Speaker 1If you're putting together an SKO and you do not have a point of view on how AI is going to help the sellers do something better, be more productive, make more money, help understand customers better, you're not demonstrating it, you're not practicing it, you're in trouble.
Speaker 2Welcome to the Revenue Builders Podcast, a weekly show featuring B2B sales leaders and executives. Hosted by five-time CRO John McMahon and Force Management co-founder John Kaplan, the show takes guests in the barrel, behind the scenes with the people who've been there, done that, and seen the results. Revenue Builders covers best practices for scaling and growing your business while sharing the pitfalls to avoid.
Speaker 1Johnny Mac, how are you? I'm good, Cap. What about you? I'm doing pretty good, man. I'm doing pretty good. Can you believe we're going to have this conversation again, which means at least half the year is over. Have you been having a good year, bro? Good year, buddy. Good year. Went fast, dude.
Speaker 3It's not over yet.
Speaker 1No, no, but it really does seem to be going fast. So look, we decided we want to talk about, just for planning purposes, around August, September, every year. Talk about the concept of, you know, getting your organization together in some type of sales kickoff mode. Let's talk about some of the basics, Johnny, like what you would expect to, you know, what are some of the best things when you think about an SKL? What are some of the best things that you should be thinking about and where are some of some potential pitfalls?
Speaker 3For me, like most SKOs that I've attended when I'm not running it myself, it's like too much inspiration and not enough execution. You know, it's loaded with, the agenda is loaded with the CEO talk and how we did last year. And they'll throw a motivational speaker in there that has nothing to do with, you know, selling. They have new product announcements, and then they have all the awards. So the reps can leave, you know, energized because there's a lot of inspiration, but they're no better equipped to go out and win another deal, right? So I think like a strong SKO should, you should be answering the question of what do I as a rep need to do different on Monday? And if you're not answering that question, based upon everything that you see in your sales force, where reps are getting stalled in deals, like where are the two to three areas, you know, your reps get stalled in deals. Your SKO should mainly be about that. Right? I don't care about having every C-level person get up on the stage and tell me about themselves and tell me about their org chart. Quite frankly, I don't give a shit about your org chart if I'm a rep. All I care about is what are you going to do to help me sell more? How are you going to train me so I can more effectively do my job? And if you're just talking about you and how great your organization is, but you're not telling me about how to compete more effectively, I don't give a shit. I don't care.
Speaker 1Yeah, I think you're bringing up a, I think the basic premise of your message is, if you don't think about this SKO in terms of the audience, and what do you want the audience to experience? What do you want them to take away? If you don't start there, which most companies don't, they just like, we got an SKO, we got to get some product stuff done. We got, oh, should we do training? Should we, you know, let's have a motivational speaker. I think, Johnny, what surprises me is the number of companies that underestimate that probably more than 50% of that organization sitting in that room, or sitting on that Zoom, and we can talk about that, is making up their mind whether or not they want to be there for another year. So, I think some companies just think, well, we got an SKO, this is our team going forward. I actually believe the team that goes forward happens after an SKO.
Speaker 3Right. That's true. But in the SKO, just staying on this, I mean, they have a tendency to cram like 30 days, 30 topics into like two or three days, right? They're trying to cram an entire year into like three days. Yeah. Instead of, like I said, focusing on two to three things that you need your sales force to do better, and focusing on training only on those things. So, what they do is they do product training, the new pricing, the compensation, the messaging, the med pick, you know, prospecting, more AI, you know, CRM hygiene, forecasting process, all of that stuff. And they jam it, and what they do is they jam the agenda with 30 things, of which no one's going to be able to retain 30 things. And then they're constantly trying to stay on time because they jam in the whole agenda. And they get too many things to talk about in too little time. Yeah. Instead of saying, let's back up, let's figure out the two or three things our sales force really needs, and let's really bear down on that. Yeah. And this way, you never really run over your agenda because you only got three things
Speaker 1you're focused on. If you think about the uber theme of communicating to a sales organization, I just wrote this down, I think, you know, you have to hit some type of purpose. So, you have to connect with a go-to-market organization of like, what's our purpose? Like, does what we do matter, or not? Like, so that's got to be hit in the SKL. And that's not necessarily somebody from the outside coming and talking about, you know, how do you create, you know, resilience or what have you. I'm not downplaying it. I do, you and I both do a lot of that when we come in and talk to organizations. But I'm always asking about the theme, like, does what you do matter? And then, do you have evidence around it? So, to get for people to get passionate about the company, there's got to be evidence of the purpose. So, that SKL, better have some evidence that the product's getting better, that we've got good proof points, that we've got, you know, a good strategy, that we've got, you know, what are the analysts saying about us, whatever. There's got to be some evidence. And then I think another theme is going to be, where is this journey going to take us? And I call that like the vision, which is nothing more than what does purpose look like in the future? So, not only do I want to understand, why does it matter, but in five years, three years, what's it going to look like? And is that a journey I want to take? I think a lot more people are asking that. So, you kind of go at the high up level and then you break it down to say, okay, if you're buying it, if you want to get to the summit, let's say, and this is what, you know, here's what it's going to take to get to the summit. So, first you got to paint a picture of what great could look like. And I always thought you did a really good job of this. And then you break it down to making sure they're very clear. Here's the strategy to get us there. And here's the expectation. Here's the execution expectation that's associated with that. I see it. I see that hosed up. It's not a very, it's not a hard message when you think about it, but think about how many people hose it up. They talk about strategy.
Speaker 3That's all good, but there's a big disconnect between that vision and what I'm going to do tomorrow to become a better rep.
Speaker 1A hundred percent. That's why you got to break it down to the execution up. But they don't ever do that.
Speaker 3They don't ever do that. They don't ever break it down to this is where our Salesforce needs to get better because we've done this type of analysis and we know exactly where you guys get stalled and this is what you need to fix it. And that's what we're going to train you on. The other thing that happens is a lot of these organizations, they get inundated with, you know, product training. So we're going to come out with a new product, right? Product. So the product teams kind of start to dominate the kickoff and they're showing new demos and roadmap slides. But I can't tell you how many times I've listened to some product managers stand up there, talk about a product and no one in the Salesforce actually understood what they were talking about because they don't care what the product does. They only care about how it solves problems for their customer. Yeah. So who's the persona we're selling it to, why the problem matters, how the customer measures it, why they should change now. And when they can't answer those questions as product managers, the whole thing, that whole hour is just lost. You can see the Salesforce just sitting there looking at each other like I have no idea what the guy's talking about.
Speaker 1Yeah. I think that's really good. I like that. And I also think that when you do, because you have to talk about the product, when you do talk about the product, I think you also have to be vulnerable and realistic. You have to talk about it in a way that what's going to change. Like this has been really, really hard for us to sell, or this is what you've been struggling with in the marketplace. This is the feedback we're getting from our customers, when I think about the SKOs that I've been a part of, and I've been a part of a lot of them, the thing that gets the most energy in the room is when the rep understands how the suck is going away. Like how the company realizes something sucks and how that's been, and the customers realize, and that's been minimized and here's what's been done about it. Like, I think, I think that's pretty powerful, but some companies don't want to get vulnerable and say, Hey, this is, you know, the product was wherever it was. And I think that that's a, I think that's a big mistake. And the leaders, we had Thurman on earlier in the year. And one of the things I took away from his was like, he thinks his job is removing friction in the sales organization. And he actually thinks about that from the CEO level too, but certainly from the CRO level, things like redundant processes, you know, Johnny, when you were leading, how did you know, because there was redundancy, there was stuff that wasn't adding value. There were people that weren't adding value. How did you know where to address the friction in the sales organization? So you could be, you know, more equipped to stand up in front of them and say, Hey, here's what I'm going to do about what's what you're struggling with. And here's, what's going to change on Monday.
Speaker 3Well, cause to, to Mark's point, that's your number one job. Like your number one job as a sales leader is sales productivity. So what are you doing today to make sure that your sales force is more productive tomorrow? So you're constantly looking for things that are interfering with sales process with a sales productivity. So that could be, you know, I'm not, I'm not, I'm not training them effectively. I'm not, I'm not on, I'm con I'm not constantly teaching them. order processing is taking too long. You know, we can't get offer letters out. There's a whole bunch of things that get in the way of making your sales force more productive. And usually it's usually self-inflicted internal things. And that's your number one job as a CRO, is to make sure that you're running interference and clearing those hurdles out so your salespeople don't have to run into them every day.
Speaker 1How are you gathering that information?
Speaker 3I remember- You just know, you just know.
Speaker 1Because you're at PTC, you just know. I remember at PTC, you calling me and I was several levels below you. And you called me and asked, you know, how are things going? A very open-ended question. Did you have a cadence or, you know, of going to the top sellers or to the up-and-comers? Like, how did you-
Speaker 3It's called going on sales calls. You go on sales calls with sales reps and you're riding in the car with them and you're asking them, what's going on? And they're telling you exactly what's going on. You know, you don't just, you know, you have windshield time with them and then you also go out to dinner with them and have a drink with them. And, you know, they start to open up and tell you some of the things that are going on in your organization. Some of which you already know about and some of which you're surprised to hear about.
Speaker 1How many of the companies you're advising or working with today are actually doing windshield time? Very few. So what- How do we- What do we do about that?
Speaker 3Get out from behind your desk and get on an airplane and go make some sales calls.
Speaker 1Well, let's talk about- You'd be surprised about what you learn. I know. The data that we're, you know-
Speaker 3Even separate from SKO, sometimes, you know, in a growing organization, a lot of the ones I was in, we were growing 100% a year. So you're always looking for sales reps that could move up to sales leaders. So you'd ask the sales managers, hey, do you have anybody in your, you know, district, region, area that, you know, can be promoted? No, we don't have anybody. And then you go out and make a sales call with a sales rep and you're like, oh my God, this guy is so good and this girl is so good. I got to promote them. They've been hiding them. So they hide them from you too. You know, as your organization gets big because they don't want to lose this rep that's so productive for them. So they think more about themselves than about the company. And there's these, you know, really good reps that are there that are easily, they become managers.
Speaker 1So that's a great point. Like if you feel like you're a CRO, let's say you're having one that's in person. We can talk about in person versus, you know, not in person. Let's just assume in person. And you feel like a stranger. Like we all get to it at some point in an organization when you realize how many people you don't know. And as the company grows and grows and grows. And I think if you're feeling, if you feel that, you're probably not getting out amongst the troops as you need to. I always use that as a barometer. When I'd sit down, I'd be like, hey, how you doing? I'd talk to somebody and say, how long you been here? And they'd say like a year. And I didn't know who they were. That's a problem. You know, depending upon the size of the organization. But if you feel like a stranger at an escrow, you feel like you have to really kind of let people know who you are and what you're about. I can tell when I go and I see CROs, they're selling kind of who they are and what they believe in. Now, if they're new and the organization doesn't know them, OK, I get it. But when they should know them and they're kind of selling themselves, there's always another story going on.
Speaker 3Yeah. I think one other thing that people don't teach enough of is like how reps should create business cases, especially these days where you have to really sell value. And even, you know, some of the guests that we've had on the podcast that talk about, about how difficult it is for customers to truly see the difference in products and truly understand what type of value they're getting. If you're not really teaching your reps, you know, how to figure out, you know, current state costs, the future state value, the ROI, the payback, risk reduction, strategic impact of the purchase that they're about to make, then you're just really not equipping your sales reps with the ability to extract a lot of value for the customer and extract a lot of value for your company. And they just don't spend enough time telling reps and explaining to them exactly how to develop the skills and knowledge around building a very impactful business case.
Speaker 1And even a follow-on to that is they could do a great job of telling them about it, but they don't let them practice it. So there's not enough practice. At SKOs, there's a lot of talking and telling, but there's not a lot of showing and observing. Do you agree?
Speaker 3Yeah, it's usually a one-to-many. A bunch of people get up on the stage and there's, you know, a couple thousand people sitting in the audience and it's one-to-many. There's no real interaction. Like I said, it's boring. It might be inspiring. They might charge you up a little bit with, you know, some vision slides or something or some motivational speakers, but it doesn't really do anything for what you're going to do the next day when you're trying to sell.
Speaker 1Yeah. When I look at skill sets, you can add to these, but, you know, I look at three skill sets that I think always have to be addressed. You know, the first one for me is how do I help sellers attach to the biggest business issue facing a customer? So meaning, how do I take whatever we're doing technically and how do I, you know, uplift that conversation to include that conversation, but to include it to people that would care about a business outcome for that? And then, you know, how do we take our, this is a huge one for me. How do we influence the decision criteria with our differentiation? You know, help me be a better, you know, more voracious qualifier. Like when I look at those three things, I would expect to see something at SKO around those three things minimally as a skill set. Do you have any others? Or do you have, do you disagree with any of those?
Speaker 3No, I don't disagree with any of those. I mean, one of the biggest issues I see too is that CROs are really late in getting out comp plans and territories. So then what happens is, you know, the year ends January 31st. Most of the Salesforce knows that a lot of their territories might change and they don't have their comp plan yet. So then they do the SKO, you know, the end of the year, end of January, they don't do the SKO until like, March 1st. So there's a whole month where these reps are just sitting there with, you know, sitting on their hands because they're like, I don't know my territory. I don't know my comp plan. So there's nothing for me to really do right now. Now, that's what a lot of the guys, the really good guys are still out there selling no matter what, but you're really hurting the productivity of your Salesforce when you haven't rolled all those things out, you know, before, before your SKO. Shouldn't be something that they're talking about during the SKO.
Speaker 1No, that's a really good point. I think it's a kiss of death if you show up in an SKO and those things aren't ready. Because think about it, if the rep's not ready to decide, and that's one of the reasons why they're not ready to decide whether they're going to sign up for another year or not. And I don't know what my comp plan is going to be, or I don't know what changes there are going to be in my comp plan or how I can make the kind of money that I want to make. And, you know, what I'm signing up for is a responsibility for my franchise. For whatever that is, a number of accounts or geographies or what have you. But can you imagine? going to like a kickoff, and they do it. I would say probably 50% of the people we talk to, John, they don't have that done by SKO. I know. It blows my mind. I can't imagine. You know, another thing for me is where we are right now, talk to me a little bit about AI and SKOs just in general. What are your thoughts on that? Like, I'm thinking if you're putting together an SKO and you do not have a point of view on how AI is going to help the sellers do something better, be more productive, make more money, help understand customers better, you're not demonstrating it, you're not practicing it, you're in trouble. If you don't have an AI point of view for this SKO, that's another case. What do you think?
Speaker 3It should only be that you're using tools or implementing tools that are going to help the sales reps be more productive and sell more. It's as simple as that.
Speaker 1If you were a CRO today, Johnny, I know this is a real, you know, this is a really appropriate.
Speaker 3Putting me on the spot here?
Speaker 1Not a little bit, but I think you're going to have a good point of view on it. Like, what would you be expecting a company to do for sellers? As it relates to AI, what would you be expecting?
Speaker 3I mean, at the highest level, that you're going to make your sales reps more productive.
Speaker 1What are some of those things that are, we talk about productivity a lot. What are the productivity suckers? Like, what are the.
Speaker 3Well, the current productivity suckers is the current tech stack. It's awful. You got Gong and Outreach and Clarity. And CRM and Word and Excel and, you know, all these different tools that the manager wants the sales reps to pay attention to. And then the sales reps keep their forecast and deal updates, you know, in Word or Excel or some other product. So where the big productivity losses are is when I got to update the entire tech stack all the time. So I'm wasting probably five, five hours a week updating the tech stack and updating my own tools. And then right after I update them at Friday at 5 o'clock, it's outdated by Monday at 12 o'clock. And then I made a sales call. My manager's calling me for updates on the call. You know, who'd you talk to? Do you have a champion? Who's the competition? Did you set the decision criteria? They're asking me all those questions. So I'm constantly updating them verbally, even though I'm not doing it all the time. Even though I put all this stuff in the tech stack and I'm wasting another five hours a week. And five hours a week times 12 is 60 hours. I'm wasting basically, you know, almost two weeks at a time. And then another big time sink is my set. Let's say my sales cycle is six months. So I need John Kaplan on the first call, John McMahon on the second call, Susie on the third call, Sally on the fourth call, Kaplan again on the fifth call, McMahon again on the sixth call, Sally and John on the seventh call. And every time that that happens, they're always asking me to update them on the deal and where the deal stands and what they should do and what I should do and who's the people involved and all that stuff. That sucks another five or six hours of my week. So I'm really losing probably three to four weeks out of a quarter just updating everybody. Updating the tech stack and updating everybody. That's where this huge time sinks. And it's all because the managers don't trust the data that's in the tech stack. So they're just hounding and pounding the sales reps into submission because they have to give an accurate forecast. So they're basically doing what I call chasing the forecast instead of effectively coaching and going on sales calls with reps and making them more productive.
Speaker 1Yeah, I think that. The productivity, the seller productivity, John, we would expect in 2026, 2027, that seller productivity would be improving. But yet the data is actually telling us it's going the wrong way. So the amount of revenue per rep, the amount of reps that are making their number, all of those are going the wrong way. What you see is
Speaker 3company scale, right? So their productivity, when they're 10 million, 20 million, 40 million, their productivity is kind of going up. The ramp time for a sales rep is maybe six months. They don't really have much churn.
Speaker 1And that's going up.
Speaker 3They start to scale. And as they start to scale and they get close to like 100 million or so, then all of a sudden you start to see that the ramp times go from six months to nine months. The productivity starts to flatten and the churn stays about the same or goes up. Then the CRO is underneath the gun because the CFO goes to the CEO and says, hey, you know, the ramp times are going up. The productivity is flat. Churn is flat to increasing. So what are you going to do because your CAC is going up? So now what are you going to do to reduce CAC? And the CFO will offer guidance. Okay, there's three things you could possibly do. One, we can cut the number of SDRs. Two, we can cut the comp plan. Three, we can cut the manager to represent. So what are you going to do? Pick one, Mr. CRO. So the CRO picks one or picks, you know, a combination of all three. Okay, so now the CFO got what he wanted because they cut the cost. But it doesn't mean that the productivity is going up. In fact, you might have made the productivity decrease more because you have less SDRs and you have, you know, the manager to rep ratio has gone up. So it's like, and it's all because no one, they're not effectively training. And coaching reps, they're mainly chasing the forecast. So that's the biggest problem that I see inside sales forces today.
Speaker 1I think so too, Johnny. And I think one of the symptoms of that is I think the average tech stack just for go-to-market is 12 to 15 products. So when you think about the impact. None of which talk to each other. Most have, you know, their own sign-ons. So can you imagine a seller to generate a forecast, to generate their rhythm on a daily, weekly, monthly, quarterly basis? They're going in and out of 12 to 15.
Speaker 3Well, they probably have some single sign-on package like Okta or something.
Speaker 1But my point is it's a different interface. It's a different, I'm going out of one system that's not talking to another system. And so that. They get tool fatigue. So, you know, big heads up. To CROs right now, if you're not looking at your engagement model, which says, how is this buyer buying? How are we selling to this buyer? What are we doing in each one of these segments or each one of these stages? Who's doing what when? And then take it down a further level to say, how are we qualifying that business? What are the gates that we need to be able? What are the gates that we need to be able to create value and capture value, deliver value, and then start to map the tech stack to it? It's not a hard exercise. You start to map the tech stack to it. I think you're going to find out what's the cholesterol building up for the reps when they show up at an SKL because it's wearing them out. I think it's wearing them out.
Speaker 3I would say on the SKL, I also think that there's no, what they do is they typically are. They're training the reps. I mean, there's no differentiation typically in an SKL that you go to where there's, you know, the rep training, manager training, executive training, right? And the managers need to learn how to inspect things, coach the sales reps, challenge the sales reps, challenge customers, qualify deals. They can't be doing just the same thing and learning the same thing as the reps. You have to have manager training. You have to have sales rep training, right? Because you can train. You can train 500 reps. But if there's 50 managers that, or 60, 70 managers that don't know how to reinforce the training, how to hold people accountable to make sure that they're implementing the training, then it's all lost. And that's what you see at these SKOs. It's a big high, big inspiration, really low on execution. They talk a big game. And then one month later, all of that stuff. That stuff's disappeared.
Speaker 1I think that's such a huge, I think that's such a great point. At the SKO, like most companies, at the very most, we'll train everybody together. Like, or at the very, let's say at the, yeah, say at the very most, like they'll say, we'll throw everybody in a room and we'll, but they're, in order for that behavioral change to happen, it's never going to happen unless something has changed at the frontline sales manager level. Yeah. most companies never do it. They're like, hey, we trained everybody on a new value proposition. We trained everybody on a new tool, on a new product or what have you. And they've never addressed what is going to have to change for manager behavior in conjunction with seller behavior. And they never give the, I shouldn't say never, but just think about it. If you're planning for an SKO now and you don't have a section in there for the managers just to be with each other to say, what's going to, you said, what are we doing differently on Monday for a seller? You got to have a section in there that's, what are we doing differently on Monday as a leader?
Speaker 3Exactly. Right. Yeah.
Speaker 1What are we missing?
Speaker 3Well, one other thing that I've seen at some companies is that they don't, they're not honest. They're not honest about competitive differentiation. Oh yeah. So, which is just so, so tough on the sales reps because they want to believe that they've been trained effectively and that their company truly knows the strengths and weaknesses of their own product and the strengths and weaknesses of the competitive product. And then they wind up listening to what some product manager or product marketing manager has to say. And they go out there and they say those words in front of the customer and they get the shit beat out of them. And they find out that they weren't told the truth. Gosh, that's just awful. And you see it happen a lot at SKOs because they do a lot of product training from the product managers and product marketing people.
Speaker 1I think this is one for me is you can feel it in the room and you're most experienced sellers, the ones that have what my father used to say, have the most sand in their butt, which means they were hard to move out of the way, which means they had credibility and foundation. When those people are balking at something on a product, well, what are we doing about this? What are we doing about that? And if you don't have answers for that, like if you're a product person and you haven't tested that with some of the best sellers in the company, and you haven't gotten that feedback, you're still going to get it in the room and there's nothing worse that can happen on a product or a strategy or whatever marketing campaign. And it just falls flat because a senior seller stands up and asks some questions, not even rudely, just ask some questions that you don't have a good answer to. But this goes back to a tech stack for me too, because for me, I want to know what the best sellers are doing. I want data on what the best sellers are doing. I want data on what the best customers are doing. I want visibility and I want it at the workflow level. I want it at the seller level. So I would also think about all this stuff that we're talking about, that if we don't have a plan to figure out a way to get people access to the best information in the company. I'm hesitating to say in a dynamic way, because I know there's a lot of technology behind that, but that's what all of our customers at Force Management are asking. What are the best people doing? How are they doing it? I know we said these were the differentiators. The reality is, Johnny, we just got off a podcast with Crunchbase and the CRO there told us that, you know, 10,000, there's 10,000 AI companies now, 10,000, which are getting, you know, what did we say, 70% of the funding or what have you. But the reality is, is that there is changes that will be happening under our very feet. So whatever we kick off at SKL, the reality is in a month, two months, three months or what have you, those things could need to be updated. So I think having a plan for that, and I know you've always said, give airtime to the people that are doing it right. Just let people see what great looks like. Right. And at your SKOs, I always knew that, you know, the top sellers were going to get up, not in a, hey, we're giving them a big bonus and making everybody, but basically you're asking them and helping them, giving them a platform to talk about what they do that's different, that makes them great. And I think that's a big component. It's got to be on the agenda.
Speaker 3Yes, sir, Mr. Kaplan. What are we missing, bro? I think that's a good wrap. That's a good wrap. I have no other thoughts on SKL right now.
Speaker 1All right, brother.
Speaker 3I'm dry. That's it.
Speaker 1Well done, buddy. Thank you, Mr.
Speaker 3Kaplan. Thanks to everyone for listening to another episode of the Revenue
Speaker 2Builders podcast. Please subscribe, rate, and review the show to help us reach more people. This show is brought to you by Force Management, where we help companies improve sales performance, executing the growth strategy at the point of sale. Check out forcemanagement.com for more information.
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