blogBack to Articles
How Can LIFO Training help my business?
Posted by Daphne Kan, November 19, 2013 06:04:55AM
LIFO training is very helpful in improving the quality of interpersonal relationships with people that you deal with in business. Here is a great example of the financial implications of applying this practical and insightful business tool:
Charlie, the consummate “people orientated salesman”, prided himself on the way in which he was able to get along with “everyone”. He was friendly, personal, good humoured, aware of others feelings, inclusive of people that looked left out, and always careful to make sure that everyone felt as though their opinions were heard. He was great at building relationships, because, after all, “that’s what sales is all about”. He didn’t weigh himself down too much with the solid details of the subject matter – he had a great relationship with everyone in the office and whenever called upon to produce detail, he simply wheeled in the right person who did know.
One day Charlie was chatting away over the phone with Irfan, the CFO of a major corporation that he had submitted a proposal to. Charlie didn’t really get on that well with this guy because “he always wanted to talk about business” – he wasn’t really much fun. Nevertheless Irfan was a key decision maker in this deal, and if Charlie got the deal he would double his target for the year. After a few minutes on the phone his client got a bit irritated with the small talk and suggested that they meet very soon. They had some very detailed questions about the calculations in the proposal Charlie had prepared. Irfan finished the conversation by saying “and please bring someone with you that understands the details – we are extremely busy at the moment”.
“No problem” Charlie thought, and called his friend Bob, the numbers man, to join him in the meeting. On the day of the meeting Bob couldn’t make it and Charlie was stuck because he couldn’t defer the meeting, as the client needed the information immediately to make the decision overnight. He tried to get on top of the data but in the meeting Charlie’s explanations were unconvincing and he completely embarrassed himself. His company lost the deal. Charlie felt betrayed by Irfan, whom he had invested an enormous amount of personal energy and money in playing golf, introducing him to his network and taking him out for dinner and drinks.
Some time later Charlie attended a LIFO training course. He was very proud to discover that he was excessively Adapting Dealing – a real people person. He was then completely shocked to realize that his over-dependence on this style had most likely led to his downfall with Irfan, who was clearly very detail oriented and rational in his thinking. While Irfan probably didn’t mind the unexpected attention from Charlie, he actually felt very uncomfortable when it became excessive, as it was very clear what the expectation was. Furthermore, he made decisions based on facts and logic – who was actually impacted by the decision was a minor consideration.
Charlie quickly realized that many of his prospects and clients were probably similar to Irfan in their preferred LIFO styles – they were corporate treasurers and chief financial officers who overwhelmingly relied upon facts and numbers when making decisions. This is the Conserving – Holding Style. Having a high Adapting Dealing style and low Conserving Holding preference, Charlie and his clients spoke in different communication languages – they didn’t understand each other, or worse, possibly didn’t trust each other.
Reflecting on the ratio of deals that he had been unsuccessful in closing, Charlie figured that probably 50% of his key contacts in those companies were strongly Conserving Holding in their LIFO style preference. He had behaved in exactly the same with all of his clients, and had probably irritated, annoyed or even driven these people away from him.
Using the LIFO methodology Charlie realised that he needed to modify the excessive use of Adapting Dealing, and build up his strengths in Conserving Holding. By getting more involved in the complexities of the nature of his clients’ business, by learning about the financial models they relied upon, by demonstrating attention to detail and having most of the facts at his fingertips he would begin to speak his clients’ language, and this would over time build trust.
Not long after Charlie saw Irfan at a conference and approached him. Irfan was a bit uncomfortable when he saw Charlie, but Charlie reassured him that there were no hard feelings. Charlie recounted the insights that he had gained from the LIFO training. Irfan smiled broadly upon hearing about Charlie’s experiences and his new approach, and offering his hand to shake, said to Charlie, “Well I am really pleased to hear that Charlie, because we all thought that you were a flake!”.
Lesson: LIFO Training provides insights and tools that can have a major impact on business. In the real case above, the original deal was worth 2 million Euro to Charlie’s firm. Charlie’s lack of perception of his own style and how it was perceived by Irfan, combined with Irfan’s key orientation and what influenced him cost Charlie’s company 2 million Euro. Using his insights from the LIFO training Charlie managed to improve his sales ratio to 90% of the deals that he proposed for, building a new business that doubled its revenue in each of the first five years of operation.