Flint's Blog

Topgrading for Sales

I try to alternate books I'm reading between fun fiction to business and sometimes even some history. I usually have two or three books I'm in the middle of at any given time.   I love a good Nelson Demille or Lee Child novel but usually guilt myself into reading two business books per month under the theory that we all have something we could learn.

The latest business book I finished is Topgrading for Sales.  If you have anything to do with a sales organization; whether it's hiring, firing, motivating, or evaluating; this is an absoulte must read.  Most business books feel they need to stretch the 4 or 5 points they want to make into 500 mind numbing pages of personal anecdotes.  Thankfully this book has gone with the no BS approach.  It's 112 pages long and almost immediately gets to the point which is, finding great sales people is tough and if you don't have a systematic approach of building a great team, you will have an average sales team.  It's chock full of real exercises that are really eye opening. 

Customer Advisory Council

A  year ago Billtrust had an offsite management meeting where we discussed a number of things, including how to better integrate customer feedback into our product development plans.  Through 2007 we had done this very informally. In my previous life at enterprise software companies, we would hold annual user conferences in some attractive destination and invite all of our customers to attend.  There would be a couple of days of presentations by management followed each night by alcohol consumption that rivaled college days.  They were good bonding events but I never felt that we really gained enough insight into what customers were looking for or the pain they were feeling.

This week we hosted our first Customer Advisory Council meeting (CAC - pronounced kack - I know it's terrible, I lobbied to come up with something different but I was overruled :[  ).  We invited 8 influential customers in for a day and a half of intense product conversations.  We talked about each of our product lines, asked the customers what was going good and more importantly what we could do better.  We bounced future product plans off them.  We talked about the performance of our difference teams. 

Prior to the meeting, my expectations were really middle of the road for what we would accomplish.  Some companies do this to placate customers and make them feel important.  I really didn't want that.  I was looking for concrete things that we could do to perform better and deliver better products.

It would be difficult to overstate how great the meeting was - both for us and according to the customers, also for them.  I personally jotted down roughly 20 product suggestions that either weren't in our near term plans or we hadn't even considered. 

For example, we are going through the final stages of certification for PCI compliance which has to do with storing of credit card numbers.  We discussed this as part of one of our product updates and one of our customers mentioned that they were struggling with this as well.  This particular customer is in the distribution business and they accept credit cards for in store purchases.  These credit cards gets stored in their ERP system so they are subject to the PCI guidelines.  This was one of those light bulb moments.  I knew first hand what a pain it has been to go through this PCI compliance process so knew it was going to be a pain for them.  Maybe we should productize what we have done for PCI Compliance and offer it to our customers so they don't have to deal with it.  Seems obvious in hindsight, but I had never thought of it.   

I'm sure there are a lot of formats to run a Customer Advisory Council, the one we selected worked well for us.  What's more important than which format you choose, is to do something where you can get customers around a table and pick their brains.

You Know It's Time To Quit When...

My wife and I watched the movie Michael Clayton last night starring George Clooney as a lawyer who is the resident fixer for his firm.  Reasonably good movie but you have to pay attention. 

One of the law firm's big clients is in hot water for "allegedly" killing some farmers with pesticides (or something like that).  Don't you hate that every legal accusation has allegedly in it, is the criminal really going to sue you if you don't say allegedly?

Anyway, at some point, the client decides that they need to start killing some people who are getting too close to the truth. So I pause the movie and say to my wife - "I love running my company but if I ever start needing to have people killed, maybe that would be a good time to quit."

How Well Do You Really Know Your Customers?

I like to think that I've got a pretty good grasp on how our customers feel about the job Billtrust does for them.   I'm a big believer in Management By Walking Around which keeps me reasonably in tune with what's going on.  Two things happened this week that made me question whether I'm really as in touch as I think.

Everytime our sales team gets a new customer we make a fairly big production about "Signing the Contract".  I like to sign all the contracts personally.  Tom Scott, our VP of Sales, sends out an email to the entire company congratulating the salesperson and others involved.  And occasionally we will play a celebratory game of foosball.   Anyway, back to my point.  One of our salespeople was talking about a customer the other day and for the first time I couldn't recall whether they were a customer or not.  As far as I knew they were still a prospect that we were trying to bring on board.  So I asked myself, "Self, how can you know what your customers think about you if you don't even know who your customers are?"

Coincidentally, this was the same week that Mitch Rose, our VP of Marketing, sends out our annual customer satisfaction survey.  I like to read each of the individual responses and while I look at the rankings in the different areas, I always find the most value in reading the customer comments.  While the majority of the comments are positive, I can't help but focus on the negative ones.  One negative comment on any area is always a concern for me. Two negative comments on the same area is a trend and causes Flint the Nice Boss to turn into Flint the Boss From Hell who everybody avoids. 

The customer survey this year had a couple of interesting comments that reminded me once again that maybe I'm not as in touch as I thought I was.  If you don't survey your customers regularly, go to SurveyMonkey and do it right now.  Make sure you ask open ended questions and ask about how you're doing in areas that you know are your weakest.  You never know, you might just learn something.

Raising Money

Earlier this year I got to thinking about the number of times I've been involved in raising money.  My last company Paytrust raised 6 rounds of angel/VC capital (which was probably 4 or 5 too many!).  Billtrust took in a small amount of venture funding in 2006 to help accelerate growth.  Not once, however, in either of these companies did I participate in raising money for anything other than my company.  Seems sort of selfish in hindsight. 

Most companies with any sort of size or stature do something to give back.  This year we decided that Billtrust should be one of those companies.

The Big Brothers and Big Sisters of America (BBBS) is an organization that can best be described as awesome.  They help at-risk children who are in the need of one-on-one mentoring by a responsible adult.  Kids who participate in BBBS are more likely to graduate high school, less likely to do drugs, and less likely to commit a crime.  Basically they are more likely to lead happy and productive lives thanks to this organization.  This is particularly near and dear to my heart.  I grew up in a single family household and there were two men who took me under the wing as I was growing up.  They helped me get jobs, helped me pick colleges, helped me pick out suits for my first job, helped me in a similar fashion as BBBS.

Billtrust is under way with a huge company wide fund raiser for this great cause.  We're encouraging all employees to participate, we're giving out some great prizes, we built a web donation site.  I don't say this to brag, it's more of an about time we did something.

How can you help?  The best way is to volunteer as a big brother or big sister.  There are always kids in  need.  If you don't have time, a donation to this great cause I'm sure would help as well. 

Surprisingly Great Sales Effort

I try to spend a large portion of my time on sales so like a lot of other salespeople, I'm always intrigued by how others sell. 

If I'm buying a car I'll tell the salesperson that I'm in sales and give him/her the approach that works best with me just so we can skip a lot of BS.  If you've ever had a car salesperson go into the back to "ask their manager" if they can do something special for you, you know what I'm talking about it.  I'm convinced that car salespeople are given a book of sales tricks to use.

I went to Lowes last week with my wife to get some deck furniture to replace a table that smashed into a million pieces (what a mess).  My wife and I were blown away by the level of service we got from one of their people.  I had to track someone down but ultimately found somebody on the top of a big ladder.  She came over, asked us how she could help, located the deck set we wanted, got us a cart, and muscled it on to the cart for us. (I did offer to help with the last part but she was too quick for me).  To top it off, she even checked us out at the register.  My wife and I got to talking in the car about this since it was so outside of a normal Lowes experience. I told my wife that she was the Assistant Store Manager which I saw on her name tag.  I tend to notice these things.

Today I get a call on my cell phone from an unknown number.  My first thought is oh great, my cell phone number is on some telemarketer list, what a hassle.  I answer the phone and it's a man who says in a very professional voice "Hi, I'm Steve from the XYZ Landscaping.  We did some work on your property last year and we're just calling to see if there are any landscaping projects you could use some help on."  Well I just finished spreading 7 yards of mulch and made my annual promise to never tackle any landscaping project more than pulling a weed so there are LOTS of projects they could help me with.  This call couldn't be more timely.  He asked me what kind of projects, I told him some details, he asked for my email, and promised he would email me a quote.

Keep in mind this wasn't some professional Oracle salesperson, this was my landscaper!

This is called Proactive Account Management and is probably the easiest and most effective sales technique.  A lot of companies, including Billtrust, don't do anywhere near enough of this.  The main reason is that sales teams have compensation packages typically geared towards driving new business.  The incremental revenue for add-on sales doesn't make sales people enough money so they don't focus on it. 

If your company doesn't do enough Proactive Account Management, what are you waiting for?

Freakonomics for Randomness

I read this great book over the weekend that reminds me a lot of Freakonomics.  It's called The Drunkard's Walk:  How Randomness Rules Our Lives.  If you haven't heard  of Freakonomics, it was a runaway bestseller and described how economics intersects with everyday life - everything from the drop in New York City crime rates to the fixing of Sumo fights.

The Drunkard's Walk starts with a basic primer on probabilities with a little history lesson thrown in and then quickly moves in to some real world examples. 

One of the more interesting ones is The Monty Hall Problem.  Monty Hall was the host of a TV game show called Let's Make A Deal.  He would offer contestants the chance to win a car by picking one of three curtains.  Behind one of the curtains would be a car and the other two curtains would have a goat.  After the contestant selected a curtain, Monty would open one of the other curtains and reveal one of the goats.  At this point, Monty would give you the chance to switch the curtain you selected to the other remaining one.  The question is, what would you do?  Since I was a math geek, I of course knew the answer was it didn't matter, you had a 50-50 chance at that point of winning the car.  Apparently an overwhelming majority of math professors in the US also agreed.  And that's where we would all be wrong.  You're actually far better off switching to the other curtain.  Here's why. If  you select Curtain 1 and decide not to switch,  you have a 1 out of 3 chance of getting the car.  However, if you do switch, you have a 2 out of 3 chance of getting the car.  The Wikipedia link above has much better explanation.

Other stories covered in the book are Wine Ratings (i.e. is there really a difference between an 89 and 92), why polling results are often misleading and where they get the +/- numbers, and how you can improve your SAT scores just by taking them a few more times.

Very good read, even if you're not a geek.

Can someone please invent a better email system?

Email billing has been one of Billtrust's more popular B2B offerings.  However, it is a daily battle to manage the delivery of email.  There's no way to guarantee to delivery, there's no way to know for sure if someone received an email, there's no way to know for sure if someone opened an email, and there doesn't seem to be any solution on the horizon.

Obviously the problem is spammers and the great lengths that everybody goes through to block unsolicited email. ISPs attempt to block spam, corporations attempt to block spam, all email clients worth their salt have spam filtering built in.  The net of all of this spam filtering is that a large percentage of spam is blocked .  However, a small percentage of emails that should get through, invariably don't.

So I know it's not a revolutionary concept but can someone please invent an email system that is fee based?  Any fee, no matter how small, would be a huge deterrent to spammers.  Businesses that send opt-in email want it.  People who receive email want it.  ISPs would embrace it.  The only ones who wouldn't want it are the spammers and the companies that sell spam protection.

Marketing On Your Invoice

Businesses that send bills to consumers (B2C) have known for a long time that inserting stuffers or adding a message to your billing statement every month will often result in a 0-2% response rate depending on the offer.  These might seem like low response rates but bill messaging & stuffers are an inexpensive way to communicate and upsell your customer base.  For some reason, most businesses that send bills to other businesses (B2B) haven't caught on to this yet.

Our VP of Marketing, Mitch Rose, has a great post on this here.

The basic theory is that you're paying for the postage and the paper anyway, why not add a message?  It's free, it's being read by your customer, and it may be the only communication you have with them this month.  The only possible reason not to do it is because you're too busy.  I could imagine someone from  marketing bringing this message to the CEO of a company "I'm sorry but I'm just too busy to talk to our customers."  WHAT!!! 

This is the time where I would go with one of my favorite sarcastic motivational lines "Let's set the bar a little lower and we'll pass out shovels."

The Value of the Network

Most businesses would love to have the Network Effect that have made companies like eBay wildly successful.  Simply put, the more users use something the more value that is created, which leads to more users wanting to use it.

We recently were at SAP's Sapphire user conference in Orlando and heard a lot of discussion about a  network that was going to allow billers and payees to seamlessly deliver bills electronically.  This is not a new concept. 

A number of banks banded together back in the 90's to create a consortium call Integrion.  The banks weren't thrilled that CheckFree and Intuit had a stranglehold on the bill payment market so decided to put a bunch of money in a pot and build a payment network.  Ultimately I don't think a single payment was made through Integrion when they folded up shop.

Apparently the lessons learned from this endeavor were soon forgotten and the banks decide to tee it up again.  They threw some more money in a pot and formed Spectrum. This time with even loftier goals.  Not only did they want to rout all payments through their network, they were going to manage all bill delivery as well.  This network met a similar fate of not processing a bill or payment before it was quietly put to rest.

Both of these networks met a similar fate because they didn't follow what in hindsight seems to be blindingly obvious.  There needs to be a value proposition for all participants in the network or it just won't work.  The reason eBay is successful is because they offer tremendous value to both the buyer and the seller.  The ATM network is even a better example and the banks certainly get some credit here.  Banks avoid paying tellers to handle withdrawals and consumers get the convenience of 24x7 access and avoiding long lines.

Spectrum and Integrion failed because they didn't make their networks financially compelling for billers to rout their bills through.  They were good concepts and certainly there was enough friction to make this interesting, but imposing a tariff that exceeds the value is a sure fire recipe for failure.

Ultimately someone will figure out a working bill presentment and payment network that will be compelling for all participants - banks, billers, and consumers - but it's a hard problem.  Billers don't have the necessary IT infrastructure, consumers have ingrained bill payment rituals that are hard to change, and banks move slowly - and that's why it hasn't happened yet.  Or maybe I'm wrong.