Summary

Lucas Price interviews Pete Scharber on building elite sales teams by honing in on true product differentiators. Pete shares his journey from his early career to sales leadership, emphasizing the importance of honesty in identifying market fits, fostering team camaraderie, aligning compensation with objectives, and navigating tough executive conversations. The episode is rich with insights on authentic leadership, strategic market focus, and boosting sales team morale.

Take Aways

• Honesty and Transparency: Success in sales requires a candid assessment of organizational strengths and weaknesses to determine competitive differentiators.
• Strategic Focus: Aligning sales efforts with core competencies and long-term strategic goals prevents wasted resources and enhances win rates.
• Team Dynamics: Building a supportive and motivated sales team hinges on open communication, celebrating wins, and fostering a culture of belief and camaraderie.
• Effective Compensation Plans: Uncapped and well-aligned compensation plans motivate sales teams to maintain high performance and drive company-wide objectives.
• Continuous Learning: Learning from both successes and failures, and incorporating these lessons into ongoing strategies, ensures continuous improvement and resilience.

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BEST Outro

In what pockets of customers are the right customers for your differentiators as a founder? I understand the temptation to believe that everyone needs your product But thinking of the market that way is not the path to an efficient and high performing team being honest as an organization about who your product is not for Is essential as a leader and as a team on today's episode of building elite sales teams, we will discuss this with Pete Sharber, who's learned this lesson firsthand over the past 27 years, Pete has developed businesses and lead teams in the medical manufacturing sector during his career.

Pete enjoys wilderness canoeing, backpacking, and hammock camping in his free time. Pete, welcome to building elite sales team. And thank you for joining us today.

[00:01:37] Lucas Price: Yeah. Pete, can you help our audience get to know you a little bit better? Give us some more details about your career in sales and sales leadership, how you got started and then how you made the transition from individual contributor to sales management.

And the last month of my training project or training program was to shadow the local sales guy. His name is Jay Kirihara. He's a legend in my industry and still one of my really good friends today. And Jay took me under his wing for a month and I never had so much fun in my life. Like I can travel, I can meet customers.

Became a rep for them, a hundred percent commission, 24, 24 year old kid, you know, with no guaranteed paycheck. And that was no better way to get a real quick taste of what sales is and what it takes to be successful. So that really started me off on my my career in sales, business development, did that for about six years.

And then after that joined probably the largest. Medicals contract manufacturing industry was Jable. It's currently Jable was Nipro healthcare at the time and spent about 10 years there and just had a great level of success it's when they are on a really rapid, I call it magic carpet ride in terms of their growth in the industry.

So I've got to see firsthand what makes you know, a medium sized company at that time really accelerate into You know, quickly becoming one of the largest contract manufacturers in my industry. So that was a great learning experience.

To be successful because a lot of people, you know, can be successful in other walks of life, but not in sales. And the people that are successful in sales usually have drive and there's usually something in their background that kind of gave them the determination to be able to do it. Curious, you know, what if there's anything you'd point to specifically in your background.

He was in the commercial nursery, so growing plants and trees and shrubs, things of that nature hardest working person I've met in my life. But he was there for every single sporting event, every single family event. I remember I did, I wrestled in high school and I got one vivid memory of my dad said, I'm going to try to be there.

It's going to be close. It was early. And I'm literally taking the mat. I look, my dad's in the corner. He's, I'm getting emotional because he was full of mud, right? He was in the mud, he was in the corner and you know, he made my match and you know, and he gave us my mom stayed home.

So she was a full time stay at home parent and my dad never made much money, but I never knew it growing up. And just, I think just seeing him work so hard and providing us with just an, a great, you know, great. Upbringing just instilled in me, I think just that drive to work hard. I've worked since I was 11, had a paper out at 11 was up six o'clock in the morning before school, delivering papers.

[00:06:05] Lucas Price: Appreciate you sharing that. I've never done any competitive wrestling at all, but I would imagine that's a, I've always thought that's an area that requires that same level of kind of determination and drive and hard work to succeed, to be a competitive wrestler as well.

Um, so it, it seems like that's something that you had very early in life. You were gaining that from your father from the very beginning and even, you know, as a, as a. Teenager, you probably that work ethic had rubbed off on you.

That's for sure.

[00:06:55] Pete Scharber: Yeah, sure. So that was I guess, you know, roughly the first half of my career, just, I think was very [00:07:00] fortunate to have a great mentor early and then to land with a company that just, you know, just really took off and seeing what, what made that work. So it took a lot of those learnings. I believe into the second half of my career, where I began to lead teams, right?

Player coach, but mostly coach got introduced to the strategy side, which I've really enjoyed. I think I've gotten very good at that. That's probably the one thing that I enjoy most currently is, you know, I think the main topic for the podcast today, right. Is just. Devising a go to market strategy around the true strengths of your organization.

I think it's not to get into the topic, but I've got a lot of I think thoughts and ideas around, and it's really about just being honest with. The organization and where you can differentiate and excel against your competition. So, so got on the leadership side and, you know, through that first call, 15 years of my career, made a lot of connections, a lot of network.

You're in the industry. If you survive 10 or 15 years, you've got a reputation and you're known, right? You can make two or three phone calls and really, you know, get to know just about anybody in the industry. So built some teams from scratch. I really enjoyed that. I really enjoyed. Devising and optimizing the strategies, coupling that with appropriate compensation plans that focus on the objectives of the organization.

And mentor.

That was the importance of that,

Or medical components almost always in my career, it's been through plastic injection molding. So usually design services, plastic injection, molding, assembling molded components [00:10:00] together. Coupled with purchase components, putting it together up to like a finished medical device. A lot of the stuff on TV for the GLP one drugs and auto injectors and things of that nature.

So that's my industry, right? It's most of the major medical OEMs that we see and that we invest in, in the stock market. Those are typically my customers. They own the design, they own the product. They will come to, to me and, you know, the company that I'm representing sometimes with a finished design. So they just want you to manufacture to their specifications and their design.

Some can't, but what's happened over the last really 15 years, a lot of a consolidation. So a lot of acquisitions, a lot of private equity money coming into the industry. So left is a lot of mid sized to large medical contract manufacturers that can do it all. You go to the website, it says the same thing.

So it's this web of really 30, 40, 50 companies that could all do a really good job and provide a product to a customer. So how are we different? Right? I mean, that's how do we, when we get in front of a customer and they've got six or eight quotes in their hand, how do we differentiate ourselves? Right. And you got one shot.

So you probably want to dig deeper, but it's, it starts with, I think, just looking in the mirror and challenging, typically challenging leadership. What are we honestly really good at? What are we on the top side of our market? Where do we excel against our competitors and where are we weak? Right? So from there, if you can get an honest take on where you sit in that landscaped.

You can then do, uh, you know, you can do gap analysis. You can say, do we need to invest in technologies? Do we need to make an acquisition? Should we divest and focus? So that's where it has to start. Is that honest? Where are we and where do we want to be?

Let's not put in proposals on stuff where we're not differentiated. I, you know, are either of those directionally correct or is it some other way that you learned like that, that you have to, that you have to do this?

Do you want to do neuro? Do you want to do drugs? So. Often you need to really focus on an end market, right? That matches with at least the world I live in, that matches with the core competencies and strengths of the organization. Once I've gone into leadership, I think every single company that I've worked with in a leadership role, I've instituted a process where we look at incoming opportunities before we get them into the hands of the people that are quoting, and we do a review with a small group of decision makers to make sure it's aligned with.

Right? So in my world you win a program. You typically are going to run it for 7 to 15 years, right? So that's kind of the annuity that pays off when you win a program. And so we do a quick review of all those to make sure all those boxes are checked. And then at that point, if it passes, right, you get the green light, then we're going to go to quotation.

Because when I was stepping in and I'm looking at all the code activity, all the pipeline is huge. We got all this code activity. And one organization, Lucas that I joined, I think it was the first week, so it was a piece of business. That was one before I joined the organization and we're in a kickoff meeting with operations and the operations manager says, we don't want this piece of business.

[00:15:11] Lucas Price: I would imagine it could be challenging at times. You have a sales rep who brings in a piece, you know, an opportunity to quote a piece of business. It goes through the checklist and it doesn't pass. How is it to sort of. You know, deal with that on the sales rep side and I quote this piece of this opportunity that you brought in.

So, yeah, it does happen. And it's early on, right? When you're making that transformation in the organization here's what I'll tell you within three to four months, the percentage that don't pass it. It's dramatically falls off because the team [00:16:00] will quickly learn, right? What's a good piece of business for the organization and what isn't.

And there's nothing worse than spending time. Six months of effort, right. To get a quote, especially with a new prospect of customer, only to have all that effort go for not because you're not even going to get an opportunity to quote it. So, so some of those early rejections can be absolutely learning experiences.

Right. And like I say, you, you spend that effort. And you don't get the return. You quickly modify you know, your behavior and your, you know, your, you know, that individual salesperson really quickly will change their focus on what they're, you know, how they're spending their time.

They're getting clear clarity pretty quickly. It sounds like we're on the types of business that they're bringing in. What are some of the things that you do to make, to Help that clarity come quickly so that they stop bringing in the wrong types of opportunities.

It's lots of communication and training with my team. Here's where we're going. I want them. To have direct feedback, right? And it's part of that assessment of where do we compete, right? What is the sweet spot? I, that's not a decision I'm making in a vacuum, right? This is a collective conversation with a lot of individuals.

So it's all about communication. It's about training. It's about getting buy in, right? Cause last thing you want is somebody that's, you know, on the sales team out prospecting and they're. Disconnected with the focus or, you know, disagrees with, you know, the alignment or disaligned with where we're going and, you know, Hey, forget this.

Right. I don't, you know, this is different. This I don't believe in it. Right. There's nothing worse than a salesperson that doesn't believe in what they're selling. That's a pretty quick. You know, flag that any customer is going to pick up on. So it's just honest communication and feedback and a collective effort.

And, you know, and I think that those decisions like, It's really easy to say, Hey you know, we're going to stay focused on our differentiators. We're not going to, you know, go chase waterfalls or whatever. But the reality is that in those meetings, it can be really hard to say no to, you know, chasing opportunities that could be gigantic.

What are some of the things that you think about to evaluate? Is this a big opportunity in our wheelhouse versus, you know, it's not what we set our strategic direction is. But it could be bigger than our strategic, it could expand our strategic direction. How do you how do you maintain discipline on those types of things?

So we look at it on a annual production revenue basis, or as I mentioned they run for years. And the smallest opportunities tend to be about a half million to a million dollars a year of annual revenue. All the way up to the home run is the 50 million, you know, annual revenue type program. So you gotta have the mix, right?

So in my industry there's some companies that are really good at the lower volume to mid volume, which tend to be the smaller program size too. Right. And you get a typically a little bit higher markup, right? You get more profitability, but you've got the smaller programs, the big whales, huge revenue, but typically.

And longevity that. Trying to optimize you, right? Tap into the high end side of those types of opportunities. So it, one organization or one, one role that I had Lucas, it would, you talk about those difficult conversations, right? So I'm sitting with the executive leadership, the board of directors.

Here comes the new. Sales leader, right? And he's got this wild idea. He's telling me, I said, listen, guys, the pipeline is going to be cut in half, right? And you see the gasps, like, well, no, it can't happen. Right? I said, but our hit rate, we're not going to quote nearly as much stuff as we shouldn't be quoting.

Really difficult conversation. And maybe I'm not the right person to lead the charge. Right. So literally overnight cleaned up the CRM, right. We stripped it out. We instituted some of these processes and then six months, certainly within 12 months, the pipeline got even larger than where it was at that original state, and it was comprised of much more real tangible pipeline that was aligned with.

You know, the organization's expectations and goals. So I think you just, you got to believe it and you got to commit to it. And yeah, there's always that pull outside of, you know, the core focus, that big program out there, that's maybe an orthopedic or some other, you know, end market that you're not focused on.

You need to change the strategy and evolve it.

And so, you know, I want to take these steps and do some, you know, cut our, cut the garbage out of our pipeline and get a, get my team more focused. What are the things that these sales leaders should be watching out for? What are the mistakes that they could make when they go through this process that you've been talking about in terms of getting their team more focused on the highest propensity deals?

Barn up, you [00:23:00] can load the pipeline up with whatever and make it sound real and glorious and everything, but you're not going to win it. Right. So in the end it's garbage. So don't just be honest. Right. Again, I can't keep coming back to that. Be true. Right. Because I think if you start to take shortcuts or feel like you're taking steps, you know, again, outside of that true, honest depiction of where you're trying to bring the organization you're going to get burned every time.

I've learned to, if you can pull a team together, right. Honestly, like everybody's individual contributor, everybody's competitive. There's competition within a sales team, which I think is healthy. I got no problem. Board meetings and sales meetings. I'll put the individual pipelines up of everybody.

I mean, that's, let's just see where we're at and let's root for each other. Right. And if we're not. Individuals not performing, they know it and it's not to call them out, but it's sales is black and white. And that's part of why I love it. Right. It's just, you're either closing business or you're not right.

And it's like, we'll have a meeting. It's almost always Monday morning, not first thing, but early earlier in the day, and it's like, Hey, who's got a story from the weekend. Right. And it's usually something funny. Or I told the story. I. I was doing some landscaping and my wife's cutting and trimming the old dead stuff from spring.

And I'm like, this is tedious. It's a faster way. I thought this, you know, let's light it on fire and burn it off. And I started a very large fire in my backyard with trees and everything. And anyway, but anyway, not to get off, but I mean, there was an example of some, I was embarrassed and it was this great story.

Like, Hey, I know so and so I've done this before. Here's where I went wrong. And it's. We'll talk about work, but I'd really try to keep it the topics. I'll come with a few things to talk about, some updates, things like that, but it's almost always, you know, somebody who's on vacation or somebody had a graduation or one of their kids was doing something, it's just keeping it personal like that.

And I think just the chemistry of a team, the best teams I've seen in my career have been teams that truly cared. Believed and would support each other. And it sounds kind of cheesy and soft, but I've seen when that dynamic comes together to me, that's, I've seen the highest performance come from teams that are just united like that

one of the things I heard through your stories is to avoid the pitfalls is like communicate that ahead of time, like let your board know, let the rest of your executive team know this is what's going to happen.

I think that's very important for avoiding that pitfall that I wanted to reiterate. But yeah coming back to this idea of like kind of building that, that team atmosphere like you and I know that like, there's always, when you're. When you're building a high performing team, there's always challenges, whether it's a high performing team or a struggling team, there's always challenges.

It's not like it's it just becomes easy. But on that high performing team, there's also like a feeling of camaraderie and belief that you're talking about. And so when you're going into an organization and maybe they haven't had that. Maybe that's part of why you're being brought in is because they didn't have that feeling of camaraderie and belief.

And, you know, I guess another thing I'd love to hear you talk about is like, why, like, how did you find out the importance of that? Where did you discover it?

And I think I appreciate when people communicate to me that way. And that's how I communicate, you know, with people in general, whether it's through work or just in life. So a team that. Maybe culturally isn't there or is struggling, or there's individuals on a team that maybe aren't fully aligned with that kind of culture that we're trying to get.

I mean, honestly, like it's devastating, right?

[00:28:15] Pete Scharber: So it's, I just sit down and it's one on one like Ben there had done it. I mean, I know how you feel. Does it make sense to do a post mortem, right? Is there anything else we could have done? You know, it's, we did all the right things.

We just. Lost out for whatever reason. Right. So how do we do everything in our power and ability next time around? Right. That we're, in first place or can we correct. So anyway, it's just, to me, it's about being just real, that open, honest communication with an individual. And I just.

I'm a firm believer in that team chemistry. And if. An individual or individuals just, you know, can't or don't align with that. It's just, you got to have those conversations and sometimes make tough decisions. And again, I think that's part of the sales. Just that's the, that's. The profession we're in, right?

It's a performance profession. It absolutely is. And it's never usually a surprise. It's difficult. And that's the part of my job that I, keeps me awake at night, many nights. My wife will attest to that. But and it's. You know, I've interviewed hundreds and hundreds of people the last 10 years and hired many.

I hire for passion. I do. I love a person that comes in, you know, hair on fire, just, you know, just really driven, very passionate does their homework, ask the right questions. I'll hire that person. Every time over the 25 industry vet with the thick Rolodex and impressive resume of success, but just is rigid, right.

Like one of the other things I'll do Lucas is sometimes we'll have like if we win a big piece of business, you know, some of those Monday morning meetings, we'll have a Friday afternoon celebratory, we call it dance party. Right. And we got the disco lights out and there might be a few cocktails that show up through some of the zoom.

What was, you know, share, you know, some of the experience on what made you successful in winning this? Cause everybody's interested. Salespeople want to hear that. Right. So anyway, I think it's just doing things outside of the. The norm and the corporate grind and doing, I think, fun, sometimes surprising things that make it a fun environment for people to people to succeed and work with.

[00:31:48] Pete Scharber: Yeah. I mean, you need the right team dynamic. You need that passion. You need the driven individuals. Unselfish people. I mean, and I think I've, and again, I've interviewed hundreds of people like you probably [00:32:00] have. I usually feel like I got a pretty good spidey sense in five minutes, right?

Just culturally, if this person is the right kind of person I'm looking for I can't emphasize enough the right comp plan. I see organizations. I've been in organizations where I came in. If you have a comp plan that's capped, I just don't understand that to me. I mean, why would you cap somebody if they're bringing in and the organization is winning business they want?

Why in the world would You know, I've seen top people, you know, four months into the year and they're capped, what incentive do they have for the next eight months to keep cranking? I saw that's something I've seen that still kind of blows me away. I see business development roles. Where there's no tie to individual performance on what they sell.

And you know, one of the, I got a lot of great advice from my early mentor when I started. But one of the things that I think about often is he told me Pete. You can't think about the money. You can't think about the commission. I mean, I'm money motivated myself. I like that. But if you are focused on the money side, he says, it's going to taint you.

He said, you do the right things. You win the right business. That's a natural by product that will come. Right. So I thought that was very wise. Scratched 23 year old saying, I want to make a lot of money. Right. But so I mean, that's it. And how we started Lucas, right? You got to have a very strong go to market strategy comprised of the right prospect of customers that are aligned with your growth strategy.

And I think waste energy. You know, trying to chase business that you really don't have the, you know, the right to win, or you just can't be very competitive with. So it's that gut check time, that honest assessment. I think it's so important. Right. And yeah, I think again, that's something that I think is just imperative is to have that honest.

Being honest with your potential customers about what your differentiators are, what you can bring to the table and what you can't bring to the table. And there might be better suited with someone else. And then being [00:35:00] honest with your sales team about, Hey, this is who we're looking for in a customer.

This is what we're looking for in performance. This is, you know, what, you know, the. The type of culture that we're looking to build here. And so I think that level of honesty and transparency is, you know, very much a theme of the things we talked about today and ties it all together. And Pete thanks so much for being on the episode.

To all our listeners out there. If you enjoyed this interview in this episode, you can find more of our content at yardstick. team. And if you have any feedback for us, you can connect with me on LinkedIn. Thanks for joining us today.