Tag Profits

The Almighty Dollar

Steve Keating 1 Comment

Businesses that have the singular goal of making money are very poor businesses indeed. 

They are also businesses that won’t be around very long. Businesses that survive long-term have leadership that understands no matter what business they are in, they are also in the people business. 

It’s people who make the products the business sells. It’s people who sell the products the business makes. It’s people who buy the products the business sells. It’s people who supply the profits the business needs to survive. 

Business Leaders who lose sight of those facts run the risk of losing, actually the likelihood, of losing the entire business. 

Authentic Leaders never lose site of those facts. They keep their people, employees and customers alike, at the top of their organizational charts. Leaders who put The Almighty Dollar at the top of their organizational chart, even subconsciously, create disengaged employees and disgruntled customers. 

Businesses that chase The Almighty Dollar see every dollar spent as an expense. Businesses that put people first see many of those dollars as an investment in people. They see investing in people as the surest way to generate more long-term profitability. 

Businesses that only chase dollars have never seen a corner they couldn’t cut. They will cut expenses anywhere they can, all in the name of profits. They would rather make a dollar today than two dollars tomorrow. 

To be clear, chasing dollars is very different than prudent expense management. Expense management is done for the benefit of the stakeholders and the shareholders. Cutting corners most often benefits only the shareholders. It most often comes at the expense of the stakeholders. Stakeholders, if you’re not familiar with the term are primarily the employees and customers of a business. 

The challenge for businesses is to make sure that their expense management, done for the benefit of all, doesn’t turn into cost cutting done for the benefit of some. That happens when the leadership of a business doesn’t have strong core principles that put people first. 

For businesses that chase only dollars product quality is a corner to be cut. For businesses that chase only dollars customer service is a corner to be cut. For businesses that chase only dollars employee development is a corner to be cut.  

Many business leaders simply don’t understand that each one of those cuts, made in the name of The Almighty Dollar, actually make it less likely that the business can remain profitable long-term. 

Businesses don’t just need people to survive and thrive. They need engaged people. Employees who care and customers who are loyal. “Cutting” doesn’t accomplish that. 

There has never been a business that saved or cut their way to long-term success. Success over time requires investment in people. It requires a willingness to perhaps, and only perhaps, sacrifice today’s profit to make triple the profit tomorrow. 

Long- term success requires long-term thinking.

If you’re a business leader today then you need to know your people are watching…ALL of your people, employees AND customers. They want to know if you care about them as people or if all you care about is the profit they can bring you. 

There is a tipping point. People, whether they be employees or customers, will try to help an organization right itself if it loses sight of how important people are. 

But they only do that for a time. If they determine the business is not open to their help then they do something different. Committed employees leave and potentially loyal customers take their business elsewhere. 

The final lesson the business learns is that when enough people leave The Almighty Dollar follows them right out the door. 

No, Sales Don’t Fix Everything

Steve Keating 5 Comments

Sometimes I’m at a loss for words. I know frequent readers of this blog may find that hard to believe but sometimes I am so flummoxed by something I hear that I don’t know how to respond.

 

I recently had one of those conversations when the subject of selling came up. I pretty much despise discounting of any kind. If a company has built value into their products and services then they should be able to sell that value to customers. The purchase price of that product should reflect the value that was built into it. 

 

In a perfect world that’s the way it would always be. But the last time I checked the world wasn’t perfect. 

 

So salespeople, even at times very good, well trained salespeople will be forced to offer a discounted price to earn the business of a customer. That happens for a lot of reasons. One of the biggest is a competitor pricing their inferior products well below the price of the superior product. Then they sometimes deceive the customers into believing the products are nearly identical. 

 

They in effect commoditize the product and tell the customers “it’s all the same so why pay more.” It’s not exactly ethical but if you don’t have a lot of mirrors around and you don’t need much sleep at night it works.

 

The skill of the salesperson must match the quality of the product. If not then the customer may not have the opportunity to compare the products on a level playing field. 

 

That’s what first attracted me to sales training. Companies with high value products need salespeople who are skilled at showing that value to customers and prospects. 

 

Without highly skilled and professionally trained salespeople the companies that sell products with high value will leave their customers and prospects vulnerable to the offers and “deals” on inferior products put forth by their competitors. 

 

The customer loses in that scenario. They may not realize it at first and truthfully some may never realize it but they lose all the same. But the high value company loses as well. If they can not receive fair value in return for the value they offer then they will fail as a business. The failure may come quickly or it may take a while but the end result will be the same. 

 

If your business is selling high value products and services then you must be compensated fairly for those products and services. That requires a well trained and professional sales force.

 

This is a bit of an aside but if you’re training your salespeople today in the same way you were 10 or 15 years ago then you are only partially training your salespeople. The marketplace is far more chaotic today then it’s ever been before. There is more information available to customers and prospects (much of it misinformation) than ever. There are more ways to purchase something than was imaginable only 5 years ago. Sales has changed and your sales training needs to change as well.

 

Which brings me back (finally) to the point of this post. In a conversation with someone who should know better, who in fact MUST know better, they used that oft stated cliche “well, sales fixes a lot of ills.” 

 

I immediately corrected them and said “no, sales HIDES a lot of ills.” The problems are merely disguised for a time. If too many of those sales are heavily discounted then you have a problem.  If you are a high value company you have two choices: stop selling high value products or go out of business. 

 

Businesses don’t succeed because of an impressive top line. Businesses succeed when their bottom line is reflective of the value they sell into the marketplace. 

 

What truly flummoxed me was this person’s disagreement with that statement. They insisted that if you were selling enough you would be successful regardless of your profit margins. 

 

For emphasis they repeated, “it’s all about sales and only sales.” 

 

That is almost scary! I wonder how many people in business feel profits are optional? I never considered there would be people in a for profit business that felt that way. Now I’m wondering if I‘ve discovered the cause of a whole lot of business failures. 

 

Sales are not what keep a business going. Profitable sales are what keep a business going. If you don’t know that, if you don’t live that, then you won’t be in business very long.

 

Just so we’re clear, profit isn’t the only thing a business should make. They hopefully make a real difference in the lives and businesses of their customers. They do that by providing them with high quality products and services. But if they hope to do that consistently, for the long haul, they MUST make a profit. 


Because no no matter how much we may want it to be so… sales do not fix everything.