The CEO’s Essential Customer Facing Role – Mace Security

Posted on January 14, 2011

CEOs aren’t in sales, but they have a critical role to play.  Dennis Raefield of Mace Security International (OTCQB: MACE) shows us that the proactive CEO is key in landing and retaining key customers.

Nobody can sell like the CEO. If you don’t believe me, here’s two high stakes, near-death experiences from Dennis Raefield, CEO of Mace Security International (OTCQB: MACE) that illustrate the power and prudence of the CEO going eyeball to eyeball with key customers.

The company Dennis founded and built, Omega Corporate Security, was one of many suppliers to Apple Computer in Cupertino. He assumed that his sales VP had been staying close to Apple, which was a young company at the time. When a multi-million dollar opportunity arose, however, Dennis’ firm was rebuffed, in large part because of the company’s poor attentiveness to Apple in the past. When told by Apple that the opportunity was going to three other bidders, who had stayed close to Apple all these years, all seemed lost. Dennis decided to go over the head of the buyer and managed to get a 30-minute Saturday appointment with his boss. He found a senior buyer who was openly hostile, and who was firing shots even before Dennis could get his laptop PC open. He even berated Dennis for bringing a PC to a meeting with Apple! Things were not getting better.

Having nothing to lose, Dennis stopped trying to make his sales presentation, and asked the buyer why he had even been invited down on a Saturday when there were three other proposals already on the table. Only then did the truth come out: None of the three proposals were even close to Apple’s budget. On the spot, Dennis innovated a very different solution that might solve the problem within Apple’s budget. By listening to the needs and issues of the customer, he closed a multi-million dollar deal that added 60% to his top line that next year.

Most CEOs have confidence that is palpable, that comes across the table. Prospects and customers appreciate this presence. But that confidence is also critical to staying cool under fire. It means upset customers can vent openly without panicking the CEO, which then leaves two executives in an ideal position to develop go-forward solutions. And while sales executives can and should be empowered to satisfy the customer, CEOs have the ultimate authority, and can salvage really difficult situations.

Another big factor that helps CEOs make such a powerful difference is that they are generalists, and often have the broadest overview of the business and the marketpl

ace. This gives them a unique capability to spot innovative solutions.

A few years later, Dennis’ firm was a security system subcontractor working on a Wells Fargo Bank

facility. His firm was on time and on budget, but overall, the construction project was out of control. At wit’s end, the executive at Wells froze all payments to everyone on the project until he got to the bottom of the problems, which were anticipated to take two to three months to resolve. Holding Omega’s money was equal to two months income and cash. On December 23rd, that prompted Dennis’ CFO to recommend filing for bankruptcy, given the size of the hole created in their working capital. But Dennis wasn’t ready to file. Instead, he demanded a meeting with the Wells Fargo executive, who granted it late on December 24th.

The meeting was held on Christmas Eve, in Wells Fargo’s offices, with the exec’s child on his lap. Everyone else was busy having drinks and exchanging gifts. Dennis explained the gravity of the situation for his firm, which had no effect, then shut up and started listening. He dug into the pain this executive was feeling. As he listened to the mess the project was in, a resolution developed in his mind. He agreed to personally act as the on-site project manager, five days a week at no additional cost, and to get things back on track—if only his payment would be released immediately. The men struck a deal, and Dennis’ company survived. Four months later, the grateful Wells executive—whose own job was secure again—let Dennis bid on another security project that was even bigger. His company’s performance on the first project helped Wells to choose him for the second.

There is no substitute for being face to face. I repeat, there is no substitute for being face to face. Trust is built most rapidly face to face. The amount of information exchanged between two humans when face to face is enormous, and little of it is in the words. When the stakes are high, face to face is the only option. Having a CEO pleading for the survival of his company in front of you and your child speaks volumes. The ability to tease out of the Wells Fargo executive his real problem came only because they were face to face.

Dennis’ actions in both situations also underscores that listening is the most powerful sales tool. This is true for all sales situations. But CEOs should be able to listen to business problems and understand them at a deeper level. CEOs understand business problems of all types. Dennis understood the problem from the customer’s side and solved it, asking in return for something that the executive could easily give (that one small sub-contractor be paid immediately).

At Mace Security, his current company, Dennis continues to keep a hand in key account activities, making sure each key decision maker knows and meets Dennis, so that when his presence is needed, a relationship already exists. Recently one of their larger buyers was challenged by her superiors about the value proposition that Mace represented. Because of the close communication, the buyer felt comfortable being transparent about the situation with Dennis, and worked collaboratively to better understand Mace’s value and how Mace stacked up against alternatives. Dennis’ team gave the customer the facts and tools to present the value proposition as it should be done, as if Mace was in the room with the upper management. The customer was saved, and the relationship continues to grow.

Playing the role of salesperson superhero sounds fun, but it’s always high risk. It’s much preferable to have a constant presence and involvement in critical relationships so that emergencies are avoided.

While CEOs aren’t typically in charge of the entire sales effort, they have a critical role to play. The best senior sales executives will deploy their CEO strategically to assist in landing and retaining critical customers. CEOs who find themselves distanced from big customers must take steps to increase face time and make their presence felt.