The DEATH and REBIRTH of the SALESMAN Today's customers want solutions, and companies are remaking their sales forces to satisfy them. But total quality goals and sales quotas still clash.
By Jaclyn Fierman REPORTER ASSOCIATE Ani Hadjian

(FORTUNE Magazine) – I sold systems that people didn't want, didn't need, and couldn't afford. -- Bill Gardner, 23-year IBM veteran, now retired.

NOT SO long ago, many salespeople might have regarded Gardner's admission as the mark of a colleague at the top of his game, one so skilled he could persuade people to act against their own interests. Today, his dubious achievement is more likely to be seen as embarrassing, unenlightened, counterproductive, and even, under some new compensation systems, a shortcut to a smaller bonus. Merely pushing metal, as IBM insiders say, or slamming boxes, as Xerox salesmen daintily describe the act of closing a copier deal, won't carry a sales force in the Nineties. Companies now measure success not just by units sold but also by the far more rigorous yardstick of customer satisfaction. As vendors ranging from Hallmark Cards to Marshall Industries -- and even IBM -- have discovered, if you anticipate what your customers need and then deliver it beyond their expectations, order flow takes care of itself. As more managers awake to the challenge, old stereotypes are fading faster than Willy Loman's smile and shoeshine. Forget the mythic lone-wolf sales ace; today's trend-setting salespeople tend to work in teams. The traditional sample case? It's more likely to hold spreadsheets than widgets, and the person hauling it around probably regards herself as a problem solver, not a vendor. These days you don't ''sell to'' people, you ''partner with'' them. At the rhetorical frontier of the new sales force, even the word ''salesman'' is frowned upon; the preferred title is ''relationship manager.'' Let's admit that the rebirth of the salesman in corporate America remains a work in progress. Not all companies or all salespeople will adapt equally well to the extra training and teamwork that today's more cerebral sales approach requires. Moreover, as long as salespeople work on commission -- as they do in virtually every major company today -- the rhetoric of total customer satisfaction will inevitably clash with the reality of sales targets. ''Come quota time, you still reach for the low-hanging fruit,'' says Robert Rodin, CEO of electronics distributor Marshall Industries in El Monte, California, one of the few companies to have eliminated commissions.

That said, companies that dismiss the new, more collaborative sales methods as a fad are likely to slip behind. Today's demanding buyers are running out of patience with mere product pushers, whether at the new-car showroom, on the floor of a department store, or in the corporate conference room. Jon Gorney, head of information services and operations at Cleveland's National City Corp., captures the mood in speaking of one of his chief vendors: ''I don't want IBM coming in here anymore and telling me they have some whiz-bang technology unless they can tell me exactly how it will help my business.'' As it happens, IBM knows better than most the dollars-and-cents argument for a more customer-conscious sales approach. Robert LaBant, senior vice president in charge of Big Blue's North American sales and marketing, says every percentage-point variation in customer satisfaction scores translates into a gain or loss of $500 million in sales over five years. What's more, he says, developing new business costs Big Blue three to five times as much as maintaining the old. Says LaBant: ''We used to be focused on moving products and were paid on the basis of which ones we sold -- $500 for this, $1,000 for that. It was critical that we turn that around.'' IF EVER there was a business that cried out for a new way of selling it's that of moving cars from the showroom floor to the driveways of America. The familiar but widely despised old approach is known among automotive historians as the Hull-Dobbs method, after Memphis dealers Horace Hull and James Dobbs, who reputedly created it following World War II. In the old Hull-Dobbs drill, customers exist to be manipulated -- first by the salesman, who negotiates the ostensibly final price, then by the sales manager and finance manager, who each in succession try to bump you to a higher price. Car buyers are fed up. A survey by J.D. Power & Associates found that only 35% felt well treated by their dealers last year, down from 40% a decade ago. Just 26% of buyers rated the integrity of their dealers excellent or very good in 1983; by last year, that figure had dropped to 21%. ''People feel beaten up by the process,'' says Jack Pohanka, owner of 13 import and domestic franchises in the suburbs of Washington, D.C. ''You think you got a good deal until you walk out the door. The salesmen are inside doing high fives, and the customer is lying out on the street.'' Enter Saturn and its original, no-dicker sticker system. As everyone knows by now, the price you pay for a Saturn is the one on the sticker (between $9,995 and $18,675, depending on model and features). But that's only part of the package. Buy a Saturn and you buy the company's commitment to your satisfaction. A ritual reinforces the promise. When you pick up your new car, an entire team gathers around you, including a representative from service, sales, parts, and reception. They let out a cheer, snap your picture, and hand you the keys. Corny? Maybe, but last year Saturn scored third in a J.D. Power customer satisfaction study, just behind Lexus and Infiniti, which cost up to five times as much. A fervent convert to the Saturn gospel is Jack Pohanka. One of 180 Saturn dealers in the U.S., Pohanka has seen firsthand the method's effect on customer loyalty and salesmen's morale, and he has extended Saturn-like practices to all his other franchises. ''You have to let people walk out the door and not harass them,'' he says. ''That way they may come back or refer a friend to you.'' Take your car in for body work to any Pohanka dealership and you will get it back vacuumed, washed, and even polished. ''Our goal,'' says Pohanka, ''is to exceed customer expectations.'' Transforming combative salesmen to customer servants required what Pohanka calls ''Saturnization.'' Every one of his 465 employees, including mechanics and receptionists, went off-site for three days of classroom exercises and physical challenges, similar to the training that Saturn requires of all its dealers. The high point of the cultural remake was the familiar ''trust fall'' -- a backward leap off a 12-foot stepladder into the arms of fellow workers. Pohanka contends that postfall salesmen no longer compete with each other and so don't hesitate to refer customers to one another if a different Pohanka franchise would better meet a buyer's needs. He points to a 25% jump in sales at the company in the first five months of the year, twice the national rate for cars and small trucks. For his sales staff, the new system translates not only to higher commissions but also to a better frame of mind. Says his Saturn general sales manager Brian Jamison: ''I was planning to get out of this business. I couldn't stand all the games we played with customers. This way feels a lot better.'' Saturn and Saturn disciples like Pohanka reformed their sales methods to exploit a screamingly obvious market opportunity; for IBM a sales force remake was simply a matter of survival. The company has cut its cost of selling by close to $1.5 billion in the past two years. Its worldwide sales and marketing team, now 70,000 strong, is close to half the size it was in 1990. Those who survived are part of a new operation that is a cross between a consulting business and a conventional sales operation. Big Blue now encourages buyers to shop for salesmen before they shop for products. Gorney of National City Corp., a superregional bank (assets: $30 billion), handpicked Don Parker as his sales representative after interviewing a half dozen IBM candidates. Says Gorney: ''I wanted this person to be a member of my team.'' An engineer by training, Parker maintains an office at National City, and Gorney has sought his help to drive down the bank's costs of delivering services within the bank and to retail customers in the branches. Consultants obviously need a more sophisticated set of skills than metal pushers, and IBM has not stinted on their training. For the 300 people like Parker who head client teams, the company has developed a voluntary yearlong certification program. The classroom component consists of a three-week stint at Harvard: one week devoted to general business knowledge, one to consulting, and one to the industry they specialize in serving. For the rest of the year, enrollees work on case studies and then write a thesis on their particular customer. Harvard professors grade the papers. So far, 28 IBM employees have received the certification, along with a raise. (Parker is in the midst of writing his thesis on National City.) Those who fail can keep trying. In their new role as purveyors of solutions rather than products, IBM's sales teams don't always recommend Big Blue's merchandise. About a third of the equipment IBM installs is made by DEC and other competitors. Says senior vice president LaBant: ''In the Eighties we never would have recommended another company's product because all we were paid to do was install Blue boxes.'' LIKE IBM, Fletcher Music Centers in Clearwater, Florida, understands that the key to winning and keeping customers is to figure out what they need, sometimes before they figure it out themselves. A few years ago Fletcher was struggling along with other dealers in the moribund business of selling organs. ''There is no natural market for organs,'' says Fletcher president John Riley, 42. ''No one goes to a mall to shop for one.'' But after conducting focus groups with its main clientele, senior citizens who retire to Florida, Fletcher realized that what these people wanted wasn't so much a musical instrument as companionship. Today Fletcher drums up business by positioning a ''meet 'em and greet 'em'' salesman at the keyboard within earshot of elderly mall patrons. ''What's your favorite song?'' he'll ask. And to the peels of Chattanooga Choo Choo, he'll begin his line of patter: ''Where ya from? You just moved here? Do you play the organ at all? Ever seen one like this? It's specially designed for someone just like you with no musical background. Come on inside and try it out.'' Once inside, the prospect is treated to a pitch heavy with subtext: Buy from us because we can help enliven your retirement years. Whether the customer springs for the $500 used model or the $47,000 top of the line, free weekly group lessons -- good for a lifetime -- come with the package. Says Riley: ''We've seen a fair share of romances develop at these lessons.'' Then there are the small details that show elderly customers how much Fletcher cares about their needs: large type on the keys and outsize knobs that arthritic fingers can easily manipulate. Says Sherman Wantz, 75, who just bought his fourth Fletcher organ: ''They know how to treat elderly people without making them feel like children. They appeal to a desire in older people to continue accomplishing things in their lives.'' Such satisfaction is music to Fletcher's ears. Pretax profits reached $3.5 million last year on sales of $24 million. Building durable customer relationships is one thing when you're hawking mainframes, cars, or organs; it's a rather different story when you're pushing a product as short-lived as a greeting card. That's why the sales force at Hallmark Cards, the world's largest greeting card company, concentrates on pleasing retailers. Says Al Summy, a vice president of sales and service for cards sold through large merchandisers like Target, Kmart, and A&P: ''We're not selling to the retailer, we're selling through the retailer. We look at the retailer as a pipeline to the hands of consumers.'' Anything his salespeople can do to make Hallmark products more profitable for retailers, he figures, will ultimately benefit Hallmark. As a result, Hallmark is reorganizing its entire sales and marketing operation into specialized teams designed to work effectively with product managers at major retailers. In the old days -- less than 24 months ago -- Hallmark sold pretty much the same mix of cards to every store. Now, using data derived from bar codes at the checkout counter and laptops that supply merchandising information from Hallmark headquarters, salespeople can tailor displays and promotions to a retailer's demographics. James River Corp., which sells toilet tissue, napkins, Dixie cups, and the like, also understands that when it puts its head together with its retailers', both sides benefit. Specifically, James River shares proprietary + marketing information with its customers that enables them to sell more paper products. For instance, it told its West Coast client, Lucky Stores, how often shoppers generally buy paper goods and which items they tend to buy together. Lucky has since reshelved all its paper products and managed to win market share in the category from competing stores. James River has reorganized the way it calls on customers. Previously, three or more salespeople would approach a company like Lucky Stores: one with plates, one with cups, and one with toilet paper. If all three secured orders, Lucky was obliged to buy three full truckloads, one for each product, to get the lowest price from James River. Today, a unified team from James River will sell Lucky Stores one truckload with a mix of paper products at the lowest price. At James River, as at Hallmark and IBM, building a sales force for the Nineties has meant a thorough rethinking of a salesperson's job. But an important aspect of managing a sales team hasn't changed much: how you motivate flesh-and-blood salespeople. It remains the same idiosyncratic blend of financial incentive, inspiration, and cajolery it always was. After all, sales is a tough job. Says Larry Chonko, marketing professor at Baylor University in Waco, Texas: ''You still need fire in your belly, you still get rejected four out of five times, and you still need energy to get up in the morning and say, 'I can do it,' even if you sold nothing yesterday.'' One of the more visible motivators in the game today is Frank Pacetta, 40, who is something of a folk hero at Xerox for having turned around the company's flagging Cleveland and Columbus, Ohio, sales teams. Pacetta has also become a minor media presence of late, thanks to a profile in the Wall Street Journal; a major role in The Force, a new book about Xerox salesmen by David Dorsey; and the publication of his own manual for sales managers, Don't Fire Them, Fire Them Up (reviewed in Books & Ideas). Pacetta uses a hyperbolic mix of praise and shame to inspire his team of 70 reps in Columbus. For his winners, Pacetta holds testimonial dinners, dispenses effusive hugs, and has them ring a ship captain's bell at the completion of a deal. Weak performers can expect a month-long visit on their desk from an ugly troll doll Pacetta swiped from his son. Salespeople who aren't sufficiently fired up after three consecutive visits from the troll are fired -- the title of Pacetta's book notwithstanding. Sales, Pacetta style, boils down to three simple steps: Identify the customer, make sure your product fits the customer's requirements, and ask for the sale. To minimize resistance on step three, Pacetta recommends the ''presell,'' which he likens to a conversation he might have had when convincing his wife, Julie, to marry him: ''Julie: 'I don't like the way you dress, I don't think you make enough money, and you drive like a maniac.' Frank: 'If I let you pick out my suits, if I double my income, and if I promise never to exceed the posted speed limits -- will you marry me then?' '' In marked contrast to Pacetta's freneticism stands another master of sales motivation, 140-year-old Southwestern Co., America's oldest extant door-to- door sales company. It peddles Bibles and Bible study guides to millions of families, and its Nashville boot camp turns its young sales trainees, mostly college kids on summer vacation, into some of the most dogged salespeople in the country. How's this for a drill? After a week of classroom training, the graduates fan out to assigned territories across the country and settle down to work -- up to six days a week, 13 hours a day. Southwestern salesmen ring as many as 65 doorbells a day to make 30 demonstrations, each lasting 20 minutes. Sticking to that schedule, they can expect to close one to three sales a day, enough to earn over $5,500 their first summer. The company, which is privately held, rings up over $100 million a year in revenues. Don't discount Southwestern as an anachronism. The company's working alumni, well over 100,000 of them, have carried their skills to places like IBM, Xerox, Procter & Gamble, and Wall Street and in many cases are leading the sales revolution going on today. Says alum Marty Fridson, 41, who runs high- yield securities research at Merrill Lynch: ''There's nothing magical about sales. You want to be truthful and present a credible story so people will want to do business with you in the future. To sell effectively, you need to present the facts, list your supporting arguments, and learn all the nonverbal cues your customer gives while you're making your presentation.'' With one element of sales motivation -- how they pay their salespeople -- many companies believe they can improve on tradition. IBM, for example, is following a budding trend to base compensation partly on customer satisfaction. Salesman Don Parker says that 45% of the variable component of his paycheck depends on how Jon Gorney at National City Corp. rates him. If Gorney is pleased with the way Parker has helped him meet the bank's business objectives, Parker says that he stands to make ''a lot more this year than ever before.'' At Hallmark, too, customers get a say in how well some salesmen are paid. In a pilot project, about 100 employees have taken a 15% cut in base pay and made that portion of their income variable, based on retail sales of Hallmark products. If results are good, those salesmen stand to make more than 15%. The point, of course, is to encourage these workers to focus on helping retailers do their job better. Electronics distributor Marshall Industries has taken this thinking to the next logical step and eliminated commissions altogether. Marshall's 600 salespeople earn a straight salary, with a bonus opportunity of up to 20% more based on pretax corporate profits. In the latest fiscal year, with sales over $800 million, the bonus was 10%. Marshall CEO Robert Rodin overhauled the compensation system when he realized the distortions that quotas and commissions were creating in the system. ''How can you say you're pursuing excellence if you give away TV sets to your top salespeople? Customers got their parts ahead of time so the salesmen could get their prizes. But guess what? Those customers wanted on- time delivery, not early delivery.'' Rodin says his people hoarded inventory in their cars in case they needed it. And in the mad rush to meet monthly quotas, salesmen shipped ''anything that wasn't nailed down, to any customer on our list, regardless of their credit standing.'' The mania strained the shipping department's ability to complete orders accurately: ''You can imagine what bleary-eyed warehouse people do at two in the morning.'' Rega Plaster, 32, a top Marshall saleswoman, worried at first when Rodin took away commissions: ''I wondered where my motivation would come from.'' She says she was pleasantly surprised at her response: ''Within a month, it was like being able to breathe again. This takes the sliminess out of selling. Now I can spend time with smaller accounts and nurture them, and I can do it with a clear mind and conscience.'' Sales at her Milwaukee branch have risen from a monthly average of $850,000 last year to over $2 million. FOR ALL the hype and half measures, salespeople in the Nineties can make the world a better marketplace. Any inefficiencies wholesalers and retailers squeeze out of the supply chain will benefit consumers by keeping a lid on prices. And smart solutions from any corner have a far-reaching payoff. At the very least, the new ethos may herald the decline of in-your-face salesmen who sell things people don't want, don't need, and can't afford.

BOX: THE NEW SALESMAN

-- Today's best salespeople see themselves as problem solvers, not vendors -- They gauge success not just by sales volume but also by customer satisfaction. -- To reinforce that view, companies are increasingly making customer satisfaction an element in salespeople's pay. -- Despite the new attitudes, selling requires the same mix of grit and persistence that it always has.