Sales AQ with Dr. G and Chris Mackenzie

High Sales AQ: Transforming a $500 million industrial manufacturer from a direct to indirect sales model 

This article is part of the High AQ Interview Series where executives, academics, and thought leaders discuss elevated answers.

Introduction

Chris MacKenzie, an industrial manufacturing sales executive discusses a successful effort he orchestrated to transform a $0.5 billion dollar industrial manufacturing sales approach which was 90% direct and 10% indirect to one that was 90% indirect.  During this transformation, Chris had to identify and convince a network of hundreds of distributors to sell his product portfolio in addition to his competitors. In the process, he had to successfully introduce end users to the distributors (the new selling intermediary), while realigning an internal sales force of 130 to sell through distributors.

Chris and I discussed the transformation from a direct sales channel to an indirect sales channel in AQ terms.  We covered the 5 High AQ practices, the role of conversations (questions and answers) in sales, and the High AQ sales attributes that allowed him to pull-off the sales transformation to an indirect approach. We identified six High AQ takeaways. The following interview is edited for clarity.  

Six High AQ Takeaways

Interview with Chris MacKenzie

Dr. G: [We reviewed the 5 High AQ Practices and discussed the implications.]  What is your reaction to Sales AQ?”

Chris MacKenzie: “I would estimate that that the top 10% of sellers have High Sales AQ.  And most of them are doing it intuitively. The AQ framework can help the low-skilled to the highly skilled sales reps upskill.”

Dr. G: “Which of the six answers (theory, concept, story, metaphor, procedure, action) is something you did not appreciate until it was brought into relief by the AQ framework?”
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Chris MacKenzie: “Metaphors.  I have never coached, nor consciously applied to use metaphors before. It makes sense because it simplifies…  [you can] hit a lightbulb very quickly.”

High AQ Takeaway 1: If the top 10% of sales reps have High AQ, that’s a good thing. However, even the best don’t realize they are using AQ. And there are no systematic efforts to elevate the entire sales origination. The AQ framework and associated 5 High AQ practices represent a way to explicitly surface principles and techniques that can elevate answers provided by the entire sales organization.
High AQ Takeaway 2: Metaphors are often underappreciated in a society that focuses upon stories to make emotional connections with others. Yes, stories are important, but metaphors offer several advantages including compactness (short time to convey) and lower difficulty level to communicate (as compared to a story).

Dr. G:  "Your indirect sales strategy involves three parties: The manufacturer (you), the distributors, and the end user.  What are the different needs between end users and distributors?"
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Chris MacKenzie:  "The end users are focused upon product features and functionality, and as you move up the value chain to the distributors, in addition to product features, they are focused upon strategy and overall profitability of the manufacturer-distributor relationship. With the distributors I had conversations about business strategy that went beyond product features, including tiered discounts,  packaging, pricing, drop shipping, credit terms, on-time delivery, training, cooperative advertising, and customer service."

High AQ Takeaway 3: In a horizontally integrated supply chain, High Sales AQ recognizes that end-users ask different questions and need different answers than distributors. In this case, end-users ask the how-question and seek action answers (those associated with product features). Conversely, distributors are asking what-questions associated with business strategy (concept answers). Sales reps with High AQ understand that questions and answers may vary across the sales supply chain.

Dr. G: “In AQ terms, you indicated that concepts (e.g., packing, training, customer service) were important to distributors.  How could you identify which strategic concepts to focus upon with each distributor?”

Chris MacKenzie: “First and Foremost...you had better go into the meeting in over preparation mode.  You need to know what is important to the  that specific distributor… talk about their business in that area (customer service, competitive pressures, training, hiring).”

Dr. G: “Let’s say you locate the correct strategic concept; let’s say training is the hot button topic.  Then, how would you credibly convey you understand their hot button topic?”
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Chris MacKenzie: “You need to give examples…. If you don’t have the right training… we will get you up to speed and show them an example…. Or, if their team is not trained, discuss how your training works. It illustrates that you ‘get’ their business. The relationship with each distributor will not be successful with a ‘one size fits all’ channel program. That is not insignificant. But, you want to avoid the ‘show up and throw approach’… you discuss every feature and function of your product.  That will be a turn-off.

High AQ Takeaway 4: High AQ Practice 1 explains that for any given question there is a correct answer. Related to concepts, each distributor had strategic concepts that were more salient to them specifically. Also, in discussing procedures and actions associated with a product, you need to get them just right. High AQ is not just about recognizing which answer to provide (theory, concept, story, metaphor, procedure, or action) – it is also determining the best way to deliver that answer.
High AQ Takeaway 5: Provide Complements (High AQ Practice 3) holds that adjacent answers are related and can re-enforce each other. In this case, Chris wanted to demonstrate that he got the strategic concept correct, and he utilized the adjacent answers of procedure and action to substantiate his claim that he was on the same strategic page with a distributor.

Dr. G: “You initiated a huge disruption—the sales process going from direct to indirect. This was a significant investment of time and energy.  Why was this the timing right to flip the switch to an indirect sales approach?"

Chris MacKenzie: “As a major manufacturer we sold to large A-accounts. These A-accounts were consolidating their vendors, and actually downsizing at the time. We wanted access to the much higher number of B and C accounts to compensate for the reduced volume of A accounts: Distributors actually had a better relationship with the B & C Accounts than my direct salesforce. They were looking for single source vendors. We needed to align ourselves with single source vendors. Given this dynamic, it made sense for us to invest in the distributor indirect sales channel to to sell to A- gain access to B & C accounts (as opposed to going direct while giving distributors access to our A accounts – we both grew in a shrinking economy)."

High AQ Takeaway 6: Answer in Context is High AQ Practice 5. All conversations involve primary questions (what, why, how) and associated answers (theory, concept, story, metaphor, procedure, action). These conversations occur within a context. This context activates the focal questions and the appropriateness of answers. In Chris’ case, purchasing department consolidation triggered conversations with distributors that would have not otherwise occurred. Therefore, those with High AQ understand context and how that impacts any conversation. The influence of context is often overlooked. In Chris’ case, internal conversations with Operations, IT, and other departments required a lot of convincing (as they did not understand the contextual changes the way Chris did).

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