How to Build a Winning Sales Culture: A Q&A with John McMahon
January 21, 202117 min read
Intimidating: that was the reputation of the “Ice Man.”
At software powerhouse PTC in 1995, where John McMahon ran worldwide sales, both his nickname and reputation preceded him. Outwardly, he looked tough and played the part. What was easily missed under the surface, however, was his generosity.
John’s true defining characteristic – as I learned over time – was how much he cared about developing talent. I’ve been a grateful beneficiary ever since. And now I’m pleased to share his wisdom with others.
John’s commitment to mentoring propelled the careers of an entire generation of sales leaders and CROs. Sitting down to talk recently, I asked him where his own journey began – and about the key lessons he has learned along the way to building a winning sales culture.
1. How did you get into sales? More importantly, why did you get into sales?
Luca, I was an electrical engineering student and quickly realized I was never going to be the best at engineering because I wasn’t as smart as many of the other students but, more importantly, I just wasn’t passionate about engineering. In my senior year of college, I was president of the student chapter of the IEEE and ran a panel discussion for the students with engineers from different companies and different disciplines. When the panel discussion was complete, students could have dinner with the engineers, and the only seat left was with a person from sales who seemed like someone I could easily socialize with. The conversation piqued my interest in sales and even more so when I found out many sales people made more money than most engineers.
2. Tell me about your experience at PTC. How did you and your team build such a successful, disciplined sales culture?
The PTC team was created by a maniacal focus on fundamentals. Most sales organizations believe they practice the fundamentals well, but don’t truly dedicate their team to the difficult discipline of the details of the fundamentals. At PTC, the fundamentals were recruiting, development, leadership, and forecasting accuracy. All of which were constructed by relentless qualification of everything and everybody, and based entirely on a “refuse to lose” mentality.
That all sounds easy and you might say, “everyone does that,” but in most cases the fundamentals are overlooked. Understanding, training, and driving discipline around fundamentals were elements we consistently lived and breathed. Let me give you an example: At every single sales leader meeting – every week, every month, every quarter, every year – we went into deep details on recruiting, the people, and the forecast. Deep inspection on a potential recruit’s capabilities versus the hiring profile, an extensive inspection of current reps’ strengths and weaknesses, and an absolutely exhaustive qualification of every deal on the forecast. This focus forced people to be completely and totally prepared for the meetings. You needed to be intimate with all the strengths and weaknesses of your people, potential recruits, and the details on every single deal on your forecast. It was through this relentless qualification of every detail that people were forced to internalize lessons learned. More importantly, they internalized the minute details, the difference makers, which in turn allowed them to perform at a higher level by recruiting only the best people, training people’s weaknesses, and maniacally qualifying deals.
No one, and I mean no one, was immune from embarrassment or humiliation if they didn’t have all the details. But, let me be clear, it was much more of a team embarrassment than a top-down scorning since the enforcement of these fundamentals had become a team mentality that was locked in the DNA of the team and became the basic expected level of performance.
3. How many people do you think you’ve hired in your career? What are the top characteristics you look for when it comes to hiring?
I’m not sure of the exact count but it could very well be in the thousands. The top characteristics I look for are the characteristics that I can’t change. The top two are intelligence and a PHD – persistence, heart, and desire. If someone is smart enough, they’ll gain the knowledge of the game and if they are persistent enough, they will be determined to practice new skills over and over again, which takes time and dedication. If people pass those two most important characteristics, then I look for integrity, coachability, adaptability, and intuition. I think everyone understands why integrity is important on any team. For coachability and adaptability, the sales environment in high-growth startups is constantly evolving as the product changes, competition changes, customers become more educated and therefore the sales message changes and the sales process changes. That means sales people will need new knowledge and need to develop new skills. A sales person’s ability to be coachable, learn, and then be flexible enough to adapt to the changing environment is the only way people can keep pace as the company experiences rapid growth.
And finally, intuition, a sixth sense. The instinct to quickly read a room, to know if a person could be a champion, to be able to sense an enemy, or spot a potential coach, is critical. The best sales people have a natural premonition that a deal may be changing for the best, or that the customer may be losing interest and the person is perceptive enough to trust their gut and act on it in time to change course and save the deal.
4. You’re known as the champion of MEDDIC. What was the genesis of that framework?
Before the acronym MEDDIC existed, I always taught specific items as qualification parameters on every forecasted deal. Things like, do we have a Champion or just a coach? Has the Champion helped us get to the Economic Buyer to qualify the deal further and help us “frame” the Decision Criteria and fully understand the Decision Process? And, as our product evolved and eventually worked – since it didn’t work until version 7 – we focused on what Pain we were solving; how could we quantify the customer’s pain, and quantify the tangible business value of our solution.
Jack Napoli was the man that actually tied the acronym to MEDDIC, because Jack was doing sales training and was excellent at simplifying the message. MEDDIC was an easy acronym for people to remember. Later, I changed it to MEDDPICC. I added a P for Paper Process, because if we don’t understand the paper process and associated timeline, then there is no way for us to accurately forecast the deal. An additional C was added for Competition, because when I was qualifying deals I was always surprised by reps that didn’t know who the competition was, who the competition’s champion was, or what the competition’s strategy was to win the deal.
5. What changes have you noticed in the sales (and/or software) landscape in recent years? Are there any skills or capabilities that have become increasingly important as a result?
The world is full of commodity products where people are selling a new product to the enterprise that is just N+1 better than the old product. They don’t need to have the same skills as a sales person selling a product that no one has ever previously purchased. In true enterprise selling, where people are selling a product that no one has ever bought before, there are three major skills they must possess.
First is simplification of the message: the ability to quickly conceptualize what the product does, why it is different than anything in the market, and why it is important to the prospective customer to pay attention now. Too many sales reps selling technology make the message overly complex, forcing the customer to question why they need to listen.
Second is the ability to call on multiple decision makers in different disciplines and levels of the enterprise. Many reps will only have a single message and single approach to whomever they call on, never understanding that different types in each discipline and level in the enterprise have different job functions, which are measured differently and have different personal desires and motivations. Understanding who you are speaking to, how they are measured, and their motivations are critically important to your ability to adapt to the potential buyer in front of you.
Third is the ability to build a rock solid, “CFO-ready” cost justification and business case. The skills required to build a cost justification require a deeper understanding of the customer’s environment, their “as-is” process versus “to-be” process, all the associated metrics, and how your product capabilities directly influence their process. Without an ability to build a cost justification with the customer’s metrics and financial data, you’ve lost all ability to justify a higher price point for your product, and you’ve lost leverage in holding your price point when the paper moves to Procurement. Procurement does a great job of “separating church and state” to minimize your product’s business value and create competition for your product. You have to understand the customer’s business and the tangible business value your product brings to their business to drive higher deal sizes.
6. You’ve been a phenomenal champion for me at five different companies. First of all, thank you! Who were your champions throughout your career? Can you share any lessons they passed on to you?
Early on at PTC my champions were Dick Harrison and Steve Walske. Dick was the COO and Steve the CEO. Dick was a total pragmatist and had incredible intuition. I learned from him to focus solely on two things. One, focus your decisions for change on the facts at hand and the things that make logical, common sense versus some idea you read in a business book. And two, make the best decision you can make with the information at hand, and if your decision turned out to be wrong, quickly change the decision and not let your ego get in the way.
Dick relied on more than his intelligence to make decisions. He was well practiced at using his intuition or gut instinct to help him make the right decisions. Over time, I learned to make more decisions when my brain and gut were aligned. If there was disagreement, I learned to wait before making a decision, trusting my gut instincts with people which, through practice and time, gave me more insight into people and situations, making me a better leader.
Through Steve, I learned about the business side of running a sales force. Meaning, as the leader of the sales force, you only have two dials to play with: headcount and productivity. The headcount was given to me by Dick and Steve, but it was my job to make those heads productive by recruiting A-players, onboarding them to decrease their ramp time to productivity, constantly training them to make them more productive, and only giving them to leaders that will continually develop them for continued productivity and preventing rep attrition. Steve showed me the direct effect that productivity and attrition had on revenues and margins, which reinforced the importance of recruiting, training, development, and leadership which drove an increase in productivity and decreased attrition.
Steve was a detailed planner and had great insight into the numbers. He always had a detailed eight-quarter plan for the business outlining productivity, reps, attrition, revenues, and margins. He forced me to constantly plan ahead for high growth in the sales force by defining new territories, new regions, promotions, number of new reps, managers, and SE’s needed to sustain the growth. And, with Steve, you couldn’t hide from your numbers. We built a five-quarter report for each rep by manager, outlining their start date, performance each quarter for the last four quarters, and the current forecast. The five-quarter report became a story line for each rep and each region, which was impossible to hide from.
7. You and I have been to many Bruins games over the years. Do you see any similarities between a hockey team and a sales team?
No doubt there are similarities. On recruiting, if any hockey team recruits B- and C-players and does everything else perfectly, they’ll fail as a team and never win the Stanley Cup. Every general manager in hockey is focused year-round on recruiting only the best players onto the ice. The same goes for sales leaders, which need recruit only A-players.
On fundamentals, every hockey team has a “morning skate” every day, regardless of whether or not there was a game last night, there was travel, or there is a game tonight. During the morning skate, the team focuses only on the fundamental skills and drills of the game, the same drills they have performed since they originally learned to skate at five years old. Nothing has changed. It’s the fundamentals again, again, and again. If hockey players or sales reps can’t perform the fundamentals of the game without thinking, then why would any coach ever believe they will perform higher level skills in a playbook during the game?
For performance and discipline, every hockey coach is promoting and demoting players on and off the bench every 45 seconds based on their effort and performance. Every 45 seconds, a new “forward line,” which is three players, jumps over the boards for their shift on the ice. The hockey coach is “intimate” with his players. Meaning, he knows their strengths, weaknesses, motivations, and fears. In 45 seconds, he can tell if the player’s performance matched their abilities to execute the play. If not, the coach will coach them on exactly what is required and make them sit out a shift to have time to think about what went wrong and how they will perform better next shift. Great sales leaders are intimate with their reps’ strengths and weaknesses and coach them effectively on execution.
It’s the discipline of details of each play in the playbook that drive any team’s success. The reason most teams don’t succeed is because they are simply unwilling to honestly dissect what is going wrong when running the plays. Even if they know what works, they’re unwilling to enforce consistent discipline until they perfect it. They say that losers practice until they get it right and winners practice until they never get it wrong. That is the same whether it is hockey, sales, or any other game. It’s the discipline of the details.
8. As a company goes through different stages of growth, are there different types of salespeople you need at each step? Does a company need one sales philosophy in its early days, and a different one as it gets bigger?
If we had to categorize different stages and different types of sales people, I’d say that in the initial stages of a company, they need reps that either come from the domain or are artists who have a great sense of ingenuity. These are necessary characteristics in order to sell the first number of deals when no one has heard of the company or the product, or the product may not work and development is looking to obtain product feedback.
In the next phase, let’s call it the deal stage, the product starts to work but the company has no brand recognition or marketing resources. In this stage, the sales environment is not fully defined. Meaning, the sales process, messaging, presentations, and demonstrations are starting to take shape, but are not 100% baked and they need sales reps that can consistently make the number through their own efforts in pipeline generation, product demonstration, and product presentation.
The next phase would be the scale stage where the product works, the reps have the requisite company resources from Sales Leadership, Sales Training, Marketing, Application Engineering and Professional Services, and are able to perform their jobs. Here, you’re typically recruiting rep sales athletes. They can be from outside the domain because they have been recruited for the strength of their characteristics and a track record of high performance, and they have the company resources and playbook needed to perform at a high level.
I don’t think the sales philosophy changes during each stage, but the product, competition, messaging, training, and resources around the rep constantly evolve and the best reps are quick to adapt to the changing environment.
9. I’m proud to say I worked reporting directly for you for 8+ years without being fired – a world record, thank you. 🙂 Tell me about your approach to leading people on your team.
Leading a team is about setting a vision for what the team will eventually become, in terms of how the individual can relate to it. Leaders have to answer the “What’s in it for me?” question. People want to know what they will become if they put in the time and effort to go through the rigor and discipline of onboarding training, constant sales training, relentless skill development, and living in 90-day increments.
People also want to know specifically what you want from them. Setting 3-5 clear standards of performance – and holding people accountable to those standards if they are consistent non-performers and rewarding those who are consistent over-achievers – is important to creating an equitable team environment.
I believe in caring for people through competence. So, I heavily invest in the development of the team. The more educated and skillful the team is, the better prepared they are, and the more we win. So, as you’ve personally witnessed, it’s non-stop training of the knowledge areas and constant development of the skills required to be successful. Some leaders say they care for their people, but they do nothing to make their people more competent. They think caring is being their friend and having ping-pong tables and foosball tables. If, as a leader, you truly care, you help your people become more competent to learn, develop, grow, win, make money, and get promoted. Caring is making them competent.
It’s important to create the right culture because culture, good or bad, is contagious. I believe in creating a culture of pride, where people are proud of the team they are on, proud of the people they work with, proud of their accomplishments and the team’s accomplishments. Pride only occurs when the team is winning, when people are learning and growing, when people are being promoted, making money, and beating the competition. Doing everything you need to do as a leader to help the team win is paramount.
In a winning culture, it’s important to drive a sense of selflessness versus selfishness, where people are part of the solution and not part of the problem. A culture where people take ownership on the team, not just what they’re responsible for as an individual. They think about the betterment of the team before thinking ‘me’. I’ve found that in a winning culture, reps and managers are willing to share their secrets to winning and competing, versus in losing cultures where everyone seems to bicker, no one shares, and they’re out for their own interests.
10. I can’t imagine you miss the anxiety of quarter end… do you? What do you miss?
I absolutely don’t miss the stress and anxiety of living in 90-day increments, but I really do miss the camaraderie of the team, watching people develop, and helping people win and achieve their goals. I’ve always found it rewarding to push people way beyond what they ever thought they could possibly achieve and being able to later hear their story of satisfaction. If, as a leader, you don’t find joy in the development of people and the achievement of their personal goals, then you’re certainly in the wrong position.
John McMahon is not just a sales master.
He’s a sales mentor – the kind who cares enough to expect the very best from his people, then invests in making sure they achieve it.
While sales will always be a number-driven endeavor, McMahon’s career is a testament to the value of investing in people and championing a culture that supports them. And that’s a legacy worth emulating in any professional or personal framework.