#314 Kyle Hegarty - Why AI is Accelerating Sales Failure for Most Companies

Speaker A: Your sellers have a risk problem. They have a buyer who's terrified of making the wrong decision. And almost no one on your team is trained for that type of conversation. In today's episode of Scale youe Sales podcast, we'll explore why the sales recession is quietly dismantling the commercial teams while leaders are still funding the old playbook. You'll hear why risk aversion is a big issue for buyers, why your sellers must win the meetings they're not in the rooms of, and why bolting AI onto weak fundamentals only accelerates and automates mediocrity. You will walk through some actions for your sales managers and leaders to test whether their teams are ready for 2027 and beyond. My next guest is the sales strategist and executive coach who argues most teams are being trained for a world that no longer exists. Across two decades coaching commercial teams in Asia Pacific and globally, he rebuilds trust based consultative selling for today's sales recession and is the author of the Accidental Business Nomad and Sales Punk. Welcome to Scale your Sales podcast. Carl Hegarty.

Speaker B: Thank you for the, for the invite. It's good to be here.

Speaker A: Yeah, I'm really looking forward to getting into this conversation. Carl. Now in your, your latest book Sales Punk, you talk about the sales recession. Now would you explain what you mean by sales recession and why many companies might not be reacting to really what's right in front of them?

Speaker B: Yeah, um, I kicked the book off with this as well as with some statistics around it, but maybe we'll start off just almost on a, on a vibe type of feel. First, the sales recession is that, uh, actually let me tell you a story. So I do sales training work and so I'll be in front of sales teams and over the last 10 years in back, call it back 2018, I would ask the team beforehand who has gone through sales training before and I'd usually get 70% of the room. These would be senior sales types of people, 70ish percent. And they'd let rattle off the big, the big name training programs or an internal program that was pretty robust. Fast forward to post Covid. The number of people who have gone through that type of training is now less than 20% that, that I'm seeing. And, and I think that there's data that also backs that up. So, so one big piece of this is that from a sales skill sets across the board, I think we're seeing a, an overall decline in what we'll just call traditional consultative sales sales skills. Uh, there are a number of Reasons we can talk about for that. But that would be one piece of this sales recession. The second piece is, is on the buyer side. Their world has, has changed profoundly. So it started changing with, with Google 25 years ago. Uh, and, and we've been talking, all sales professionals have been talking about this for decades now is that the buyer's more educated, the buyer's more educated. AI just put that on steroids. Right. So now, now we really are, um, we. I'm, I'm in a buying mode this week. So I'm like AI, you know, doing all this research. And it's a profoundly different relationship now with buyers and salespeople. The buyers are coming in at very different stages and they have very different needs. So combine that with the fact that salespeople haven't been keeping up with, I think I would just call it, um, training. And the training probably hasn't been evolving the way it should be as well. I think that those are two of the core pieces of why we're in this sales recession. And the result is that, you know, targets are not being met. Uh, there's much higher turnover within sales teams now. And you can I list out some of these statistics. The last four to five years, the post Covid years have been pretty, pretty depressing for this, for sales organizations generally.

Speaker A: Uh, I mean, I think that's really interesting and you know, I see that in terms of the, the foundations, but it's almost like the wrong foundations. You know, the things that people are focusing on, there's the, there's no point having more tech and having more AI if they're not doing consultative selling. Um, all you're doing is putting the wrong things on steroids and you're going far quicker in the wrong, wrong direction. And so, yeah, having those foundations, I mean, that's why I use a diagnostic process, um, sales assessments to identify individually where the gaps are in, in their processes, in their training, in their understanding. And you know, you know, with sales, so much of sales is what's happening in your own head and the conversations. Sales training doesn't always deal with that, you know, and that's the thing that informs your actual behavior. Yeah, because salespeople may know what to do, but when you're actually, um, in front of a customer, if you're not doing it because you think, well, I'm not going to ask that question, um, because that's too competitive and you know, it may mean that they won't go for the sale, well, they're not going to go for the sale Anyway, unless you ask that difficult consultative question. And so you have to get over that mindset. Um, first of all. So you know, as you say, the foundations aren't in, in place. Sales training isn't, isn't training in the right area. So if we look at this model being broken because all we're doing is retrashing that. Why do um, CEOs and revenue leaders keep funding this same old playbook? More reps, more tech, more pressure. Instead of dismantling it, would you say, how would you deal with it?

Speaker B: So the, I called the book Sales Punks. I have a copy of it right here. My uh, my. Can you see that? I don't know, uh, can see it. My blurring technology. Uh, this uh, the COVID is a uh, uh, homage to Sex Pistols album. Which. And, and, and the concept of punk was that you know, in this 1970s you had disco and what basically killed disco was punk. And it came in and it kind of broke everything. Now it might not rebuilt it very well, but at least it broke stuff. And I'm arguing that a lot of the, the mindsets that sales leaders have today actually originate all the way back from the 70s and 80s and we kind of need a punk movement to come in and just break some stuff first before we start rebuilding it. Or as you put it, you know, putting layers on of like bandages, like AI, additional technology, um, hiring reps, crossing our fingers and hoping next quarter gets better. So I think we're in alignment. It's like we need to break away at the core things that aren't working. And I think part of the punk mindset is just to have that critical thinking to be able to just actually ask those honest questions. Uh, what, what are my reps spending all of their time doing? Uh, I, I know some of these mid sized to large companies where the sales managers, they're basically slaves to uh, CRM. Like they're, they're just on CRM. They're manipulating CRM to make the data tell the story that they need to tell just so they can get by the next weekly meeting, the next quarterly report. And it's just theater. Like it's, it's just performative nonsense. And um, you know it's, it's that brave sales leader that steps up and starts calling this stuff out. That's where it's, that's where, that's where we can start to effectively break stuff before we rebuild it.

Speaker A: Yeah, and it's interesting that uh, you know those ah, sales reps that avoid the real issue and then You've got the managers that are avoid, I mean it's just too big, isn't it? Because no one's actually broken it yet. And even if you know it doesn't work, I mean I, I speak to so many um, revenue leaders and when we're talking about recruiting then they go into the um, traditional um, recruitment agencies and it's like I keep saying this is not working, it's not working. So there's another way of doing it, but they won't do the other way because they've always done it that way and that's how they've recruited. Even if they know the stats are staring them in the face, this is not working. So you've got the sales manager that are really focused on the CRM, the dashboards. How do you break that behavior when all above you is reinforcing it?

Speaker B: Yeah, um, the, My Take the Store. The book follows a story of ah, a sales leader who goes in and he finds a mess of a tech company and he has to rebuild the sales organization. So that's the story that I'm telling. Uh, it's based off of a compilation of real world stories that I've kind of Frankensteined together into one uh, fictional company. But all of the specific tools, actions, messaging that they did is um, is realistic. One thing that I found is that especially in large companies, and I say large, I'll call a medium size, you know, anything 10 million, 20 million revenue and above. I know that's small but still there's a lot of bureaucracy, there's a lot of politics. It's, it's, it's difficult to make big changes. And so the, the quick answer to your question I think is um, pockets of excellence, small teams, small even individuals can come in and actually have a process, a new approach. And if that works, that creates a level of safety to be able to start expanding. Um, my take generally is that you know, if you're a mid manager you're not going to change the organization. What you do have power to change is your specific team. So it's almost like we're doing like I'm doing this with a couple of companies where it's these sandbox pilots programs where let's just work with these 10 people, let's do this and let's just compare the numbers at the end of the quarter, at the end of the year and see who's you know, who's, whose approach is working better and, and assuming we're measuring things correctly, more often than not, you know, these types of break and rebuild approaches end up having better results.

Speaker A: Yeah, and I think this is a great strategy. I often do this, uh, with larger companies and say, okay, well let me just create this team, let's assess this team, let's provide a roadmap and work on that team. And because I know, because it's predictive and um, verified that the results are going to change double, quadruple, then you've got all the senior leaders on board and they quickly want to make the change across the board. But it's also an example of how um, uh, reps should be working as well with their customers. You need to pilot things, you need to build that trust because working with a new supplier is a huge risk to buyers. So pilot, you know, chunk it down, sandbox it all and get them to, to sample and try it. So I absolutely love that example.

Speaker B: The keyword. Oh, sorry, go ahead. Keyword, uh, uh, the keyword that you'd mentioned, and it's what I think about on a daily basis, especially in the last year or so is, is risk and risk internally. Because there's fear that you pointed out where people are afraid to try something new, even if they'd rather do something old that's proven to not work because it's at least something that they know versus try something new. Right. Because there's a risk aversion there. Uh, and it's the same thing that's happened on the buyer's side as well. So there is a hesitancy to do something new. It generally lengthens sales cycles. Uh, there's another piece of this where there's more decision makers on average than before. And I bring all of this up because I believe that it changes the skill set that sales reps need to be, need to have. Uh, and so, and what I mean by that is that actually a big chunk of what it means to sell, especially at the enterprise level today, is the ability to help your buyers navigate their own internal systems. Uh, and I'm seeing with a couple of accounts that's like, that's, that's where they're spending 50% of their time. It's like we've got, we've got a, we've got a champion in an account, but man, there's eight to 10 other people that need to be on board. And look, multiple decision makers is nothing new, but it has expanded and there's more people that now can say no. So the skill set from a sales standpoint is to figure out how to work and partner with, with these buyers to Be able to help them navigate their own internal situations, to be able to uh, mitigate that risk.

Speaker A: I love that. And we're going to get into that. But let me just appeal to the listeners here. Like if you're watching on YouTube, hit subscribe right now before you forget, to make sure you get the next conversation that it will find you. I record twice a month incredible people, uh, like Kyle. And all of this is to help CEOs and revenue leaders and operators to generally move the needle on revenue. So we're talking about, you know, the playbook, the system is, is broken and all of the strategies that they need in place in order to fix it, move forward and modernize. This is not just theorizing about it. So subscribe before you forget. So Kyle, let's pick up on, on that. Um, further, you know, is this biggest mistakes that you see many leaders, um, making in their environment.

Speaker B: Uh, when you say so we were talking about the concept of risk avoidance and managing it the right way. Is that what you're asking?

Speaker A: Yeah, internally managing it, you know, the in, because we're always talking about the external risk, but you've got the internal risk and um, you've got the external risk for the buyers as well. And you mentioned about, you know, 50%. Um, in terms of, I think it's higher than that. I think It's a good 80% is deal management. And then you've got the sales process, the other 20%. Managing that deal through your buyer, uh, means you need to have a different operation internally in order to do that externally with your buyer.

Speaker B: So, so it's, it's funny and I, I, I, can I get tongue tied a little bit with this because sometimes when we're talking about navigating internally, there's, there's the internal on the, on the sales side, right. Managing the multiple stakeholders to get the deal through internally, but then there's also internally on the buyer's side. And so, uh, the good news is that the skill set to manage both of those is actually similar. And one bit of advice that I give to salespeople is treat your internal customers like prospects. And if you, if you take a step back and kind of think about that, oftentimes what will happen in a, uh, in a sales situation. Sales reps trying to get a deal going. And I'll, I'll generalize but you know, they have to go internally to ops to make sure they get signed off or they have to get um, uh, uh, compliance to agree to this. They have to get the tech Team to, to write, sign off on this. Oftentimes sales teams come to their internal colleagues when they need something. And more often than not, they come to them when they need something immediately. And almost always there's a struggle there because it's sales rep kind of knocking on the door saying, hey, I need this, I need this asap. I need this compliance thing. I need legal to sign off on this. And legal comes back and goes, yeah, I've got my hands, I got my own problems. Take, uh, a, take a number, right? Wait, wait. And then there's the, then there's the tension, more time gets spent and, and things fall apart. So the, the concept here is treat those people like your prospects. And how would you do that if you were truly consultative or buyer centric? You would come in and say, hold up, uh, before we even talk about my stuff, like, what's going on on your end? Let me understand this procurement world. Like, tell me like what's working? What, what are the top challenges? What if, if there's one thing that we, that you could take off your plate, like to make your life easier, what would that be? Now as a sales rep, you're not necessarily going to be able to solve some or any of those problems, but you'll certainly be the only person internally that's actually taking the time to listen. And so it's a little bit of a long term strategy. Yeah.

Speaker A: So because I, I'm my, I'm um, my brain scrambled now. So when we're talking internally, this is why you're like, internally is your company to me, externally is you working with your buyer, even if you're helping them to manage their internal process, the internal, external. Because otherwise. So are we talking about the, um, the finance department of the supplier internally or are we talking about them getting it through the finance department of the buyer?

Speaker B: Yeah, this is, and this is on me. This is on me. Uh, this is the buyer's team. So company A, I've got, um.

Speaker A: Yeah, no, no, no, no, no, no, no, no.

Speaker B: Sorry, sorry. Now, uh, now you've, now I've scrambled myself.

Speaker A: Okay.

Speaker B: We've got a salesperson, he works for company A. Yeah, he has to, he has to navigate internally, his company A politics and challenges. Okay, Right. So the previous example that I just gave was I'm, I'm the sales guy. Company A, I've got to spend, and I know companies that spend people that spend 70% of their time working on their internal problems just to get deals going. Right. And that, that has increased over the last Couple of years. Again, I think it's because the um, the risk profiles have, have increased. There's, there's just people don't want to be, to be um, dealing with, with risk as much. Right, so, so that was the example that I just gave. Now what I was talking about earlier is that the same skill sets apply though. How can we help our buyers go through that same song and dance on their side? Right, yeah. And ah, that's just conversations that I don't think a lot of salespeople are having because salespeople are thinking about it like how can I get this deal done? How can I win this? But customer centric, buyer centric mindsets is actually, you know, what is going to make this person's life easier.

Speaker A: Absolutely. Yeah. And I think it's, it's a challenge, uh, because also the buyers now have, have a limited window in order to get the deal through and done as well. That was it Gartner's research that says that um, buyers, they have, they only spend 17% of their time actually on sales. And actually that means only 5% that is with you if you're on their, you know, you're the, on the short list. So 5% of the entire time in order to get probably a deal through that's worth millions that they haven't done before because it may not come up the sales cycle maybe every 10 years. They've only been there five or or so. So they're under pressure as well. And their risk that their, you know, their, their jobs on the line. So how, if buyers are really paralyzed by risk and surrounded by these multitude of stakeholders, how should organizations make it easier? You said about you've got to make it easier for your buyer. Treat them like the prospects. How does that uh, work to engage them, enable um, them to buy?

Speaker B: So it'll start off sounding a little bit cliche, but, but we, we do need to partner with these individuals. Okay. And what I mean by that though is that it's to say, it's to really put ourselves where they're sitting and to say, okay, in the past, how, how have deals like this gone through? Who, who else is involved in this? What is it that they need to see? And, and people often don't have the right answers to that because they don't know. Uh, so what salespeople need to do is actually behave as almost like coaches to be able to help kind of be like, okay, well in my experience this is another obstacle that could come up from the finance team. Would you, would you Expect that if that's the case, what's the messaging that I can help you with? Uh, and one of the other bits of advice that I give to people is, you know, learn to speak multiple languages.

Speaker A: Ah.

Speaker B: And what I mean by that is you've got to speak the language of finance, you've got to speak the language of compliance, you've got to speak the language of tech, you know, depending on what you're selling. But the point being is that your key champion, your key buyer, has one language, but they are trying to navigate other languages as well. So if you can be fluent in those different languages, that puts you in a way to be able to really help them more effectively.

Speaker A: And often you have the better perspective, as in a supplier, uh, in order to speak those multiple languages because you're supplying to the tech department the CFO in different other companies. So if you haven't got that, if you're not able to write the email for your buyer that's going to be passed through in their own organ, uh, the buyer's organization, so that the CFO or the CIO or whoever that customer, the stakeholder might be understands. If you can't write it as, as a sales rep, then you really shouldn't be in that deal. And that's how I think that you, as a good way of testing those multiple languages. And what it actually means is, can you take that pitch and write it for a cfo? Can you take it, can you write it for the cio, can you write it for the C, so that you really what they're looking for? Because it doesn't really change vastly a cfo, you know, across companies are looking for particular things in order to get the deal through.

Speaker B: I'll give you an example. Uh, I'm working with this company. They do, uh, it's a, it's a solar energy play. Oftentimes they're selling to, um, businesses, but also governments. And what they traditionally do is they sell into the environmental sustainability groups. But the reality is that a lot of those groups don't actually have that much power. It ultimately goes to the C level decision makers, CEO, cfo. And the message to the sustainability people is, lo and behold, sustainability. Great. Everybody's, everybody agrees it's all great, but when you start using that messaging to other groups, it just bounces off. It just doesn't have the same impact. And we've been going through this exercise over the last few months, especially with the situations that are happening in the Middle east and the other parts of the world rising Energy prices. This isn't about energy sustainability. This is about energy security. And that word change in this example has changed everything because now we've got the CEO's attention.

Speaker A: Yeah.

Speaker B: Now she wants to be in this meeting. Right, the sustainability stuff. Uh, no, you know, you can, I, I'm a big fan, but some people just, it, it doesn't, it just gets pushed off to the side. Energy security, that's front and center. And so it's just one example of how you change your, you, you've got to speak the language that you need to. You know that for who you're in front of.

Speaker A: Yeah, yeah, absolutely. Okay. So Kyle, for the CEO, uh, and revenue leaders that are, uh, listening, what is uh, one of the priorities that separates those who will be winning in 2026, 7, 8 and beyond for those that won't.

Speaker B: So I, we, we have to, it's 2026 today. We have to talk about AI. We have to. I think it's come up a couple times already. It's just, it's, it's obligatory at this point. Um, if you, it's about finding the right balance of AI. So we can't be rushing into this stuff, especially when it comes to the sales teams. We've, we've already alluded to this, uh, in the conversation today. Often what I'm seeing more often than not is that AI is being used in revenue generating teams to amplify problems that are already causing issues. So things that are already broken, uh, I'm getting pitches that are clearly AI generated. I'm, I'm in buying mode. I think I said for a couple of different things. I'm looking at software. I'm actually buying a car this week. I'm looking to buy a new house. Uh, the, the buyer's process has changed. So my advice to a CEO would be to go through the process, put your. Spend a day, if not more as, as your buyer today. Because I think that that journey has changed over the last few years and uh, if possible, listen to what your salespeople are saying because it might be outdated, it might not be landing anymore. And I'm just, more often than not I'm seeing just meetings and efforts. These are not. Salespeople are not bad. They just need the right type of help. So that, that's what I'm seeing out in the market across industry right now.

Speaker A: Yeah. That's interesting. Yeah. Yeah. So before we go, um, Carl, you mentioned Brenny Brown. Tell me, ah, about why she influences you.

Speaker B: Yeah, you would ask that. I think you would ask the question before we, um, we went online, uh, just as somebody. It was just an example that came up. Uh, and this is actually a Covid example. Um, she was on Spotify and I, you know, she's, she's the, uh, she does, she does, um, behavioral, uh, research. And uh, I've always liked her work. I think she's very thoughtful. I think she's a legitimate researcher. She's not making stuff up like some of the other big names that are out there. So I've always had time for her, um, covet hits. And there was a big controversy. There was one of the big podcasters who was platforming anti vax people and, and there was some false information or there was accusations going around. It was very messy, it was very noisy. And a lot of, uh, top people, top artists were pulling their, their records, their, their recordings off of Spotify in protest. And Renee Brown didn't. And she gave, I thought, a very thoughtful reason, which was, I'm seeing this trend, I'm seeing this happens. I, you know, I think that this misinformation is, is damaging. No question. Before I do make a big change like this, I want to do a little bit additional research and really think about this carefully. And, and I'm, I am doing a terrible injustice to the way she phrased this, because she phrased this much better. It was much more articulate than this. Uh, and, and she, I don't believe she ever pulled her stuff. And I think almost all of the artists that pulled their stuff quietly just crept back in. You can get all their stuff now. Right? And so while they come across looking kind of inconsistent, I thought she came across being just thoughtful, grounded, and having sort of a, uh, process to be able to handle uncertainty. So because we talk about risk, we talk about uncertainty. Her name came to mind, not necessarily from her research, but for her actual actions. So that was just one case study that I thought was pretty, Pretty interesting.

Speaker A: Yeah, I think that's interesting because, you know, actions do speak louder than words, even when we're talking about CEOs or where they're talking about, um, sales and their relationships. And relationships is so important in, in sales. And you know, buyers don't believe what you say, but they do believe what you do and how you behave. And I think it's, it's really important for us to, to remember that. So, uh, Kyle, how can listeners get hold of you and get the book Salespunk?

Speaker B: Um, I'm, My only social media is, is LinkedIn. I've got a newsletter on that. That would be a good one to to follow. So look me up Kyle Hegarty. Or uh, there's another story there I've got my handle is Slapdragons, which was from my first book. So that's, that's for another podcast. Um, but so look me up on LinkedIn. My website is leadershipnomad.com and the book should be found anywhere on Amazon or any of the other online stores. Certainly to be able to do that.

Speaker A: Well, thank you for the discussion. It's um, been really insightful and I think we're aligned on so many levels, Carl. So thank you for being a guest on Scale Yourselves podcast.

Speaker B: Thank you so much.

Speaker A: If this conversation has given you food for thought, hit subscribe so the next one finds you. Twice a month I bring on CEOs and operators genuinely moving the needle on revenue. Not theory, not fluff. Drop your biggest takeaway in the comments below. I read everyone. Um, until next time, keep scaling your sales.