3 Biggest Cross-Selling Challenges with Keith Conley

You know, on the, the point on cross selling, Keith, I could see you were thinking a bit about that and you said you tried it so many times. I'm wondering what is it that you found that makes cross selling so challenging? Because it is kind of the obvious big benefit. It's like, well, we can just cross sell. We're going to be able to get all these extra benefits. But what are the, what are the challenge points that you see with that?

You know, I think it has a lot to do with turf, right? So, for example, a sales rep being very successful, right? Making maybe a million dollars a year, right? And say, hey, we bought this company. There's other services you can pull in. Here's the compensation plan. And they're like, well, I don't know if those guys can deliver that. Why would I want to risk my million dollars in bringing in a service line that I don't know how good the service is and so forth. So it's the risk that many in territory turf that I found at the end of the day is the hardest thing to break down. You think compensation comp plans for cross selling in itself, and we put some really attractive compensation plans together for cross selling would be enough for the inertia. But it wasn't right. And if I had to do it all over again, we never had a chief revenue officer. And when you have different lines of businesses, it really goes up to the president and you become the chief revenue officer, right? So I was driving the comp plans discussions across five different sales executives and, you know, trying to get them to work together. But having a chief revenue officer, I mean, you gotta be a certain size. But that, you know, their goal is to cross sell, to align things across all the different business units. That's something we never had at epic. And if I had to do all over again, I would have put that in place because that could have been a big driver of bringing things together and breaking down some of these barriers.

So when you talk about behavioral motivators, you think the comp plan is going to motivate people to do certain things, but the bigger motivator is actually the avoidance of risk if people are at a certain compensation level.

Exactly.

I'm more motivated to not mess things up than I am to try to make a few extra dollars possibly and put it at risk.

Right. At the end of the day, because I would go out in these sales calls and I'd bring in, I'd try to say, why is this right? Because we married went from like 4% cross selling to 7%. But it sounds like a big percent increase, but it's around here in the big scheme of things. And that was what I found out personally. And you know, even in consulting, I did a lot of cross, you know, when I was a manager consulting in sales. And it's easy to lay out the plans, but it's just really one of the most difficult things to execute in a company.

All right, So I want to ask for, maybe if you have anything in your head for any examples, kind of the blood and gut stories, like anything that's happened, you go, man, this is like something I saw that it was a pitfall I would avoid at all costs or something to watch out for. And you don't have to name name or anything, Keith, but I'm just kind of interested because you've seen a lot of action. Like what are some of the bigger mistakes that you've seen happen?

Well, in smaller acquisitions, right? And when you're acquiring a company, you know, you're imposing your vision, mission values, existing comp plans. Right. Processes and so forth. You know, when you're acquiring a company, imposing that, it's less risky in my opinion. But we've run into issues. As I mentioned before, when you get good at integration, you have speed and velocity, you integrate quickly. And with smaller companies, we had earnouts, so someone that ran a company, we would pay them out one third of the valuation next year or third, the next year's third to keep the business going. And they're heading. And when you integrate a company quickly, you start losing that P and L focus. And so they had a P and L before and all of a sudden you bought them to integrate and to sell those services or offerings throughout your whole company. So, you know, we got into a lot of legal issues with some of the owners that we bought businesses from because we couldn't measure that earn out as effectively. And you get into negotiation what that would look like and so forth. We gave them the benefit of the doubt. But that is just, that's one of the things about earn outs is if, if you're going to keep them separate and measure as separate P and L, you're not going to get the benefit as much, but that's easier. But if you integrate these companies, you just have to watch out on the earn out front because we have had a few litigation issues that come about.

So. So basically the playing field or the game changes a bit. So at the beginning when you're doing the acquisition, it's like, here's what we want you to do. That's all really clear because we have control over, we can handle those things. We've done it before. And then everything starts to come together and the game changes and then it gets harder to measure.

Yeah. And measure that specific business that you caught because you're integrating, you're leveraging those resources across other areas because of their expertise and so forth. It's good overall for the business. But if you are being acquired and you're expecting this payout every third, every year, it can be complicated. So that's one of the risks.

And any other watch outs for people that kind of things that you've learned through experience.

You know, the sales area. What I've learned is like there is a role for the executives when it comes to sales during these acquisitions. Right. And an executive needs to be proactive, engaging like I would be on the calls of the top clients of the company they were acquiring to speak through it. And still due diligence. We're asking questions about, you know, the. We're letting them know we're buying this company and. But then we're finding out a little bit more about, you know, their business and how much revenue might get over the next year or so forth. But, you know, it's engagement, the executives, you know, going out there, going on a call with your sales team. I would call my top salespeople every month. Right. And I would send out notes to people that had, you know, exceeded their quota for the month. Right. But just I think really getting in touch with, with that company you just acquired, participating in learning firsthand at the beginning what the challenges are because you have the resources to address some of these systemic issues. And if you always rely upon two or three layers below in a major acquisition, it might be a missed opportunity. So you don't want to be micromanaging, but at the beginning, you can communicate your values, your mission with these people. You're out in the sales call, you're meeting clients and learning about the clients and then you're hearing the salespeople talk and understanding what challenges they have. Then you can kind of bring that back, look for the systemic issues and drive some change on behalf of there to help help those sales reps and just overall help them become better as they come into the country.

Yeah, yeah. Staying close to the action.

You know, Keith, I think that's probably one of the best pieces of advice that we could give a sales leader. I'll tell you from our own experience, so many things that we see if a leader doesn't have all the answers. Sometimes they say nothing and then all of a sudden they're being flooded with churn that they didn't want from the top sales people from the company that they're acquiring in a water cooler. Talk. It just happens if you're not leading the conversation. And that's one of the first things that we tell, that we talk to sales leaders about is just get out there, regardless of what you, you know, what the message is. They just want to hear something from you and understand, like, what's ahead.