Turning tides Featured

11:07am EDT November 20, 2003
What if someone told you to fire your entire sales staff? Well, that's what R. Sam Bowers advocates.

Bowers, president and founder of Service Sales Institute, and a former executive and economics professor, has spoken to thousands of CEOs and at trade associations and corporate conventions, flustering decision-makers with his take on the future of business.

Like a corporate Dr. Phil, Bowers has a home-spun business sensibility that shocks and goes against long-standing business traditions. But there's something about what he says that rings true.

According to Bowers, the business world has changed and the focus has moved from being on how we sell to consumers to how consumers buy products.

And this leads directly to the Internet.

"To deny e-commerce is to deny the telephone ... The Internet is where (products and services) are going to be bought and where you need to learn to buy," Bowers says. "Your buying skills will be your competitive advantage."

He says a company's No. 1 management team member should be the head of the purchasing department because that person's buying skills can lower the company's fixed costs.

Selling to consumers

To find the lowest prices, consumers are researching products online before they buy. Since customers don't need to be "sold" in the traditional sense anymore, Bower says some companies can lower fixed costs by eliminating their sales force.

"(CEOs) aren't willing to come to grips with the fact that the salesperson isn't necessary," he says. "The customer's decision has already been made. Take the cost of the salesperson out of the way."

Bowers adds that when companies get rid of salespeople, they do away with the cost of sales, salaries and commissions. The costs of travel and entertainment that went hand-in-hand with sales are also erased when companies do business online. Why pay for an afternoon of golf or dinner at a fancy restaurant when the customer already knows what he or she wants to buy?

"In a purchase economy, you need to take the cost of the relationship out of the equation," he says. "You have to turn from a selling company to a negotiating company."

No value-added

Value-added is a concept that adds services to a product, and it sounds good in theory. But Bowers says most businesses that offer value-added services have to raise prices so much that they take themselves out of the equation when consumers compare prices. "It will drive more businesses under than any other concept ... It's a death spiral," he says.

He suggests companies simply offer their product at the lowest possible price. If customers ask for additional services, tell them up front they will have to pay for them. Bowers calls this "unbundling."

He says companies should offer customers "just enough" -- not more and not less -- so the customer chooses that company over another.

Winning the game

To win a sale, CEOs should focus on their company's marketing and branding rather than on cold-calling, Bowers says. And after the customer chooses your company as its supplier, focus on providing top-notch delivery, logistics and follow-up.

The key to re-engineering a company, Bowers says, is to provide products better, faster and cheaper than its competitors.

"The game has changed," Bowers says. "It's a cold, hard, cruel world. It's called competitive business." How to reach: Service Sales Institute, (704) 365-0542


The eight worst manager types

We've all had them -- bad managers. If you've ever wanted to put a name with the bad behavior, Gary S. Topchik can help, with "The accidental manager: Get the skills you need to excel in your new career."

In his book, he outlines the particulars of each type of bad manager.

* Noncommunicators: Aren't interested in exchanging ideas; secretive; have a closed-door policy; avoid holding meetings; walk as if in a trance

* Management knockers: Ridicule their role; tease higher-ups that they aren't doing "real work." The company could do better with managers who are respected by their teams.

* Task mongers: Micromanage and expect everyone to agree with their unilateral decision-making

* Best friends: Ignore when procedures aren't being followed; avoid confrontations; don't take anything too seriously

* Limelight takers: Like being the center of attention; take credit for their department's success; seldom give credit to deserving employees.

* Wafflers: Procrastinate; ask for others' opinions; become busy with other projects to avoid having to make decisions

* Braggarts: Genuine braggers know quite a bit and are entitled to some bragging rights; others tell everyone how great they are when, in reality, they aren't.

* Deceivers: Don't want to face company issues, don't know what is happening and need to respond in some way, or like to see others' emotional reactions