so new we are still learning.) We have had absolutely incredible results so far. For example, we were able to use the ACQUIRE model in September to set appointments with 1230 people who were going to be at a trade show in San Francisco to come and meet with us at the show (we did it before the show even began.)

For perspective, years past with traditional methods we had around 50 pre-set appointments at the same show.

My Forbes readers may want to reserve a seat for my webinar where I’m sharing our first findings. Then my team is putting it into a downloadable eBook in a few weeks you will have access to also. The price of admission is your feedback and comments as you try it yourself personally and in your business.

‘Testing’ means we honestly don’t know the outcome, we welcome your help.

As our testing concludes I will share the tips, tricks, best practices, and your feedback, ideas, and stories of social nurturing in part 2 of this article, probably right after the holidays.

Stay tuned – Ken

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Author: Ken Krogue | Follow me on Google+
Summary of Ken Krogue’s Forbes articles

What is an Entrepreneur?


What is the difference between an entrepreneur and someone who just runs a business?

As is often the case, I may not exactly know what it is, but I know what it is not.

What is the difference between a leader and a manager?

A leader worries about her people; a manager worries about his boss.

Leaders walk in front and show others the way. They lift the heavy boxes first and, like Tom Sawyer, they start out by painting the fence better and faster than the crowd who gathered to watch them. It is awe that makes the crowd members pick up a brush and join in. But unlike Tom, they stay involved through the process and keep recruiting others. (Entrepreneurs figure out vinyl fences don’t need paint.)

Leaders don’t stop for nearly as many breaks or gather around and watch others, unless they are learning and comparing. They always hoe to the end of the row, even in heat, a rainstorm, or when supper is calling.

Leaders begin to sing out when the song begins, because they know the other voices will soon blend in and hide the fact they are slightly off key.

Leaders seek out the one lagging beyond, find what makes them tick, then challenge them to keep up and to keep time.

Leaders are like the Marines… first in… last out. They don’t punch a clock, they get a job done, even if they mop up what’s left behind.

Leaders work on the system, managers work in the system.

Leaders are like Tom Sawyer, they start out by painting the fence better and faster

Leaders like exempt over non-exempt. They demand a fair salary, they don’t ever want to be measured as just an hourly wage. But they will work hard and long under one if they have to, even if they get sent home by their manager before overtime rules kick in.

A manager never quits a job until they find one that is better.

Leaders rarely get fired. But they often get fired up. They will quit any job that asks them to do something they don’t believe in. But they will work at any job if the reason is strong enough or they have given their word.

Leaders are shepherds with a staff who call out with their voice, not sheep herders that ride horses with lots of smart dogs that nip at your heals.

Entrepreneurs know you need to be both a leader and a manager… in that order. They always start with a leader, and then find a manager.

They know a great leader is the ultimate solution to any problem. They pay ten to a thousand times more money for a great leader than a great manager… in a heartbeat.

What is the difference between finance and accounting?

One is a tool with leverage, the other is a method with scrutiny.

One puts the world at your feet, the other keeps the IRS away.

Finance finds the money at all costs. Accounting finds the cost of money.

Finance uses predictive analytics and statistics to gauge the odds of success. Accounting uses bookkeeping to track success and report to finance.

Accounting hears there is a recession going on. Finance finds counter-recessionary trends and catches a wave.

Finance steers through the land mines and sees trends on the rise. Accounting reports on the cost of running aground.

Entrepreneurs practice both and hire both. And pay much less for Accountants.

 

What is the difference between sales and marketing?

Sales are the Navy Seals, the Green Berets, the Rangers. Marketing is the Air Force that rides high and sees far. They can’t win a war by themselves, but they sure look good to the folks on the ground kicking door to door.

Sales seeks out and solves need.

Marketing causes awareness and turns it to interest.

Sales wishes Marketing would educate interest into need before it gets to them, so they don’t have to. But they do if they need to. It just takes longer.

Sales knows that interest is the counterfeit of need.

Sales yells at Marketing for not generating enough good leads. Marketing yells back for not calling them all before they get cold.

Sales makes a way, marketing finds a way.

Entrepreneurs know they are both right, but that sales is the last to ever turn off the lights.
What is the difference between a statesman and a politician?

A statesman, or stateswoman, wades into the fray, a politician maneuvers through it.

A statesman fills his hand against the odds. A politician feels the odds against his hand.

Ethics and law are a statesman’s guide, with greater good as the motive. A statesman is honest when nobody is looking. He speaks up even when he is the only one in the room who is willing to.

He would serve for a single dollar, and often does. He would love to put down the heavy burden, but only does so when those he loves and is duty-bound to uphold are out of harm’s way.

Entrepreneurs are the statesmen (and women) of business.

 

What is the difference between faith and belief?

Faith is action, it is of the body. Belief is thought, it is of the mind.

Faith comes after hope, which is the fuel of the heart… desire… purpose… motive.

Faith is an assurance that what you have seen happen before, though you don’t see it now, will happen again… if you act and work.

Faith knows it’s enemy is doubt.

Belief hopes to become faith someday when it grows up.

Faith is based on truth. Belief may not be based on anything.. It doesn’t know.

Faith will risk it all and is willing to pay the price for every blessing. Belief flees because it isn’t sure, and wavers when things get really difficult.

Others look at faith and say “I get it!”

They look at belief and wonder if they get it.

Faith only wonders why.

Belief worries how.

Entrepreneurs know that belief turns to faith based on truth, assurance, and action… always action.

What is the difference between church and religion?

Church is a place you go to, on the outside. Religion is within.

A church is a building you go to worship on a specific day each week. Religion can be found on a mountaintop… alone.

Religion may or may not be had in a church.

A church is what you identify with. Religion is who you really are.

Some religions believe in God or god, or no god. But they live it.

Religion is the sum total of your habits. Habits are the true garb of religion.

Entrepreneurs hire people from all churches, but look deeply for those who live their religion, whether it includes a belief in God or not.

 

What is the difference between learning and understanding?

Learning goes to the source by itself, practices and rehearses, engages, memorizes and teaches back, and walks away with a treasure.

Understanding watches the teacher do the problem on the board and gets it then, but can’t figure out the ciphers in the textbook at home in the evening.

Learning goes to Lynda.com for $25 a month, where every software package lies at its fingertips, and in six months figures out how to start a company building websites.

Understanding gets a degree after four years, finds a job, and then works for somebody else for six years to pay off student loans.

Understanding is the counterfeit of Learning.

Learning goes to school to sit on the front row and ask questions.

Understanding takes notes to pass a test.

Learning cares much more about the quality of the question.

Understanding cares more about the completeness of the answer.

Training is what the trainer does. Learning is what sticks.

Teaching is what a teacher does. Learning is what a student does.

Learning is the valuable residue that is left over after Teaching occurs.

Learning counts only if it is measured and can be applied.

Learning leads to an education. Understanding leads to a degree.

Learning leads to an entrepreneur. Understanding leads to an employee.

Entrepreneurs don’t spend much of their time as an employee.

Only long enough to learn on somebody else’s dime, and from somebody else’s understanding.

Entrepreneurs don’t usually have an MBA, but they hire as many of them as they can.

 

Author: Ken Krogue
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15 Hot Sales Tools and Sales Acceleration Technologies


This article comes from an interview with and original research led by James W. Phillips, Business Intelligence Analyst for my company, InsideSales.com, about a research study entitled “2014 Sales Acceleration Technology Market Size Study.”

Sales Acceleration Technology Market Size Study

Sales Acceleration Technology Market Size Study, now available for immediate download

The research will be formally released next week at The American Association of Inside Sales Professionals Leadership Summit in Chicago.

Sales Acceleration is defined in detail in a prior Forbes article entitled “What Is Sales Acceleration? Start By Picking Up Your Phone.” It outlines categories that include new and emerging software applications and services that fall under this new market category.

The 15 cloud-based categories listed are as they appear in the study:

  • Contract Technology
  • Data Visualization
  • Business Intelligence
  • Gamification
  • Presentation Technology, including Slide and Screen Share
  • Predictive Analytic Tools and Technology
  • Sales Intelligence Tools
  • Email (designed specifically for the sales function)
  • Fax
  • Sales Communication tools
  • Chat
  • Texting
  • Video technology
  • Voice technology
  • Social selling technology

In summary, sales acceleration means to increase the velocity of the sales process.

James gives some background, “Over the last 10 years, the sales industry has witnessed a disruption. Due to the innovation of Internet cloud-based business transactions and an upsurge in sales technology development, the sales profession is in a state of rapid modernization.”

He continues, “The ‘Sales Acceleration Technology’ industry is the business space between CRM and marketing automation which facilitates, and thereby accelerates, all processes pertinent to the sales pipeline.”

The study addresses the following questions:

  • How much spending is currently going towards sales acceleration technology in North America?
  • How much spending occurs per sales rep?
  • How big is this new market?
  • In what categories is the spending occurring?
  • What should we expect in the future about the growth of sales acceleration technology?

James collected information from 439 companies for this study, which was segmented by type of sales function (retail, inside sales, outside sales) as well as size of company and industry.

U.S. Census data presents a total of 13.98 million sales reps in North America. Analyses through this research shows there are 8.357 million in sales people employee retail sales, and 5.622 million inside or outside sales professional sales reps.

Census-based forecast of professional sales rep jobs until 2020
Census-based forecast of professional sales rep jobs until 2020

Of this 54.4% or 3,064 million are inside sales (professional sales done remotely), and 45.5% or 2,558 million are outside sales or field sales representatives.

By 2020 there will be over 6 million inside and outside salespeople in North America.

In the sample, companies allocate 3.5% of total budget towards sales acceleration technology, with spending ranging from 1% to 24%.

Spending on sales acceleration technology by category
Spending on sales acceleration technology by category

Given considerations of current sales rep adoption rates, North American businesses spend $2,280 per rep, per year, on sales acceleration technologies in the following allocation:

Spending per sales person on sales acceleration technology by category
Spending per sales person on sales acceleration technology by category

From the same Census and the sample data from this study, estimations are able to be made showing current spending in North America for sales acceleration technology to be $12.8 billion annually in the world of professional sales with the following by inside sales and outside sales:

Current spending on sales acceleration technology in North America in 2013 by inside sales versus outside sales channels
Current spending on sales acceleration technology in North America in 2013, compared with inside sales versus outside sales channels

NOTE: This estimate is conservative by at least two accounts.  James omitted “Sales Training Technology” which could be considered a sales acceleration technology, and the entire category of spending for retail sales was not included. The $12.8 billion would increase to roughly $15.8 billion if Sales Training Technology were included.

Spending by industry varies widely, with Software and Education leading, and Finance and Telecom bringing up the rear.

Sales acceleration technology spending per rep by industry
Sales acceleration technology spending per rep by industry

Size of company, in this case by employee size, correlated to a massive difference in spending:

Spending on sales acceleration technology in 2013 by company employee size
Spending on sales acceleration technology by company employee size

The next interesting item in the research is the assessment of four favorable business outcomes and the associated correlated patterns in sales acceleration technology spending by the following:

  1. Bigger deals
  2. Faster sales cycles
  3. Higher close rates
  4. Stronger overall company revenue

The average deal size in the sample was $12,500.

Again, the average spending per sales rep is $2,280 per year, but in companies with the largest 50% of deal sizes, the average spending is 89% larger, or $4,319 per sales rep per year.

Average spend per salesperson by average size of sales opportunity
Average spend per salesperson per year on sales acceleration technology by average size of sales opportunity at the company

NOTE: Greater sales acceleration technology spending does not necessarily cause bigger deal size, there is only a notable correlation from the sample data. The study goes into much greater detail with further regression analysis of this interesting correlation.

The average sales cycle in the sample is about 60 days.

Interestingly, the Communications and Intelligence technology received a greater proportion (28% more) of spending among companies with the fastest sales cycles, compared to the average.

Spending on sales acceleration technology was notable in the categories of Business Intelligence and Sales Communications spending for companies with the fastest sales cycles
Spending on sales acceleration technology was notable in the categories of Business Intelligence and Sales Communications spending for companies with the fastest sales cycles

From the companies surveyed, the average close rate is about 20%.

The four notable technologies correlated to higher close rates were Sales Communications, Data Visualization, Business Intelligence, and Voice technology.

Sales acceleration technology categories of Sales Communication, Data Vizualization, Business Intelligence, and Voice Technology spending were notably higher in companies with higher close rates
Sales acceleration technology categories of Sales Communication, Data Visualization, Business Intelligence, and Voice Technology spending were notably higher in companies with higher close rates


Companies with higher than average close rates spent 17% more per sales rep than the average.

Companies with average revenue over $3,000,000 had a 78% more being spent on sales acceleration technologies than the average with an average of $4,052 per rep versus the previously mentioned $2,280 per sales representative.

Average spending on sales acceleration technology by company revenue size
Average spending on sales acceleration technology by company revenue size

NOTE: This correlation is similar to the size of company by employee size section already mentioned, but now illustrated by company revenue.

The ends with the question to respondents about how their sales teams with grow or shrink over the next two years.

There was a promising increase of team sizes from an average of 12.8 reps in 2013, to a 45% increase of 18.5 reps in 2014, and a 41% increase to an average of 26.1 sales reps per team in 2015.

Sales Managers were asked how big they thought their sales teams would grow over the next two years

The Day The World Of Sales Changed Forever


It’s pretty rare when you can remember an exact day when the world changed.

I remember 9/11… The day the twin towers fell.

I was meeting with my client, the Department of Defense, a mile away from the Pentagon. Luckily we had received a call the night before asking us to move our location. We had just finished our very early meeting and were walking out of the conference room in the basement through the cafeteria when we saw the first of the twin towers burning; we were transfixed to the television screen.

Then the second tower was hit and the jet fuel erupted outward in a yellow and black surging cloud.

When I saw them start to fall later that day I knew the world had just changed.

My parents Dave and Sheila Krogue both remember where they were the day John F. Kennedy was killed, and the day Neil Armstrong declared his first small step for man… on the moon.

Mark the day…

March 27, 2009…

Five years ago yesterday… The day inside sales became an industry.

It was the day that Bob Perkins and Larry Reeves launched the American Association of Inside Sales Professionals with a press release from Minneapolis, Minnesota, dedicated exclusively to advancing the inside sales’ profession:

“Over the past two decades the inside sales profession has undergone a remarkable evolution. Not long ago, inside sales was perceived as annoying telemarketers or unsophisticated ‘order takers’ who smiled and dialed. “

How wrong the world was. Bob continued:

“Today, inside sales is an integral part of many organizations’ overall sales strategy. Customers accept and sometimes prefer virtual communication through e-mail, internet and the telephone. It’s not unheard of for inside sales representatives to build and manage multi-million dollar accounts and close six-figure sales.”

He knew it wasn’t the use of the telephone that started inside sales, that is what started telemarketing, which is most definitely not inside sales.

It was web conferencing… Webex and GoToMeeting: the ability to simulate a face-to-face sales call remotely.

I hadn’t met Bob and Larry yet the day the world of sales changed. But it was January 10th, 2010 that I wrote an article that went viral called “What is Inside Sales? – Our Definition of Inside Sales” and stated:

“Inside Sales is “remote sales,” most lately called “virtual sales,” or professional sales done remotely. Where Outside Sales or traditional Field Sales is done face-to-face. Telemarketing is a single, scripted, unprofessional phone call you get at dinnertime where you have to say “No!” seven times before you hang up.

In fact, Inside Sales Professionals regard “tele” as a four-letter word.

Taken in this context, the majority of all sales is done remotely, and the numbers are growing.“ Bob finished, as he started hammering in the coffin nails to the traditional world of going door-to-door.

Dave Elkington, our amazing CEO, and I were still recovering from the crushing blow of the crash of 2008.

Our little company, though profitable, had just had our credit line yanked by Wells Fargo and we thought we were like Billy Crystal said in Parental Guidance: “lights out Alice.”

Without enough money to smooth out not enough water over the rocks our managers rallied and went without pay, then we started to grow… in the worst economy of our lifetime.

Wondering what had just happened we called several of our brand new clients and asked them why they were buying our technology when everyone else was laying people off.

They answered that they were laying people off also, their $300,000 outside sales people to be exact, and hiring three $80,000 inside salespeople with our leveraged technology and others and still doubling their new sales revenues. The crash had forced them to look deeply at where the sales efficiencies and effectiveness were both really happening.

Inside Sales…

Bob and Larry had called it right.

What had once been a second-rate department taking the crumbs off the table from the outside salespeople was now a counter-recessionary growing industry, an answer to companies who needed answers.

We knew the world had changed when Dr. James Oldroyd who had already researched the power of responding immediately to a web-based lead also analyzed survey data offered by infoUSA and found that inside sales was growing at a rate fifteen times faster than outside sales, to the tune of what would be 800,000 new jobs.

Did I say 15 times faster?

Yes.

We realized four years later that it was the counter-recessionary surge that caused companies like Apple, Cisco, Fedex, IBM, Google, Dell, Sprint, and ADP to hire thousands of inside sales reps, and join the American Association of Inside Sales Professionals or the AA-ISP.  Bob and Larry gave a voice to those who were now the dominant, though very young, players in the sales space.

Another study came out in 2013 showing inside sales was now only growing 300% faster than traditional outside sales, and the same study demonstrated there were now more inside sales than outside sales reps, if you removed retail salespeople.

And inside sales was expanding at the rate of 42,400 a year now, great paying jobs, when American wasn’t quite believing the economy was really standing on it’s own again without the Federal Reserve’s quantitative easing money printing practices. (And still isn’t I might add.)

Marc Benioff, former inside sales rep from Oracle, and the founder of salesforce.com, was one of the early disruptive game changers of sales models when he went the first six years in his company using the remote sales model before hiring his first sales rep out in the field.

How do I know? We hired Dave Orrico, who was the Vice President of Enterprise Sales at Salesforce.com. For seven years he built the team that finally lived in the field and went face-to-face at the cloud-computing juggernaut.

Check out my summary of Marc’s book, Behind the Cloud, or go to Amazon and download it to your Kindle app right now. He tipped over an entire industry with a bunch of young upstarts full of vision and incredible passion and was finally recognized as the most innovative company in America.

Rightly so!

My old company, FranklinCovey, was an even earlier pioneer when they asked me to roll out an inside sales model in 1993, and became the 2nd fastest growing company in the United States a year later. We had just coined the phrase “Inside Sales” because we hated anything with the word “tele” in it.

Like Avis, we may have been second, but we tried harder!

Those were the glory days, but I don’t miss them.

The political battle for position against the entrenched veteran field salespeople who first wanted to crush, then control, then collaborate, left me waking up every morning with what I thought were little rocks in my mouth…

Bits of my own teeth I had ground off the night before.

Now outside salespeople are realizing they better learn the methods of selling remotely we pioneered.

Many are embracing a hybrid-model of selling that still goes remote once or twice instead of four to five times, but spends most of the time on the phone and GoToMeeting saving both buyers and sellers much valued time and money.

Thanks to Bob and Larry I get to keynote for the fourth time at Leadership Summit 2014, the worlds largest gathering of Inside Sales Leaders in Chicago on the 8th and 9th of April. If you are anywhere near Chicago, or really need a shot in the arm of your career…

Be there!

If you aren’t a member of the AA-ISP you are missing out on my favorite event of the year, and the best bunch of people I’ve ever been a part of other than my family, my plebe company at the Naval Academy and InsideSales.com, my company.

Thanks to Bob and Larry, I get to see all of my dear industry friends several times a year: Trish Bertuzzi, Steve Richards, Art Sobzak, Kraig Kleeman, Koka Sexton, Mike Smalls, Chad Burmeister, Peter Ostrow, Kyle Porter, Bruce Lewolt, Sean Burke, Anneke Seley, Antarctic Mike, Lori Richardson, Kelly Molander, Josiane Feigon, Jill Konrath, Jamie Shanks, Liz Gelb – O’Conner, and tons of new friends.

Thanks to Bob and Larry, I get a fun and friendly place to rub shoulders with companies like Oracle, Vorsight, Factor 8, Clearslide, LinkedIn, Hoopla, Xactly, Kitedesk, Salesloft, Frontline Selling, Tibc, Aslan, PGI, LexisNexis, Salesloft, Acton, and Marketstar.

Thanks to Bob and Larry even competitors come together to grow an industry that has room enough, and for all (but I don’t have to mention them in my article, now do I…)

Thanks Bob…

Thanks Larry…

Here’s to another five years!

Where are we going from here?

Now it’s all about what my friend Mick Hollison calls Sales Acceleration

First star on the right, and straight on ‘till morning!

 

Author: Ken Krogue | Follow me on Google+ 
Summary of Ken Krogue’s Forbes articles