Warren E. Buffett once said, “It takes 20 years to build a reputation and five minutes to ruin it.” Wow, is that statement ever so true. It’s especially valid when it comes to salespeople who oversell and/or underdeliver. Or those who make or exceed their quotas time and time again, but their cost of sale is astronomically higher than everyone else’s on the sales team. Are either of these situations part of sales ethics? Let’s take a look at each scenario.
Overselling and Underdelivering
I know those of you who are reading this would never purposely oversell or underdeliver, but it happens. I remember a situation in which my sales team worked very closely with product management to ensure we sold what we actually had, and that any development was blessed by the head of product management. We had tons of internal meetings to make sure everyone understood the “must have” functionality that would enable the prospect to accomplish their business outcomes. We also had lots of conversations about risk and timing, and shared all these details internally and with the prospect.
We got this all in the contract, and the head of product management and the president of our company signed off on it. A win-win for everyone. The salesperson and I knew this deal would need to be well monitored to ensure on-time and on-budget delivery. We truly believed ethics was part of our sales DNA.
But, you must know how this story ends. Product management could not deliver and sales was at fault in the customer’s eyes. They believed we had done a bait and switch. We had not, but no matter. From the customer’s perspective, we had oversold and underdelivered.
Unfortunately, there are salespeople out there who knowingly oversell or underdeliver. Usually, a good compensation plan can keep this from happening often or at all. But, I have known salespeople to do things they know are wrong. They want the almighty commission and be able to pass the buck to implementation and others to deal with it, even if the project costs go over budget and the customer’s required timelines are missed. Needless to say, these salespeople typically never get repeat business or a reference.
High Margin Sales
We have all seen high margin sales happen before as well. The salesperson brings in the deals and blows away their quota, but drags every Tom, Dick and Harry into their deals. They are disruptive internally, always whining, crying, shouting and pounding tables to get what they want.
Regretfully, if they are not managed correctly, they will get their way − especially if their sales management is compensated on gross revenue rather than net margin. They will approve tons of people to attend meetings, fly them all over the world, and never really care about their impact on their company’s bottom line. They are also usually the culprits who oversell and underdeliver, while managers justify their approach as an implementation problem rather than a sales ethics issue. Is it?
Making Sales Ethics Part of Your Sales DNA
The bottom line is this: how you sell will follow you and your company everywhere, and for a very long time. Reputation damage is difficult and costly to fix, and the standards for sales ethics are rising with each passing year and each new generation of buyers and influencers. Being a good corporate citizen must be part of an organization’s DNA in today’s digitally connected landscape, because the world finds out awfully fast when you’re not. And, in sales, it all starts with the salesperson.
Making sales ethics part of your sales DNA is critical to your and your customer’s success. And if you see bad behavior happening intentionally over and over again, then dig deeper into the root of the problem and correct it before it does irreversible damage.
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