Question: We’re a learning event organization just like your son’s Salt & Light Ventures. We’re a latecomer in the industry. Some 3 years ago, what we decided as our market entry strategy was to concentrate on in-house training workshops.
We’ve had some successes especially at the start but our third year does not look promising. Two major frequently occurring problems confront our selling team. The first is the contracted customer. Because we’re a latecomer, most customers already have a contract with another learning event company and are happy with them. We’ve tried playing with pricing but the raised revenue wasn’t enough to sustain profitability.
The second most occurring problem is the growing competition from business schools. There were times when we resorted to speakers who were business school professors. After only 1 or 2 engagements with us, we noticed that clients bring their in- house executive training requirements to the school where the professors we engaged were in the faculty. And almost all clients tended to stay with the schools and forgot about us.
Your experience at Salt & Light must have taught you some valuable lessons on how to solve these 2 critical problems. We hope you can share them with us even if we are a Salt & Light competitor.
Answer: We start with 1 or 2 necessary clarifications. The first is about Salt & Light Ventures. I’m no longer connected with it since 2 years ago when my son, Ardy, sold it so he can become a full time pastor. Secondly, because I’m an educator, I share “lessons” from my research and consulting experiences as long as those sharings do not violate the non-disclosure clause in my client contract.
Answering your first question would have been perfect for Ardy to handle if he were still my Marketing Rx’s co-columnist. But Ardy’s gone to attend to a higher calling. So let me take care of this first question of yours. I’ll draw my answer from my sales training workshops.
Suppose the client we’re talking about were Smart Telecom who contracted their sales training requirement for this year to an established and known training agency. Your account executive was able to get an appointment with Smart’s sales VP and visited him. Even before your account exec could start explaining your sales training program, the Smart sales VP said that their sales training is already under a contract with a “very good” sales training organization and that Smart is quite happy with the program and their speakers. Instead of giving in to the human tendency to hint at the “competitor’s” weak points, our account executive should instead understand what the contracted training agency is doing well and then what it’s doing not so well.
For the latter, I tell my trainees to ask my “MADI” questions, namely, M for missing (or “kulang”), A for annoying (or “nakakabuisit”), D for disappointing (or “nakakabanas”), and I for irritating (or “nakakainis). One or two of these four will always be answered. The answer tells the account exec the “gap” in the competitor’s servicing that your own servicing can fill in. Of course, that’s assuming that your service is set up to do just that.
It’s risky for you to assume that the task has been completed and that your account exec can now close the sale. The responsibility for understanding continues. Suppose, the client says that one competitor’s MADI is: “Well, I have to say that two of their speakers do not know the latest in sales training. But overall, we’ve evaluated half a dozen sales training agencies and this one had the highest score. So we chose them.”
Your account exec shouldn’t lose that critical part of the conversation. She must follow through and say something like: “Mr. Sales VP, if this contracted sales training agency were to replace its two speakers with what you want, what good would that serve for you?” Suppose the Smart Sales VP said: “That would save us from the cost of getting another sales trainers who will give us the latest. That also means we can really be ahead of our competitors.”
There’s where your cue is for the closing but therefore not before. All that your account exec has to say now is something like this: “Sir, that’s exactly what I wanted to explain to you. We have those two replacements. Will you now give me just 10 minutes to explain about those two replacements?” And if the Smart sales VP agrees and he will surely agree, you’ve got the complete answer to your first question.
Now to your second question relating to the threat from business schools. This is not only a threat but an irreversible trend. More and more clients are going back to business schools for their in-house continuing executive development programs. My own trend spotting research tells us why this is happening. Here’s a typical comment from an HRD director of a multinational that’s gotten back to business schools: “Learning event organizations are into this as a business and for profit. Schools train executives for a nobler and truer purpose; that’s to develop their minds, heart and attitudes.”
As to the business schools, there’s also no stopping them in re-owning this market. Here’s a typical argument from a business school dean: “Why should leading management speakers from overseas be brought over by money making learning event agencies? That’s what makes them expensive and why the tickets to their talks are so much. We’ve learned from those speakers that if it’s a business school that would invite and bring them over, they would charge just about 10% of their commercial rate. So this will make their reach to be much wider and at a much much lower price.”
So what should you do? Don’t resist or deny the trend. It’s for the good of everyone and a real contribution to executive education. Why don’t you seek alignment and partnership with a business school. You can enrich each other as well as enrich the executive education discipline.
Keep your questions coming. Send them to me at ned.roberto@gmail.com.