Analysis of Michael Krause's "Sell or Sink" sales strategies

Michael Krause has written a new book that provides eight sales strategies that are supposed to help increase sales, engendered a more motivated sales staff, and help sustain both. The eight strategies are: USP and UVP; Strategic planning; SWOT analysis; Engage your ideal clients; Build a cash reserve; Core capabilities and realistic goal setting; Balanced scoreboard, and; Do you have what it takes? The author looks at the entire organization and not just the sales staff, but he tries to tie all of what he says into sales.

He loses some credibility because he uses some terms wrong, but this is not problematic necessarily as they are the sailing terms he employs as part of the illustrations in the book. However, he does make some questionable suggestions regarding the fourth strategy.

Analysis of "Sell or Sink: Strategies, Tactics and Tools Every Business Leader Must Know to Stay Afloat"

Introduction

The business world is full of books that promise more than they can deliver because they offer platitudes instead of actual substantive advice. The reality is that there are very few books considered classics in the sales self-help realm because there are very few books that deserve that status. However, since sales people are often looking for an edge, they will buy almost any book to see if it contains the magic pill they need to succeed in a profession that is both demanding and difficult. Or, there is an expert who has decided to sell a book that is full of the same techniques given by more observant men and women, hoping that by using different wording they can write the same book in a different way and achieve the same financial results. So, the books keep coming because the author believes in, and has been successful (hopefully) with the program that they espouse, or they have the desire to make money the easy way; by selling more inanities to a gullible sales public that continues to buy magic beans.

This is not to say that every new sales book falls into the above categories (only time will tell if they do or not) because there are those which try to use new techniques, proven by the author's success, as a useful means of garnering new sales. The book under discussion for this analysis is called "Sell or Sink: Strategies, Tactics and Tools Every Business Leader Must Know to Stay Afloat" and it was written by Michael D. Krause. This recently released book (2011) is a mariners guide to the world of sales. The mariner part comes from the use of nautical terminology as chapter titles, and extensive use of nautical quotes and imagery to emphasize points. The efficacy of the book is discussed in this paper according to the problem it seeks to solve, its use of organizational behavior theory, key moments in the book, and this writers substantiated opinions of its worth to the sales world in general.

Problem Facing the Person/Organization

The issue described in the book is that of the seller who has either lost the desire to sell or does not have the tools required to do so. The author says that

"I have an affinity for sailing. I am fascinated by the mechanisms and methodologies along with the attention to detail required to keep the boat on the right tack. Sales is no different, really. Without the right knowledge and preparation, you will find yourself adrift and in irons with no prospects and no way forward" (Krause, 2011).

Sales professionals too often have no idea why they are not able to makes sales quotas, or any sales, but they keep pressing ahead without the proper knowledge because that is the job. Krause is describing an approach that can be used to assure the salesperson that they have a plan. But, he also has other warnings for them.

The main problem that people have according to Krause is that they may have a plan, but they do not adhere to it. The person who reads this book must be willing to use the book. That is why Krause gives the lesson and asks questions as the "tactic" is being explained with room for jotting down answers in the book. Since many people would be underlining or writing notes in the margins anyway, this seems to be an excellent method for keeping the reader engaged in the lesson at hand.

Krause lists the problems, and then seeks to solve them, in the books chapters. He begins with some quotes, an anecdote that relates to the tactic introduced in the chapter, the problem the chapter addresses, and then he gives the reader a "tactic" for solving the sales issue presented. In the first chapter he presents the dilemmas which his sales tactics are meant to address. In the problems list he asks whether:

"Sales team morale is low after consecutive quarterly results fall below market projections and/or trying to meet unrealistic sales goals

Everyone is burdened by the ongoing emotional strain of riding the sales quota roller coaster

Internal tension and competition create a chaotic atmosphere within and between the sales and marketing departments

Your access to comprehensive meaningful performance feedback is clogged with excessive internal reporting and paperwork

Reporting from top executives or department heads lacks transparency on troublesome issues due to their natural concern for being perceived as too critical, negative or incompetent

The sales team is trying to reach an audience who has a particularly strong distrust of salespeople and marketing messages" (Krause, 2011).

He seeks to offer the solutions to these issues by presenting a comprehensive sales program that is eight sessions long. It should also be noted that the book is only 124 pages long and can be read easily in a single two-hour sitting. However, if the sales professional is interested in following the lessons as Krause suggests, the individual or sales team will see an increase in sales.

Conclusion and Discussion

As for organizational behavior, Krause does not mention the phase specifically in the book, but he does give the lessons that an employee will need to change her or his thoughts on sales, and how that affects the overall organization. But it is difficult to draw conclusions when only part of the book has been discussed so far. So the next few paragraphs will be a detailed overall look at the book.

In the first chapter Krause give a general overview of the technique he is going to describe, and also discusses how the sales people can get started. The discussion of his selling technique truly begins in the second chapter in where he asks the question "What are you selling?" He gives some general information then he allows the reader to try and describe what they are selling while he gives a few leading writing assignments. The main portion of the chapter discusses unique selling proposition (USP) and unique value proposition (UVP). He describes these two terms as "Your USP is what is unique about the service or product you provide -- in essence, the unique advantages you offer your customer & #8230; Your UVP refers to specific value (benefit) for the specific customer or prospect to whom the service or product is being offered -- the overall package as it benefits or helps the recipient" (Krause, 2011). The sales people who work with the product or services must understand why the customer values the product and what benefits it offers them before they can successfully sell a given product. The author then talks about a few methods the company can use to find out what the customer really needs from the product, so that the sales people can discuss those aspects of the product.

The third chapter talks about strategic planning. The author calls this the most important sales technique because it is how a leader builds a strong company. Team members are only as strong as the leadership they receive. Krause (2011) writes that "Sustained, strong sales can only be built on a strong foundation of growth and strategic planning." This stance is backed up by Griffith and Sawyer (2010) who point out the advantages of strong leadership in molding the organizational culture.

The next chapter is about the SWOT analysis which was already discussed, but the fifth chapter takes the reader through how to engage their clients. Even the most able sales person has bad days with clients. Sometimes no one is responsive to what the individual is selling, but that does not mean that they should necessarily try a different strategy entirely (Sliter, Sliter & Jex, 2012). The salesperson needs to think back on the previous lessons that they have learned so that they can see aspects of the product that they may not have been emphasizing before. But the salesperson also needs to remember that the most important person in the organization is the customer. That is the emphasis of this chapter. Krause says that it is important to work with the company's top customers and make sure that they are actively engaged. He states that with this strategy the organization will:

"Eliminate spending too much time on customers who net you the least amount of return for your efforts

Create targeted marketing campaigns for specific large-reward customer categories

Establish incentive programs to attract less active customers into your top range

Develop a relationship package to secure relations with your most valued customer groups, such as a bronze, silver, gold, or platinum level" (Krause, 2011)

This does not mean that the company is to stop looking for customers or that it is to completely ignore the 80% of customers who give the company 20% of its total sales. These customers are important because they do offer some amount of revenue an because they do offer value to the company. One of these customers may also one day become part of the top 20%. However, there can be too much time spent trying to engage these customers that is better spent with the actual sales producers.

These middle chapters are all about increasing the profits of the company, and at this point it seems more like a management or leadership book than one designed for sales people in particular. The main point in this chapter is to maintain or build cash flow because "insufficient capital or cash flow is one of the top reasons for business failure" (Krause, 2011). It is true that a salesperson or sales staff can definitely affect the cash flow that a business generates, but it is difficult for them to have any direct effect on the plans that are implemented for this to happen. If the sales staff does their job competently, they will create positive cash flow. However, the title for this chapter is somewhat puzzling. He calls it "Fill the Gunwales" which is strange because if they are filled, they can cause a ship to tip over in a storm. He should have more appropriately called it "Fill the Hold" which is where a ship stores all of the goods it is carrying.

Chapter six has already been discussed to some extent as it is about knowing and influencing organizational culture. This chapter will be discussed in even more detail in another section of the paper. It is the one that deals primarily with subjects that have to do with organizational behavior.

At the beginning of chapter eight Krause says, "In much the same way, it is incumbent upon you as a business owner to know the internal workings of your organization. If not, when adverse things happen, there is little that can be done to anticipate how changes will impact your operations." Again he is deviating from talking directly to sales people to looking at the overall organization and how it can influence sales. Specifically, he talks about the structure of the organization from the CEO down, and how the entire environment can affect he sales people. In part he says that

"An organization's structure is constantly shifting and adjusting. People are hired, new products and services launch, committees are formed, informal alliances change and systems within the infrastructure are updated or reconfigured. This dynamic shifting has direct ramifications on your organization's ongoing ability to function at its most productive pace. It also subtly affects your sales people's ability to sell efficiently to your clients, whose organizations are also probably in the throes of their own structure shifts" (Krause, 2011).

If the sales people do not know what is happening from one day to the next, they could have problems making sales to generate revenues because they are caught up in the chaos. The responsibility of the executive managers to make sure that balance is maintained so that employees can be as productive as possible.

He ends with the eighth and final strategy in this chapter. He asks whether the company and the individuals in the sales staff are ready to make the changes necessary to see the increase in sales that he is preaching. Krause (2011) believes "That enterprise's stable, sustainable growth requires a vision, a strategic plan, motivated talent, tools and the right materials. Successful business owners begin with the completed organization firmly in mind." Unless the captain of the ship is willing to make the necessary adjustments to the ship and give the leadership needed to head it in the right direction, it will not make any progress toward the goal.

The final few chapters of the book give a few more pointers and motivational words about what a company can be if they adhere to the points expounded on in the book. Of course, he talks for a few pages about other sources of sales income, such as outsourcing that may be necessary to fully implement a sales plan, but for the most part the last few chapters are motivational. He gives a final list of the eight strategies:

First strategy: USP and UVP

Second strategy: Strategic planning

Third strategy: SWOT analysis

Fourth strategy: Engage your ideal clients

Fifth strategy: Build a cash reserve

Sixth strategy: Core capabilities and realistic goal setting

Seventh strategy: Balanced scoreboard

Eighth strategy: Do you have what it takes?

and then he gives a list of resources that the reader can use to further enhance their sales growth. It is a comprehensive book, but there are some issues which seem troubling. These will be discussed in the last section of the paper.

Solutions Offered and Key Takeaways

The reason that the author uses so many sailing examples and quotes is because, in his personal sales life, he has used the lessons he learned from becoming a qualified captain. Krause (2011) says that

"My dad and grandfather taught me the basics of boating when I was just a kid. Since then, I've gone on to study sailing more formally and received my marine captain's license a couple years ago. My license qualifies me to command sailboats and motorized vessels up to 50 tons."

This is a great device to use when discussing any topic which requires motivation of the audience, but his use of wooden ship sailing technology leaves something to be desired. However, his ideas with regard to effective sales growth is spot on.

He talks about building up the culture of the company and making sure that the environment is conducive to giving the sales people the atmosphere they need to survive. This agrees with an article written by Sliter, Sliter and Jex (2012) in which they talked about the ineffectiveness of sales staff that feel bullied by customers or management. The environment is one of the most important elements of overall sales success.

The chapter which discussed the need for the sales people to value the product is also one that marginal sales people need to hear. Unfortunately, many people try to sell products they do not believe in or they are selling for a company they do not believe in or maybe both are true. If the individual has gotten to this point they need to look at a career change or the sales person can look at the value that the product gives to the customer and take some satisfaction in that. Many times a salesperson just needs a job, or there are so many products on a sales floor that they cannot become excited about every single one. At this point it is important to remember that the customer is the most important part of the equation, and sell to them rather than worrying about personal feelings regarding the product or service.

It is also important to note that he did not talk about specific sales techniques. He did not talk about old school door-to-door methods such as sticking your foot in the door so that the potential customer cannot slam it in the salesperson's face. He did not talk about glad handing, kissing babies or any of the other more political methods that salespeople have been known to employ. He talked about honest approaches that, he admitted were time tested, and therefore known to work. He may have been partially rehashing what has already been said, but he uses recent research that confirms its efficacy.

Finally, Krause importantly leaves the reader with additional information that they can glean even more from. Sales is an evolving occupation that is changing because people and the overall environment change. It is not enough for a salesperson to get training or a degree that says they are ready to sell, that individual must constantly keep up with trends in their industry and sales methods that have proven successful there. Krause does a good job recognizing that a long list of resources is needed to fully address the subject.

Agree and Disagree

There is much in this book to agree with. Because it is a book about sales, it has to talk about the drive that is needed to do the job, and Krause addresses this. Sometimes all a salesperson needs is a vacation to regain their motivation, but sometimes it is a much more serious affliction that requires a more thorough healing. Circumstances are different for every individual, so sometimes a book like this is needed to rejuvenate a salesperson, or even an entire sales staff. The management of the company will have ti make this determination.

His best writing was done when he was speaking of the sales environment that has to exist for the salespeople to most effectively do their jobs. He calls the strategy associated with this chapter "Core Capabilities and Realistic Goal Setting." It seems that the most important word in that strategy is "realistic." The salesperson knows what they are capable of. The individual, especially one who has worked in the industry for a long period of time, knows who they are and what they can do. But, companies often make the mistake of setting sales goals too high, or expecting more than a limited sales staff can give. At that point it is up to the sales staff to talk to management about what they believe is a real goal. He says that "

Sales sense -- the ability to understand and apply consistent, reliable sales growth strategies to attain solid results -- requires you to identify your organization's core capabilities. Your company's core capabilities, also known as core competencies, refer to the abilities, products and services that give your organization a competitive advantage in delivering value to your customers" Krause, 2011).

The management has to know what the sales staff can accomplish, and that is a finite quality. They also have to be willing to do one of two things if they believe that they will have to exceed those goals. The management either has to reduce the sales expectations and take the consequences from the shareholders, or they have to take a risk and hire more sales personnel. Hopefully a well-balanced management team will make the correct decision.

Unfortunately there are some parts of the book that make the entire writing seem suspect. The first, and this may be somewhat nitpicky, is his use of nautical terms. He is a qualified captain who relates that he is well read on the subject of sailing. This is a specious claim, at least as far as the wooden ship terms he used, which can bring the credibility of the entire book into question. The specific instances are his err with regard to "filling the gunwales," the fact that he said a captain will always call hard a-lee when he or she wants to make a turn (they can also go hard a-luff of callout a side of the ship depending on which way they want to turn), and the third term was already discussed earlier. Again, this may not have anything to do with the quality of the book, but the point is that if he is wrong about these facts, he could be wrong about others. These are easy mistakes to avoid with a little further research, and something an editor and a publisher probably would not catch. But, there is a more serious issue with the book which has nothing to do with his possible loss of credibility because of the apparent lack of research. It has to do with attending to a certain class of client.

Chapter five suggests that salespeople engage the top 20% of their customers; the ones who provide the most revenue for the company. The strategy suggested here may be one that produces more sales, but it may also produce salespeople who are competitive with fellow sales people and who do not care about giving any time to the customers that they believe are the least productive. This can be seen as counter to his suggestion about creating a positive culture in an earlier chapter. The Aspen Institute equated this very strategy to one of the reasons that the financial crisis occurred. They say

"Speculation about the star culture and talent ideology that discouraged companies from questioning risky actions, and the power of leadership and values in shaping behavior within companies' "living systems" raise important questions about the factor that contributed to the current mess" (Aspen Institute, 2009).

This is a significant statement coming from an organizational think tank. Krause seems to overlook the potential danger of this suggestion because it is probably a tactic he used to generate more than $100 million in sales over his short sales career (Krause, 2011). There is more than likely no harmful intent in this strategy, but it could cause some amount of damage to the company if it is not used properly. Of course the company wants to keep its top customers happy, and there are means of doing this, but suggesting that a company pay less attention to the people who could become part of that elite group seems irresponsible. The better suggestion seems to be to encourage the top customers with organizational incentives (which could cause other customers to want to be in that top group) without causing conflict among the sales staff.

Overall it is a positive book, but, in the end, it is just a rehashing of sales techniques that have been around for many years. It is more a book designed to reinforce good organizational and sales staff habits than to teach them anything new. For what it is, this is a worthwhile book.