Kevin Micalizzi: Welcome to the Quotable Podcast. I'm Kevin Micalizzi.
Today, we're speaking with John Spence. John's a business expert, speaker, and best-selling author. And today, we're going to dig into some of the most important issues that businesses are facing right now — whether that's trust, issues with culture, or the fact that you not only need to manage change but you need to drive it.
Let's jump into it.
John, thank you so much for joining us in the studio.
John Spence: My pleasure. I'm happy to be here.
Micalizzi: So, John, it's been I think a year since we first talked about having you on the show. I'm very excited that we were able to catch you. You're constantly traveling. Would you share a little bit about what you do?
Spence: For the last 25 years, I've been an executive trainer, a professional speaker, an author, written a couple books — a very eclectic way I help companies. I travel about 220 days a year, worldwide.
Micalizzi: That's fantastic.
Spence: It's fun.
Micalizzi: It must get a little tiring?
Spence: Well, I don't have kids. My wife travels with me. So it's a tremendous lifestyle business.
Micalizzi: Oh that's phenomenal. So, John, when you were talking about things to watch out for in 2018, you talked about trust being at the top of that list. I think politically, from a business perspective, trust is a conversation. People are talking about trust pretty frequently right now and usually not in a very positive sense.
What are you finding and what are you recommending?
Spence: Well, it's been fascinating because I teach a lot of leadership. The number one characteristic of a leader that people willingly follow is honesty, and we're not seeing a whole bunch of that in many, many areas.
So when I look at trust, there's a five-level framework, and then I've got a nice phrase that goes with it. To build trust, the first thing is an honest connection — getting to know the other person, hang out, talk like we are now. Number two is to show that you genuinely care, that you've got compassion. We would call that EQ now.
The next one is competence, to prove that you're really good at what you do. Unfortunately, a lot of people lead with number three. And if you lead with number three, you're not really going to create that connection.
The next one is character. Another word there would be integrity: "Do what you say you do." And the last one is consistency, which I've just seen some research lately that shows — and I know it from my own experience — that an inconsistent leader is one that's hard to trust.
I have a phrase that I put around this. I read a book on leaders. Here's the entire book in one sentence: "I'm good at what I do, and I do it because I care about you."
Micalizzi: Right. I like that.
Spence: Yeah. High competence, high concern.
From a salesperson, a leader, a team leader, you want to consistently communicate that you're competent and you care. "I'm good at what I do. I'm working hard. I take this as a craft. I want to be great at it, and I do it all in service to you, to help you to serve the customer, to do what's in your best interest."
Micalizzi: Right. I think to your point about the competency, a lot of people target individual items on that list. But they don't look at it holistically and make sure that they are in service.
Spence: Yeah. The way I look at it, we use a quadrant.
If you're really, really good at what you do and not very nice — people would call that arrogance — "I respect your skill and your talent, but I don't trust you because I know you don't care about me."
If you're incompetent and you don't care, it usually doesn't work very well.
If you're really, really nice but not competent: "I like you. I like to hang out with you, but I don't want you to work with my company or be my leader or be on my team."
So it's where that intersection of high-competence, high-concern comes in.
Micalizzi: Now, do you find that these leadership traits apply to salespeople as well as the actual managers and leaders?
Spence: Oh absolutely, because your customer is looking to you to help lead their decision, lead their company. Oftentimes, they're buying something that's business-critical, essential to their company. "I don't want to turn over something that's extremely important to my business to someone who isn't highly competent, doesn't care about me."
Micalizzi: Right. I'm finding in a lot of podcast conversations, we're talking about keeping the sales process human. Not just from a technology AI perspective, but really the fact that I think a lot of people miss the boat on meeting that EQ and really approaching it as being in service.
But I think that the other side of it for me is, too often, sales reps are really not positioning themselves as leaders. They don't think of themselves that way. I mean, customers obviously have pretty complicated buying processes especially in our world, which is B2B. They're just not embracing it as a leadership role.
Spence: When I started my career about 25 years ago, I worked for a large, global sales training firm. The words that we always used were "trusted advisor." You've got to position yourself as a partner or peer. To do that, "I have to know as much about your company as I know about mine. I've got understand who your customers are, how you make money, what's going to give you differentiation advantage in the marketplace."
A lot of people say this: "I've got to be able to see around the corner for you, as my customer, so I can bring in ideas and solutions for problems you didn't even know you had." You don't do that unless you're really, really, really good at what you do, getting better every day. You'd lay awake at night worried about your customer, worried about their business, trying to solve the problems that keep them up at night.
When you can present yourself like that — "Hey, I've been studying. I've been working on really, really trying to get better. I'm doing it all because I want to help you be more successful" — I think price goes out of the equation pretty fast or at least it drops way down, and you become the person that they're excited to see. "Oh, I'm going to get to meet Kevin today. He's fantastic. He always has great ideas," rather than "Oh great. Here we go again, version 3.7."
Micalizzi: Yeah. The product and price have to be dramatically different for liking you, and "trusting you" not being a stronger factor than price and product features.
Spence: It's got to be a balance. "I have to like you enough, but I'm not going to spend a couple million dollars on you just because we enjoy playing golf together." That's part of it because, "I get to know you, get to know your family. I get to know your values, what you stand for. But that is not going to drive a solution that I'm willing to spend six, seven, eight figures on."
Micalizzi: Right. Now, have you found, in the years you've been doing this, it seems like we talk a lot more about mindset nowadays than I used to hear? Is it more of a cerebral game now than it used to be?
You've really got to get into — you're in service to the customer. You have to have the right frame of mind. You have to be engaged. You have to be listening, really bring those EQ skills to bear. But you also have to have, I don't want to say, just a positive attitude. But there's a certain amount of compassion.
I don't know. I'm not sure how to explain.
Spence: Well, you look at most customers today. I don't know all the research. You guys know it better than I do. But I think it's 78% of purchasing decisions are made before they ever talk to the salesperson, some number like that.
So to me when I look at a really great salesperson — and I deal with folks all over the world selling things up into the billions — they're curious. They really want to understand. They want to dig in deep. They're not salespeople; they're consultants. I bring a consultant in to help me build my business and grow my business. When I think of a salesperson, that's somebody I have to spend money on.
So I think there's a mindset now of connection, camaraderie, care. "I really want to get in there and be very, very, very skilled but do it all to help my customer be more successful." People talk about this all the time.
It's unfortunately very rare that I meet a really high-level salesperson who has positioned themselves as a true consultant, someone that the entire industry looks to. I don't like the word "thought leader," but somebody who's recognized as "among the best at what they do in the world."
Micalizzi: Right. So really driving that value, not just relating to the product but in helping the customer to be better.
Spence: Oh yeah. Strategy ideas, leadership ideas, people they can partner with, things they should read, bringing them ideas and information.
I think the product is almost tertiary. It's the relationship. "How can I add value and introduce you to people in my network and help you get better at things?"
What I always say to my clients is, "If I don't have the answer, I can find somebody who does." I don't make any money off of that, but I'm there to say, "I solved this problem, this problem, this problem for you that had nothing to do with what I sell. Now, I'm going to move way up on your list of people you want to talk to when you want to purchase something that I sell."
Micalizzi: Right. So when we're talking about trust, we can talk about the individuals. Obviously, you need to be consistent. You need to be trustworthy. When it comes to organizations, I think a lot of organizations have cultural challenges and maybe aren't as deliberate in what kind of a culture they want to portray.
I happen to be lucky that I work here at Salesforce. We are very clear and very strong about what our culture is, and that just permeates everything we do.
You talk about having a culture, a purpose. What do you mean by that?
Spence: Well, having looked at many, many companies, I understand this pretty clearly that culture equals cash. A lot of the organizations that I work in, their product is very similar to other people in the marketplace. The pricing is pretty much the same. I can throw more money at marketing. There's always somebody willing to drop their price and go out of business faster than you.
But when you really get down to it, I think most companies, their competitive differentiator is the quality of the people they can get, grow, and keep on their team and the relationships with their customers.
When you want to attract top talent, one of those things is, "We need a winning culture where people are excited, engaged, having fun, and want to deliver business results."
Now, we look at it where you can see that in a lot of businesses. But the thing that really drives younger folks — I'm 53 so the millennials and the folks that are younger — is not just "I want to make money," but "I want to make a difference."
If you can find that noble compelling purpose that somebody can get up in the morning and they're excited about doing that — "It's not just the job, the money, or the paycheck, but I make a difference." Or "Even if my job is not that exciting, maybe my company does really cool stuff in my community."
There's a great book about the folks at Chick-fil-A. They say, "How do you get somebody that makes minimum wage and cleans toilets to be super excited and engaged every day?" The reason is each Chick-fil-A franchise saves a certain amount of their money and gives it to the staff to go help the community. So the harder they work and the more money their franchise makes, the more money they can contribute to the community.
I see companies like that where it's not only the product. You've got Genentech in town. They're a great company that they save people's lives. When they get up in the morning, people go there with, "I'm not going to work. I'm going to save people's lives."
It's hard sometimes. I'll give you a very quick story about this. I worked with a CEO that owns a company that makes gearboxes, not very sexy.
Micalizzi: Yeah. I was going to say, "Definitely not."
Spence: And they make ball bearings and things like that.
They had just bought a company that made the gearboxes for Black Hawk helicopters. They just bought the company, and they called all the employees into a hanger. They had their number one customer, which was the Department of Defense, a general, come up to talk to them.
They're thinking, "Okay. Here's our biggest customer. He spends millions and millions and millions of dollars a year. It's going to be some rah-rah.” He walks up, stands at the podium, and looks at everybody and says, "Both of my sons fly Black Hawk helicopters in Iraq. Don't kill my boys."
Spence: Yeah. Now, it's like they don't make gearboxes. They protect his sons' lives and the other people that are there. That's a whole different purpose than building gearboxes.
Micalizzi: Definitely. Wow. It's hard not to get emotional when you reframe it like that.
Spence: Yeah. I can't remember who the client was this week, but I challenged them. Oh, it was a software company. I said, "What do you do that changes the world? Why should people get up here?" [Someone said,] "Well, we work on really hard problems."
That's really not an ennobling purpose — "I solve really tough mathematical problems." They do algorithms. They do transportation stuff.
Finally, I heard a [kid] say, "We make the world more efficient. It's greener. People can feel good about traveling. It's more efficient, and it saves money."
So when it got down to saving the earth, saving money, making things easier for people, that's a lot more fun than just writing algorithms.
Micalizzi: Most definitely.
Spence: But they really had to stretch to get to it.
Micalizzi: Yeah. Well, you're turning it entirely on its head. It shouldn't necessarily be that you're turning it on its head, but it's really focused on the outcome and the impact that you're having versus what you're physically creating or physically working on.
Micalizzi: Yeah. I like that.
So we've talked about trust. We've talked about culture. One of the things I do want to make sure we talk about is change and not just managing the change — because, obviously, especially with technology, change is accelerating even more — but really driving change.
Spence: This is a subject I spend a lot of time on because almost every industry is going through massive changes. I hear that all the time, but it's really true.
I teach a class as a guest lecturer at Wharton every year on the future of business. People walk out of there where their head is spinning and going, "I had no idea."
So when we talk about driving change, there's a framework that we use. I think the most important element — this goes right to what salespeople do — is there has to be an irresistible case for change.
People are resistant. You've got to overwhelm them and make it incredibly clear that you must change, and they have no choice. As long as they think there's a door open or an opportunity to get out of or they can resist — "this too shall pass" — you will not be able to drive the kind of change.
That also comes from being able to expose them not only to emotion but data. "I want to get you emotionally agitated, scared, or excited." And then I've got to be able to back it up with hardcore data, facts, and information so you can't really question me.
Micalizzi: Right. So it's more than just a carrot or stick. It's really trying to inspire them and then provide that supporting data for those more logical.
Spence: Well, what I want is proof. They can't just say, "Well, it's your opinion, John. Who are you to say the industry is going to change?" [Then I say,] "It's going to change, and here's all the stuff."
So the first step is that irresistible case for change. Step two then is a compelling vision of the future. Again, this can be positive, negative, or a combination of both that says, "Here's something big coming. We've got to change. You have no choice. Here's how great it's going to be in the future. It's going to be fun, engaging. We're going to have a great time."
I will give you a very quick story on this one. I was working with a CEO of a large hospital. They had to tear down one of their towers, and they were going to build a brand-new one across the street. No one was going to lose their job. You get to work in a state-of-the-art building with the best equipment. They park in the same parking lot. They just walk another way.
Nobody wanted to do it, fighting it. I said, "If you give them a way out, you will lose them." He's standing out in front of them: "I don't really want to tear down the other tower. My kids were born there. My mom passed away there. But the board says we have to because we're $62 million short."
What did they do? They went out and started trying to raise $62 million. Bake sales, everything they could do to resist the change. But as soon as it was clear, they realized, "Hey, this is a great opportunity. It'll be fun. We can save more lives."
As soon as they put it into that [context] of, "This isn't just about a building. It's state-of-the-art equipment, a children's hospital, best-of-the-best. We're going to be able to save a lot more lives and help a lot more people." All of a sudden, they got excited about the new tower.
Micalizzi: And everybody got on board.
Micalizzi: Are you finding technology is helping with some of this driving change and really embracing how things are changing? Or do you think technology is a strong factor in the need to drive change?
Spence: It's fundamental. Technology is both empowering and scary. You've got amazing things coming, the speed of computers, algorithms, artificial intelligence. All those things are driving massive change in many industries.
I'm here this week to go up to Napa Valley to talk to about 100 CEOs of credit unions. Their whole industry is changing, consolidation.
We just bought a car not too long ago. We never stepped foot in the bank; never talked to anybody; never saw the car; never went to the dealership. Picked it out online. Had our bank do an electronic signature. The car got dropped off at our house, and they took the old one away.
That is a completely different model for buying cars and financing them. The technology is driving that change dramatically. The key is you've got to get out in front of it. You've got realize, it's not going to slow down. It's going to get faster and faster. There will be some industries that are completely annihilated, complete new industries that are created.
It's been my experience that about 80%, 85% of people I work with in business do not understand how fast things are going to change, how dramatic it's going to be, and how it's going to impact their business, maybe make it go away.
Micalizzi: So to your example, that's a B2Cexample with a car purchase. I think we have truly become spoiled in many respects because your consumer experience is phenomenal in so many areas.
Are you finding, with the business clients that sell to other businesses, that they are really stepping up their game in terms of the customer experience?
Spence: They have to because everybody measures you by their very best experience. So if I can get stuff downloaded in milliseconds, I can do a huge deal and not have to talk to anybody, see anybody. It's perfect. It shows up at my house.
All this amazing user experience stuff they have for B2C. When I go back to my business, I expect the same level of service from my business providers. "And you're an even bigger company. Why can't you be better at that? My credit union handles this better than you do."
So everything is measured in download speed now. When I have a wonderful experience some place, I expect every single person I deal with, from a business or consumer side, everyone I buy from to give me that good of a wow experience.
Micalizzi: Right. So you're finding companies are actually stepping up?
Spence: Oh yeah. They have to, yeah. What they're doing is they're starting to look outside of their industries.
While I'm here this week, I'll be in a special program at the Ritz-Carlton talking about white glove service. You look at it. People are always comparing themselves to big companies like that. We say, "How can we take that service ethic, move it into a B2B area, and exceed the customer's expectations consistently by delivering things above what they thought they wanted?"
And that a) takes a lot of skill and a lot of thought, b) it's a really fast-moving target. As soon as you get there, it's going to move again. Hence, the reason driving change is so important — not just embracing it but driving it, creating those strong relationships, and having that strong purpose to drive it. Because it's going to get harder and harder. If you're not running at full speed, you won't be able to keep up.
Micalizzi: I love how you brought it back to the desire to serve when we were talking about trust at the beginning and really how you approached that. A lot of it has to do with you're in service to the customer. I love the fact that it goes full circle. The customer is the center of everything that you're doing as a salesperson.
Spence: Yeah. I want to be the first person they call when they have an issue or problem or they want to understand something, whether it has to do with my product or not. I just want them to look at me as someone who's highly professional, very skilled, thoughtful, well-read, well-studied.
So if anything happens in their company and they're a little concerned, I'm one of the first people they pick. And when I'm saying "I," I'm talking about any salesperson. I want them to call me and say, "Hey, do you know anybody that can fix this for me? Have you heard about this?" Or being the one that sends them information on technology that's going to impact their business that they never even knew to read or study.
Or that every time an email comes from the salesperson, they go, "Oh it's not a sales thing. It's a piece of information, data, a connection, a link, something that's going to help me with my business. This is really valuable."
Micalizzi: So, John, we've talked about trust. We've talked about culture, and we've talked about driving change. For the folks listening, where's the best place to start? I mean, obviously, you can't tackle everything. How should somebody be prioritizing what they go after?
Spence: That's a great, great, great question. I'm going to try to go with the answer of "It starts with you." It starts with you investing in yourself, investing in your time.
One of the reasons that I've gotten to where I am in my career is I read 100 to 120 business books a year, and I have, every year, since 1989.
Micalizzi: Wow. That's an impressive number.
Spence: Well, don't forget, that's what I do. I did that when I was just a sales trainer, and I've owned a couple of companies. I always wanted to be that.
So the average college graduate reads a half a book a year. If you were to read one book every other month, six books a year, you'd be in the top 1% of the United States of America. If you read one book a month, 12 books a year, you're in the top 1% in the world. That's not just books; it's YouTube videos.
But if it were me, the first place to start is studying everything you can around trust, around change, around leadership, obviously, in your arena, in your industry. But I think if you can create a habit of lifelong learning, what I like to call personal kaizen, continuous incremental improvement, you're going to learn the stuff necessary to be the one that can drive change.
You're going to understand human interaction, EQ, reading some of the stuff on that to create better relationships. You've got to understand your business well enough that you'll start to see the purpose behind what you do more than just sell stuff.
I think if you improve yourself, you're setting a living example. That's also what adds value to customers and value to your own life, your family, and your community.
Micalizzi: I like that. John, are there any areas I haven't asked you about that are very much top of mind or you're getting asked about frequently?
Spence: Yeah. One I'll share with you is the single biggest problem I see at companies around the world — number one — lack of accountability and disciplined execution. A lot of people are smart. I run into companies all the time, great product, fantastic strategy, new business model.
Again, the classes I teach at different universities, I've got a senior executive class I teach at Wharton for the securities industry. Every year, I get about 100 to 120 senior executives in my class. I ask them, "What percentage of companies that have a good plan, have a good strategy, have a good product, know how to win in the marketplace, have good people effectively executing their plan?"
Do you want to take a guess?
Micalizzi: Oh gosh. I hate to say it, but I would say, "Ten." [Laughter]
Spence: It used to be 10% to 15%. Now, it's 5% to 10%. I see that on an individual level too.
So being able to be the person that not just has great ideas but can turn those ideas into action is a game-changer. In an organization, if you got to just 50% execution on your ideas, you'd crush the competition.
So time and time again, it's not that they don't have great products and plans. It's that they don't have the discipline to get in and actually make that happen every day. As an individual, that's critical. Then as a leader in an organization, be able to take that stuff, and as a salesperson, be able to take your solutions and make sure they're implemented effectively so the person gets the value they spent their money on.
The people that can do that are very rare and extremely valuable.
Micalizzi: What about the accountability? I mean, that to me sounds like a cultural problem within an organization.
Spence: Yeah. One of the things was a great workshop I did. This is something your listeners could do, some of the leaders. I did a workshop called "What Will You Tolerate? What Do You Refuse to Tolerate?"
I would say "Look at your culture. Look at your values. Now, I want you to write a list of all that stuff that you currently tolerate in your company that you know you shouldn't" — people showing up late to meetings; people coming in late, leaving early, looking at their electronics all the way through meetings.
They usually write a list that's very painful because they realize "We have a lack of accountability." Another word I'll use there is tolerating mediocrity.
Then you look over here in this other list of stuff where you refuse to tolerate — lying, cheating, and stealing; being rude to customers; being rude to teammates. "That stuff I can be proud of and celebrate in my organization." And the other list of stuff, you don't. That's the list you've got to fix.
So accountability comes down to five key things. Number one is 100% clarity plus appropriate authority and resources. "If I'm going to hold somebody accountable, I've got to give you everything you need." Number two is 100% agreement. "If you try to assign something to me, I've got to say, 'I understand it. I got it. I'm good to go.'"
Track and post, which is interesting with your product. Being able to make sure there are dashboards so we know what's going on.
Coaching, mentoring, and training so that when someone is slipping, you can run in and help them. If they're not being accountable as they should, you can support them and give them what they need. And the last thing is celebrate success lavishly and deal decisively with failure.
When you look at creating a culture of accountability, those are the five things you have to have around it.
When I talk to senior leaders at companies all over the globe, and when we talk about the kind of employee they want to hire, same two words, "ownership mentality," which is another word for high levels of both personal and mutual accountability.
Micalizzi: Definitely. So, John, I want to change gears and ask you our lightning round question. If you could take all the knowledge and experience that you have now, go back to the beginning of your career and give yourself one piece of advice, what would you tell yourself?
Spence: Wow. That's a tough question. You know, it's funny. I just had a friend talk to me about intuition, and I'm very, very data driven. I would have learned earlier to see the red flags with business partners or people that I was dealing with and realize that "We don't have a values match here.” No matter how much I might try, if someone's a liar, I'm not going to get him to tell the truth.
I had a guy who worked for me that believed "Every customer is out to get you. They're going to take advantage of you. They're going to get the lowest price. Every vendor is trying to steal money from you." I should have known that the minute I hired him. It took me about a year to figure out, and it was painful for the whole company.
So I would have trusted my intuition more. It hurts me to say that. [Laughs]
Micalizzi: Yeah. Obviously, you're still doing a lot of great work. So it's great that you realized that, and you can actually apply it.
Spence: Well, after a quarter of a century doing this, when I get the red flags now, I just walk away. Luckily, I'm at a place in my career that I don't have to work for one person. If somebody is rude, obnoxious, it just doesn't feel right, I go, "It's been a pleasure meeting you. I don't think we're going to fit, and I don't think it's a good idea for us to work together."
It took a little courage to get there by having been burned by trusting people I shouldn't have.
Now, the reverse is — I'll tell you this story. I'm a big believer that you give people 100% trust when you meet them. If they violate, start to remove it. Most people are the other way that says, "You have to earn my trust. It might take six months or a year or two to three years."
So the way to build trust quickly is to extend trust first to say, "I've never met you before, but I believe you're going to tell me the truth. The minute you do something, I can pull it back. I'm not naive. I won't be taken advantage of." I'd rather go into every relationship saying, "I trust you fully," instead of "In three years, I might trust you."
Micalizzi: Especially, in a sales context because you're struggling to get that prospect's attention. You're really trying to build your image in their eyes. If you've already got that wall up, and they have to somehow prove to you that they're worthy of your trust, that seems like you're making this entire process far more difficult than it needs to be.
Spence: One of the things that drives trust in people is, "If I feel like you trust me, I'm willing to reciprocate that. But if you've got a wall up, you're standoffish, and you want to check every single thing, then already I realize you don't trust me. If you don't trust me, why should I trust you? Because I'm a trustworthy person, at least, as far as I'm concerned. [Laughter] If you don't trust me, then there's something wrong with you."
Micalizzi: Right. So, John, this has been fantastic. Thank you so much for joining me in the studio.
Spence: My pleasure. My honor.