A case study.
The Conceptual Foundation Traditionally, job performance has been based on a two part paradigm of Attitude and Skills & Experience (see Illustration A). If a person had the skills and experience to do the job, but they did not meet performance expectations, it was attributed to an attitude or motivation problem. Consequently, management looked to motivational solutions to solve the problem. They promised bonuses if performances went up, or threatened punitive measures if it did not. Sometimes these measures were successful; sometimes they were not.
If a person was motivated and worked hard, yet still failed to meet expectations, training seemed to be the answer. Better skills, more knowledge and the acquisition of more experience promised to bring them through the learning curve into profitable performance. Sometimes that proved to be true, but in many cases, the promised increases never happened.
The early 90’s saw the advent of a series of advanced psychometric instruments that were designed specifically to measure how people thought, learned and behaved and then to correlate those metrics with job performance. The research conducted over a two year period, included jobs such as sales, management, manufacturing, financial and administrative. In every case, there seemed to be certain personality traits or cognitive abilities that were essential to the successful performance of key job behaviors. The instruments were used to grossly match job candidates to the most appropriate roles based on a model of those job behaviors. The average increase in productivity across all types of positions when compared to the candidates placed into the same positions without the benefit of the instruments’ data was 25%. These findings were dramatic, yet they remained virtually unknown as the company that had created the instruments struggled to market their products, leaving their best story in the files.
The inescapable truth that the research revealed was that the old paradigm was flawed. There were hard-wired personality traits and cognitive abilities that did not appreciably change with training, coaching or incentives. This fact shattered the foundation of traditional hiring, training and management programs. A far more effective paradigm became clear. (Illustration B). When cognitive abilities and interpersonal competencies (personality traits) were added to the model, it opened the door to a whole new way of under- standing and affecting job performance. If a person does not have the cognitive abilities and personality traits needed for a particular role, then even with a great attitude and the necessary skills, they are unlikely to be successful. Similarly, a 4 foot player can be thrilled and enthusiastic about slam dunking a basketball. They can be an excellent shooter, a superb dribbler, and marvelously knowledgeable about basketball. Yet, even with the best coaching and extensive training, they will not be able to slam dunk a basketball without using a ladder. The failure is not because of attitude or skills or lack of hard work; it is because the rim is too high and the other players are too tall. The data on hard-wired personality traits and cognitive abilities, when juxtaposed with critical job behaviors, offers the same pragmatic clarity of decision that is found in many sports decisions, as in the slam dunking example.
Following this research, newer instruments followed which provided ever more closely focused and specific measurements of the hard-wired traits and abilities that were proven to be the prime drivers of critical job behaviors. For the sake of simplicity and clarity, these measurements will be referred to as DATA. The following case studies will illustrate how the availability of DATA is revolutionizing the approach to common business problems.
A Practical Application
Optimizing the performance of any sales team depends upon how well the job capabilities of the team match up with the sales strategies and sales processes of a particular company. These job capabilities are only fully understood when the underlying cognitive abilities and behavioral traits of the sales team are measured and translated into terms of those job capabilities.
The following case study illustrates how DATA drives tactical and strategic decisions that can dramatically impact longstanding performance issues. The client is a division of a Fortune 500 corporation, occupying a dominant position in a global market. That market was divided into segments, each served by specialty products. As the company had pioneered much of the technology for the industry, it had a significantly installed customer base. Product salespeople introduced new products or product upgrades to their existing customers, while at the same time, prospecting for new customers. The company’s reputation had historically driven a strong customer-driven order business, as exist- ing customers expanded their facilities. All of these factors made for a highly profitable and stable business.
As the company moved into the new millennium, however, the technology became more widespread. Competition from a variety of smaller offshore vendors intensified and profit margins shrunk. The company was no longer an automatic choice for new factories, and even their replacement business was being eroded by less expensive options. In response to this, the company’s strategic executive team decided to change the game in a way that would favor its own greater size and range of services. They would move from a product sales strategy to a solution sales strategy. The logic was obvious. Off-shore competitors may be able to offer a cheaper version of a few components, but no competitor could match their overall capabilities. The company could present complete solutions, using the many elements of their corporation, including consulting, expertise, training, and other services. Strategically, it made perfect sense.
A team of 120 salespeople was assembled from the various sales teams within the organization’s various segments. This team was charged with going to market with a solutions-oriented value proposition that integrated the various service elements of the company into a comprehensive proposal for the customers. A top-tier sales training organization was engaged to train the team in the latest techniques of solution selling. At its announcement, this change in strategy was met with positive excitement and enthusiasm by both customers and the sales team. What was not apparent at that time was the extent to which the new strategy challenged the fundamental job capabilities of the sales team.
Transitioning from Product Sales to Solution Sales
Traditionally, the company served customers through a simple distributor network, serviced by company engineers, who specified parts when customers called with a problem. Now, they had to compete for business by providing broader, value-based solutions to a wide range of customer issues. Such strategies are based on a proactive approach rather than a reaction to a problem. Salespeople must discover opportunities through a thorough knowledge of the customer’s strategic goals and tactical issues. They must then assemble an integrated solution, by collaborating with the various technology re- sources within the company’s various specialized resources.
The following table illustrates the changes in job capabilities required to execute the company’s new solution sales strategy:
In a pre-DATA world (without easily understood measurement of hard-wired traits and abilities), training was seen as the bridge between the old product sales strategy and the new solution sales strategy. It seemed to be a simple matter of providing the necessary knowledge and skills to a proven team of successful product salespeople for them to carry that success over to the solution sales strategy. Only the DATA, could reveal the flaw in that plan. Even though the new strategy was developed by intelligent and experienced sales executives, they lacked critical information about the fixed-job capabilities of their sales team. Consequently, they fielded a strategy that their team could not execute.
The Company’s Track Record
Product quality was high.
Customer satisfaction was high on delivered projects.
Name recognition was excellent.
Their technology was the industry standard.
But...
For the last 2 fiscal years since the change in strategy, the company’s revenue was less than 50% of the plan.
Sales processes were redesigned twice, and a third version is in the works.
Over $2 Million was spent on training the existing sales team with little impact on revenue.
The third sales training initiative was being organized.
At this point, someone finally asked,
“Would it make sense to see if the job capabilities of the current sales team match those that are needed for the current sales strategies... before investing in more training?”
Consequently, before the training initiative, an inventory of the strengths and abilities of the sales team was taken using DATA-level assessment tools. The following chart shows the distribution of critical job capabilities among the team, comparing the capabilities needed for the current solution sales strategy against those needed for the product sales strategy.
Each row in the chart displays a single job capability that is dependent upon a hard-wired personality trait or cognitive ability. The columns represent a normal distribution, or bell curve, of the population (as shown below).
That same format is used to display the distribution of job capabilities that are dependent upon personality traits or cognitive abilities. The chart below shows the distribution of the 120 members of the company’s sales team against the critical job capabilities of product sales on one end of the chart and solution sales on the other end of the chart.
Ideal for Product Sales Adequate for Product Sales
100% can handle a simple sales process such as product sales.
• 97% are effective offering standardized programs.100% can work with either customers or them- selves controlling the sales process.
The situation changes dramatically with the change from product sales to solution sales. Cognitive ability is not a critical factor for most product sales. Any level will work. As the sales process becomes much more complex, only faster information processing speed can handle it effectively.
When the value proposition must adapt to the customer’s particular needs rather than simply be a standard offering to meet a common need, innovative thinking becomes vital and the consistency that served so well with products becomes an obstacle.
Most product sales do not require that the salesperson control the sales process. They may do that, but often the customer orders what they need without direction from the salesperson. Solution sales typically involve a much more complicated decision process with each participant having slightly different priorities. The salesperson must coordinate and manage that process, and this requires a strong and direct personality.
• Only 32% of the existing sales team had the information processing speed to handle complex solution sales.
Only 20% of the existing sales team had the innovative thinking necessary for adaptive solution sales.
Only 43% of the existing sales team had the strength of personality to control a complex multilevel sales process.
At this point, it was clear that another sales training program was not the answer. When all of the analysis was completed, it was found that 56% of the existing sales team lacked one or more of the critical strengths and abilities necessary to execute the solution sales strategy.
Summary
The information provided by the DATA enabled the company to understand why talented and hardworking people had been unable to realize the full marketplace potential of their unique product and service capabilities. While there was not a quick solution at hand, there was now a clear course of action, both strategically and tactically. Through a combination of changes in positions and responsibilities plus a strategic redeployment of those salespeople who were strong matches into regions with significant revenue potential, the company was able to salvage several key opportunities. Approximately one year later, the company was seeing stronger results and their strategy was gaining traction in multiple areas.