Which Business Philosophy is Right for Today’s World?
The global philosophy of businesses has shifted over the years. Modern business began with the product centered philosophy and was eventually replaced with the selling philosophy. Most recently, the business world has evolved into a marketing-centric philosophy. The question is, “Which business philosophy is right for today?”
The answer is, “It depends.”
Production Concept
In the late 1800s, Ralphs Waldo Emerson said, “Build a better mousetrap, and the world will beat a path to your door.” His expression is a perfect example of the production philosophy of business. The production philosophy says, “I’m going to build this thing and you, the consumer, will buy what I build.”
Henry Ford, in the early days of the Model T automobile launch, is attributed with the saying, “You can have any color you want as long as it is black.”
The assumption among executives prior to the Great Depression of the 1930s was, I know what I like, so I will make it the way I like, and other people will also like it.
Engineering and production departments determined what the company could build. They designed it, built it, and placed it in a catalog for people to buy.
Corporate sales forces were relatively unknown, and marketing departments didn’t even exist in those days.
Selling Concept
The Great Depression of the 1930s was a time of high unemployment and limited consumer demand. The resources for consumer goods throughout WWII were redirected to the war effort. So, by the time the war ended, there was significant excess production capacity from all the factories that had been built, and there was an enormous pent up consumer demand.
Companies continued to be driven by engineers and production departments. Essentially, they only made what they knew how to make. But suddenly, making a product and putting it in a catalog wasn’t enough. Consumers had a lot of products to choose from, so companies couldn’t just wait for the customer to find them.
The solution was for companies to employ a sale force to visit potential customers and take orders. Advertising, to augment the efforts of the sales force took on a larger role in helping to make the consumers aware of the new products available to them. Initially, advertising campaigns focused on newspapers and magazines. Then, eventually, advertisers also started using the fledgling radio market.
The limitation of the selling concept is it is driven by the engineering and production departments without a solid understanding of consumer needs/wants.
Marketing Concept
The 1950s saw a significant shift away from engineering and production, controlling the business toward the consumer. Companies realized they needed to make products customers actually wanted and would meet the consumer’s needs. As a result, marketing, rather than selling, became the focus of many businesses.
The focus on marketing meant that the company planning and operations needed to be customer-oriented. Products needed to deliver profitable sales growth, rather than to make sales for the sake of sales.
Businesses to realize the full benefits of the marketing concept needed to understand and meet consumer needs by coordinating the efforts of the engineering, production, and marketing departments.
The limitation of the marketing concept is, the emphasis is on developing familiar products, not “new to the world” products.
Selling versus Marketing Comparison
Still, several business people do not understand the difference between selling and marketing concepts. Many executives think they are similar when, in fact, they are nearly opposite philosophies.
| Production/Selling Concept | Marketing Concept |
| 1) Emphasis on the product. | 1) Emphasis is on customer wants/needs. |
| 2) The company makes the product, then figures out how to sell it. | 2) The company first determines what the customer wants/needs. Then figures out how to make and distribute the product. |
| 3) Management is focused on sales for sale’s sake. | 3) Management is focused on profitable sales. |
| 4) Planning is short-term. | 4) Planning is long-term. |
| 5) Stresses the needs of the manufacturer. | 5) Stresses the needs of the buyer. |
So Which Philosophy is Best?
Now, to revert back to our opening question, “Which business philosophy is right for today?” My answer is, it depends. However, in some cases, none of these current philosophies by themselves is sufficient.
Think about all the “first of its’ kind” products. There are pocket-size transistor radios, videotape recorders, hand-held calculators, cell phones, Pampers, Crest White Strips, and Swiffer. The list of products invented by engineers in research labs is endless. Every single one of these products was produced because some engineer invented it, and then, some production guy figured out how to make it.
Consumers didn’t know they needed the product because they had never seen it before. But once it was made, marketing created consumer awareness and demand. Likewise, the sales forces filled channels of distribution with the product.
However, what successful “new to the world” products have in common today is that they are designed and built with an understanding of consumer needs. Focus groups, research studies, beta testing, and test markets are all used to develop and refine products.
My conclusion is, the production and selling philosophy still has a place in the business world, but only to the extent that it leverages knowledge from the marketing concept.
Join the Conversation
As always, questions and comments are welcome. Which business philosophy do you think is most suited to meet the changing wants/needs of today’s consumers?
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Category: Sales Management
Is There One Best Leadership Style for Every Situation?
In our last article, What Is the Best Way to Lead A Sales Organization? I introduced the concept of a leadership continuum. The leadership continuum comprises four leadership styles which were identified as Tells, Persuades, Participates, and Delegates.
On one extreme, the Task style focuses on telling the individual how and when a task is to be accomplished. Whereas, on the other extreme, the Relational style is focused on delegating responsibility to the person completing the task.
Thus, given these four predominant styles, the question arises, “Is there a preferred or best leadership style?”
My answer is, yes, there is a preferred or best leadership style, but the best style often depends on the situation.
Let’s look at the four styles in detail.
Tells
The telling leadership style is characterized by above average levels of task behavior and below average levels of relationship behavior. The sales manager makes all the decisions.
- Appropriately using the telling style is with a new sales representative who needs to be trained on how to develop a sales presentation.
- Inappropriate use of the telling style is with a seasoned, high performing sales representative who does not need to be told how to develop a sales presentation.
Persuades
The persuading leadership style is characterized by above-average levels of task and relationship behavior. The sales manager makes all the decisions but also attempts to gain the cooperation of the sales force by explaining what needs to be done and persuading the sales force to carry out the sales manager’s plan. The sales manager makes decisions with input from the salesperson.
- Appropriately using the persuading style is when a recently promoted sales representative is highly motivated but is currently unable to carry out the responsibilities of the job adequately.
- Inappropriate use of the persuading style is at a sales meeting where a sales manager instructs the salesforce on the proper procedures for the sale of a new item and provides them with an opportunity to ask questions
Participates
The participating leadership style is characterized by above average levels of relationship behavior and below average levels of relationship behavior. The sales manager sets direction by establishing an overall strategy and goal(s) but leaves the decisions about how to achieve the goals to the individual. The sales manager and the salesperson make decisions together.
- Appropriately using the participating style is when a sales representative needs to focus more on servicing the customer but doesn’t see how that will improve sales. The manager presents reasons for the need for increased service and how it leads to increased sales. The sales representative is allowed to take their preferred course of action.
- Inappropriate use of the participating style is when the sales force is not achieving their sales goals due to increased competition. At a sales meeting, the sales manager seeks input on meeting their sales goals but provides little direction to the sales force.
Delegates
The delegating leadership style is characterized by below average levels of task and relationship behavior. The sales manager provides little direction, contact, or support for the sales organization. The salesperson makes almost all the decisions.
- Appropriately using the delegating style is when a high-performing, motivated salesperson wants to be a top performer.
- Inappropriate use of the delegating style is when a new, untrained salesperson asks for help from the sales manager and the sales manager declines to help the salesperson.
The quadrant chart below summarizes the four styles of the leadership continuum based on the primary decision-maker.
As you can see, there is no one best style for a sales manager to employ in every situation. However, there is a best style to employ based the situation at hand and the salesperson involved.
A successful sales manager is someone who can flex their leadership style to fit the situation and the salesperson.
Join the Conversation
As always, questions and comments are welcome. Which leadership style is your primary style? Are you able to flex styles to leverage the situation?
I’d love your help. This blog is read primarily because of the people like you who share it with friends. Would you be kind enough to share it by pressing the share button?
Category: Sales Management
What Is the Best Way to Lead A Sales Organization?
Imagine that you are a young sales representative. Your boss comes along and tells you exactly how he wants you to present the new product your company is launching, to which customers, when he wants it all done, and the results he expects you to achieve.
Again, imagine that you are a young sales representative. Your boss comes along and consults with you to determine the best method to present the new product to which customers, what order you will present to which customers, and what results you expect to achieve.
In the first scenario, the boss is exhibiting what is known as task behavior. In the second scenario, the boss is exhibiting relationship behavior.
There is a lot of research which found both task and relationship behaviors are effective, and both are needed to lead and influence employees in different situations.
Task Behavior
Back in the dark ages when I started my sales career, many of my bosses were ex-military officers. Lower level managers mostly came from the Vietnam era. Whereas, the higher-level managers and executives were WWII and Korean War veterans.
But they all had one thing in common. They all had a command and control leadership style. When it comes to command and control leadership the individual says here’s what I want you to do, how to do it, when to do it, and where to do it.
In the command and control leadership style, there’s not a lot of room for creative problem-solving. The command and control style is also known as a task behavior leadership model because it focuses on the behavior of the individual completing a task.
Relationship Behavior
I noticed more and more leaders who were people-oriented, as my career progressed. These people-oriented leaders listened to their employees. They provided an overall direction but also took the time to solicit input on goals and objectives from employees. They even used positive feedback to reinforce the employee’s confidence.
Another substantial difference for relational leaders is their willingness to delegate decision making to employees. The manager is there to provide guidance if it is necessary, but also allows the employee to establish goals, priorities, approaches, and the expected results.
Task Relationship Continuum
The task behavior style of leadership is autocratic and even has dictatorial traits. Communication is one-way. The boss informs the employee what to do. Supervision is close at hand as the boss monitors the employee to make sure the task is completed as directed.
The relationship behavior leadership style is at the other end of the continuum. This style is characterized by two-way communication. A high degree of delegation means direct supervision is limited but available when needed.
Between the extremes of task and relationship behavior are two intermediate positions on the continuum. They are leaders that persuade and the leader that will participate.
The leader who persuades has a specific task, approach, and expected results in mind. The persuading leader seeks to gain alignment with the employee by convincing the employee to accept the leader’s approach.
The participative leader also has specific tasks, approaches, and results in mind. However, the participative leader engages the employee by seeking input into the proposed plan. Together they develop a plan that melds their thinking and expertise.
The Best Approach
The best way to lead a sales organization depends on two things: the salesperson and the situation. There is no one “best” way to lead all sales representatives in all situations.
For example, if a sales representative is new, a leader may tell the sales representative how to create a presentation. This telling/teaching approach is a characteristic of the task behavior style.
On the other hand, if the sales representative is a seasoned, high performer, the leader may delegate responsibility for developing and delivering a presentation. This approach is characteristic of the relationship behavior style of leadership.
In our next article, we will look at the Task versus Relationship behavior continuum in more detail by examining the strengths and weaknesses of each element of the continuum. We will also consider which is most effective in a given situation.
Join the Conversation
As always, questions and comments are welcome. What leadership style, task versus relationship, have you encountered most often in your career? Which style do you prefer?
I’d love your help. This blog is read primarily because of the people like you who share it with friends. Would you be kind enough to share it by pressing the share button?
Category: Sales Management
7 Character Traits of a Successful Relational Salesperson
It takes a very special combination of character traits to be successful in sales in the long run. Oh sure, there are some nefarious salespeople out there who mislead and outright lie to customers just to make a sale. But most of the time, they flame out or end up in politics before long.
On the other hand, the men and women who are honorable, who spend a lifetime serving customers with integrity, are a special bunch. If you are a salesperson, this is the kind of salesperson you want to be. If you are a manager, these are the kind of salespeople you want to hire!
The list of character traits I think are essential for a salesperson are, I admit, a bit different than most lists you might find if you Google, “character traits of salespeople.” However, this list has proven to be an accurate indicator of sales talent over the span of my career.
Top 7 Character Traits
So, here goes, my top seven character traits of successful salespeople. Successful salespeople are patient, kind, ethical, faithful, fair, humble, and self-controlled.
Patient
Salespeople are often under a lot of pressure to meet their numbers. As a result, there is a tendency to push the customer to order now! Successful salespeople are patient. They let the customer determine when the right time to buy is. They know having patience goes a long way toward building trust and long-term relationships.
Kind
Successful salespeople are kind. They are friendly, generous, and considerate. They are open, generous with their time and expertise, and considerate of the customer’s needs. They know that addressing a customer’s needs and helping to solve a problem is the shortest route to making a sale.
Ethical
Successful salespeople are morally ethical. They don’t shade the truth or bend the rules to make a sale. They are honest in all their dealings with customers and with their company.
Faithful
Successful salespeople are faithful in taking care of their customers. They don’t abandon their customers when something goes wrong. They take the time to help when needed.
Fair
A successful salesperson is equitable and just. They operate from the position that a deal must be fair for all parties.
Humble
Successful salespeople are humble. They are not pretentious or braggadocious. They respect the needs and desires of their customer.
Self-Controlled
A successful salesperson is in control of their emotions, passions, and desires. Selling is a career where there are great highs and lows. Successful salespeople don’t let their emotions get the better of them when things go wrong. They don’t let their passions and desires override their desire to be patient, kind, ethical, faithful, or fair.
The Relational Salesperson
I recently wrote about the differences between traditional, professional, and relational salespeople (You can read the article here).
The person I have described here that embodies these seven character traits is a relational salesperson. Relational salespeople are focused on their customer’s interests. They are patient, kind, ethical, faithful, fair, humble, and self-controlled. Successful relational salespeople know in the long run meeting the needs of their customers and solving problems will result in loyal, trusting relationships.
Join the Conversation
As always, questions and comments are welcome. Is there any character trait I described here you think is more or less important than others?
I’d love your help. This blog is read primarily because of the people like you who share it with friends. Would you be kind enough to share it by pressing the share button?
Category: Sales Management