In this episode, Liz Heiman discusses the importance of having a sales operating system to bring predictability and structure to sales organizations. She emphasizes the need for founders and business owners to understand their sales process and develop a clear vision, positioning, and value proposition. Liz also highlights the role of AI in prospecting and research, as well as the importance of managing cash flow and understanding profitability. She advises business owners to be actively involved in sales and hold their sales teams accountable.

Takeaways

• Developing a sales operating system brings predictability and structure to sales organizations.
• Understanding the sales process and having a clear vision, positioning, and value proposition are crucial for success.
• AI can be used in prospecting, follow-up messaging, and research to enhance sales effectiveness.
• Business owners need to actively manage cash flow, understand profitability, and be involved in sales to ensure success.

Chapters

00:00 Introduction and Background

02:01 The Need for a Sales Operating System

03:18 Understanding Predictability in Sales

06:06 Building Blocks of a Sales Operating System

09:17 The Importance of Vision, Positioning, and Value Proposition

13:17 Managing the Sales Strategy

17:47 The Impact of Sales on Cash Flow

20:46 Utilizing AI in Sales

26:36 The Blind Spot of Business Owners

28:06 The Role of Business Owners in Sales

29:18 Closing and Contact Information

Connect with Liz

LinkedIn: linkedin.com/in/lizheiman

Website: regardingsales.com 

Connect with Wesleyne

LinkedIn- linkedin.com/in/wesleyne  

Instagram- https://www.instagram.com/wesleynewhittaker/?hl=en 

Tiktok- https://www.tiktok.com/@thewesleynewhittaker 

Facebook - https://www.facebook.com/transformedsales  

Youtube- www.youtube.com/@wesleynewhittaker 

Twitter - https://x.com/wesleyne  

Website- TransformedSales.com   

Email- email...podcast@transformedsales.com  

Hello and welcome to the Transform Sales Podcast. Today I am so excited to have Liz Hyman back with me. How are you, Liz?

Oh, I'm great, how are you?

doing fantastic. I'm doing fantastic. Liz is not new to the show, but we really didn't get to finish our conversation and she's been up to some amazing things. So let me give you guys a little bit of an update of who Liz is. She is the Sales Operating System Architect and the founder of Regarding Sales.

Liz guides ready to scale founders and CEOs to take the chaos out of sales and create a more sustainable growth strategy that strengthens their pipeline and streamlines their process to predictably increase revenue. Early in her career, Liz trained some of the world's powerhouse sales organizations, including HP and Coca-Cola. Now her focus is startup and mid-size companies selling into complex B2B environments, including med tech, government, and manufacturing. Liz is on a mission to challenge assumptions

build trust and make founders dreams come true. So what have you been up to? What have you been doing in the past couple of years, Liz?

Well, you know, not much. Just hang it out. No. As much as possible. Hang it out in Hawaii, actually. But yeah, lots of really exciting things. I think the last couple of years I've really been focused on understanding founders and midsize business owners and, and how they're struggling with sales.

Not much. Just not much. Just hanging out in Hawaii.

So how it's impeding their ability to grow their businesses. So I've been focused on building what I call a sales operating system. These are the pieces that you need to manage, organize and grow, scale hopefully a sales organization. So I've been focused on that. And then of course, more recently, we've all been focused on AI, because how can you even have a conversation in the business world without talking about AI? So those are the two things I've really been focused on a lot.

So tell us, how did you get interested in really leaning into this need that business owners have for having their own sales operating system? What drove you in that direction?

So a couple of things. One is, so remember my dad wrote strategic selling. So I grew up in the world of sales process. But I realized really early on in my business is that just having a little bit of process around the sales, around complex sales is not sufficient to run an organization. So what I hear from founders all the time is my sales team is chaos.

It's unpredictable. It's unmanageable. We throw in leads. We close our eyes, cross our fingers, and pray that something will come out the bottom. And we have no idea what to expect. So we can't plan our business. And so I hear that a lot. And I say to somebody, does it sort of feel like chaos? And they're like, oh my God, that's exactly what it feels like. So if founders or mid-size business owners or leaders wanna grow,

They need predictability. The only way to grow and scale is with predictability. And so that's what I've been focused on in helping them figure out how to get that predictability from sales.

So what does predictability in sales mean? I thought sales was just all random, throw the spaghetti at the wall and do whatever you want. What does it even mean?

Yeah, black box, right? Just no process, no, it's just magic, right? It's just magic. Salespeople go with magic.

Magic, it's just magical. And they just all hit their quotas just boom. They're just created like that.

Woo. Yeah. And it's really interesting because it isn't magic. There's a certain amount of magic in it, right? There's this magic that happens between really great salespeople and the people who are buying from them because they're listening, they're compassionate, they're curious, they're creative, and they're creating this one-to-one or one-to-a-few magic. So there is magic as part of it, but the rest of it...

is process, system, strategy, order, management, right? It's all of those things that allow you to have predictability. So what I would mean by that, you cannot 100% predict whether something's going, whether you're gonna win a deal or not. There's no way to do that. Each individual deal has a unique set of circumstances. So, you know, when it comes down to it, depending upon how much the salesperson knows about the group they're selling to, what kinds of...

other things happen within that company, what happens in the economy, anything else that a deal can close or not close. So the only way you get predictability is making sure that you are consistently putting the right things in the top of the funnel and moving them down. You have to know what I call the sales map. If I want to close one deal, how many things do I need to put in the top of the funnel?

that are good qualified leads, they're gonna get me that one deal. And basic, you know, kind of the standard thing that people say is one to 10. And I find that's pretty accurate. 10 things in the top of the funnel that I'm prospecting gets me one thing out the bottom. So if you measure from prospect to close, you can begin to understand what the math is. And if you have a long sales cycle, which a lot of my clients do, then you begin to see months in advance.

whether or not I've got the numbers of qualified leads in the funnel to actually hit the goal. So that's one way you can have some predictability.

Yeah.

Yes.

I love it, I love it, I love it. I've been talking a lot to my clients about leading and lagging indicators. So these are the inputs for these outputs, saying we didn't hit our numbers. Sorry, that's kind of too late. Like there are certain inputs we need, there are certain things that we need to be tracking, to be looking at, to ensure that we are hitting those targets. So if I'm a business owner and I'm like, I feel like I'm in chaos, I feel like.

I might need to start adding more people to the team. I feel like, you know, based on where rates are, our customers still aren't gonna be buying. So we need to shake things up a little bit. What are the first bits of that building block of that sales operating system? What's the first thing that they should really be looking at?

So I think the first thing is the very, very top of this process, which is what is our vision? What are our values? What is our mission? Right. So people think, oh, salespeople don't need that, but they do because they need to understand who you are so they can sell. Your customers need to understand. The second thing and probably more important is you need three things. You need to know who's your ideal customer. You need to know how you're positioned in the marketplace and figure out how to position yourself.

the way you need to be positioned. And third is you need your value proposition. You need to understand why people would buy from you. And that is, what is their problem? How do you solve it? And why are you the best solution for your ideal customer? Which is why you need to know who your ideal customer is. So the very beginning is about positioning. How do we position ourselves for success in the marketplace? And then the next thing is, okay.

What's our sales strategy? And I'm gonna say this, I know you're not gonna believe this, Wesleyan, but a number is not a strategy. Like just say we're hitting 10 million this year, that's not a strategy that you didn't know about. So.

Nope, that was new, that was new, that was new. I thought just having this magical number that I just pulled out of the air, that was my strategy and I was gonna just make it.

I knew that.

Yeah. We'll just do 10% over last year. Go. But it doesn't work that way. We really need to understand what did we do last year? Who did we sell what? My thing that I soften is what did we sell to? Who sold what to whom? Which salespeople did what work? What were they selling and who did they sell it to? If you have multiple products, that matters. The what? Because you need to sell the most of the product that's most profitable.

and not have your salespeople leading with things that are not the most profitable or ones that you really want to make go away. So really understanding what you're selling, who's selling it, and who you're selling it to. So what happened last year? Who did you sell it to? What did you sell? Those are important questions. Who were your top five, 10 clients? What did they buy? How much could they have bought if you put a little effort in? And then you start thinking about, okay, which clients could we be growing?

Hmm.

Mm-hmm.

everybody has a list of clients that could be buying more. So sort of looking at what did you do last year and what could you do this year to leverage what you did last year and what are you gonna do now that's new or different? So how has your market changed? How has the product changed? How has the economy changed? What's happening? Which industries are growing? Which ones are shrinking? Kind of looking at that stuff and thinking, based on all of this, I need to put together a plan of what we're selling to whom.

and who we're marketing to get the leads we need. How is that for a lot in one bite?

Mmm. That, so as you're saying, because once you started talking about the sales operating system, it made me start thinking of building blocks and Legos. And I, you know, I'm a recovering chemist, and so a part of my low chemist brain, I love Legos. And so I've taught both of my kids how to build Legos. And the thing that I tell them is, you open the book, you get to the page, pull all the pieces out. Don't start building until you have all the pieces in front of you.

And literally what you said is don't start selling until you have the pieces of the strategy ready. And realize that if you're in chaos, if you're in a place where your business is not hitting its sales numbers, it's gonna take time to get where you need to get. And if you just wanna do, I call it random active selling. If you just wanna go out there and start cold calling and spamming people and doing this and doing that, then you're gonna fail because you don't have the strategy to back you up.

Yeah, and salespeople will do what's easiest. It's like if you give a three-year-old the Legos, they're just gonna stick them together. If you give a salesperson a number, they're gonna go and get what is easiest to get. That's always what they'll do. That's not necessarily in line with your business strategy or your goals or what it is you need to be selling. They're gonna do what's easiest. They'll always do what's easiest because we commission them to do what's easiest.

anywhere they want.

Right? If you have to change your commission structure, if you want them to do something different. So you have to really understand what you want them doing. But yeah, it's all building blocks and foundation.

Yeah, just hit the number.

And you know another thing.

Another thing that, you know, in building this sales operating system, it's having those numbers, having those metrics, having those things that people are striving towards. So I know that I have to sell a million dollars worth of widgets this year, but like you said, those inputs at the top. Well, if I had to sell a million dollars worth of widgets, oh, that means I need to have $3 million worth of pipeline at all times throughout the year in order to make sure I'm hitting it.

And if I drop below $3 million, then I need to go figure out a way to backfill the top, not just focus on closing the bottom, but how do I make sure that I have a very balanced pipeline? So when you're working with business owners and you're trying to help them understand this concept, because it's kind of like, they think a funnel is just this up and down cylinder, like in out, in out, in out, right? It's actually a funnel for a reason. So explain that to us, walk us through that.

Workline.

Well, so I always think of a pipeline. Like if you walk up to the sink, you turn the water on, the water comes out, you turn the water off, the water stops, you turn it on again and it comes out. But that's not how sales works. Like if you turn off the spigot, you're out of water for a while. It's like you now have to pump, prime the pump like they used to in the old days to get the water coming out again. So when we think about a funnel, we wanna think about how long is our sales cycle?

And I don't mean the sales cycle from the time that you create the proposal until it closes, because that's not your sales cycle. Your sales cycle starts when your team is out prospecting and qualifying and understanding what's out there and what opportunities there are. So if you learn what your sales math is, you can actually say, okay, so it's the, it's, I need to have this many conversations in order to hit this number. I need to have this many people click.

on something on my website in order to hit this number, right? So you've got to back up. So we start with this is what I need to close, which means this is what I need in closing stuff that's ready to close. And this is how much I need in what I call solving or, or cultivating, which, you know, when it's going up and this is how much I need in qualifying. And this is how much I need in prospecting. So you've got this funnel. And if you at any time look at it and go that's shut funnels, not the right shape.

because I have to know the ratios. So it goes 10 to seven to five to two to one, right? So if I don't know those ratios, I don't know what to look for. And if I don't know how long my sales cycle is, I don't know what to look for. So we start creating the math for your business. And then at any time you can look and go, we have a problem.

Yeah.

Yeah. And it's knowing your numbers, right? It's not just knowing the revenue that's coming in, but those activities that are important. And, you know, when I bubble this down to sales leaders and sales managers, I like to tell them, coach to the conversion, right? Like, where are you seeing things falling off in the conversion from this step to the next step? Coach there. Don't just tell them to go get more leads. They can get more leads, but they're still not converting. So you're not actually helping anything, right? And so really understanding those

critical pieces, those critical numbers for your business is what helps you grow and build the type of organization that you really wanna have.

Yeah. And I think it's important though, too, to understand that some sales will fall out of the funnel. Know what your math should be because don't get mad at your salespeople because you put 10 leads in and one only came out the bottom. Know that that's normal. And if that's not what you want, then you better get better qualified leads in the top. So more come out the bottom, but you can't just say to the salespeople, close everything because everything's not been closed. So you have to know your math, put stuff in the top, manage the stuff in the middle.

Yeah.

we lose so much out of the middle of the funnel, right? Because, oh, I was focused on closing and I didn't follow up with these guys and now I don't remember what I'm supposed to say to them or they're talking to somebody else now, I totally blew it, right? That middle of the funnel, a lot of stuff that falls out of the middle is due to lack of attention. And so if you're a sales leader or a company leader and you don't see momentum, things moving from stage to stage, then you've got a question, what's going on?

Yeah.

Yeah, that nurture. Nobody wants to nurture, right? They just want to hunt, call, and then close. Nobody wants to be stuck in the middle, like having to send out webinar invitations or sending out case studies, testimony, whatever, or just calling and chopping it up with someone, right? And so a part of that is, like you said, how long is your sales cycle? Like understanding your numbers. I think that business owners, this is one of the things that they are really, really bad at.

And when I work with entrepreneurs or business owners, I think about sales, but I also think about their numbers from another standpoint in terms of their expenses, right? Like, and they don't know, like how, what is the cost of a sale? How much does it cost to acquire one customer? How much does it even cost to service that customer other than the hard cost of, you know, the equipment or something like that? Like knowing your numbers, don't be scared of those numbers. Sit down with your CFO, sit down with the accounting firm that you're using and understand those things.

Absolutely. And not knowing what it costs is devastating on the other end. So when you close stuff and you didn't, you're not gonna make enough profit to pay for it, that becomes really problematic. So there's a couple of things when we're talking about finances that we wanna think about. So one is, is there enough profit? And my clients can never tell me. I'm like, how profitable was that? I don't know, right? And what I'll find working with them is often their top clients.

are not profitable. So they are working all day long to provide somebody a service for nothing. They're like, but they're our biggest client. That's what keeps us going. No, that's what keeps you broke. Right? So, really understanding who our top clients and are they profitable, but also understanding that sales has to be consistent. So if the pipeline dries up, I'm gonna start having cashflow problems, which is gonna make it difficult for me to deliver what I sold.

Sales can't be hit and miss, stop and start, up and down. You can't run a business like that because you will constantly have cashflow problems. You'll constantly be struggling with, how am I gonna pay for what I need to do next? If that sales pipeline isn't consistent and you don't have consistent dollars coming in, you're gonna have all kinds of problems in your business. So a lot of times when you're, we've got a cashflow problem, it's not a cashflow problem, it's a sales problem. Right, so having a real clear understanding of your sales,

Yeah.

Yeah, yeah.

I'm going to talk about process in a second, but your sales numbers and your consistency will help you understand what you need to do differently.

Yeah, and you know, I wanna tap into that thing that you said about that the top customers, they're not profitable, right? There are some times when I sit down and I talk to prospects or customers, I'm like, you don't have a sales problem, you have a profitability problem. Like I can get you more business, but unless you figure out how to decrease your expenses, this isn't, sometimes it's linear. Like the more business you get, the more your expenses increase, right? And so really tapping into what do I need to tackle first?

Yeah, you need more sales. More sales will help solve your problems. But let's get your expenses down. Let's make sure that your the cost of your goods are at the right place. Are you even pricing the right way? Like, there's so many factors that go into a lack of revenue for an organization. And I think that many times business owners have the wool over their eyes and they want the easy fix. Beat the salespeople up.

tell them to go make more money and then we'll figure it out.

Yeah, no. The other thing is how much money are we spending on marketing that doesn't work? So, oh, we have to go to this conference. So we go to this conference, we spent $100,000 all told, right? And what did we get out of it? Well, nothing because nobody did any work before, nobody did any work after, and all that money just was wasted. So...

Oh

You know, how much money are we spending on content that isn't converting? Maybe it's converting to clicks, but it's not converting to leads and then not converting to business. So if you're not tracking, um, your marketing spend, if you're not looking at what is it, you know, what is it that we've spent and how much do we need to make in order to make that spend worthwhile and how do we track across the entire sales process, then you may be wasting tons of money on marketing. And I'm not saying don't market.

Cause you have to market. If you don't market, it's like having a party and not inviting anybody and wondering why nobody showed up, right? You can't do that, but you can't waste money either. Don't send, you know, invitations to Alaska if your party's in New Jersey. So figure out what you need to do to get the right people in the room having the conversation and measure it. Don't let marketing off the hook with clicks. You have to track it all the way through.

Absolutely, you should know where, you know, if you're spending X number of dollars in ads or like you're saying, even if you think about, okay, we invest this money in a conference and we're taking our salespeople out of the field for three days to go to this conference. It's like the cost of their lost productivity. It's not just the cost, those hard costs, right? And so you can't just do random acts of sales, random acts of marketing, like both of those things, they just don't work.

So I want to tap into, you mentioned AI. How are business owners using AI to help them get better, improve productivity? How are you seeing them use it?

So let's back up first, I couldn't talk about where you would use it, right? So if we start at understanding our sales process, which is the next part of a sales operating system, let's look at what the sales process is. How does things come in the top of the funnel? How is salespeople prospecting? Are they prospecting with existing accounts? Are they prospecting with new accounts? How did they qualify? What tools do they need to qualify? What things do they need to do? How do they get people from prospect to qualify? How do we move people from qualified to the next stage? Like when we fully understand

all of the stages of our funnel. And we also look at the entire sales operating system. So we look at complex sales, we look at online sales, we look at key accounts or strategic accounts. We start looking at all of those things together. We can identify in each one of those areas, places where we can use AI. So one place that we can use AI is in prospecting, right? Everybody hates writing prospecting emails, but actually I have to stop for a second and I have some disclaimers.

or warnings just because AI wrote it doesn't mean it's good or accurate. So we never send anything out without checking it. And the other is just because AI wrote it doesn't mean it matches your company messaging. Right. So we need to be really clear about that positioning in the marketplace and what our messaging is and our value prop so that when we get AI involved, we're still on message. Um, so we want to use it for prospecting. It's a great place to help with prospecting.

Yeah.

Mmm.

Yeah.

Yeah.

messaging, emails, telephone messages, and so forth. The place that I find it's really helpful though, is with follow-up messaging. It's really hard to be creative. And how many times do salespeople just want to write, hey, I'm just following up. And the person who gets the message is like, who are you? What are you following up on? What did we talk about? I don't remember, right? So if we can start with...

Yeah.

Yeah.

Mm-hmm.

What did we talk to that person about last and what's going on with them? And then ask AI to help us write it in a creative and engaging email or phone message. And that's really great. And then check it and make sure it's right. So it just stimulates our creativity around follow-up. The other place we wanna use it is when we're trying to understand our larger customers or trying to understand our market. So one of the biggest things that I see with strategic accounts is nobody wants to spend the time doing research.

Mm-hmm.

I'm like, go out, understand who's this client, what are their mission, what are their values, what are their initiatives this year, what bad things have happened, what are they worried about, who's getting promoted? They don't have time to do it. That's what they tell me, I just don't have time to stand top of this. Well, guess what? This is something AI is really, really good at. Pick my client and ask AI pointed questions. What are the mission vision values of this client?

Hmm.

Mm-hmm.

Mm-hmm.

Mm-hmm.

Mm-hmm.

What are the key initiatives they're working on for 2024? What were the key initiatives they worked on in 2023? What problems did they have that they need to solve? Who are they hiring? What positions are they hiring for? Like you can ask all kinds of questions and they'll come up with amazing information that really cuts down on that research time. And you can do the same with the target market. This is my target market. Who are the buyers? What are the titles of the buyers that would be involved in buying this at this market?

Mm-hmm.

Mm-hmm.

in this market or this, you know, like hospitals or schools. And then you can say, okay, what are the key problems that these buyers are facing? So you can literally ask AI to help you answer some of these questions so that you can plan a little bit better.

That's good. Most salespeople spend, I don't know, five minutes on their pre-call prep. And so if you spend those five minutes using a tool to actually give you the data, give you the inputs, give you the information you need to set you up for a call, you come into that place and you are looking more strategic. You're looking like you have done the research on the client. And we all know...

Everybody loves themselves. And so if I love hearing me and I love people knowing about what I did, if you come to that conversation armed with that, that sets you up for success. And one thing that I know about AI, it's just kind of like we were talking about in terms of strategy and building blocks, the better the inputs you put in, the better the outputs you get, right? So if you ask very specific questions, this is a company that I'm working with, these are the specific things that I wanna know. I wanna understand how much money they spend

particular area, right? Maybe you will provide some kind of operational excellence. You wanna know how much they spend in operations. They may not give you an exact spend, but they'll say companies like this, or companies this size, typically spend this much, right? So get really specific and think about the questions that you would normally ask as warm up questions in discovery and just put it in AI and get the answers so you can ask more pointed questions to that person.

Yeah, absolutely. And there are lots of companies now that are putting out helpful tools to create prompts, because prompting is gonna be the biggest thing. Being a prompt engineer is actually a thing now. So if you can look for companies that are prompting around the work you wanna do, that will be really helpful.

That's good. So we talked a lot about process and pipeline and strategy and AI and building blocks. What would you say is the number one thing that business owners have their blinders on for right now and they're not aware of that they really need to be focused?

There's so many things, but I think if we're going to talk about sales, if you have a business to business complex sales, I think that not understanding the process, not understanding how sales progress is problematic because then your expectations are unrealistic. And if you can't have a conversation with your salespeople about big deals and things that are going on and understand what they're talking about and hold them accountable, you're going to have a problem. So, you know, things that, that

Owners should know there's no such thing as my guy when you're selling. My guy does not know everything. So if you have a business to business complex sale and your salesperson keeps talking about one person, they're not following a sales process. They're just winging it. And so if you say, what's your next action on this? And they say, I'm going to follow up with Joe. That's not a next action. A next action is what am I doing?

to move this sale forward. I need Joe to do this. If Joe's not gonna do this, I need to find somebody else to do this or I need to walk away from this business. But just looking at what your salespeople are doing and having them, yeah, I'm gonna follow up. I'm gonna follow up. That's not helping anybody get to the end. We really need to understand the steps of a sale, what the salespeople are doing, who they're talking to and how they're creating the momentum that you need. So if as an owner of a business,

You have no idea how to have those conversations and you don't have a sales leader doing it. You have a problem.

Yeah, yeah. Equip your, and I think that you kind of summed that up, like it's our job as business owners to equip our next level of leadership to have those conversations and to hold people accountable. And if they can't, then you need to hire someone to help you, right? To help you get to where you need to be, to help you get to where you want to be.

Yeah. But I, and I think also though, as a sales, as a company leader, you are never out of sales, like you can't just hand it off and be done. You're always on top of it. You're always involved in it. You're engaged. You're helping. You're having the conversations your sales team needs you to have. You're coaching, you're answering questions. You're doing whatever needs to be done, but you don't just sit around and wait for the sales numbers and then panic.

That is not your job as CEO. It may sound like as CEO, you don't have to do it, but you never get to relinquish sales 100%. You have to know what's going on all the time.

Absolutely, absolutely. I love it. I love it. I love it Liz. This has been another amazing conversation If people want to get in touch with you if they want to learn more about what you're doing, how should they do that?

Well, two ways. One is you can always go to LinkedIn, Liz Hyman, H-E-I-M-A-N. I'm the only one. Or you can go to my website, RegardingSales.com. And there's lots of articles, podcasts, webinars. And there's a place where you can schedule an appointment if you'd like to chat.

Awesome, awesome, awesome. Well, thank you so much again, Liz, for enlightening us. It has been an honor having you again on the podcast and thank you for your time, talent, and expertise.

Thank you.

That has been another episode of the Transform Sales Podcast. And remember, every day in all that you do, transform your sales. Until next time.