The notion that consultative selling is the optimal way to sell has been around since the last millennium. The concept was coined in the 1970s in the book Consultative Selling by Mack Hanan.
In the current economic environment, buyers are having to do a lot more with a lot less and make do with what they have, which means that new business opportunities are fewer and farther between.
To compete in this “new buying normal,” we need to modernize what we mean by and how we execute consultative selling. An excellent place to start is by understanding the definition of “management consulting” (Wikipedia).
Management consulting is the practice of helping organizations improve their performance
Management consultants from consultancies like McKinsey, BCG, Bain, and Accenture get hired to improve the financial performance and operational effectiveness of their client’s organization.
To excel at helping our prospects optimize their performance and effectiveness, we need to become more knowledgeable about modern performance management systems, which is where OKR comes in.
What is OKR?
Objectives and Key Results (OKR) is a collaborative goal setting and planning system designed to create company-wide alignment, engagement, and accountability around ambitious goals.
Dr. Andy Grove, the founder and former CEO of Intel, pioneered OKR. It has been evangelized and codified by Kleiner-Perkins’ John Doerr — whom many have called “the Michael Jordan of venture capital” — in his book Measure What Matters.
OKR has been adopted by hyper-growth companies like Google, LinkedIn, Box, Salesforce, Twitter, Adobe, Amazon, Spotify, Facebook, and Slack, and has become the de facto goal setting and planning method for venture-funded startups. Other industries besides Tech also use OKR. Walmart, Target, Dun & Bradstreet, and the Gates Foundation are examples.
Here’s an explanation of the key terms.
OBJECTIVE. OKR Objectives are big, bold, and highly ambitious. Done right, they challenge and motivate the organization to higher levels of performance. Achievement of the Objective can have a material impact on the prospect’s business. Google calls these Moonshots.
“We set goals we know we can’t reach yet because we know that by stretching to meet them, we can get further than we expected.” From Google’s “Ten Things We Know to Be True”
KEY-RESULTS. Key Results are a set of metric-based goals, typically 3 to 5, with a starting value and a target value used to track progress toward the Objective. These are aggressive but doable. Most importantly, they are measurable and verifiable. Key Results are metrics, not initiatives. Initiatives define the work needed to drive progress on the Key Results.
“If it does not have a number, it is not a Key Result.” —Marissa Mayer
Senior management sets strategic OKRs; departments and teams set tactical OKRs in support of the corporate OKRs. This top-down, bottom-up approach leads to company-wide goal engagement and alignment. OKRs are time-bound, typically quarterly and annually.
Here’s an example of an OKR:
Objective: Achieve record third-quarter revenue
Key Result 1: Generate $25m in new business revenue
Key Result 2: Improve win rate from 30% to 40% for deals that are >$100k
Key Result 3: Reduce customer churn from 15% to 10%
OKR includes a traffic light color-coding system (red, yellow, green) used during weekly, monthly, and quarterly check-ins to grade Key-Results progress. This level and frequency of inspection drives accountability and enables quick course correction if necessary.
If you want to take a deeper dive into OKR, check out this video or this LinkedIn Learning course or buy “Measure What Matters.”
How Will Understanding OKR Make You a Better Salesperson
Being knowledgeable about how companies set goals and the metrics and methods they use to track and drive achievement of these goals will make you a better business person and hence a better salesperson.
Improving your performance-metric fluency will equip you to speak and understand the language of the C-suite, and align you with senior executives’ interests, especially the CFO.
Like a bonafide management consultant, your OKR expertise will give you the confidence, competence, and credibility to ask insightful questions about critical issues that draw out ideas, opinions, and information you might otherwise not be able to get.
Developing and delivering demos and business cases that showcase how you impact the buyer’s Objective and Key Results will make it easier to gain buyer traction and, ultimately, buy-in.
Shifting your mindset from pitching products to optimizing prospect results can have a profound effect on how you see yourself and, more critically, how your buyers see you; this is perhaps the most meaningful benefit of all.
How to Use OKRs For More Effective Discovery
The first step of the management consulting process is discovery, so let’s take a look at how you can use the concept of OKR to lead discovery conversations that uncover your prospect’s desired outcomes (OKRs) and if and how you might be able to impact them.
The OKR-Based Discovery guide suggests what type of information you should uncover through research and conversations, not how. The questions are grounded in management consulting discovery best practices using OKR as the framework. Sales leaders, this framework can also be useful for deal reviews and qualification assessments.
If you’re selling into Tech, you can start by finding out if the prospect’s company uses OKR. Chances are they do.
The premise of this article is that to excel in the current buying environment and beyond, we need to up-level our consulting selling skills; this starts with focusing our attention and conversations on what our buyers care about most — achieving their desired results.
To accomplish this, we need to employ the mindset, behavior, and techniques of a performance management consultant. We introduced OKR as a framework to make this happen.
Thinking and caring about helping your customers hit their numbers, will help you hit yours.
What say you? Was there a particular OKR-Based Discovery question that resonated?