In the business world, trust is fragile thing. One screw-up can destroy a customer relationship that took years to build. And the fall guy is usually the sales guy. But here’s the thing. When sales screws up, it’s usually because they’ve been incentivized, motivated and budgeted to do the wrong things. The same is true of marketing.

In other words, the problem starts at the top.

It’s remarkable how many CEOs don’t trust their sales and marketing folks as far as they can throw them. I know that because just about every chief executive I’ve worked with – and that’s a lot – fit that description. I can’t tell you how many times I’ve been brought in to fix a sales and marketing problem that was actually caused by the head honcho.

CEOs say they want their sales execs out in the field calling on customers, cutting deals and selling shit. Those same CEOs imagine those same sales execs sitting home screwing off instead of working. Either that or they bog them down in meeting and budget forecast hell. They can’t win.

CEOs say they want their sales people to have unlimited earning potential. The logic is, if they’re making good money, then the company is making good money. So they tie 100% of bonus comp directly to revenues. Then they wonder why sales never does anything strategic, innovative or long-term.

Don’t even get me started on channel stuffing, conflicts and the like.

The same goes for marketing. Marketing execs are forever fighting for budget for their anemic programs and organizations. CEOs say there’s no accountability, and in many cases, they’re right. But when marketing pitches a more sophisticated data analytics-based approach with metrics, those same CEOs balk at the cost.

When a mid-sized public company was near bankruptcy — sales had stalled and the veep quit in frustration — I took over (was running marketing at the time), spent the next few weeks traveling (most of our sales were international) and presented my findings to the board. Turns out sales was cutting deals at the end of the quarter to “maker their number” pushed by the CEO, but it just sat there in the channel. The core issue was prices — also set by the boss — were way too high.

“Is that all you limp dick marketing pukes know how to do,” raved our irritated CEO, “Cut prices?”

“No,” I said calmly, having been called far worse by the guy, “But if we don’t, we’re all going to be out of a job in three months.”

We cut prices, flushed the channel, quit cutting deals, and everything was fine.

Savvy business people will generally do what they’re incentivized, motivated and budgeted to do. If sales and marketing is dysfunctional, it’s a good bet that the underlying issue is how they’re incentivized, motivated and budgeted. Fix that and you fix marketing and sales.

Image credit Laura Cummings via Flickr

  • BigGameHunter

    Geez, Steve, this was good, and it made me feel there is more you could say. I can only add that those same CEOs are incentivized the same way, leading to “trickle down economics” . . . in the form of pay plans throughout the organization that mirror theirs. One of the key drivers for this phenom is the need to drive greater shareholder value. It’s the breeding ground for short termism.

    I talk to a lot of CEOs; short termism runs rife. Everything, including the thinking, is deal-centric and very transactional in nature. When it comes to marketing investments, there is a certain head set that thinks a marketing investment should work like an ATM machine. Deposit a check in the bank today, and take out cash tomorrow. Most strategic marketing investments work more like a savings account where interest or payback is earned over the long term. Truth is most marketers can’t rationalize or defend their recommendations to the point where expectations concerning payback are set correctly. So they fall into the trap.

    While I believe in digital media as one contributing marketing plank, I swear the wholesale shift to digital is because some new metrics can indicate some immediate leading indicators of ROI. That’s equivalent to feeding a charging lion your left arm to chew on while you protect your balls with your right hand. I’m old school, and rely on profitable share growth and loyalty scores as indicators of success, and that generally does not imply overnight success in marketing and sales.

    • Steve Tobak

      Quite right, BGH. Marketing is rarely strategic — even less so in the digital era, if that’s even possible. As I wrote in the book, one of the reasons that marketing gets a bad rap is there are so many bad marketers. Unfortunate.