Michael Webb:     You're listening to the Sales Process Excellence podcast with Michael Webb. B2B sales and marketing works to find the highest quality prospects, reach decision makers, and sell value. Operational excellence uses data and systems thinking to make changes that cause improvement and eliminate waste.

Michael Webb:     My name is Michael Webb and this is the Sales Process Excellence podcast. In the next 30 to 40 minutes we're going to destroy the myth that these two groups conflict and show you how to bring both strategies together to create more wealth for your company and your customers.

Michael Webb:     Hello everyone. This is Michael Webb, and I'm pleased today to bring to you a guest that I have not spoken with before, but because of his background, as you'll see, I'm very excited to have this discussion, and I think there's going to be some pretty interesting discoveries that come out of our conversation. I'm on today with Tripp Babbitt. Tripp is the president of a firm called the 95 Method. Tripp, welcome here.

Tripp Babbitt:         Thank you Michael. Thank you for having me on.

Michael Webb:     Now you're also... Have been involved with the Deming Institute, and remember my audience is mostly executives who are focused in on sales and marketing. Most of them have heard of Deming, but could you just kind of share your background, because as I understand you came from a place very different than people who come into a sales and marketing career typically come from. So tell us where you've been and what's the journey you've been on.

Tripp Babbitt:         Interestingly, I actually started in sales, but-

Michael Webb:     Really? I didn't know that.

Tripp Babbitt:         Yeah. Yeah. Absolutely. I worked for an industrial distributor in the midwest. Then I got my MBA. I was a manager for an industrial distributor, and I got invited once I became a manager to a seminar by W. Edwards Deming from Allison Transmission, one of his original four-day seminars that he did across the US.

Tripp Babbitt:         I had just completed my MBA and I was expecting kind of more of the same types of stuff with the education I get out of the seminar, and what I got instead was a big smack in the face. Dr. Deming's seminar was pretty much the opposite of everything that I had been taught in my MBA program and is still being taught today in MBA programs throughout the US.

Michael Webb:     Parenthetically, my son just signed up for a very expensive, very prestigious MBA program. I tried to talk him out of it and I couldn't, so we'll make the most of it that we can.

Tripp Babbitt:         Very good. We could talk about that too if you like. But I was really intrigued by the Deming philosophy, so I eventually started my own consulting business and I used the Deming philosophy. It's based off of his system of profound knowledge, which is systems thinking, which I know is near and dear to your heart, theory variation, which is the data, theory of knowledge and psychology.

Tripp Babbitt:         I use that as kind of the basis of what I call, and you mentioned, the 95 Method. That's kind of the short and long of it I guess so to speak, of kind of my story and how I got into this.

Michael Webb:     Many of the people who are in my audience, they've learned about process improvement or process excellence and the Deming philosophy. They got to it through being trained in Six Sigma or in Lean. So it would be great to get your perspective on this I don't know what you would call it, this operational excellence marketplace, because there's several different flavors, and I'd love to understand your perspective of where you sit compared to, for example, people who go at it from a Six Sigma orientation or a Lean orientation or the Shingo Institute.

Tripp Babbitt:         I think you have to have a little bit of history in order to kind of understand. The Deming philosophy in Japan... When Dr. Deming went to Japan in 1950, he basically started a whole new program, and some of the things in his system are profound knowledge. It was the beginning of what would be later called Lean, and I would even say an offshoot of that would be Six Sigma too, because he used Walter Shewhart's control charts.

Tripp Babbitt:         So the base philosophy of Deming to me is what is exactly missing from Lean and Six Sigma. I am a Six Sigma Master Black Belt, so I went and did that under a lady by the name of Dr. Frony Ward, and I also worked with Dr. Don Wheeler for a little bit in order to get my data smack.

Tripp Babbitt:         So I believe these are Lean, being the Toyota production system in essence is what it's based off of. You got to remember, in Japan Dr. Deming worked in a number of industries, not just the auto industry, and just within the auto industry he not only worked with Toyota, but he also worked with Nissan and... Well, it was Datsun at the time, and then Honda, and then a number of of other companies throughout.

Tripp Babbitt:         So to me Lean got off I think for a long time focused on tools, and the Deming philosophy is just that. It's a philosophy. It's not a method. It's a way of learning, and one of the things I always challenge Lean folks to is so what new tools have you developed, because I always hear about the same old ones.

Tripp Babbitt:         Deming's philosophy was set up for us to continually update and innovate the way that we think about work and product and everything else, and management for that matter.

Michael Webb:     Let's dig into that a little bit, because I agree with you the Deming philosophy, the four fundamental principles, seem to me to be at the root of the tools of Lean, the method of Lean, right, focusing on flow and distinguishing value from waste, and using that as sort of your North Star.

Michael Webb:     But they're also unpinning the tools of Six Sigma, which is much more measurement oriented and statistically oriented, and it also is underpinning the ideas of the Shingo Institute, which is way more management focused. Would you agree with that?

Tripp Babbitt:         I don't know much about the Shingo Institute. I know a little bit more about Six Sigma. I think there are some tools in there that they use, statistical tools, that are unnecessary, matter of fact most of them. But the one tool that I often find even new Green Belts and even Black Belts on occasion, they aren't with Shewhart's control charts, and that's a shame, because that's a very primary tool.

Tripp Babbitt:         As a matter of fact, any organization not using Shewhart's control charts that Dr. Deming made famous are really missing out on an opportunity to look at their data in a refreshing way, and gets to some of the things that you talked about in this podcast about using systems thinking so you can understand what's attributable to a system versus attributable to social causes or the individual.

Michael Webb:     Yes. Absolutely right. What I understand about the Shingo Institute, it's very interesting and it's very compatible with what you're doing, as I understand it, and we'll get to it in a minute, about the 95 Method. But it's a set of principles for how senior executives can help change the culture.

Michael Webb:     So they don't get a lot into the tools. They fully recognize the error of teaching people about tools and why when you try to introduce this change to a business to give them these problem solving tools it typically doesn't get sustained because the people in the business don't know why. They don't know why to do this, right? So they just have a bunch of tools. It doesn't help much.

Michael Webb:     But when they understand the why, then they can see... They can invent their own tools, right? They can put them together in creative ways, and the Shingo Institute... It sounded to me like it was a similar type of a focus to what you and perhaps the folks at the Deming Institute were trying to accomplish.

Tripp Babbitt:         The Deming Institute itself is more focused on just the fundamentals of the Deming philosophy. What I found lacked in the environment was a way to transform an organization through the individual. One of Deming's famous quotes is... And it's actually from The New Economics, which is the last book he wrote before he passed, but the first step is transformation of the individual.

Tripp Babbitt:         One of the things that I heard when I was listening to some of your podcast episodes with people talking about, you know, people just don't understand, those types of things. Well, a lot of that is rooted in neuroscience, where we don't like to feel unimportant as an individual. We want a predictable future. We want to have control of things. We want some freedom. We want to be social. We want to have some integrity or fairness within our organization.

Tripp Babbitt:         So one of the first things, and the reason I put the 95 Method together, and you've alluded to it in your podcast before also, is that 95% of the performance of the organization is attributable to the system, so the 95 in the 95 Method focuses then on the system.

Tripp Babbitt:         So that's the steps, and actually what I am building, and I am building it with people that have volunteered within organizations to help steer what works and what doesn't work, is a method to go through to first understand their organization. A lot of changes are made kind of top down or because somebody has a great idea, and what I find better is that you need to involve everyone, because they want that control or freedom, and if you're going to change people on the front line, or really anybody in their organization, you need a method for making that change occur so that they can see things differently, and that's really what the 95 Method is all about.

Michael Webb:     Let's distinguish that. With that helping people see things differently so they can change, where does that fit in with the job of management?

Tripp Babbitt:         If if the transformation begins with the individual, whether you're in middle management, front line or an executive, then you need a method to kind of understand your organization. The larger your organization gets, the more complex and bureaucratic it becomes, and people don't really understand everything that's going on within their system.

Tripp Babbitt:         The best way to get to understand their system is customer end, so taking a view from sitting in the customer's seat, and where that happens is typically... You know, a lot of organizations have contact centers, and listening to phone calls and listening to what customers say and what types of interactions are they bringing to the table so that they can understand exactly what's happening within their organization and how their front line folks react to that.

Tripp Babbitt:         Now when you do that obviously then executives try to fix things, which you don't want to do. You just want to understand how your system is working, and if people are doing things wrong they're doing it probably for a reason, and those are systemic changes you need to do.

Tripp Babbitt:         The thing that's lacking in management today, and it doesn't matter what management position that you're in, is that ability to see the entire system, and this, Michael, dates back to really the industrial revolution, which is where we had craft industry, where the person that came into the shop, you know, and they were going to make a shoe, they made the whole shoe. They worked with the customer until it fit right and did those types of things.

Tripp Babbitt:         Then the industrial revolution comes along with Frederick Taylor, and then you got your specialization, your different departments doing different pieces, so people don't lack the view of seeing things systemically or end to end. So part of what I'm building with the 95 Method is that the beginning part is to understand how things flow through your organization, and not because of what you think it is doing, but because you have knowledge of what you're doing.

Tripp Babbitt:         That applies to anybody, whether you're a salesperson, front line, middle manager, executive, because getting that view and getting agreement on what customers are trying to get out of that system helps you not only prioritize, but it also tells you how your system is performing.

Michael Webb:     Let's take what you just said, that craft industry, to multiplying the division of labor, the complexity of it, and then how that applies or impacts on the commercial side, the sales side of an organization, for a moment.

Michael Webb:     And I wanted to see if you would agree with this. From my reading of it and consulting with companies over the last 17 years, the Frederick Taylor days... Frederick or someone would study how the work is done, use a stopwatch, come up with a new design, and give it to the people to do as though they were a machine, automatons, just go do it. It creates all kinds of backlash, immune reactions. People don't like that.

Michael Webb:     The next kind of phase seemed to be well, there's all these tools that you can use, so they teach people to use the tools, but they didn't know why to do it. So likewise, okay, we'll do it for a while if it works great, but if it doesn't it falls into disuse.

Michael Webb:     What appears to me to be today, and this is so critical in sales, where people are constantly given a sales process, but having been in that role I know you have to just give lip service to the sales process, because only parts of it really help you do your job. Most of it does not help you do your job. It gets in the way of doing your job, so a salesperson is in a difficult spot.

Tripp Babbitt:         The proper role of the quote process is for the people doing the work to express how best to get it done, how best to achieve the objective. The proper role of the process is not for somebody on high or outside the company to come in and tell people how to do the work. Would you agree with that?

Michael Webb:     I do. And there's actually in the military now, where everything used to be command and control, it's now done through something called the commander's intent. It's not take the hill and do these steps. It's take the hill, you figure out how to take the hill.

Tripp Babbitt:         Absolutely what you're saying is right on, and what I'm trying to do is develop a method for people to be able to understand that to the point that the people doing the work may have to make adjustments. You know, if you're going to take that hill and all of a sudden the whole army that you're fighting against is on the front part and you're told to go right straight up the front part, then you may need to adjust your theory and maybe try a different method in order to achieve the end that you're looking for, the goal.

Michael Webb:     I really appreciate the fact that you started out as a salesperson in industrial sales and now you have all this background and experience and studying you've done about management systems. I mean what are your observations about the marketing and sales side of the business and the pains and problems they have and what this approach can do for them?

Tripp Babbitt:         It helps you understand not just the piece that you're in, so if you're in sales you have a tendency to be very focused on trying to make the sale and that's the only thing. It has to be much broader than that. There has to be something, that you're gaining knowledge about the customer, you're gaining knowledge about different things.

Tripp Babbitt:         I would even say as part of the 95 Method one of the big things that's missing from a lot of organizations, big or small, is innovation, and I don't necessarily expect that from a salesperson, but they do get insight and they are valuable players and can be in innovation, and certainly anybody that's selling knows how easy it is to sell something new that people want. It makes the sales job a lot easier.

Tripp Babbitt:         I think today we still kind of have... And it's disappearing I think slowly, but from a sales management perspective we still have a lot of command and control. It's a formula. You know, if you make so many calls and you go and you check these many boxes, that's not systemic enough. That's too command and control and doesn't understand necessarily the broader system that is at work.

Tripp Babbitt:         It's been a long time since I've been in that type of sales, but we're all selling everyday to a certain degree, but education on products and services and really understanding... When I was with an industrial distributor, understanding how manufacturing work was something that I had to gain knowledge on in order to be able to sell products or find new products that would help them increase their productivity.

Tripp Babbitt:         These systems come into contact when a salesperson meets up with someone, whether it's a manufacturing firm or a service company or an individual, so understanding their system has got to be a major part of that process.

Michael Webb:     And salespeople are caught in the cross-hairs of a pretty big dilemma, because the companies that employ them employ them to bring money to the company, bring customers in who are going to pay us money. That's the oxygen. We have to have that.

Michael Webb:     They may say we got to sell solutions instead of products without ever really defining the problem they're trying to solve, right, so they'll hire sales training. I was in the sales training industry for seven years. There's lots of very valuable skills, active listening skills, research skills and communication skills, that can help salespeople be more effective in these complex sales environments where there's multiple different decision makers, but they all take more time and they take more energy.

Michael Webb:     The salesperson very quickly reaches a point where he doesn't have enough time to do all the things that he needs to do, but the pressure to bring the money in is there. So the salespeople are in a difficult kind of environment and there's nobody in the company that's looking around to see how can we make this job easier.

Michael Webb:     Instead, they take the guys or gals who made the most revenue and they reward them handsomely. The rest of them are just slackers, and you need to go do some more training and you need to organize yourself better, so they're all just individual contributors instead of the fact that they actually work in a system. I guess you can tell there's a little personal frustration there, because I was there for 17 years.

Tripp Babbitt:         Yeah. Well, Michael, you're exactly right. I think one of the first things that I learned and I'm putting the 95 Method together the way that I am is you got to lose the judgment, the judgment of people and the judgment that this is the right way, and we have the one right way. That's the very old Frederick Taylor type of thinking and industrial revolution age stuff.

Tripp Babbitt:         I think what you have to do is kind of sit back and take an inventory, and this is part of what I'm building, is understand the theories that are at work, here's what I believe works, and you write those things down, I believe that you need to hammer the salesperson and those type of things.

Tripp Babbitt:         I'm very non-judgmental about those things these days because I want to understand why they believe that that theory is working and what results are they getting from that thinking. Typically they're going to have high turnover, they're going to have unhappy customers, those types of things.

Tripp Babbitt:         So maybe we ought to look at some new theories, and when you go through this process of developing new theory you want to try different things. This is how organizations can innovate, whether it's reading or listening to a podcast or new salespeople, or even the existing salespeople... If they build something that they believe will work and you try it out, and preferably on a small scale, then you can start to learn new methods that work better.

Tripp Babbitt:         So in order to make that change happen, it's not a matter of me being the sales manager, the old-school sales manager hammering out people, but kind of coming back and saying all right, I need to get rid of this judgment thing that I have, that I have a perfect method and they just need to follow it.

Tripp Babbitt:         People have views. They want to explore. They want to be curious and they have ideas, and getting those and starting to develop new theories is the best way to go about it, because the organization with the best theories, whether it's in sales or operations or whatever, is the one that's going to win in any industry.

Tripp Babbitt:         So constantly challenging existing theories that are at work is what you want to do, and you want to do that in a non-judgmental way. Unfortunately, alluding to your frustration, a lot of times that's not done without judgment, you know. Oh, you didn't try hard enough. It's not a matter of that. It's a matter of working smarter.

Michael Webb:     It's not the judgment that's the problem, but how we make the judgment. Because if you come up with a new theory, a new experiment, and it works because the data shows you that we've had improvement, then you can judge that this is a better theory, and we need that judgment. We need to make those decisions, right?

Michael Webb:     But it's the judgment in absence of data, it's just by going from the executive's gut feel or what have you. Would you agree with that?

Tripp Babbitt:         To a certain degree yes, and to a certain degree no. Deming is famous... There's often a quote across the internet Deming was all about data, and without data you're just another person with an opinion, and stuff like that. Well those are not things that Deming said. As a matter of fact, Deming often talked about the unknown and the knowable types of data.

Tripp Babbitt:         So you have to work off of theory a lot of times and then take data that is basically casting a shadow. So I may never know the cost of an unhappy customer, right? Supposedly they tell 15 or 20 other people, but we'll never know what the number is. But we can get an idea by the attrition of customers and things of that sort.

Tripp Babbitt:         So that being the known data, and data can be helpful, the data is basically the feedback loop for what you're doing, and you may often not have the type of data that you directly need and you're going to have look elsewhere for ways that it's coming across. So we have to develop theories based off of what we're learning in the organization sometimes without data, and look for ways to get data on what it is other than the end result. Data is always helpful if it's available, but it also can be a double-edged sword.

Michael Webb:     And here we enter into a area that is rich with opportunity, because there are differences in the culture between sales and marketing and in a manufacturing environment. In the manufacturing, especially in the engineering side of things and the process excellence side of things, I mean they know that they have to have operational definitions, a method of how you arrived at that number, that data.

Michael Webb:     Those operational definitions, they take the form of words and concepts. So you have data and you don't know what you're measuring, it doesn't mean anything, right? Data outside of context is not meaningful. In sales and marketing we have all these words we use.

Michael Webb:     Customer, we sort of assume we know what we mean by a customer. The fact is you can go in most companies, especially large ones, and ask four different people maybe in different departments who's the customer and you are virtually guaranteed to not get the same answer.

Tripp Babbitt:         There's a few things that go through my head as you talked there. One is the need for a shared aim, shared purpose if you will, and getting that has to come through some type of method for people to be able to agree on things. So whether it's operational definitions or whatever it is, you get agreement.

Tripp Babbitt:         The approach that I'm taking is that they take a customer in view of the organization and a method to do that, so they're all kind of singing from the same music that they're seeing the same things when they're listening to phone calls or listening to interactions with customers.

Tripp Babbitt:         By getting that kind of shared understanding of what's happening within the organization and having a shared aim or purpose associated with it, then you are going to be able to get people singing from the same sheet of music, and that's really... Again, what I'm trying to build in the 95 Method is a method for doing that so that an engineer or a salesperson or an operational person or an executive or a contact center person can all sit there and have a method go through and they can talk about it.

Tripp Babbitt:         There's no reason that somebody on the front line can't talk to an executive other than cultural barriers that exist within organizations, which are just foolish. Having those interactions and talking about... You will argue about everything in an organization if you take your functional view.

Tripp Babbitt:         If you are talking about what the customer saw, that's a better conversation, because now you have kind of this touch point that you can go to and say here's what the customer is saying and here's the data associated with it, getting back to your need for data, to be able to say this is how we're performing. This is how we're viewed by our customers, and that kind of gives you that rallying point, and then I think after you get that type of knowledge, then I think you can start to build a better aim or purpose from that and that kind of gets people on the same page.

Michael Webb:     In support of your concept of that customer... That outside in view, I was doing a podcast with Brian Carroll, who's the president of markempa. He's focusing on marketing and empathy. He also wrote a best-selling book called Lead Generation for the Complex Sale back about 10 or 15 years ago. That's how I met him.

Michael Webb:     He learned something a few years ago that has sort of changed his direction. He had heard that there was this really odd company that was making all sorts of record growth and customer satisfaction, but it was a collection agency. Yeah. Yeah.

Tripp Babbitt:         I heard the story, yeah. Go ahead.

Michael Webb:     Okay. So when he learned that the secret of this collection agency, which was growing and way profitable, way outside the norm of its industry, was that instead of pursuing their people, who didn't have any money, and beatings will continue until you pay the bill and all that, they took a reverse kind of approach and tried to understand what those people needed, and if they needed to find a job they'd provide something to help them find a job, right? If they needed to find an apartment, help them do that.

Michael Webb:     Whatever it was that they needed, they found ways of doing that. You wouldn't expect that at all from a collection agency, but by doing that they won support from their so-called... I don't know, I guess it's the customers, but from the client anyway, and they created all this goodwill and it had this counterintuitive approach.

Michael Webb:     Brian started trying it in the company he was working for, doing lead generation, and instead of trying to find somebody who's ready to buy our product they're trying to find out when the person came to the website and downloaded something what were they looking for, and they tried to find other things to help that person.

Michael Webb:     Counterintuitively, they grew 300% by taking that approach. Rather than a sales approach, here, do something I want you to do, it's what do you want to do, and let me see if there's something I might be able to do to help you, and it seems to have worked.

Tripp Babbitt:         Yeah, I've heard that story before, and when I hear it the first thing that comes to mind is that they understand the business that they are in. So if you go back to some of the famous Deming maybe analogies that would go with that, if you thought you were in the buggy whip business or the carburetor business, you're out of business.

Tripp Babbitt:         Now if you understood that you were in something to do with motorized vehicles, support for that, or that you were looking for ways to getting the gas to come together so it would be able to run the car, then you would have been in the business to understand that my purpose isn't making better buggy whips or carburetors, but a greater aim, a greater understanding of what business that they are in.

Tripp Babbitt:         So this gentleman that you're talking about in the collection agency understood that there was a broader perspective associated with what businesses they were in, and I think that a lot of organizations are struck in this. They're trying to get better at just what they are doing and they're missing the opportunities associated with kind of the greater purpose associated with the business that they're in. By virtue of that they're missing opportunities to innovate, and innovation now is so critical.

Michael Webb:     There's kind of a baby in the bath water problem I think that causes a lot of senior executives to not understand the value of this, and that is that... In my opinion, I would be curious about your thoughts here, that we get this concept confused with altruism, that our job is to find out anything that would be good for the customer and make sure they get it. But wait a minute, we got to make a profit, and the more profit we make the better.

Michael Webb:     What this is really doing is finding what a customer's problems are and seeking win-wins to help them that may not cost as much, and if they're not qualified for us to help them, then we point them in a direction that will help them. That actually saves our sales costs, rather than trying to convert an unqualified customer.

Michael Webb:     But then by earning their respect and appreciation for really understanding them, you can find those that are qualified and then we have a much more credibility with them to make the sales process go faster with us. It's selfish. It's win-win. It's not altruistic, and a lot of people don't make that distinction I think.

Tripp Babbitt:         I read something in a book and it really hit me. It said that if we were selfish enough we would be altruistic. When I heard that, and I was reading about altruism is that by virtue of being altruistic we are being selfish because it serves the greater purpose.

Tripp Babbitt:         So my thinking on that is... Along that line, is that if we were selfish enough we would be altruistic, and that we would be wanting to help everyone because it's to our benefit. You know, you look at the example, for instance of... Are you familiar with Mattress Mack? He was a Deming proponent.

Michael Webb:     No.

Tripp Babbitt:         Mattress Mack... You can look him up online, out of Houston. They had the hurricane that came through. What did Mattress Mack do? He opened his warehouses to people who didn't have... Who were flooded out of their homes, and so hundreds of people came to his warehouses to sleep, so that's where people migrated to.

Tripp Babbitt:         Now did he lose money doing that? Absolutely. But what greater good did he do? He did a lot of greater good and people are so grateful to him, and the business that he's been able to increase by taking that altruistic attitude, it helped grow the business. So I'm a big fan of altruism, but with the understanding that if we were selfish enough we would all be altruistic.

Michael Webb:     Well that's a subject that we should maybe pick up at another time. I have a little different take on it. Definitely the intent is the same, so this has really been a fascinating conversation, ranging all over a broad bunch of things, but I think that they're things that are very important for senior executives and for sales and marketing to have a perspective on, because there is a system there, cause and effect does apply, you can measure it, and this isn't about giving people processes that don't work or making compliance.

Michael Webb:     It is about pulling what people know from them and helping the organization to achieve more for the customer, while also giving the employees more satisfaction, more income, more success for everybody, and that all requires innovation.

Michael Webb:     Any closing remarks or observations, and then how can someone get ahold of you if they want to learn more about what you're doing and the 95 Method?

Tripp Babbitt:         I actually have a document that's a free download. It is at my other podcast that I started. It's called mindyournoodles.com/overview, and they can become a part of what we're building. We're getting feedback and input and so forth on how you can go look at your organization's customer, and I believe that everyone would benefit from that. It's being updated constantly, so that's why we ask for your email. They can obviously listen to me at the podcast.deming.org for the Deming Institute podcast, and you can reach me directly at Tripp, T-R-I-P-P, @the95, which is the number, method.com.

Michael Webb:     Super. And we'll make sure these links are in the show notes. Thank you very much for being here, Tripp. I really appreciate it. I know my audience is going to get a lot of value from it.

Tripp Babbitt:         Very good. Thank you for having me.

Michael Webb:     Until next time everybody, take care.

Michael Webb:     The Sales Process Excellence podcast is sponsored by Sales Performance Consultants. Discover how to improve your B2B sales with systems thinking at salesperformance.com.