A leading manufacturer brought together its top sales staff from the U.S., Germany, and Japan to serve as its booth staff at the largest trade show in its industry, which is held annually in Germany. The staff had never worked together. They were selected because most of the visitors were coming from these three countries and there was a good cultural and linguistic fit. Visitors from other countries would be met by any available staff member. The VP of Marketing and Sales from headquarters created an incentive program for the sales staff based on the number of leads attained each day. Bonus money was set aside as an incentive to go to the top 5 salespeople each day based on the number of leads they attained. What could go wrong?
You might be surprised…
THE ISSUES
The Americans liked the incentive idea and won all of the top 5 bonuses each day. The Japanese and Germans were upset that the Americans were the only ones receiving the bonuses. The incentive program that had been created to foster friendly competition and collaboration instead created distrust and ill-will among the sales teams from each country. There was little to no cooperation between the teams, which resulted in fewer sales for all.
Following this disappointing showing, the VP of Marketing and Sales asked for an analysis of the poor performance and a training solution to prevent similar disasters. Let’s review the findings of the analysis and the resulting training and audit solutions.
CAUSES OF FAILURE
The bonus system was biased toward the Americans. Why? Rewards and recognition and customer relations vary significantly across cultures, and this was not considered in the bonus program.
The typical American trade show visitor came into the booth and did a quick survey to see if there was anything interesting and any good handouts. If they saw something they liked, they asked the salesperson to arrange an office visit (a lead). The average time for an American visitor to the booth was 10 minutes.
German visitors to the booth looked for specific items. If they saw something that interested them, they asked the salesperson several detailed questions about the materials being used, the manufacturing process, the relative benefits and costs of the product in contrast to competitors’ products, etc. If they liked what they heard, they told the salesperson to make an office visit (a lead). The average time for a German visitor to the booth was 20 minutes.
Japanese visitors to the booth were met by a Japanese representative and then were assigned to a salesperson based on the status of the visitor and the company’s prior experience with the client’s organization. If, during the visit, there was a need for other salespeople, they were invited into the discussion. If the discussion was going well, they went next door to the café to continue the conversation over coffee. If the visitor was an executive from a current client, the salesperson would leave the trade show and take the person out for a meal or drink. Japanese visitors to the exhibit booth spent from 15 minutes to two hours with one or more salespeople. The average time for a lead was 40 minutes.
TRADE SHOW TRAINING SOLUTION
A consulting organization specializing in international trade show training was brought in to conduct a post-show analysis, interviewing associates from each of the respective countries. Based on the analysis, the consulting company created an in-person and Web-based training program to address the underlying issues.
The training included the following three components:
Cross-Cultural Sales Skills Development: This included a simulation where success was achieved by following different rules. The challenges from this activity led to many insights on how different groups follow their own rules to play the same game. In debriefing the simulation, there was a mutual perceptions exercise. The results of this exercise included awareness that there are different customer expectations, so a single bonus solution does not work for all.
The Americans won because they were individualistic and American clients neither wanted nor expected to spend a lot of time at the booth. German visitors required more time since they would not request a follow-up visit unless they were certain of the value of the product. Since the Japanese are very relationship-oriented, the Japan sales team first needed to determine their relationship with a visitor, then assign a salesperson whose status would match that of the visitor. If an existing client visited the booth, the salespeople were obligated to take the client out for a drink or meal. Relationships are money and take time to develop, but once established, they can last a long time. Additionally, the Japanese prefer group rewards and recognition, so the bonus system undermined the cooperative spirit of the Japanese team.
Both the Japanese and the Germans thought the bonus system was rigged to make the Americans look good and that most of the American leads were not legitimate. This shocked the American VP who created the system.
Cross-Cultural Competencies: Each participant completed a self-assessment that resulted in a cross-cultural profile, which demonstrated where each person scored on 11 cross-cultural variables. For example, one of the variables was risk tolerance. Cultures with high risk tolerance make quick decisions with relatively less information than countries with a low risk tolerance. When the profiles were compared, the Americans had much higher risk tolerance than the Germans and Japanese. This helped all of the sales staff and management understand that American visitors would agree to a followup call or meeting (a lead) much quicker than a Japanese or German booth visitor.
Another variable that affected success by country was hierarchy. Here, the Japanese scored the highest of the three groups, which helped to explain why the Japanese sales team made an extra effort to assign a salesperson based on the status of the client, both in terms of seniority and any existing business relationship with the company. The Japanese even had different gifts to give to visitors based on their status.
Communication Styles: The communication styles of each of the three nationalities impacted their willingness to trust each other. The training addressed this through role-plays of meetings. It quickly became apparent that the Germans were the most direct communicators. When providing negative feedback, the Germans went right to the point: “You failed to meet your quota.” The Americans were more indirect: “Can you help me understand why the target was not met?” The Japanese were the most “face saving” and least direct: “The team is counting on all of us for success.”
After a discussion of the communication styles, the whole team created communication ground rules and even a “safe word” in case someone thought there was a misunderstanding.
PERFORMANCE AT WORK
Three months after the training, the trade show in Germany was held again. This time, there was no bonus system. The sales staff reported much better cooperation between the representatives. The booth results were 30 percent higher than the year earlier. The organization also asked for a Show Performance Audit and Analysis (SPAA) of its booth and staff in comparison to its competitors. The results of the audit will be incorporated into next year’s training.
If you would like a more detailed description of the training, the SPAA, or a list of the Top 10 Guidelines for International Trade Show Success, contact me at: ngoodman@global-dynamics.com.
Neal Goodman, Ph.D., is president of Global Dynamics, Inc., a training and development firm specializing in globalization, cultural intelligence, effective virtual workplaces, and diversity and inclusion. He can be reached at 305.682.7883 and at ngoodman@global-dynamics.com. For more information, visit http://www.global-dynamics.com.