A downturn can create opportunity

1. Downturns Create Sales Opportunities
Once again, I am privileged to have a guest columnist and friend grace the pages
of EDT with a timely editorial. Tim Brown and I worked together during his tenor
in executive positions at Sprague Electric (Vishay). Tim was employed by global
companies such as Murata, Morgan Crucible, Aerovox and Ark-les before
establishing his own consulting firm, Brevis Consulting, located in Mattapoisett,
MA (www.brevisconsult.com). An experienced international manager, his clients
have found him to be a viable bridge into the European and Asian markets. He
understands the cultural differences, and his background and experience have
proven to be a valuable asset to his high profile clientele.
When the economy cycles down and business softens, most sales managers are faced with
the inevitable finance department driven budget reductions just as the need for order input is
its most critical. Often if the finance side of the business is calling the shots, budget
reductions come with specific instructions; usually top of the list are immediate reductions in
travel and spending on promotion. These mandates are often accompanied, or followed
quickly, by mandatory across-the-board reductions in headcount. Arguing that sales isn’t the
place to cut effort during a downturn sometimes resonates with management. But more often
than not, the sales manager is faced with some percentage of reduced budget expense he
must contribute to bolster the company’s bottom line.
Often the easiest thing to do is to put your head down, do exactly what has been asked and
manage your way through to better times. But where are you going to be when better times
arrive - in the same place you left when things turned down, or ahead of your competition and
poised to win in the upturn? How you manage during a downturn can have a profound impact
on your performance during the following upturn and on your durable market position and
future success.
A downturn creates both the motivation and justification to take stock of the organization and
reposition it to take the maximum advantage of the recovery.

2. Let’s assume that, like most of us, you have lost the argument with the CFO that cutting the
budget of the people landing orders when orders are needed most doesn’t make sense. You
now have to deal with a fixed budget reduction and create competitive advantage from what
you have left to work with.
It’s time to:
• Quickly redefine your Objectives and Sales plan to fit the current market
• Reevaluate your Customer Portfolio and decide who is on the A list
• Refocus your remaining Sales resources on Future Growth Prospects
• Co-opt Underutilized Operational assets to support Selling
• Shift Sales Effort more heavily to Customer R&D
• Present your Innovation aggressively and improve your positioning
• Rethink and Restate your value proposition to leverage current Customer needs
• Increase Velocity in the internal parts of the Sales cycle
Quickly redefine your Sales Plan and Objectives.
A downturn changes the sales world dramatically. Unless you accurately forecasted the
downturn and carefully built your plan around it, you likely are facing a plan that is now off in
the weeds when compared to conditions on the ground. It’s time to revise your plan and focus
on what can be achieved in the current conditions. Don’t go forward measuring against
impossible goals; people will just give up. Set new achievable (but challenging) goals and
measure against them systematically. Every objective in the sales plan should be
reevaluated, restated and clearly assigned. Refocus on what is possible and achievable.
Motivate your team to accept the new challenges. If management insists on tracking the old
plan then do it, but manage to your new set of objectives.
Reevaluate your Customer Portfolio and decide who is on the “A” list.
We all have customers who have been with us forever but are going nowhere, those who
demand a disproportionate amount of attention for the billings they generate or, finally, those
who are just not profitable. Resources during a downturn are going to be tight and one way to
free them up, so they can be focused where they will do the most good, is to figure out who
your least productive accounts are and pay less attention to them. Put those freed resources
to work where they will make a difference when things turn back up. Take care of your “A”
list.
There is nothing as healthy for any organization as a periodic forced ranking of customers
and a revision of the resources allocated to them. A downturn creates a need and an
opportunity to tackle this task with a renewed sense of urgency and the potential for a hefty
payback.

3. Refocus your remaining Sales resources on Future Growth Prospects
Once you identify who your best prospects are, focus on them. Ask yourself what the
segments and customers are within the portfolio which represent the future. These customers
deserve extra attention during a downturn. Redeploy your top people to take care of them.
Improving your position with your new “A” list will insure that you are positioned to take
maximum advantage of the recovery in the short term, and improve your long term success
at the same time.
Sure, you can’t abandon customers who are important contributors to your sustaining sales
volume, but reduced product and transaction volume during the downturn will allow you to
focus limited direct sales effort elsewhere. Have your inside salespeople take up the slack
with a systematic communication program which keeps the company in front of these
customers at a lower cost without sacrificing your account development goals.
Co-opt Underutilized Operational assets to support Selling
Most operations’ organizations have less to do during a downturn; capital spending dries up,
projects are put on hold, production levels are down and the intense activity that
accompanies a high level of business dies off. These underemployed internal assets can be
co-opted into your sales effort. Design engineering and Quality personnel likely already
interface with customers and understand the sales environment. Other internal assets clearly
are well liked by customers. It’s time to get these people out front in support of your revised
sales plan. Customers love to see “the inside guys” and having them available creates
opportunities to get in front of your customers with something interesting to say. You can
discuss everything from design changes in support of cost reductions, to better coordination
of your quality objectives. Putting these “inside” people on the sales team may allow you to
reach parts of your customers’ organizations which have been unavailable until now. Now is
the time to work on those relationships which will carry you well beyond the upturn.
Shift Your Sales Effort more heavily to Customer R&D
Your future winners on the “A” list aren’t going to stop thinking about the future, that’s part of
what will make them winners. Their R&D may be reduced, but it will continue to work on new
products or projects. Now is a time when refocusing your resources on this interface can
outsell your competitors, who are sitting at home paying strict attention to the travel
restrictions mandated by their finance folks. Also, R&D is a natural place to target with your
newly “liberated” inside technical resources.
Access during a downturn is always easier if you have something interesting to offer. Bring
some challenging ideas with you or dust off some old ones, repackage them and offer them
up in the new environment. Use your competitors’ absence to position yourself as the go to
technical resource. Connect your inside people to key customer players and plan to sustain
those connections in the future.

4. Present your Innovation aggressively
People want to take ownership of a good idea, especially during a downturn when everyone
is trying to demonstrate their value to management daily. Now is the time to present your
innovative ideas. Not only do people have the time to listen, they are hungry for some good
news. Downturns make people listen especially hard to cost reduction suggestions. Don’t
have anything new to offer? Revise your “good” old ideas which were rejected when times
were good and everyone was busy with other priorities; splash a new coat of paint on them
and present them again. Perhaps you can pitch to a slightly different audience. Now is the
time to forge partnerships based on common goals - tee something up and go for it. Build a
relationship based on shared value.
Rethink and Restate your value proposition- loudly
Take some time with your team to review your value proposition. Its not always true that that
what you were presenting in a strong economy still resonates with buyers in a down market.
Customer’s needs change in a downturn. Measure your value proposition against the
customer’s new reality. Can the organization offer new value which addresses more of those
current needs? If the answer is yes, then change your value proposition and make sure your
customers (at least the A list) know all about it. Get out in front and make your value visible.
Shout it out!
Increase Velocity in the internal parts of the Sales cycle
How many times have you missed a customer promise because your organization was “over
committed” with internal and external projects? Downturns reduce internal workloads and
make resource available. Use this “liberated” resource to increase the velocity of your
responses to your target customers, and figure out a way to preserve this advantage when
things turn up.
Conclusion
Not every suggestion above will fit every organization, but some will. The key to successfully
working through a downturn is not to accept the inevitable but to use the opportunity to create
the future.