Friday, 4 September 2015

An EdTech Startup and An Educator Walk Into a Bar... GrowSumo in Edu

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If a corporation and an educator walked into a bar... who would pay for the drinks? 

This post considers this by looking at how sales people could be getting paid and rewarded for unwelcome and inefficient practices, while educators get very little for their welcome and effective methods.

We consider why this happens... and how GrowSumo could help change the situation. 

In the documentary "The Corporation" Dr Robert Hare, consultant to the FBI on psychopaths, highlights how a corporation exhibits all the symptoms and traits of a psychopath... except "there is no soul to save or body to incarcerate"

Such a checklist might mean a corporation won't do anything unless there is a clear reason/incentive to do so. What are the implication for this in the context of EdTech sales?

The Corporation and Coin Operated Sales People
A number of startup and sales gurus argue that the best sales people are the ones that are coin operated (another reason I'm a rubbish sales person). But do "coin operated" sales people have the customers best interests at heart? Whether they do or not they certainly get results! Philip Delves Broughton highlights this when he details the sales practices of Xerox's sales manager Frank Pacetta;

"Sales cultures are determined by the business, not the other way around. The people who sell are victims of the market's hidden hand. If you happen to be in a great business with fat margins, you can afford a humane sales culture. If not, you must endure men like Frank Pacetta. Pacetta was a legendary sales manager described in The Force, an account of a year in the life of the Xerox Corporation's Cleveland sales team in 1994. He was in many ways a clown, like Michael Scott, the office manager played by Steve Carell in The Office... Pacetta created a "culture of ironic phoniness" that permitted people "to do outrageous things," which in turn exposed them to manipulation. 

Pacetta would throw violent tantrums and churn through staff who failed to meet his standards. Patience, he once said, is "for someone without a budget." Like many of the least appealing salesmen, he boasted of being able to sell "snow to an Eskimo." His methods sharply increased sales and made him a legend within Xerox.

The success of men like Pacetta poses a difficult problem. His methods were vulgar and in some cases downright unpleasant. He exploited people's vulnerabilities for the unimpressive purpose of selling photocopiers. And he bragged about it. But from Xerox's perspective, he closed sales. We might wish for a more benign climate for salespeople, in which they are motivated to learn and improve, to feel a strong sense of inner purpose and develop meaningful and long-term customer relationships. But when your business is failing, it's Frank Pacetta you call." Philip Delves Broughton, Life's a Pitch   

Speaking from experience, I can see the accuracy of Delves Broughtons closing comment in this extract and why cold calling is still used. Unfortunately the methods that might be more welcome by educators are a long way off getting the kind of results that the practices of sales people like Frank Pacetta achieves... and when you run a business there are overheads that need to be paid, so sales are vital.

I have been praised for my approach by educators, but if I were to follow up by asking if anyone has tried any of the products/services that I think show a lot of promise, or if they have employed any of the advice regarding how to get more buy in with Crowdfunding PD... I wonder what the response would be.

There are a number of reasons that make what Broughton calls a "More benign climate for salespeople," with issues on both the supplier and educators side, the result is that some work-arounds may be required at the that appeal to psychopathic corporations and the giving nature of educators while being mutually beneficial.

I am exploring a few ideas and models that will help organisations looking to engage educators to stay as small as possible for as long as possible and, ideally, ensure that they don't need to hire sales staff in education.

This is quite the departure from the norm, but not without precedent in other sectors, with inbound marketers and organisations who are exploring social selling achieving good results. I'll be focusing on non-educator examples in the next post, for the moment I'd like to focus on the education ones.

Are the Darlings of EdTech Psychopathic Corporations?
There are some companies that might be described as the "Darlings of EdTech," they have achieved product-market fit, they have taken their time, consulted with educators and support them in a number of ways. I have learned so much from these organisations, and other suppliers would do well to follow their example.

What happens if we look at these exemplar organisations in the context of "The Corporation" documentary? Can we find evidence of psychopathic tendencies? Lets take a look...

Any time I find EdTech that is being raved about I check a few things out including:

1) Do they have Venture Capital investment?

2) Are they part of an EdTech incubator?

3) Is the service free and/or does it have a feemium model?

9 out of 10 times they have two or three of these things going for them. What implications does this have on the EdTech ecosystem? Are there questions that need to be answered? For example;
  • What are the expectations of the investors? If the answer to this question is "get a return on investment,"
  • What happens when the investors look to cash in? If the model is to remain free, how will the investors recoup their investment? 
I've heard some people at companies that are popular with educators say "We'll worry about how to make money later, for the moment we're well funded So we're focusing on distribution"

Distribution for what? Providing investors with a return on investment? If so, how? These questions are unanswerable at the moment, but they are worth considering.

Can we assess the concept of "Psychopathy" in corporations even amongst the EdTech companies who are renowned for doing great work. If so what role does the emphasis on investors ROI play? And what could be done to create a fairer model... one that will also reduces the number of sales calls.

Word of Mouth Referals: Social Norms & Market Norms
There are a number of companies who have done everything right, so right that the don't need any sales people! 

Everything about the product is right - the price, presentation and product... It's a dream experience for educators. It's such a great experience that educators are willing to do all the selling for the company. This makes the cost per customer acquisition = $0.

In exchange for their support, educators might get admitted onto the companies advocacy program, get a sneak peek at new products and/or help co-create and collaborate on new product development.

All of which is absolutely 100% fantastic! I've learnt so much from exploring the practices of these exemplar organisations in the hope of emulating the results they have achieved... With one exception.

As well as providing T-shirts and other swag (which let's face it, is free advertising for the company), I'll be doing with any Tech Stories advocates what we would be doing with any sales people who would be assisting with sales and any services we are supporting and looking to roll out... we'll be paying them!

Cold hard cash, whether the revenue goes to the educator, their school via a crowdfund project, the department responsible for securing alumini contributions or the PTA, we'll find ways to contribute to causes that are important to the educator.

If these educators are saving the company on sales commission, or even the costs of hiring a sales person or two (or even an entire education sales team), why shouldn't we contribute some of these savings to the educator/school?

How common is this with the EdTech companies that educators play a role with the adoption of their services? If it's not all that common, why is this? Do any of these factors contribute to this?

1) That "Corporations" are indeed psychopaths, even the darlings of EdTech?

2) No matter how great the product is, or what the founders values and intentions are, when venture capitalists and investors get involved they get a say in the running of the business... and their #1 priority is on getting a return on investment.

3) In Dan Airley's book "Predictably Irrational" he highlights the difference between social norms and market norms and in this video asks what would happen if you offered to pay your Mother in-law for a Thanksgiving meal she made.
Predictably Irrational: The Cost of Social Norms
In the book Airley also highlights how you'd be happy to help a friend move a couch as a favour but, if the person on the other end was a paid removal man who was being paid for his services, you'd have some issues with this.

The Corporation, Investors, Market Norms... And Selfless Givers
So EdTech sales people are paid to make unwelcome calls and emails, get paid to go to conferences (and invade the blogger cafe) and then get paid their wages as well as bonuses for the sales they make.

Meanwhile back in the classroom... educators are doing a far better job at selling the company's product with more welcome and effective methods... but can't afford to make it to conferences because of the costs of the event. But they do get the odd bit of swag from the company from time to time.

In his book Give and Take, Adam Grant highlights that educators are selfless givers, so if they find a product/service that will help their students and colleagues, they will share details about it.

This is regardless of the investment that the company has in it's coffers, how much the sales people are getting paid for practices that are unwelcome and less effective that educator advocates, or how much the educators word of mouth referrals are generating.

So what's the point of all these observations? Whether you're an educator or a supplier ,I think there could be a fairer and more effective way of doing things.

GrowSumo... Great Teaching and More of It.
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If suppliers were to sign up to GrowSumo and invite their advocates to join them, educators would get paid for any recommendations that they make.

There may be suppliers and educators who may not like the sound of this, but that's the way of new ideas.

Successful implementation of this would mean that educators were generating money for crowdfunding their own PD, school supplies and being rewarded for their advocacy work.

Educators and EdTech companies would have a method for monitoring educator Vs company staff sales efforts. This would also allow educators and suppliers to assess the value of traditional sales Vs word of mouth referrals.

I hope that enough early adopters on both sides of the fence will give GrowSumo a try. 

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