For years Salespeople have been working on their product knowledge, their selling skills, and sales processes so they are optimally equipped to connect with prospective customers, winning their business over. In those days customers were quite happy to meet with salespeople because they were good sources of information and had solutions they were seeking for their business. Customers made decisions based on value creation in the form of what capabilities like products, services, brands, and prices can do for their business.
Sales organizations recognized that the better their sales force was trained the more likely they could close opportunities. Strong sales acumen is until today required to be the sales champion in your team. You need to possess product knowledge, features, and benefits knowledge, great relationship building and be a master in overcoming objections.
Things have changed. The buyer and the way they are buying has changed. You are no longer the source of information and possible solutions. Buyers prefer to figure out what their next moves should be without contacting sales. You are called in halfway through their buying process and before you know you are part of a spreadsheet and being drilled on price. Sales acumen is no longer the primary attribute that indicates that a salesperson will succeed.
To be successful now in sales, you need to deliver a different type of value to the customer’s table. The role of value creation has required a new set of skills. You need to have a good general understanding of business principles, how business works, how businesses make money and what all comes with it to stay ahead of the competition. You need to understand how you can help customers to achieve their budgets and profit targets while keeping their staff happy and engaged. You need to have a Business Acumen.
In the new way of selling, great salespeople leverage their business acumen to identify areas where value can be created. They come up with ideas and insights, relevant to the prospective customer’s objectives and how a change can impact their growth and bottom line.
So how can you improve your Business Acumen? It seems there is a bit of a mystery around this. True, business acumen takes time and effort to acquire but it doesn’t mean that without an MBA you cannot possess good Business Acumen. The opposite is true. Although you need to be comfortable with numbers and have some understanding of basic financial metrics, in many cases street smart wins from book smart.
Here are some suggestions on how you can improve your Business Acumen:
- Read (and listen to) the right stuff. …
Buy a book that covers how financial statements work, balance sheets and why cash flow is king for many businesses. You need to understand what ROI means for a business owner. There are plenty of books on the market that can explain this in less than 150 pages. Pick up a copy of the Harvard Business Review, Business Week, Forbes, or Fortune, even better read these online, listen to some videos or podcasts in these magazines, write down what interests you and discuss these in sales team meetings. This will provide you with a basic understanding of business concepts and the accompanying vocabulary.
- Use your own company’s resources
Invite your peer in the finance or accounting department to lunch. Ask them to walk you through a profit & Loss statement (your company or customer) and tell you what they see. Public companies provide annual reports, containing P&L statements you can find online. Make sure you keep yourself fit because why not inviting procurement, marketing, operations to your lunches? If you feel comfortable enough ask a senior management team member to give you some insight on topics they discuss in the boardroom how to grow and generate more profit.
- Learn how your customers make and spend money. …
One of the best ways to learn how businesses work is to ask your customers. Once they understand your intention (helping them to grow their business and make more profit) they are more than happy to share with you how they compete in their markets (strategy, marketing), the challenges they receive from their customers (operations, customer service), their financial results and plans for the next period or year (accounting, finance, strategy). Talk to as many customer stakeholders as you can. They all have different knowledge, insights, and views on their part of the business.
- Share your experiences in team meetings
Start talking about the big pink elephant in the room: if everyone is already a Business Acumen expert than they would have been selling differently already. Don’t worry, you and your sales colleagues are all on the same boat. Everyone has to become better at Business Acumen and what a better way to learn from each other. Share business cases where your customers are pressuring you on a better price, and you need to figure out how you can help your customer in cost savings or revenue growth or both.
In the past, success in sales depended very heavily on the salesperson’s sales acumen. Although Sales Acumen is still needed, to make a difference and add value to the customer conversation you need to be able to talk business. To be a top salesperson now your Business Acumen supersedes your Sales Acumen.