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Selling Power Magazine Article
“It’s exactly the right model, in our minds,” says Ecolab CEO and chairman Douglas M. Baker Jr., who worked in a variety of sales and marketing positions prior to joining the company 20 years ago. “At the simplest level, our salespeople are committing themselves to the customer and the customer’s results. They’re promising the customer that we are going to deliver results at a certain cost, and they are responsible for helping that customer realize those results. It’s a hybrid sales model, but it’s really quite natural for us.”
Ecolab’s sales-and-service force tracks back to the roots of the company. In the early 1920s, Merritt “M.J.” Osborn, a St. Paul, Minnesota-based salesman and entrepreneur in search of a product to sell, realized that when the carpets were cleaned in hotel rooms, the rooms had to remain unoccupied for up to two weeks. So he hired a chemist to create a product that could clean carpets overnight, called the product Absorbit, and formed a company named Economics Laboratory (renamed Ecolab in 1986) to sell it. Soon after, Osborn added a second product to the fledgling company’s portfolio: Soilax, a nonsudsing cleanser designed for mechanical dishwashers, which were becoming commonplace. Soilax’s success created a solid foundation for the company’s institutional business, which remains its mainstay today, accounting for 25 percent of Ecolab’s sales in the United States.
Soilax also provided the impetus for a growing emphasis on service. “People usually don’t go into restaurant management or become chefs because they love to clean. Dishwashing doesn’t capture the imagination of most restaurateurs,” explains Baker. “So the service we offer as experts in this area is very important to them. They want our help.”
This enduring reality meshed perfectly with Osborn’s view of the link between sales and service. His philosophy, according to an Ecolab history written for the company’s 75th anniversary: “Accept the customers’ problems as if they were your own.” Thus, from early on, Ecolab’s field sales force was responsible not only for selling the company’s products, but also for delivering and installing them, teaching customers how to use them, and ensuring that they were working properly on a continuing basis.
It has proven to be a highly successful model for Ecolab. From a sales staff of one – M.J. Osborn himself – the company’s sales-and-service force has grown to more than 14,000 associates worldwide. In 2008, it sold $6 billion in products and services globally. Ecolab currently operates in more than 160 countries and serves a wide variety of markets and industries ranging from restaurants, manufacturing plants, hospitals, and schools to cruise lines, commercial laundries, and car washes. The company is the global leader in cleaning, sanitizing, and food-safety and infection-prevention products and services.
The Right Strategy for a Sales-and-Service Force
The sales-and-service force has driven organic growth at Ecolab for close to 90 years. But like any sales model, the foundation of its success is its alignment with the company’s business portfolio and strategy.
Ecolab’s portfolio and strategy are now well tailored, but the tailoring has not always gone smoothly. In 1980, the company attempted to expand into environmental services by acquiring Apollo Technologies, a company that provided chemical systems to control emissions at coal-burning plants, but shut it down at a loss three years later. Over the years, Ecolab successfully developed a large portfolio of household cleansers and detergents, but it divested that business as the consumer packaged-goods sector became increasingly competitive and margins suffered. The company also dabbled in residential services, acquiring ChemLawn in 1987, but it sold that company, too, after its results foundered.
In 1990, however, Ecolab regained its strategic footing and began to reorganize around its core institutional business. “Ecolab’s core business and shareholder value would be best served if we concentrated on our institutional and industrial cleaning and sanitizing markets,” said then-CEO Sandy Grieve. “We decided that our future should be entirely in the cleaning and sanitizing business, where we began, where we are well positioned, and where the worldwide market potential is enormous.”
It was the right decision, and as Ecolab refocused its efforts, it also articulated a new strategy: “Circle the Customer – Circle the Globe.” It meant that the company would seek to continually expand its portfolio of related products and services for its existing customers, no matter where they did business around the world.
With a few adjustments (see Selling New Customers and Major Accounts), the company’s sales-and-service model proved to be an excellent fit with its new positioning. Combining service with sales requires that salespeople spend more time with existing customers – installing systems, checking to see if the customer’s equipment is working properly, training employees on proper and efficient procedures, auditing results, and solving new customer problems. The more time salespeople spend with customers, the more trust they build and customer needs they discover. As long as the company (continued on page 2)
– Theodore B. Kinni
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