Tomicide Solutions July 2008: Are We Chasing Beasts Or Scratching The Ground To Eat And Live Another Day: Selling Through Hunting Or Farming

By Tom "Bald Dog" Varjan

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I've recently heard and read so much about arguments between "hunting" and "farming type" business development departments that I thought I would "blow" one newsletter issue to voice my thoughts on the topic. First I thought this was up to individual taste, but after having read some serious sales lunacy...

...which may have been valid about 50 years ago but not today, I was even more inspired to put my thoughts on paper.

And there was one more reason. A while ago I wrote a tip sheet on selling technology, and I've sent out about 500 copies on a trial basis. And many people who had requested it got back to me and said the stuff was good in theory but in practice it wouldn't pan out.

I asked them why, and they said that in the real world you have no choice but to chase prospects because there is no way they will ever come to you no matter what you do. And the salesperson who is the best at chasing and manipulating is the most likely to get the deal.

These companies say they have to be aggressive hunters to get the best deals around, and unlike the patient farmers, they are not willing to wait for the roast duck to fly into their mouths, so they are aggressively chasing prospects, pin them down and get as much of their money as humanly possible before someone else gets to them.

On the surface this is valid, but when we look a tad deeper then we see that somehow the best prospects belong to the patient farmer type companies. But first

Let's See The Difference Between Aggressive Hunters And Patient Farmers

But first let's look at how humans have evolved over the years.

First there was the "hunter & gatherer" age. As the name suggests, our ancestors were roaming the land hunting some beasts and picking up some fruits, roots and any edible plants. It was pretty tedious work and the reward was rather less than abundant. It was a rather chicken and feather scenario. Unfortunately more days of feather than chicken.

Then came the agricultural age and people started systematically planting according to what they wanted to eat. Another interesting thing also happened. Agricultural people could brag about a significantly higher productivity than hunters/gatherers, while having a better lifestyle.

Yet, for a long time, hunters/gatherers looked down on the ground-scratching agricultural folks, and laughed at their seemingly futile hard work of ploughing the land, planting the seeds, nurturing the small plants, weeding the land, etc.

But there was one moment when the hunters/gatherers' jaws dropped and they went green with envy: After the agricultural folks harvested the goodies, they could sit back and relax, and enjoy preponderance of food throughout the year all the way until the next harvest, while the hunters/gatherers kept on chasing various beats day in day out, ranging from mice to mammoths, racoons to rhinoceros just to be able to eat again and not to die of starvation.

So, for the hunters/gatherers the hunt and chase was on throughout the year. But for the agricultural folks, there was the season of planting and the season of harvesting.

And this is what we see in business development today.

So, let's start with the...

"Hunter" Business Development Model

In one of the newsletters I receive I've recently read that this business development model is on the rise because this is the only model that can produce serious results and please Wall Street and shareholders. And in many cases the pleasing of Wall Street and the shareholders takes place at the expense of clients, suppliers and the work force. Of course, it's about publicly held companies. Since I work with only privately held companies, at least we don't have to worry about Wall Street, and we can focus on pleasing all stakeholders in the equation: Owners, clients, work force and suppliers.

In the "hunting" model everyone eats what she hunts. Teamwork is almost unknown because it is individuals who are rewarded for closing the sale.

The whole idea is that salespeople are individually and aggressively chasing prospects, and are trying to relieve them as much of their bank accounts' contents as humanly possible.

Sales positions in these companies are suitable for people who are driven exclusively by money.

However, management knows that salespeople are extremely money-driven, so management throws enough at them to make sure they don't desert. And when other companies find out about great salespeople at the competition, they offer even more dough to entice them. So they desert, go to the competition and the cycle starts again. So, these aggressive salespeople are endlessly circulating among companies.

Now you may ask: "If salespeople have to pound the pavement and dial for dollars to find sales leads what the haemorrhaging hell is marketing doing?

What the marketing folks are doing is that, in total isolation from sales and the actual market, they are developing catchy slogans, fancy graphics and all sorts of flash, glitz, glam and glamour to dazzle the target market and create "brand awareness".

Then they hand this stuff out to sales folks and tell them to send the stuff out to prospects. And since in most technology companies marketing are the blue-eyed boys of top management (sales are the whipping boys who can be punished for financial shortcoming), the marketing folks can get away with non-performance quite nicely. As long as there are salespeople and they bring in revenue, the marketing folks keep getting paid.

Since marketing and sales are not working as a team, and management is reluctant to invest in resources to have the two departments work together, these companies need to maintain army-sized sales forces to hunt down enough clients to stay in business.

And in contrast, now let's look at the...

"Farmer" Business Development Model

The above-mentioned newsletter issue the author writes that the biggest problem with "farmer" type business development is that it relies on selling to existing clients and fails to "hunt" for new business. What it also means is that people get lazy and develop a communist-type "entitlement mentality" for their paycheques for no work in return. It calls this model short-sighted that focuses on short-term results, hence it cannot be sustained in the long term. I believe it's the other way round.

In this business development model, the business development folks jointly with the technical folks develop "vehicles" the market can use to try and taste what the company has to offer... for free. And these vehicles are 99% void of manual labour. They are white papers, teleconferences, research reports, audio and video programmes.

This approach polarises the market, and only self-qualified prospects contact the company and request the next step.

In the "farming" model it is understood and accepted that it's teams of people who create results not individuals working in isolation.

The whole model is based on the synergy of close collaboration between team members. This is why this is so important.

First a simple example because, as a former farmer, I love animal examples...

Chimpanzees have the largest brains among animals. They are individual geniuses. But their group IQ is basically idiotic. Therefore chimpanzees prefer competition, thus the hunter format.

Baboons, on the other hand, have pretty low individual IQ but very high group IQ. Baboons are a great example of connection and collaboration. They prefer collaboration, thus the farmer format.

Here is another way of explaining team power...

Creativity and the quality of our decisions is the function of the number of connections (synapses) we can make between our brain cells (neurons). The more connections we create the more effective and creative we are, and the better decisions we make.

Now, let's say, for the sake of simplicity, you have four brain cells, so you can make maximum six connections.

And in isolation I can make the same six connections with my four brain cells. But together we can make 28 connections.

Total number of connections = (Number of brain cells [8] * (Number of brain cells - 1) [7]) / 2 = 28.

It means the quality of our joint decisions is 366% higher than the decisions either of us can make in isolation. And for this you don't need a team of superstars.

2004, Olympic Games Athens. The superstar-studded US basketball team, filled with NBA talents, went home defeated by Puerto Rico, Lithuania and Argentina. Before that disaster the US team had lost only one game ever.

By the way, the US basketball team is regarded as the best national basketball team on the face of the planet and the most successful team in international competition accomplishing various medals in all 15 Olympic games it has entered, including 12 gold medals.

Yet, at one point superstarism replaced teamwork, and that was the end.

Another great example of unproductive "superstarism" was the 1983 America's Cup. (Read Born to Win: A Lifelong Struggle to Capture the America's Cup by John Bertrand and Patrick Robinson).

Bertrand's team was motley crew of rank amateurs against accomplished professional sailors. But this motley crew won, and the first time in the 132-year history of the America's Cup beat the all-professional US team, because they understood and practiced teamwork.

And all this happened while the highly skilled and experienced professionals were too busy seeking their personal glories at the expense of the team.

It's fair to say that the professionals were the typical hunter group; and the amateurs were the typical farmer group. Each hunter was too busy hunting his own beast. The farmers listened to the "chief farmer", Bertrand, and followed his instructions without bickering among each other and coming up with better ideas on sailing.

As Bertrand mentioned later in an interview, he could teach people how to sail, but he couldn't teach them collaboration, trust, respect, honour and courage.

Business development is the same...

What you need is a cohesive team of ethical, excited, enthusiastic, accountable, committed and disciplined folks who are willing to learn (it takes some time to unlearn the hunter type "peddling" approach) a new way of selling. Well, selling by being sought out as recognised experts by qualified prospects.

The newsletter I referred to at the beginning of this article says that the "farmer" model is for lazy people who want to pick up their paycheques but don't want to work for them.

Personally I believe the hunting model is for people who love being busy and value their contribution by the amount of sweat on their brows. They equate success with busy-ness. In the farming model, people...

  1. Prepare the ground: Creating valuable content and vehicles to distributing it

  2. Plant the seeds: Distributing valuable content using well-established direct response principles

  3. Nurturing the growing plants: Feeding their markets with valuable content and keep checking for sales opportunities

  4. Nurturing & harvesting: Steady stream of qualified sales-ready buyers are trickling through the sales funnel

  5. Feeding valuable content to not-yet ready prospects

  6. Nurturing & still harvesting: Buyers trickling and sellers keep nurturing through content

  7. Forever it goes on and on and on: Buyers are trickling and sellers are distributing content

The farming model really is like an evergreen plant. You just keep watering and weeding it, and keep harvesting again and again and again.

Comparison

Comparing "Hunter" and "Farmer" Type Business Development
Hunter Approach Farmer Approach
Business development philosophy: Putting more feet and brawn on the streets and hit the road harder Business development philosophy: Putting more talents and brains to marketing and have prospects come to us
Company's objective: Increasing sales whatever it takes Company's objective: Making clients highly successful, making our people highly fulfilled with their work and lifestyle and making a highly profitable company
Leadership style: Chasing money Leadership style: Fulfilling the company's values and mission
Marketplace's perception of company: Dreaded peddlers Marketplace's perception of company: Respected industry experts
Focusing on short-term individual performance Focusing on long-term team-wide performance
Hiring is based on skills and ability to make instant money Hiring is based on character and then on skills
Ideal employee: Narrow-skilled specialist Ideal employee: Cross-trained deep generalist with significant breadth of expertise
High attrition, due to moving to greener pastures, is accepted part of the game Talent retention and ongoing development are vital business functions
Professional development is haphazard and usually unsupported, based on picking up bits of knowledge on the job or some spare time learning Professional development is structured and it's expected and supported by management. Development is part of work
Clientele profile: The trivial many of the crowd Clientele profile: The vital few of savvy buyers. The top echelon of the target market
Time frame: Short-term. Company hires and lays people off according to workload Time frame: Long-term. Company hires top-tier talents and does its best to keep them even during hard times
Business development strategies and tactics are based on expected revenue and financial projections Business development strategies and tactics are based on the company's core values, vision and mission
Chasing or picking anything that moves upon on- or grows out of the ground Farming the kind of plants and beasts we want to eat
Client acceptance: Anyone with money is good enough Client acceptance: Prospects are carefully screened before acceptance
Heavily brawn-based: Tactically out-prospecting, out-hunting, out-peddling, out-running, out-gruntworking the competition Heavily brain-based: Strategically out-smarting the competition by having the right prospects come to us
Competitive environment Collaborative environment
Transitional "subordinate-superior" client relationships: "You give us money and we give you stuff" Transformational "peer-level" client relationships: "We collaborate with clients to transform their business for the better"
Risk is minimised or eliminated by constant hunt Significant risk is taken in the nurturing and incubation periods of the farming cycle
Sales force is an organisation within the organisation, consisting of superstars following their own rules Sales force is an integrated part of the organisation, consisting of excellent team players and following the organisation's values and Code of Honour
Salespeople are driven by personal financial gain Salespeople are driven by contribution to something bigger than themselves
Individual streetfighters One cohesive "commando"
Using manual labour for prospecting Using automated systems for prospecting 24/7
In conversations pushing for the appointment No conversations. Self-qualified prospects can enter the sales funnel at their own volition by accepting an initial free offer (White paper, audio or video)
At appointments manipulate buyers to buy right away Appointments are requested by self-qualified prospects and selectively accepted
Salespeople approach appointments with an agenda: Pitch -> handle objections -> close, close, close! Sell something... anything... right now Salespeople approach appointments without an agenda: Diagnosing the prospect's current situation and jointly decide what to do next
Offering special deals for quick buying decisions Value for value - No special deals
Proposals and parts of the sales process: Suffer from "proposalitis", that is, writing and submitting proposals to anyone who say, "Hm, that's interesting" Proposals are parts of the engagement and to be paid for: Writing and submitting proposals only to highly qualified prospects... for a fee
Lots of first-time buyers and very very few return clients - Salespeople are rewarded for bringing in new clients, not for nurturing existing clients No emphasis on landing first-time buyers: Sales teams are rewarded both for new- and existing clients
Individual compensation: Strong internal competition among sales folks Team-wide compensation: No internal competition among sales folks
The annual sales curve is full of short revenue spikes (feast) and long valleys (famine) The annual sales curve pretty consistent
Opportunistic sales force is turning around at the average annual rate of 43%. People stay for the money Strategic sales force is in for the long-term. People actually enjoy working at this company
Success indicator: Individual quota Success indicator: Team-generated sales
Compensation: Straight commission or base pay plus commission, based on individual performance Compensation: Salary and bonus, based on team performance

On Summary

I know many of the readers disagree with my points. Yes, these are general points and yes, there are exceptions. And yes, while I've seen a lot, I haven't seen everything yet. This is just my experience, based on the last decade or so since I've been doing business development.

But there is one thought here. The notorious dot com bubble burst. They tried to be hunters, but even stuffed with investors' money, many of those companies with barely-out-of-kindergarten teenager CEOs at the helm, still burnt their investors' hope.

They thought they had the kind of stuff that would sell itself. And it didn't happen. They tried to play the hunter's game, and the market got scared.

What they failed to realise was that people have to warm up to innovative things and ideas. And this is where farmers win. They know they have to plant the seeds of new relationships and carefully nurture them during the consideration (incubation in farming) period before they become paying clients.

Yes, the hunter approach is good for short-term instant gratification, and it's a great strategy for companies that are in serious financial shit and instantly need cash injection or they go tits-up.

But companies that have passed the struggle for daily survival and can plan for a few years ahead, the farmer approach is a lot more rewarding. Your company will be more profitable, your people will be happier and your clients will regard you as a company of respected professionals not the proverbial used car salespeople.

And this change in perception may be worth the change in business development approach. Just a thought. As always.

Attribution: "This article was written by Tom "Bald Dog" Varjan who helps privately held information technology companies to develop high leverage client acquisition systems and business development teams in order to sell their products and services to premium clients at premium fees and prices. Visit Tom's website at http://www.varjan.com.