Wanna be CEO? Learn to Sell!

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  techsys11/19/07 Report as spam
  1

  Agree!

  After hanging the shingle 10 years ago, I find your statements to be 100% true. Unfortunately, many people in small businesses forget this and think they have enough customers and can cut back in this area. Any vision of success and long-term growth is built around the core of a strong sales and marketing program.
  
  After several years of word-of-mouth (lazy) selling, we recently decided to invest a fixed percentage of revenues to kick-start our sales and marketing program. Believe me - it is easier to build you business around a great sales and marketing program, and keep this in the center of your business plans & business focus.

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  emilpap11/19/07 Report as spam
  2

  RE: Wanna be CEO? Learn to Sell!

  Well, thats somtething thast you don't hear everyday!!! It is as real as can get.

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  Geoffrey James, Sales Machine11/20/07 Report as spam
  3

  MBAs

  Funny, isn't it, that most MBA programs don't include any courses in sales.

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  blange40011/22/07 Report as spam
  4

  MBA

  Acedemia doesn't work the street.
  
  In theory there is no difference between theory and practice, in practice there is.-annon.

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  ptiseo11/19/07 Report as spam
  5

  RE: Wanna be CEO? Learn to Sell!

  Selling ability is not the key ingredient of a good CEO. Generally, Mr. James makes good points in his blog, but this one is far off the mark.
  
  The key ingredient about a founder/CEO is: NONE.
  
  There is no one key ingredient. Anyone who says there one key item is, well, ignorant. Such people likely have never actually been an entrepreneur in a real "garage-based" startup in their lifetime.
  
  A CEO/founder(s) is always wearing multiple hats. If you spend too much time selling, you'll slowly watch your ops erode or not be able to keep up. If you spend too much time team-building, you'll find that you have no revenue to pay for it. You can sell, but you are an ass in the office? Watch that carefully-built team slowly die out to turnover. Heck, it even helps to be good with a hammer, because you may need to fix some things when there's no room in the budget for hiring out!
  
  And, in a nutshell, that is why most starups fail. It takes a unique mix of intelligence, skill, work ethic and craziness to be an entrepreneur/CEO-founder.

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  Geoffrey James, Sales Machine11/19/07 Report as spam
  6

  I hear you...

  ...but you're wrong.
  
  Everything that a founding CEO does at the start -- from team building to hammering nails -- can and will eventually be delegated to somebody else. The one thing that a CEO must do, and must always do, is know how to sell.
  
  Mitchell Kertzman, former CEO of Powersoft (and later of Sybase) once told me:
  
  When I founded Powersoft I did everything myself, but I kept finding people who could do things better than me, so I hired them do those things and now my job (as CEO) is pretty much to do what I do best, which is nothing.
  
  Then he paused for a second and said:
  
  ...except representing the company to the press and the investors. That's always part of the job.
  
  In other words, selling is both the first and last skill that a CEO must have.

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  QM BI11/20/07 Report as spam
  7

  I disagree-selling is essential!

  What you say is true-having the ability to sell is not the key ingredient. But you cannot succeed without that abillity! What ever the product, service or idea...you must sell it to someone or there is no business! I know plenty of people who are asses in the office but terrific at presenting an idea or having the ability to engage you into their vision.

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  ptiseo11/20/07 Report as spam
  8

  Sweeping Generalizations

  I have no problem with someone saying that a CEO must know how to sell.
  
  I have a problem with people who think selling is the only thing a founder-type CEO must have, ie. that there is some single "key" ingredient that has a pass/fail quality to it. Or saying something to the effect that, of all characteristics, a CEO must excel at selling and all else can be passable.
  
  It is a big (and dangerous) oversimplification. A sweeping generalization.
  
  Let me ask you this: How many dot-coms failed because of lack of a business model, lack of strategic planning, lack of an operational backbone *and/or* lack of capacity to understand finacial basics? When the selling was easy, many startups came on the scene, and when the selling got hard, they all went belly up. Many of them could still "sell" well, but without the rest, they were ultimately doomed.
  
  So, excuse me if I don't buy into the "selling skill is key". Especially if it comes from a self-declared ex-salesman. (I mean that teasingly, but the phrase "occupational bias" comes to mind.)

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  Geoffrey James, Sales Machine11/20/07 Report as spam
  9

  Dot-coms

  Many of them could still "sell" well, but without the rest, they were ultimately doomed.
  
  Ultimately, yes. But they wouldn't even have gotten into the game if the CEO hadn't been able to sell. Nobody said that it's the only skill need -- it's just the only skill that's ABSOLUTELY needed. You can hire to fill in everything else, but if the CEO can't sell, you don't have a company.
  
  In any case, plenty of people got really rich selling dot-coms that didn't have a business model. True, they were conning the investors (and perhaps themselves as well), but they did know how to sell. In fact the dot-com boom was a big giant sell-fest. That it all turned out badly in the end is irrelevant to the idea that selling is the key CEO skill.
  
  Hey, you can name any attribute that CEO supposedly needs in order to be successful, and I can probably think of a CEO who lacks it.
  
  Example: Steve Jobs reputedly berates and belittles his direct reports, the kind of self-indulgent behavior that's highly demotivating. But Jobs can sell -- nobody better. And part of his sales skill is keeping his people committed, even when he's treating them like crap.
  
  Example: Bill Gates apparently has a mild case of asperger's syndrome and is notorious for being unable to read social cues -- a necessity for effective team building. But Gates can sell his ideas almost as effectively as Jobs.
  
  The only exception is selling. Every successful CEO (even those who are temporarily successful, like in dot-com land) knows how to sell. Ipso facto, it's the key CEO skill.

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  onoropu11/20/07 Report as spam
  10

  Don't Agree

  I am currently building my third startup (some people just don't learn).
  
  The first one went nowhere. I had a great idea (that has since been copied elsewhere), but lacked the skills to excite my customers with the potential of the idea.
  
  The second one was a success, because I looked at the skills I lacked, and hired a sales manager right off the block. This guy wasn't so good, but he was good enough to get sufficient revenue to keep the company in the black, and I learnt from watching him.
  
  The current company is doing OK, and I am now doing my own sales and no longer being thrown out of offices.
  
  Being CEO opens doors that other positions can't open. And these are opportunities to sell to people who usually don't get to see a sales person, but actually "own" the budget.
  
  Sure, you need a raft of skills, in all sorts of areas, some more, some less, but selling, as a skill, is a must-have. I learnt this the hard way.

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  ptiseo11/20/07 Report as spam
  11

  Other Failures

  The second one was a success, because I looked at the skills I lacked, and hired a sales manager right off the block.
  
  So, in effect, team building, experience, self-awareness and leadership, plus selling, saved your company. Good for you.
  
  Sure, you need a raft of skills, in all sorts of areas, some more, some less, but selling, as a skill, is a must-have.
  
  And, I can hook you up with the CEO of a company that could sell like the dickens, but ultimately failed in the first handful of years because Ops couldn't keep pace.
  
  The problem with Sales is that it is the most tangible, visible and understandable part of a company. It's the "input" of the "corporation-as-an-engine" metaphor. Without it, there's no start. However, it's all nice and well to bring gas to the engine, but if the pistons are all gummed up or the engine is badly tuned, the gas is useless. It'll sit in the can and evaporate.
  
  So, I just don't buy that "selling" is the key singular skill, when I could use the same logic you and Geoffrey use to explain why bad ops or poor teams, like bad sell, will kill.

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  QM BI11/20/07 Report as spam
  12

  RE: Wanna be CEO? Learn to Sell!

  You are correct sir!

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  ptiseo11/20/07 Report as spam
  13

  Still Disagree

  Yes, of course, everything eventually gets delegated. Even most of the selling/marketing (short of the long-term strategic stuff) gets delegated, and delegated early. All that left is the high-level selling, the high-level team building, the high-level finances, the high-level innovation, etc, etc, etc. IOW, you still wear the same hats, just not the tactical ones.
  
  Anyways, at that point, when you can actually get employees in and shed hats, it's not really a startup anymore, and anywhere from 4-7+ years have come and gone.
  
  IMO, if all you can do well as potential founder-CEO is sell, with no real other skills, then I would bet that you will more likely fail than succeed. A salesman with an idea is just as likely to fail than a technician with an idea, if you have no other skills in your set.
  
  Let's take it another way. If salesmanship is the key ingredient then the easy way to test it is to ask yourself: Would every VP Sales you've met make a good CEO? IMO, that's a "no". You were fond of seeing a tautology in Advice #4, which wasn't one, but I think your piece suffers from another (sweeping generalization): just because selling is valuable to a CEO's success does not mean selling skill is *the essential ingredient*.
  
  I know we all want the one magic bullet we can hang our hat on, so that we can say: "I have the simple truth. Here it is." but the reality is there is no such thing for something as complex as the birthing of a company.
  
  But, hey, keep "selling" that idea to nacsent and growing CEOs! Makes the competitive lanscape much easier for me...
  
  PS: Since you like to drop quotes, here's a couple right back at you:
  
  "I don?t think anyone with a pure marketing background can step into a CEO slot without some financial background,? he says. ?And if they have some manufacturing training, that?s even better.? - Herb Baum, Dial Corp.
  
  "I have heard this request before. It seams to be a trend. While I think every good CEO is a salesman, not every sales VP can be a good CEO. If fact for most startups after the salesperson ?makes the sale? the CEO will have to close the deal by convincing the customer that the company has a sound business strategy that will succeed.

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  Geoffrey James, Sales Machine11/20/07 Report as spam
  14

  I think you're proving my point

  "I don?t think anyone with a pure marketing background can step into a CEO slot without some financial background,? he says. ?And if they have some manufacturing training, that?s even better.? - Herb Baum, Dial Corp.
  
  And Marketing has, uh..., something to do with Sales? As I've repeatedly pointed out in this blog, Marketing is a largely useless function inside most B2B firms, more of a malignant growth than an essential part of the business. The idea of the typical marketing drone becoming a CEO is patently absurd. There are, by contrast, plenty of CSOs who've become CEOs.
  
  "I have heard this request before. It seams to be a trend. While I think every good CEO is a salesman, not every sales VP can be a good CEO.
  
  This is a non sequitur. I didn't say that every sales VP should be CEO, only that a CEO needs to be able to sell -- a skill that's not taught in 99 percent of all MBA programs.
  
  If fact for most startups after the salesperson ?makes the sale? the CEO will have to close the deal by convincing the customer that the company has a sound business strategy that will succeed.
  
  Whoops! Isn't this just proving my point? The fact that the CEO does the closing is just another example of the importance of the skill.

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  ptiseo11/20/07 Report as spam
  15

  Selective Filtering

  I am not supporting your point. You are selectively ignoring sections of the quotes to "ensure a win".
  
  "And Marketing has, uh..., something to do with Sales?"
  
  No. Marketing has nothing to do with Sales. Before you think that's a win, I will say that that's precisely my point.
  
  The quote was used to illustrate the opinion of one "successful CEO" that declares that multiple skills are necessary. Moreso, he doesn't even mention Sales!! (Whoa, that's embarassing! ) Focusing on the word "marketing" and ignoring the rest is sneaky, though.
  
  "There are, by contrast, plenty of CSOs who've become CEOs."
  
  The fact that many CSOs have turned into CEOs is true. I don't deny that. But, to go from that to "selling is key" is a leap of faith that I, given my experiences, cannot do with you.
  
  Unlike you, I additonally see and acknowledge that many other CEOs are ex-CFOs, ex-COOs and, yes, even had stints in Marketing. (Note: According to a SpencerStuart 2004 study, nearly 25% of all S&P500 CEOs had career experience in Marketing in their background. This is roughly equivalent to Ops (24%) and Finances (26%). Sales was actually present in the background of only 17% of CEOs. Ooo. Another hit on the CEO-as-super-salesman myth! Sorry.)
  
  In this reply, you say:
  "I didn't say that every sales VP should be CEO, only that a CEO needs to be able to sell..."
  
  And, in the original post:
  "The single characteristic shared by every CEO that I?ve ever met is that he or she was superlative at selling."
  
  I smell a faint contradiction here. IMO, you are painting a picture that all that "other stuff" is useless or irrlevant, and that all you need is "selling ability". At best, you are not intending this and your writing style hides this. At worst, well, many "sales drones" are going to be in for a rough few years as they startup their companies after reading your article without a full toolbox.
  
  "The fact that the CEO does the closing is just another example of the importance of the skill."
  
  I'll repeat: I do not deny that selling is important. But, there's a difference between saying "it's important, but don't forget to have the other stuff" and "it's all you need to make it".
  
  Secondarily, in that quote, the CEO is not closing the sale by selling the product/service. He's closing the deal by showing the buyer that the company has a vision, a direction, a solid team and a solid foundation. For example, if I am about to sign on the dotted line for a big deal with some hired gun who can close like nobody else, I don't want to be in contract with some sales-only shop that can't supply on the backend. I do my due-diligence. A startup gets these things in-house not from the CEO's "selling skill" but from the CEO's "the other stuff".
  
  Geoffrey, I guess at this point if I haven't convinced you otherwise, there's not much more to say and we'll have to disagree on this topic. (OTOH, I have agreed with other posts of yours, just not this one.)
  
  Thanks for taking the time to discuss your viewpoint and experiences with me and other readers. I look forward to more articles from you.

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  ptiseo11/20/07 Report as spam
  16

  Logic Traps

  Ultimately, yes. But they wouldn't even have gotten into the game if the CEO hadn't been able to sell.
  
  Actually, yes, they could have and they did. At the height of the dot-com era, one could hobble together a web page, throw a few key buzzwords, and get a VC to fund anything, including $1.2mil Super Bowl ads. What started out as "CEO selling idea", turned into a mad rush on the part of investors and lenders to anyone and everyone, hoping to hit gold. You, the dizzy CEO, didn't need to sell the company, you just had to be a willing patsy; the investors wanted to pick something they could IPO by selling an illusion of success. The worst companies had CEOs with no selling ability or any other skills.
  
  Similar things led to the current subprime bubble.
  
  That's all asides. The point to get out of it is that when selling is easy, you can still fail if you don't have the rest of the CEO toolkit.
  
  Hey, you can name any attribute that CEO supposedly needs in order to be successful, and I can probably think of a CEO who lacks it.
  
  Again, my personal hypothesis is that there is no one key ingredient.
  
  But Gates can sell his ideas almost as effectively as Jobs.
  
  Which he had to learn over multiple years. From my understanding, in his early years, he was classic techie with no selling skill. Jobs, however, is (and always was?) a master communicator, not a master salesman. He's well-known for having a "reality distorting field" as the joke goes, from which you hopefully wake up early enough and realize you don't need what he's selling.
  
  "Every successful CEO (even those who are temporarily successful, like in dot-com land) knows how to sell. Ipso facto, it's the key CEO skill."
  
  Well, over the last few decades, the number of sea-faring pirates have decreased while global temps have increased. Therefore, if we want to prevent global warming, we should encourage more people to become pirates, not go solar or other silly things like that.
  
  Anyone can fall into a logic trap.