Slippage refers to the difference in price for a stock between what the investors estimates he will pay and what he actually does pay, due to changes in price that occur during the process of buying. Efficient buying reduces slippage.  It is a concept that applies to selling professional services, too.

There are times when a client or prospective client or network contact is more than usually predisposed to help you.  This can be, for example:

• When you have just finished an excellent piece of work for the client.
• When the prospective client becomes excited about your potential to help him.
• When you have just had a conversation at a conference with a network contact that shows the potential you have for helping each other.

The value of such opportunities fades as time passes.  The client’s desire to help you in return for the excellent work you did ebbs as she gets absorbed by other urgent matters.  The prospective client loses some of the enthusiasm generated at your meeting.  The network contact also forgets the conversation you had as the days go by.

This is one of the reasons that rainmakers feel a sense of urgency about following up.  No matter how busy they are, they find time to follow up on such opportunities, recognizing that all their hard work to produce them loses value as time slips by.

I don’t want to overwork this metaphor.  Following up too eagerly can be construed as desperation or as being mercenary.   But, in my experience, among professionals far more is lost from slippage than from pushing too fast and too hard.  And, of course, I am not suggesting that you give up on an opportunity if a week or three has slipped by before you act.  Better late than never.

Still, as a New Year’s resolution, you could do worse than committing to reduce rainmaking slippage by following up on opportunities while the glow you have created burns brightest.

A new RainMaker Blog is now being published by the RainToday people.  It addresses many of the same issues for the same audiences that this one does.  They are offering a free report, Deal or No Deal: Sales Mistakes that Turn Buyers Away.

Years ago, when trying with limited success to help my son with a math problem, I was reacquainted with the beauty of the deductive power of geometry.  Using deductive logic geometry builds from simple properties to complex theorems that explain spatial relationships.  The logic allows us to manipulate forms and objects to create buildings and infrastructure.

I felt that, similarly, deductive logic could be used to explain much of what is required to become a successful rainmaker.  The fundamental elements of rain making are also simple, but, as in geometry, they can be built into complex rules of client development that allow us to get new clients.  Here is a first stab at developing a deductive logic of rainmaking.

A. Basic Properties

1. You sell to people.
2. You can only sell to people you know.
3. To know someone you must first meet him.
4. It follows that the more people you meet, the better your chances of selling something.
5. People move around.
6. A client who moves from one client organization to another can help you open a new account.

B. Relationship Properties

1. The stronger your relationship with someone, the better your chances of selling something to him.
2. Since you can’t have a relationship with someone you don’t know, it follows from (A3) that the first step in starting a relationship is to meet the person.
3. Relationships, good or bad, are based on time together and mutual help.
4. Conversely, it’s hard to have a relationship with someone you never talk to.
5. The more time you spend with someone and the more you help each other, the stronger the relationship is.
6. The more people you know in an account, industry or function, they better you are able to help them.

C.  Good People Properties

1. Good people tend to do well.
2. The more good people you meet, the better your chances of making a sale.
3. It follows from (A5) and (C1) that good people move around.
4. It follows from (A6) and (C3) that good people can get you into a new account.
5. It follows from (A1), (B1), (B3) and (C1) that it is wise to talk to and help good people.
6. Good people tend to have influence with others, and so can introduce you to others and help you develop relationships with them.

D.  Marketing Properties

1. The goal of marketing is to help you meet people and develop relationships with them (by giving you reasons to contact them).
2. Marketing efforts that don’t do one of these two things are probably not worth the investment.

That is as far as I have gotten.  I suspect that a complete logic of rainmaking could be built with this process.   Does anyone one have any corrections or additions to these properties?

Guest post by Gary Pines

I hear many professionals say they do not know what to do with social networks. They neither have the time for them nor see the value in them.  They feel that social networks invade one’s privacy, and that there are enough communications vehicles what with cell phones, email, and a seemingly endless list of old and new media.  And they find the array of social networking options overwhelming with LinkedIn, Facebook, Twitter, My Space, You Tube, and specialized networks for specific professions and industries.

A recent Business Week article points out that new modes of communication have always attracted this kind of reaction.  Among the examples it cites are:

• Socrates’ objection to writing, in part because this “invention” eliminated the need to exercise the memory.
• Henry David Thoreau’s objection to the telegraph, the instant transcontinental communications in the 1840s about which he said, “Maine and Texas … have nothing important to communicate.”
• Western Union’s refusal of an offer to buy the patent rights for the telephone in 1880, asking “whether any sensible man would transact his affairs by such a means of communication.”
• The New York Times editorial against the typewriter because it usurped the art of “writing with one’s own hand.” (What would Socrates think of this).

To these we can add more recent examples:

• Some people disdained cell phones in 1990 with voicemail messages, saying that they would hinder person-to-person telephone communication.
• By  the middle of the decade others complained that email and the internet would lead us away from real time communication.
• And now … social networks.

Instead of being superfluous, social networks are here to stay.   During the first years of the internet, people could only guess at its future uses and impact.  Now, we are just beginning to explore their potential of social networks.  They are a piece of the rain-making process. Those who stand aloof from them lower their probabilities of success and will  lose out on their the increasing power and value in the years ahead.

In numerous earlier posts (such as Seeing Events Through a Rainmaker’s Eyes, Part 1 and Part 2), I have observed that rainmakers are positive thinkers.  Things we see as bad, such as being stood up for a meeting, they see as neutral or even positive.  (When someone stands you up, it often creates a small chit that you can collect later.)  Things we see as neutral, such as an extra attendee at a client meeting, they may see as positive.  Positive thinking gives them a resilience that allows them to get up and try again and yet again until they win.

This all may sound Pollyanna-ish, but it’s not.  When interviewing people who have observed rainmakers, they often note the rainmakers’ optimism, sometimes mentioning in a tone of mild surprise that the rainmakers’ optimism often proved to be well-founded.  The rainmakers’ positive outlook is shaped and reinforced through experience.  They know not to take an unreturned phone call too seriously, because they’ve had to deal with so many of them.

When rainmakers apply their optimism foolishly, they are as likely to get hurt as anyone else.  Our data base of rainmakers includes several who went bankrupt through misplaced optimism, often in the form of a real estate deal.  Confident that they would sell boatloads of new work, they signed leases for space to accommodate all of the employees they would have to hire to do it.  When the work didn’t appear, they were stuck with the real estate costs.

I make this point for two reasons.  First, it is a caution to rainmakers and those who work with them to question the rainmakers’ optimism, if they seem to be applying it to areas beyond their expertise or to be brushing off the risk of catastrophic consequences, if they prove to be wrong.

My second reason for making this point is to deter anyone inclined to use a colleague’s negative thinking as a brickbat to beat them with.  I’ve had this done to me earlier in my career and seen it done to others.  Branding someone has a negative thinker and berating them for it is a loathsome and ineffective form of bullying.  There is a place for negative thinking in an organization, and when appropriately applied, should be encouraged and rewarded.  When misapplied, the reaction should be education, not derision.  For those interested in this subject, I recommend Martin Seligman’s excellent book, Learned Optimism.  (I have no financial interest in the sale of this book.  I do have a financial interest in the sale of my book, Creating Rainmakers, which also addresses the subject, but decline to recommend it out of modesty and fear of being hauled into court by the blog police.)

Dwight Davies said the following to me long ago:

“At any given time there are three to five things that a company is working on that are driven by the board and CEO on down, and everyone owns a piece of them.  They’re not always the obvious things.  If you are talking to people about  one of those things, you’re helping.  If you are talking about anything else,  you’re on the outside and you’re selling.”

I think this is true wisdom.

One of the key tools in any Rainmaker’s arsenal is a great Client Relationship Management (CRM) system. Unfortunately. many rainmakers and their firms struggle to successfully implement these systems.

On September 21, 2009, a group of rainmakers and experts will provide their own unique perspective to answer the question, “what is the perfect client relationship management system?”

Each expert will draw upon years of experience to outline their vision of the perfect CRM system. This exercise will provide you with new insights into what works, what doesn’t work, and what you should consider when implementing a CRM system.

The experts include:

• Tim Klabunde, Author of the CRM Chapter in the Marketing Handbook for the Design and Construction Professional
• Bernie Siben, Author of A Horse of a Different Color: Marketing in the Public Sector
• Bobby Darnell, Former Director of National Accounts at Reed Construction Data
• Mel Lester, Owner of the Business Edge
• Matt Handal, Contributing Editor of SMPS Marketer
• and me.

Join us on September 21, 2009 by reading each author’s post at the sites listed and contributing by commenting with your own thoughts and experiences.

Two new books of interest to aspiring rainmakers and managers of profession service firms came out this summer.

The first is The Integration Imperative by Suzanne C. Lowe [Professional Services Books, 1990].   It deals with what I believe will be the single biggest issue in business development at professional services firms in coming years, the integration of sales and marketing.  Professional service firms are well behind traditional product firms in this area.  This results, I suspect, from two major causes.    First, selling was a forbidden word in the professions for many years and still is at a few firms.  If you can’t talk about it, you can’t manage it.

Second, marketing has been a poorly defined term in the professions, in part, because it was often used as a euphemism for selling.  When not referring to selling, marketing has been used vaguely to refer to a collection of activities, including public relations, advertising, running seminars and the like.   This is a far cry from the sophisticated understanding of marketing found at product companies where the term refers to the selection and positioning of products in carefully selected markets and the way a company goes about taking those products to the  markets.

Professional firms which successfully integrate sales and marketing will have a big advantage.  Some already do.  Lowe has sought out a number of these firms and studied what they have done.

The book is divided into three parts.  The first covers why integration of marketing and sales is important and the second provides guidance on how to do it.  These are both well worth reading and studying.  Still, it is the third part that I found most interesting.  I am a sucker for case studies, and Lowe has outdone herself in this section by providing detailed studies of eleven firms across the professions.

The second book, Winning the Professional Services Sale by Michael W. McLaughlin [Wiley, 2009], neatly complements the first by providing an in-depth look at how professionals should handle a sales meeting.  It covers both the strategy and tactics of face-to-face selling from how to prepare, draw out the client’s needs, deal with surprises, prepare proposals, present, negotiate and set up the second sale.  McLaughlin also addresses critical subjects that are infrequently written about, such as when to walk away from a sale.

McLaughlin provides practical advice that is clearly based on a lot of personal experience.  For example, early in the first chapter he states that in a sales meeting every client has three burning questions of a professional:

•    Do you really understand what we need?
•    Can you do what you claim?
•    Will you work well with us?

Anyone who has sold professional services knows that these are the fundamental questions.

Though I may not agree with everything McLaughlin says, his arguments are well worth reading and a valuable check on opinions that all of us hold about selling.  This book is a good choice for anyone learning to sell professionals services and also for those interested in refreshing and sharpening established skills.

One of the best rainmakers I have met in recent years called me the other day, because clients had stopped hiring him.  Naturally, he found this disturbing.   Who wouldn’t?  He wanted to talk about the cause and what to do about it.

Demand had dropped because of events in his primary market with which he had had nothing to do and which were beyond his control.  Until recently, his practice had been growing at over 20 percent per year for several years.  His efforts in new markets weren’t producing sufficient results yet to stop the dive.  For the first time in his career, he found himself unable to land sufficient new clients.

It is a credit to his awesome rainmaking abilities that this hadn’t happened earlier in his life.   I know from personal experiences and those of many professionals whom I have worked with that the first time this happens, it can bludgeon a person’s self confidence.  This is especially so, if one is emotionally insecure, as many rainmakers are.

If this happens to you, I suggest the following:

• Remind yourself that everyone has streaks and slumps.  This is partially a matter of luck.  If you flip a coin enough times, it will eventually come up tails ten times in a row.  That it does is a function of probabilities and luck rather than of your flipping skill.  You probably haven’t lost your touch; your luck has just turned.  Of course, this also means you weren’t quite as good as you thought you were when the luck was running your way and you had a streak of wins.  That humbling bit of logic is good to keep in mind when you are winning a lot.
• The probabilities of a certain run of wins or loses changes over time with market conditions and other factors.  Just as a field-goal kicker will score less often in a season with lots of gusty crosswinds, so you will win less often when the business crosswinds work against you.
• The probabilities of winning go down, if you have to enter a new or under-developed market, and go down substantially.  This if for factors I have described elsewhere (See my book, Creating Rainmakers, Chapter 2, “What Rainmakers Know or the Mathematics of Selling”).
• Of course, you should review what you have been doing that might have reduced your rainmaking effectiveness.  There is always something that we can do better.  There are always areas where we have become a bit lax with success.  Fix these problems.
• Refocus on the markets where you can get the most traction fast and have at them.

This all leads to my main point:  Beating yourself up over a slump won’t help you.  First, for the reasons I have described, it is probably inappropriate for you to do so.  Slumps occur for even the best rainmakers, and the rainmakers’ errors are usually a relatively small part of the cause.  So, question what you have been doing, but don’t question yourself.  Wallowing in self recriminations or the (false) realization that you have been a fraud, not a rainmaker, all these years, is counterproductive.

If my friend, the rainmaker, was guilty of anything, it was of not diversifying his market rapidly enough.  He had made sincere efforts to do so, but those efforts had been stalled due to the high demand in his core market which consumed his energies and time.  If that is a mistake, it is an honest and understandable one.  Indeed, it is one that most of us would make.  All this doesn’t resolve one’s revenue shortfall, but it does put one in a better mind-frame for doing something about it.

Guest Post by Gary Pines

(The golf course is among the most common venues for networking, and it’s golf season.  Surely, it’s time for a post on golfing and networking.  Not a golfer, myself, I have asked my colleague, Gary Pines, to write the post.   Golf is a factor in 25 percent of the business he wins.  Ford Harding)

You don’t have to be a scratch golfer to network on the golf course.  I’m living proof of that.  I have been playing for over twenty years in countless rounds with guests, who include clients, connectors, and prospective clients.  My score can range from 105 to 85. I have many bad shots in every round.  I do it because I very much enjoy the experience . . . and because I build closer relationships.

I believe that people who worry about their score and how they look, don’t spend enough time on making sure their guests enjoy a special experience.  And they miss most of the fun.  Your job is to make sure your guests leave the golf course saying that was a “special day with a special person,” rather than leaving frustrated about the way they played and their high score.

Golf is a game of embarrassment. If you can embarrass yourself in front of others for 18 holes and survive, then you can work with those same people, make mistakes and still help them attain their goals.

So, here are ten thoughts for building better relationships on the golf course:

1. It is not about me … no complaining about my shots and trying to explain why I hit the shot incorrectly.
2. It is not about me … no asking for extra shots.  Instead, offer your guests extra shots and mulligans.
3. It is all about them … offer information about the golf course and information about their next shot, and so make it easier for them to do well.  For example, when driving the ball off the tee, offer what direction it would be best to hit the ball, such as “hit it toward the left side of the fairway” or “hit it toward the far sand trap.”
4. It is all about them … always help with putting information. For example, putting is a key part of the game and one’s score. I always try to help them to understand how their putt may roll to the hole with suggestions like “hit it harder uphill” or “hit it to the left of the cup because it will move to the right as it is rolling.”
5. It isn’t really a competition.  Don’t keep score unless they want to.  Rather, ask them if they want to keep score and follow their desires. I have had several golf rounds where we only counted the “good shots” on the scorecard. It quickly removed the feeling of intimidation from the round.
6. It’s about giving attention to everyone.  Change riding partners on carts every six holes. Help everyone look for their lost golf ball.
7. It’s about minimizing their discomfort.  Let your guests pick the order of hitting the tee shot.  I find most do not want to hit last, so that is what I do.  Try to understand if a guest has an injury and provide mental and playing relief for him or her, if possible.
8. It’s being considerate of their time.  The pace of the round.  Make certain the group moves in a timely fashion, because you do not want to play 18 holes in over 4 hours and 30 minutes.  Your guests may have other things to do, after the game, but be too polite to urge speed.
9. It’s not about business.  Do not talk business, unless a guest brings it up.  Save those discussions for the 19th hole or when connecting for a follow-up meeting.
10. It’s about having fun  … because if you do, the chances go up that your guests will, too.

Follow these guidelines and business will come.  For example, my conversation with one guest over lunch after 18 holes in the morning was much more open and frank than in prior discussions. By asking questions, I helped him see the value in utilizing my services. He commented that I should connect with him next week and send him a short proposal in the interim. In another case, I have enjoyed playing golf with a “connector” three or four times a year. Last year without my having to ask, he urged a prospective client to utilize my services, which they did.

Make your golf game enjoyable and business profitable by determining how you will make it a special experience for your guests. Review the ten thoughts prior to every round.

And remember:  No one will  hire  you because of your high golf score, but will use experiences of a shared round to decide what you would  be like to work with.

Gary Pines can be reached at gpines@HardingCo.com.