Saturday, January 13, 2018

Ignore the Wishes of Sales Department at Your Own Peril

I had dinner with a friend and business partner who is an extremely famous businessman in Japan and in New Zealand. Hell, he has even been featured in the New York Times more than once! He was the first foreigner to ever IPO a company in Japan. In fact, he brought the first two foreign owned companies to the Tokyo Stock Exchange by a foreign founder in history. From those two deals he became a many times over multi-millionaire... Gee...Do you think it might be wise for me to listen to his advice?

He was telling me about a General Manager that was just terminated a few months ago from one of Japan's largest internet services.

He told me that the guy wouldn't listen to people and especially ignored the wishes of sales department. 

Anyone with business experience knows that is a sure-fire way to failure.

My friend explained it to me like this:

"Imagine that, Mike, you are the boss of, say, a company that makes vacuum cleaners. Sales have been going consistently down for the last few years. You need to do something. You have a sales force that's been with you for years, and knows the market.

Your company desperately needs to do something to get customers back to buying your vacuum cleaners. There are a few options from designers and factories and you must choose one to be the unit line-up that you make.

The sales department all want to make model A, but you think model B is better.

So even with all the evidence that you have compiled to prove that Model B is better, Sales - the people on the ground - are convinced that A is better. You ignore the wishes of sales department - not even offering any compromise - and you manufacture Model B.

Big mistake! Why? Now sales department feels that you don't listen to them and that their opinion isn't important. The sales department thinks that you don't know what you are talking about since it is they, and not you, who are in the field talking to clients and potential buyers. 

Is this a good result?

Maybe model B is better. But sales now feels disrespected or that their opinion doesn't matter. Are they now a Gung-ho sales force ready to sell the world? Or are they a disillusioned and disgruntled group that sighs at work and goes fishing a lot or even to play pachinko?

This was the worst result that could have happened. The project will fail because the sales force won't be motivated. This error in management has happened over and over and will continue to happen.

So, in our case, we fired the guy after a couple of years. I wanted to fire him within 6 months."

It's obvious, isn't it?

Good management will often decide nothing on their own. Bad management will decide and will also be obstinate. Good management will gather all important parties and have a discussion - even several - and try to gather a consensus and come to the best decision. Bad management doesn't. If there is a hung jury or a decision cannot be made by staff, then and only then, should management step in and make a decision. 

Bad management decides and then informs.

This is common business sense and well known professional management technique. To do otherwise is to risk your own job.

Ignore the wishes of sales staff and your own staff at your own peril!

For a more detailed description of these techniques and how to use them to keep your job! Please read the multi-million selling management books by Chris Collins, "Built to Last - The Successful Habits of Visionary Companies" and "From Good to Great - Why Some Companies Make it and Others Don't."


Anonymous said...

I'd swear you were talking about my company up until last November. But I know you don't live in Vancouver. Our old boss was a self-centered nutcase. He didn't listen to anyone excpting his yes-men. Glad he's gone!

Anonymous said...

Reading your blog teaches more about business then any "Business School" ever could. They only real reason to go to school for Business is to learn about bookkeeping and legal codes. - Aaron Egon Moser

Anonymous said...

"They only real reason to go to school for Business is to learn about bookkeeping and legal codes."

No, no. The Real reason is to meet beautiful ambitious women who wish to be entrepreneurs with you.

`````````Everything else can be learned on your own, easy.

- IndividualAudienceMember DejaVu

Anonymous said...

Does he still work after becoming wealthy? If they work without the need for money, what drives him/her to continue working?

mike in tokyo rogers said...

You know, I've wondered the same thing. Actually I know a few people who have gone to IPO and walked away with millions. They all still work... I think it's because they are business people and, as such, they are bored out of their skulls when they don't work. It's only explanation for people like Elon Musk, Richard Branson or people like that

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