Mindset - the Key to Unlocking Your Sales, with Arlin Sorenson

[00:00:00] You know, you've got to learn the discipline of what a good, well-managed sales process even looks like. Documenting the process is one of the first steps that a founder needs to do, and they need to be willing to be disciplined to follow a process. That was always what frustrated my team was. I'd do it, you know, this way for one customer, and tomorrow I'd go do it a totally different way for another customer. And it was up to them to figure out how to actually fulfill and deliver it, which is not scalable.

[00:00:28] You've got to really think scale and how you're going to set things up for success for other people. Hey guys, Damien Stevens, host of MSP Mindset. And today I am blessed to be joined by Arlin Sorenson. And we are here in person live at the GrowCon 2024 event. And Arlin is the VP of Ecosystem Evangelism at ConnectWise.

[00:00:57] It's a gigantic title, but I think that suits you. It seems like you've always been an evangelist for MSPs. Thank you for making time and your busy schedule at GrowCon to sit down with me live. Ah, it's great to be with you, Damien, and excited to have a conversation. You probably have a different perspective than most as much as you are so involved in peer groups and events and all these things. What are some of the biggest challenges you see MSPs facing right now?

[00:01:25] Well, the biggest challenge is the same challenge we've had for a long time. And that is MSPs don't like to sell, don't know how to sell, want to avoid selling, or at least throw it over the fence to some other person to be the salesperson. And, you know, the reality is that Intel and MSP, from my perspective, is at least $5 million in revenue. It's got to be owner-led sales.

[00:01:53] And most owners don't want to be the sales guy. That's uncomfortable. Yeah. It's not, you know, they're often technically minded. They can fix anything, but they almost treat sales as like, you know, the dirty used car sales mindset rather than, hey, this is how we actually grow and scale and make successful business. You know, if I could change anything in this industry, that would be it. Make owners want to sell, you know, and that would completely change their profitability,

[00:02:23] their ability to grow and scale their businesses, take care of their employees and their clients better. But there's just this disconnect in a lot of these technical owner minds that sales is just not something they want to be involved in. And they'll throw it over the fence to a salesperson who will fail because they don't have the necessary tools to help them be successful. And then they'll get fired and they'll try to hire another one.

[00:02:52] And, you know, they waste a lot of money trying to hire salespeople instead of just saying, OK, at this point in my business lifecycle, I've got to be the sales guy and just embrace it and go do it. Well, how do you think that is? It's just just the mindset that people have based on kind of how they came up in the industry and where they came from. A lot of these businesses got started just like mine did. I can do it better than somebody else.

[00:03:19] And, you know, so and they can because technically they're geniuses. But that doesn't connect necessarily with the ability or the willingness to go out and sell. This episode is brought to you by Servocity. I started Servocity because I was an MSP that lost data because I thought backup success meant I could recover. And boy, was I wrong.

[00:03:43] If you've ever been there or anywhere close, you know how much your stomach turns over the thought of not being able to recover any version of the data for your client. Now, naively, I set off to build a better mousetrap and build a better backup product until finally I realized it's all about the people and the process. So you have a choice to make. Do nothing and bury your head in the sand or level up your processes.

[00:04:10] Now, you can do that by either hiring Servocity or we'll take all the workload of managing backups off of your plate and test your backups daily, weekly, monthly and quarterly. Or you can keep the tech stack you have in place, your existing backup into your provider and steal my 18 years of knowledge and download that process and add that to your operational maturity today. Yeah. So in your opinion, is owner-led sales the only way when you're sub 5 million?

[00:04:39] It's I would say it's luck if you can do it any other way because you just can't afford to hire the right people. If you hire a good salesperson, you've got to have somebody managing, you know, and what owners like less than selling is managing a salesperson, right? Because they're good salespeople. They'll test the, you know, they're like kids, right? They're going to find the boundaries and they'll try all kinds of stuff because that's how they become successful.

[00:05:09] And if they're structured right, that's how they get paid. I know I learned early on when I hired my first salesperson, I didn't equip him. I didn't really give him the boundaries. And he went out and he sold some things that we didn't really sell. And he came back, you know, and said, hey, I closed this deal. My response was, bad boy, bad boy. That's not what we sell. You got to sell what we really actually can deliver. Well, there's no documentation.

[00:05:38] I don't have any flyers. I don't have any information. You didn't tell me the pricing. We don't set them up for success because as an owner, we can just go make it up ourselves, right? We don't have to ask permission or have any boundaries. We just make them our own. Yeah. And I think we have an understanding of capacity to deliver, profit margin, all these other things in real time. Right. Right. And if you get the sales rep and you don't watch the comp, they're going to sell.

[00:06:06] If you say, I need to sell $3,000 worth of recurring, you're going to end up with a bunch of M365 licenses. Yeah. Where you have no margin. Right. Instead of your core service. That's exactly right. They will maximize their outcome, which is what you want them to do. You want them to be motivated financially, but you got to then put those boundaries and provide the guidance so that you sell the right things to the right customers.

[00:06:30] That's the other side of it is if I was a sales guy and I could go sell one large deal, maybe to a client that we don't really want to serve, but I can get it all done in one shot instead of have to do, you know, multiple sales to others. So there's a lot that goes into really being able to manage a salesperson effectively. And that's a challenge for a lot of business owners. They don't want to spend their time doing that. They'd rather be fixing something with a screwdriver. Yeah.

[00:06:58] And I found like, at least in my journey, I wasn't necessarily great at sales, so I couldn't be a group. I couldn't understand what I needed to be to be a good sales manager. So there was always that gap, that disconnect. And it's like, well, what do I do? One of my first sales reps, I remember I was like, I think if I left and came back for a month, you'd be selling socks. You know what I mean? It would be so far. Whatever they can make money on. Yeah. Yeah.

[00:07:25] But I remember I was forced to go through that maturity, that documentation, just all these other things, because even what I thought was clear around what we do sell, there were these gray areas. Absolutely. And, you know, they would end up selling into those gray areas. And then we can't deliver those gray areas or, you know, unclear outcomes or things that we can't quite do that maybe were obvious to me. Yeah. Yeah.

[00:07:52] I mean, real good salespeople are motivated by one thing, and that is driving their own compensation, right? And so management of salespeople is a really important part of the process. And, you know, there are outsourced ways like Marketopia that you can work with that can help do some of that and teach us how.

[00:08:15] But at the end of the day, an owner's got to understand how compensation drives a behavior and make sure that they're communicating clearly what success looks like for that salesperson. Now, you said you feel like one of the top challenges is sales and that you probably need to be doing owner-led sales.

[00:08:35] So as the stereotypical MSP that loves to turn a wrench, how do I, first of all, even get on my comfort zone, and how do I approach owner-led sales so that I don't just go and, like, I know I did this. And I know I've talked to several other MSPs. I hired a sales rep, not an SDR, just a sales rep. And I fed them no leads. I gave them no process.

[00:09:05] And, you know, I handed them a phone book or said go to a business after hours. So if I'm not hiring a sales rep, I'm going to go back and say, how do I do owner-led sales in a way that I'm not just repeating the same thing over and over again and saying, gosh, I don't like it. I'd rather turn wrenches. Yeah, I mean, I think you need to, number one, you've got to work on shifting your mindset, right? And that's a big challenge.

[00:09:34] But you've got to get educated yourself. You know, owner-led sales work because owners can create the rules as they go and, you know, make it up basically to fit the need of the prospect they're talking to. You don't want to give your salespeople that freedom. It's dangerous when they can just go make it up.

[00:09:59] So, you know, you've got to learn the discipline of what a good, well-managed sales process even looks like. Documenting the process is one of the first steps that a founder needs to do. And they need to be willing to be disciplined to follow a process. That was always what frustrated my team was. Sometimes I'd do it, you know, this way for one customer and tomorrow I'd go do it a totally different way for another customer.

[00:10:25] And it was up to them to figure out how to actually fulfill and deliver it, which is not scalable. You know, so you've got to really think scale and how you're going to set things up for success for other people. You know, and that's the marketing materials that you're going to create and the social proof you're going to have available on social media. I mean, today there's so many tools that you can use to help enhance the sales process. But there's got to be a plan about that.

[00:10:55] And there's got to be a structure around how it gets delivered and consistency so that, you know, if you're going to begin to build a sales org, you can't really afford to have a sales manager for one salesperson. So then you've got to think about the scale of what that's going to look like. And, you know, once you get that engine going, the owner can begin to step back and get out of the way.

[00:11:19] And that's another transition is being willing to let go and let a manager actually do their job, right, without inserting yourself and getting in the way. So it's a big process to make that change, but it can be done. And, you know, it starts with mindset and then really understanding the process and then creating the tools you need to make it happen.

[00:11:46] Everybody thinks, well, a real salesperson will create their own leads. I'm waiting to meet that person yet, right? It's a different mindset. So you've got to have a marketing engine if you're going to have a sales engine. And so it's a big commit. It's not just hiring a sales rep and throwing it over the wall and saying good luck because they'll fail almost always.

[00:12:08] It's a very unicorn guy or salesperson that can just take whatever little they get and go make success out of it. Right. So I've got to come with a different mindset. And then what are the challenges if I want to really lean into owner-led sales? And I also have a question within that is I assume that I'm going, that I'm like a lot of people,

[00:12:35] where my selling has really been a little bit more like showing up to referrals and taking orders. But now I actually want to grow faster. I've got to build a process. I've got to actually lean into owner-led selling. So how do I kind of address that? Where do I start? Well, you know, so lead gen is a big part of what has to happen. Referrals are the best, right?

[00:13:00] And the more you can get that engine going, the better because that will always be your most successful likely way to sell. But some kind of lead gen, so whether that's leveraging an outsourced organization to help you with that or hiring, you know, an appointment setter or whatever, you need to get in front of customers. And so there's got to be some tool or mechanism you put in place to drive that.

[00:13:28] You need to have the material to be able to share with those prospects and how you're going to do that. Some type of system to track the funnel. So where are you in the sales process with each of those potential prospects, you know, which is why a PSA-type tool is so important for real success.

[00:13:53] But you put all the right pieces together and, you know, you can build an engine, but you've got to then have management that's going to actually leverage that. I find that a lot of people buy the tools, but they don't actually use the tools or not consistently. You know, a well-run sales org has got to have a lot of meetings. I mean, salespeople, they go in the ditches and off on their own tangents consistently.

[00:14:18] And so accountability is a huge part of success when it comes to sales. And, you know, following the process, entering the data, keeping it clean, all those things are really, really important. But that requires babysitting. That's what I call it anyway. Salespeople don't like that, but that's the way it really is because they don't want to be entering data in a computer. They want to be out looking for the next deal because that's how they get paid, you know.

[00:14:45] And compensation drives behavior with salespeople more than any other part of the business. So we've got to think through how do we compensate them to do the right things and get the right outcome. And that's a tricky thing to figure out sometimes because they're not all exactly the same. But they are pretty much coin-operated if they're good.

[00:15:07] So I want to back up to something you said a minute ago, which is you can't just hire a sales rep, throw them over the fence and expect that to work because you don't have marketing. You don't have leads. Boy, have I done that. I've done that exact thing and realized it's just a great way to light your money on fire. Right. Exactly. You might as well flush it. Right. It's more fun when you get to watch it than the other way.

[00:15:31] So now I need to, I guess if I'm understanding this, I need to invest perhaps for the first time in some sort of marketing or lead generation and either be the owner closing the deal or whatever that is. So what comes first in the chicken or the egg? Do I need to invest in sales and marketing and actually have the leads before I invest in additional sales capacity or getting better at closing? Or how do I start that if I'm in the owner-led sales motion? Well, I think the place to start is what are you trying to build?

[00:16:02] What's it look like? You know, if you're a $3 million company today, where do you want to be in two to three years? You want to be at $3.5 million? Do you want to be at $5 million? Do you want to be at $10 million? Because that will help determine the scope of what you're trying to accomplish with sales.

[00:16:20] You know, if you're a $3 million company and you want to get to five, I'd tell you, focus on owner-led sales and equipping the owner to be more, you know, useful in the field. Get an assistant that can help deal with quote preps and, you know, QBR preps and all the kind of things that are important to maximize the owner's time in front of prospects and customers.

[00:16:45] You know, if you want to become a $10 million company, well, you're probably going to have to hire, you know, other help to get there. And then you've got to think about, you know, how are we going to do that? Are we going to start with a selling sales manager, somebody that we think can become a sales manager, but we can't afford a sales manager today by himself? So they've got to sell and get trained up to be a manager. Or am I going to bite the bullet and hire multiple people?

[00:17:15] You know, I've always been of the opinion that if I'm going to hire a salesperson, I'm going to hire at least two. Because it takes just as long to train two as one. And expect that I'm going to lose one of them. Often I lose two, but at least, you know, I tried. So that's been my philosophy around hiring sales folks is never hire one.

[00:17:41] If you get lucky and they both work, there's nothing wrong with multiple salespeople that function. It might create a service delivery issue for you, but, you know, if you can get good ones, you go get them. And, you know, because nothing happens until you sell something, right? You can have the greatest service delivery engine in the world, but if you don't sell anything, it doesn't really matter. It doesn't generate money on its own.

[00:18:05] So, you know, it's really knowing where you're trying to go, at what speed you want to get there. And then you can decide where the investments should be made. But if you're just trying to incrementally grow, it's really about equipping that owner-led sales engine with assistant and tools and the other things to enable them to be as fruitful as possible when they're in the field in front of prospects and clients. I love that.

[00:18:35] I think super practical, pragmatic, like maximize the time in front of them. Yeah. You know, don't get bogged down by the... I mean, the value of owner-led sales is the ability to close, right? That's where they shine. And you want them closing. You don't want them sitting in the office doing quotes and getting QBRs ready. Yeah. What's funny to me is I feel like sometimes when you go to hire a salesperson and see how much they cost, you're willing to put in that sales assistant. But you didn't do it for the owner.

[00:19:04] It's right. It's right. And obviously, they have a real cost to them as well. Yes, for sure. And they can make a huge, huge difference in productivity. You know, I talked to some owners and, you know, I might get in front of a client once or twice a week. That's not adequate, right? It shouldn't be 5% of your time. It should be 50% of your time.

[00:19:28] And you need to find other people that can take some of that other stuff off your plate and enable that to be a priority. And it's that mind shift thing, right? It's, oh, I'll sell if I have some free time or I don't have anything else I'd rather do. It's not going to work. You're not going to scale that way. You might be able to stay steady, but you're not going to grow.

[00:19:52] Since you've built Heartland Technology Group and now all the peer groups that you build now, what is it you see related to this that comes up over and over again in these groups? And like how does this problem present itself? Like what are they saying? You know, they'll come into the peer group and talk about, you know, the sales guy that they hired 45 days ago that they had to fire and where can I find one that really works, you know?

[00:20:20] And a lot of conversation about, well, I hired him from one of the cell phone companies or I hired, you know, somebody that used to sell insurance. Because selling managed services is, you know, it's a different kind of sale than it was when we were selling, you know, the next laptop or our next server, right? And so people struggle with where do I find somebody that could even have that conversation?

[00:20:46] And, you know, I don't know there's any magic industry, but, you know, there are a lot of folks in larger companies that do a lot of sales training, right? So some of these people have had a lot of training, you know, in terms of how to sell recurring revenue model types of products and services. So that can be a really good place. So that's a common conversation.

[00:21:14] There's always conversation about, you know, sales process and lead gen in particular, you know. Where do I spend my marketing money? If I've got, you know, $10,000 to spend, should I spend it on, you know, SEO? Should I spend it on pay-per-click? Should I hire a caller? How do I spend the money? I haven't seen anything that's consistently always right, you know. So it depends a lot on the people you've got that are working those particular things.

[00:21:45] You can spend a lot of money on pay-per-click and get no right clicks, a lot of wrong clicks and cost a lot of money. You know, SEO is kind of a moving target, it seems, for how people manage that. So, and, you know, callers, BDRs or whatever are, it really depends on the person, their ability to connect when somebody accidentally answers the phone because usually they get voicemail.

[00:22:16] And it could be a very frustrating kind of role. And they got to be managed too, right? So all those, all that stuff has to be managed. And again, a lot of founder owners are not really in the marketing mindset either. It's like, all I want to do is just fix stuff and make it work.

[00:22:36] What separates the founder owner that comes with that issue that makes progress, that learns from the group, that really levels up and leans in and does the things they need to change versus the people that come back and they hit the same thing over and over again? It's really embracing the reality that they need to be owner-led sales.

[00:23:04] That it's their job, their number one priority has to be to drive the business and they're the lead salesperson. And as part of that process, they've got to document, they've got to put the systems in place and actually use them. I mean, I did owner-led sales for a number of years. I was terrible at actually putting things in the CRM package, right?

[00:23:31] I always had an excuse why I didn't have time or whatever. I didn't manage my own pipeline very well. So when we'd have a meeting and talk about what was coming, it was like, oh, man, I didn't write any of it down. I just got to think back to who I talked to and what might happen. You know, you've got to get that mindset right so that you're actually creating what you're going to have to have in the future as you're going.

[00:23:58] And, you know, that can speed up the ability to make a transition to a sales rep. But, you know, if you're not doing that work as you're doing it yourself, at some point you're going to either have to pay somebody to come in and do it for you or you're going to have to pause and do it because you can't make somebody else successful if you haven't done the work to set it up right. You can't make somebody else successful if you haven't figured out how to do it. Yeah. That's huge right there.

[00:24:28] It's not what anybody wants to do, but it's what everybody has to do to be successful. Yeah. Unfortunate truth. Well, Arlen, I just appreciate you giving me the time to interview you. I feel like I could talk to you all day and get so much wisdom from you. Thank you. Well, I've made most of the mistakes. No, probably not most of them, but I've made a lot of mistakes. And, you know, you learn from what you do wrong, right? And that's the beauty of peer groups.

[00:24:57] You can learn what other people have done wrong. You don't have to make every mistake yourself. And that's really an important thing. And the mindset thing, left on our own, a lot of times we don't ever get there. If you're in a group where you tell them, hey, this is what I intend to do this quarter, and you come back and you have to be accountable for that, the odds are much higher that you're going to actually execute it. Yes. Yes. Yes.

[00:25:26] So you brought up a great point. Is it peer groups? Is it hiring the right legion group? Is it telling an accountability partner? Like, what else is a predictor of a founder that will actually achieve that outcome versus say they want it? I think accountability to somebody else, you know, is really the missing link for a lot of founders. You know, we're business owners because we want to be our own boss. And it's a beautiful life to be your own boss.

[00:25:55] Being your own boss, you make decisions for what you want to do rather than what you should do. And so it can slow you down. So accountability is one of the key factors that I think make peer groups really, really valuable. And that, to me, is the main driver that can help drive change. That's it. I know I can relate to that.

[00:26:22] I was doing outreach, cold calls. And I don't know who wants to do that. Certainly not me. Yeah. Me neither. And I found every excuse. Like, I don't want to do accounting. But I was like, let me go do the accounting so I can avoid doing the cold calls. And finally it was a peer. And I said, here's what I'm going to do. And I will pay you 100 bucks. Back then, 100 bucks every week. If I didn't do it, it was real money.

[00:26:48] And then the other thing that I think was even a bigger motivator was I had to show up at an event dressed however they chose. Yeah. Yeah. And that's what scared me. Yeah. Because I didn't like what they were going to probably choose. Yeah, yeah. And so that accountability, you know. And I just also got tired of making excuses. Yes. Yeah.

[00:27:14] That conversation with the guy in the mirror, you know, Warren Buffett said that's the most important meeting of the day. And we really need to have those. So, I mean, we could have others help leverage it. But at the end of the day, we've got to make the decision that we're going to take this thing by the horns and we're going to put the effort into it to actually learn it and document it and set it up so that somebody else can actually follow the process and be successful.

[00:27:40] And if we focus on that with a little bit of accountability to derive the timing and get it done, you know, because we can procrastinate and take it forever to get there, it's not an impossible process. It's, you know, if people get the right mindset with some accountability behind it, they can actually make it happen pretty quick. Hmm. That's beautiful. That accountability to make it happen quickly. It's the missing link for most founder owners. Yes. Yes.

[00:28:10] I found when I am showing up and being accountable, which is versus when I'm not, to be all kinds of difference. And so frustrating when they ask me those questions that seem obvious. Like, why are you doing this? Have you tried this? Did you actually do that thing you said you were going to do? Oh, man, that can be frustrating. Yeah. Well, it's motivating, right? None of us want to get out in front of our peers and fail what we said we were going to do. And it's what makes peer groups so, so valuable.

[00:28:38] Well, speaking of that, I wanted to ask you about, you spend a lot of your time on legacy now. Yeah. Why is that so important to you? Well, legacy is, you know, the outcome of all of our hard work and our lives. And so it's the one thing that's going to remain and impact people, you know, for generations potentially if we do it well.

[00:29:02] And so, you know, what I find is that people think legacy is some event that's going to happen when we die. And that's part of it, right? That will be part of it. But legacy is created while we live. And so it really is the driver for how we should choose to use our time every day. And, you know, it's part of the accountability process, right?

[00:29:27] If I know what I'm trying to create from a legacy perspective, it needs to be the driver for how I choose to live today and tomorrow and the next day. And, you know, I just did an exercise with our S2S peer groups that are really focused on this. And I asked everybody to write their obituary. What do you want your obituary to read like when you pass away? And, you know, at first there was a lot of moaning and groaning.

[00:29:55] And I don't even want to admit I'm going to die, but you are. So let's get over that and let's write it down. How do you want other people to think about you? And, you know, if we start with the end in mind, like Covey says, we can work our way back to where we're at today and determine how we need to live. And, you know, the power of an intentional legacy is generational.

[00:30:21] And, you know, that's really what Nancy and I have been focused on in our family is how are we going to create generational legacy through our kids and our grandkids and our great-grandkids and setting up those kind of things today so that it can last for a very long time. And otherwise it's going to be accidental. The government's going to decide what happens with a lot of things. A lot of it's going to be taken away, you know, for taxes and other things.

[00:30:50] And so there's so much value. I think it's the greatest gift we can give our families is to really have an intentional legacy that's well thought out, well planned and executed. And that they don't have to try to deal with all the chaos when death does come. It's already all in place. And, you know, when my dad passed, he had everything kind of all ready to go. We didn't even have to probate or anything.

[00:31:19] It was just a non-event actually, you know. We were able to just mourn his passing and celebrate his life. My father-in-law, on the other hand, always had the attitude, it's not going to be my problem. And he didn't trust attorneys or others. And so when he passed, it was like looking for a needle in a haystack to figure out what was in place, what had been prepared, what was done.

[00:31:45] And, you know, I spent an entire week in his office just trying to find all the documents and accounts and all that stuff. I couldn't really celebrate his life because I was too busy trying to figure out what was going on. And he was right. It wasn't his problem. It became my problem. And, you know, it could have been so much simpler with some communication and some planning.

[00:32:10] But we all make those choices and they impact people around us. Yeah, that's huge. That's not what you and Nancy want to leave to your kids. No, no. And my kids are very good at reminding me that, you know, keep it simple. Keep it simple, Dad. We don't need to spend a lot of time trying to figure it out. You just keep it simple and we'll be able to execute that way. Yeah, that's great words of advice.

[00:32:38] Well, I feel like I could talk to you all afternoon, but I do want to keep you on schedule. Thank you so much for talking with me and for being on MSP Mindset, Arlen. Absolutely. It's always a pleasure and appreciate the opportunity.