Sales Management
A sales manager at the helm of a sales team has theresponsibility not only to manage the definition and implementation ofeffective sales processes but must also provide the leadership and coaching hisor her sales team requires to effectively utilize the sales processes toachieve and exceed their goals. This blend of strategic and tactical skills isnot easy to achieve. Sales Managers often are more comfortable with one aspectof their sales process leaving them to neglect others. That is human nature.
Being aware of the five classic pitfalls nearly all salesmanagers experience at one time or another will help you avoid unnecessarysetbacks and smooth your path to sales growth.
1. Protecting the Status Quo
As important as a sales process is, a slavish adherence to thestatus quo is the first step on the road to failure. Generally, as a sales teamis developing, a great deal of attention is focused on creating the structurefor sales activity and sales growth. Managers make the mistake of assuming thatonce their sales process is in place that they can solely focus their effortson tactical sales management. The problem is that elements of your salesprocess may not be a perfect match for your target market or for theindividuals you have on your sales team. As a sales manager you must payconstant attention to your sales process to ensure that it is always supportingand not impeding, your sales efforts and take immediate steps to revitalize itwhen it has become outdated or stale.
2. Losing the Urgency
A second pitfall sales managers have to confront is losing theirsense of urgency. This is not to say they become complacent. Rather they don’tact and manage with the requisite responsiveness. Prospects and customers havequestions and want answers in Zero-Time in order to make informed purchasedecisions in the shortest time possible. Neglecting to reinforce this urgencywithin your sales process and your sales team will inevitably lead to adecrease in responsiveness and, ultimately, orders. In sales, everything isurgent or needs to be. As a sales manager, if you aren't maintaining thisattitude of immediacy in all that you do, you risk failure.
3. Failing to Measure
Neglecting to establish metrics for key processes andoverlooking the necessity of regularly measuring how the processes areperforming is a common oversight that negatively affects sales productivity. Asales process is not an abstract concept but a discrete set of required stepsto achieve a certain goal within a certain period of time. As a sales manageryou must continuously measure the outcomes of your core sales processes andtake the necessary steps to refine them and make them even more productive.
4. Providing Incomplete Training
Sales managers often fall into the habit of providing limitedtraining for their sales team. They focus on isolated skills and producttraining to the exclusion of integrated sales training that teaches how todeploy their skills and knowledge within their sales processes to win customerorders. Sales people have to be trained on their processes as deeply as ontheir sales skills and product knowledge. Ignoring this training is akin toputting 11 football players on the playing field and telling them to justimprovise plays and do whatever they please.
5. Swimming with Minnows
Too many sales managers keep chronically underperforming salespeople onboard well past their expiration date. You don’t want to keep swimmingwith minnows when you need to be cruising with orcas to make your numbers. Ifyou have salespeople who aren’t suited to sell your product or service thenevery minute you keep them is a minute too long. It is a myth that goodsalespeople can sell anything. To ensure the growth of your company,salespeople must have experience and skills that will enable them to becompletely responsive to the information requirements of their prospects inZero-Time. If they don’t, they must go. Period.
It has never been easy to be a sales manager. However, if youcan avoid these common missteps then you, your team, and your company will allbenefit.
Before You Can "Fix" Your Sales, Master The Fundamentals
In the hierarchy of things that you can do to improve your salesperformance, there are both simple and complex solutions. Depending on yourcompany's particular situation, both the simple and the complex solution couldprovide value to your organization. They are not mutually exclusive. Thequestion is: what should you do first?
The difficulty with sales problems is that they can be hard todiagnose and solve. There are lots of interlocking pieces to the sales puzzle,and the temptation is to assume that hard problems require complex andexpensive solutions. Therefore, depending on your company’s size and resources,this could mean that your most pressing sales problem doesn’t get addressedbecause there is no budget or that a large investment is made to implement anew selling process and train your entire sales force how to sell to thatmodel.
My experience has shown that a company with ample resources willtypically default to the complex solution because CEOs and sales managers makethe often faulty assumption that the simple solutions are already in place. Acompany with more limited resources will also tend to overlook the simplesolutions to their sales problems because they have been conditioned to believethat the only answer to a hard problem costs money. If they search online theywill find a parade of reputable sales training and consulting firms promotingselling systems that promise to fix their sales problems. But those approachesoften require a substantial investment of money over a substantial period oftime.
However, irrespective of company size, if management were toinvestigate and do a little digging they will usually find that the fundamentaldisciplines every company needs to flawlessly execute their sales plan, andthat they believed were in place, have either faded due to managementinattention or never existed to begin with. They assumed that all sales leadswere promptly being followed up. They assumed that all salespeople were beingresponsive to their prospects and customers in zero-time with the informationand answers to the questions they need to move forward in the buying process.They assumed that customers were receiving the level of unconditional supportrequired to turn them into loyal repeat customers. They assumed that theirfrontline salespeople knew their products inside and out, or at least betterthan their customers did. Well, we all know what happens when you assume.
As with any investment, the dollars invested in new sellingsystems and sales training involve a certain element of risk. You can’tprecisely predict the outcome although the potential payoff of improved salesproductivity, over an extended period of time, can be large as well. So,imagine a company’s surprise when, after they have invested in an expensive newselling system. modified their sales model and re-trained their entire salesteam, they determine that they are experiencing the same sales problems asbefore.
The fault doesn’t lie with the new selling system. The problemis that the company is trying to build a new sales house on a shaky foundation.The biggest return on the dollars you invest in your sales team will come fromensuring that you are mastering the fundamental sales disciplines ( andincorporating those into your daily routines. Before you embark on an upgradeprogram do the simple things first. Then take the next step to renovate andupgrade your sales house.
What's Your #1 Priority?
If you're a sales manager and your number one priority each andevery day is something other than coaching the individuals on your sales teamto improve their sales productivity then what are you doing? Whatever it is,put it on hold and take care of your priorities.
The term coaching is in vogue these days. Much has been writtenabout the importance of sales managers becoming coaches for their team. Studieshave been cited that claim that it is the single most important thing you cando. A commonly cited statistic is that a 19% improvement in sales productivityis to be expected with effective coaching. To which my response is anold-fashioned "Duh."
The fact is that coaching is nothing more than disciplined salesmanagement. There is no distinction between the two. I attended a conferencerecently where consultants talked about how they were hired to coach front linesales reps in companies with sales managers in place. The claim was that salesmanagers had too many other responsibilities and no time to coach their directreports. I don't buy it.
If you're a CEO, there should only be two reasons why a 3rdparty consultant should be providing coaching to your frontline sales team:
1. Your sales managers are inexperienced and don't know how toeffectively coach. That is okay. New sales managers need to be trained. Theydon't arrive in their first sales management assignment fully formed and readyto effectively function as a manager any more than newborn babies are bornready to memorize and recite Shakespeare. But, if this is the case, then trainyour sales managers. If can't do it yourself, then hire that consultant tocoach your manager, but never your sales team. Teach your managers how to beeffective sales coaches. And, if they are unable to do that then...
2. Your sales managers are in the wrong job. You need to findsomeone new who is capable of performing the hard work that comes with being aneffective sales manager.
What should a sales manager do to be an effective coach?
A. Make certain that each member ofyour team fully understands the playbook.
In this instance the playbook means the sales team is thoroughlytrained to know the answers to the "what" and "how"questions. What are they selling and how are they selling it? Sales reps needtraining in the sales processes you use as much as in the products you sell.
B. Work with each member of yourthe team to develop an individualized sales plan.
The sales plan is simply composed of the objectives, strategiesand tactics that the individual sales rep is going to employ to achieve theirassigned goals. People gravitate towards sales as a career because it givesthem a sense of being in control of their own destiny. But they aren't going tofind their destiny without a road map. The effective coach makes sure theirreps understand what each day, week and month holds in store.
C. Set expectations not only byyour words, but also by your actions.
This is not about achieving the number but about the process andwhat it takes to mold someone into a high-functioning, self-sufficientsalesperson. Sales is a craft. Learning how to successfully do it is anapprenticeship. The most successful salespeople I know learned their trade bywatching their managers at work and integrating the skills and techniques theyobserved into their own daily selling routines. An effective coach has to beable to demonstrate the skills they are teaching.
D. Get down into the nitty-gritty.
This means conducting regular detailed reviews of every dealyour reps are working, supplying the strategic and tactical coaching to movedeals along, as well as providing the wisdom, guidance and counsel a rep needsto motivate them to persevere when the going gets tough. It means understandingthe details of your teams' deal so you can provide day-to-day guidance toensure that opportunities are continuing to move forward.
E. Develop a strong level of trustwith your team members.
How does that trust get established? By being openly invested ineach rep's success to the same degree that they are. This is a tough standardfor sales managers to meet. But the great sales managers are all able to makeit happen. Read interviews with players from great sports teams that have wonchampionships and the common attribute they cite for their success is thehigh-level of trust that the teammates had in each other. In short, they hadeach other's back. Have your team's back.
My first sales manager was Ray. Ray was the most no-nonsensemanager I have ever encountered. (My hiring interview with Ray lasted 2 minutesand he said all of 12 words. But that is a story for another day.) It wasprimarily through his coaching that how I first learned how to sell (and be asales manager.) Everyday we sat down and reviewed each of the deals I wasworking on. He taught me how important it was to not waste a minute, hour or aday if I was stuck on a deal and needed advice to see what I needed to do next.I remember coming into the office one morning when I was in the midst of amonth-long sales slump and Ray was standing by his desk with his jacket on andcar keys to his big red Oldsmobile jangling in his hand. "C'mon," hesaid. Let's go make some calls." We'd spend the morning talking toprospects. Sometimes I'd take the lead and sometimes Ray would take the lead.But I would always come back from those calls smarter about selling andmotivated to knock it out of the park.
Being an effective coach means nurturing the success of thepeople who work for you. At the end of the day, that is the highest success asales manager can achieve. If you're a sales manager, and you're not coaching,what the heck are you doing?
Surplus is at the Root of Discounting.
It is easy to blame the salespeople for rampant discounting butit has always been my experience that the primary responsibility forover-zealous discounting and the resulting price and margin erosion rests withmanagement.
When a manager has a surplus, whether of inventory or ofsalespeople not hitting their numbers (meaning that he or she isn't hittingtheir number either), they look for a solution in the form of a discount.Approach the end of the month or quarter with too much inventory on the shelvesor too many people not hitting their quota, and the first thing many managersdo is authorize their salespeople to offer a discount to a customer to win anorder and move some product.
All parties involved in a sales transaction, buyer and seller,are familiar with this cause and effect scenario. Salespeople wait for it.Customers wait for it. It is not an accident that the trajectory of ordersduring a quarter traces the familiar hockey stick shape. Everyone is familiarwith the rules and is in on the game.
The problem with this end of period discounting is that these"one-time" discounts have a tendency to morph into the new defaultprice point for your customer. If you're handing out discounts at the end of aquarter to induce customers to close an order or accelerate a delivery, thenyour next order from that customer is going to be at the new price point youestablished with the discount. Balk at that and you'll find that all yourorders from customers will start to materialize around the end of your accountingperiods.
Surplus is also a key factor in discounting conducted bysalespeople. It occurs because salespeople oversell their product or service,in effect offering more features than what the prospect needs to meet theirneeds. This overselling occurs when salespeople are not adept at preciselyqualifying their prospect's exact requirements. A salesperson can't sell valueif they don't understand the problem the customer is trying to solve. As aconsequence, they tend to sell the entire feature set of their product orservice in the hope of encompassing the prospect's needs in the process.
When a salesperson's offer exceeds the needs of the customerthey are left with the choice of reducing either the scope of their offer ortheir price in an attempt to win the order. Offering surplus features that arewithout value to the customer almost always leads to a discount.
As a manager, to effectively address this discounting problemyou need to develop a plan to reduce the surplus factors in your selling. First,the answer for salespeople who oversell is ongoing in-depth product training.Learning to sell value is next to impossible without a true understanding ofyour product or service. A rule of thumb is that a salesperson can'teffectively sell value if they don't understand their product better than theprospect. Does your training accomplish that?
The second surplus factor to manage is the end-of-quarterdiscounting syndrome. This is a hard habit for management to break.Unfortunately going cold-turkey is the only effective method to curtail thepractice. It could take one or twochallenging quarters to flush the temptation out of your system and re-trainyour salespeople, prospects and customers. However, you will learn whichcustomers are buying your product for the value versus the discount. These arethe customers to focus on in the future.
There is a lot of talking and blogging going on about coldcalling and whether it is a necessary or even desired part of the sales mix. Ican't resist putting in my two cents on this discussion.
I have recently seen a couple of studies and listened to somepresentations about the changes taking place in how sellers and buyers areinteracting that are worth considering as we leap into the fray. In general,the trends discussed are reflected in the 2010 DemandGenand Genius.com study titled "Inside the Mind ofthe B2B Buyer."One of their key findings was that more than 80% of B2Bcustomers/buyers said that on their transactions that they had initiatedcontact with the seller. Only 10% said that they were contacted cold by theseller.
Personally I'm not convinced that the 80%, is an accuratereflection of the sales situation today. But that is really beside the point.The key takeaway is that it is an indicator of how your customer's perceptionof the role of sellers has changed and how the actual role of sales iscontinuing to evolve at a rapid pace. The Internet and social media haveirrevocably transformed how conversations with some significant fraction ofyour prospects are initiated. And, even if you, as a seller, initiate contactwith a prospect, chances are high they are going to possess some level ofpre-education and pre-qualification on your product and service on that firstcall (or they are going to acquire it by browsing your website while on thephone with you.)
What does this mean for cold calling? In an ideal world, coldcalling wouldn't be necessary. In our fantasy, marketing departments wouldprove capable of generating well-targeted (or "sales worthy" toborrow a term from my friend Nancy Nardin) in-bound sales leads in suchlarge quantities, week after week, month after month, that all available salestime would be consumed with responsive follow-up. Wouldn't it be great if theworld were handed to you on a silver platter like that?
Unfortunately, that dreamy ideal world doesn't exist for mostcompanies. Using the figure from above as an example, even if you meet 80% ofyour sales goal today from prospects that originated as sales worthy in-boundsales leads, where will you find the remaining 20%? You will find them fromproactive prospecting (i.e., cold calling.)
If you're in Sales your job boils down to this: doing the hardwork required to meet your goals. Whenever there is a gap between in yourpipeline between the number of qualified prospect your need to meet reliablymeet your goal and the number of qualified prospects in your pipeline generatedfrom in-bound sales lead conversions, and there will almost always be one, ithas to be filled in by prospect activity generated by you. This meansfulfilling your responsibility as a salesperson to do what you have to do inorder to meet and exceed your assigned goal. If this means spending a portionof every day following a disciplined prospecting process (i.e., doing someresearch to pick targets, making connections online, getting on the phone orgoing out and making calls) then that is what has to be done.
In my first professional sales job out of college, in thepre-Internet dark ages, I was selling big computers. Everyday involved gettingkicked out of the office at 8am and venturing out to make cold calls out in myterritory. I have to admit it didn't come naturally to me. So I developedanother approach. I hit upon a system of hosting a seminar in our branch officeevery Wednesday afternoon at 4pm during which I would demonstrate our system. Iused business directories to research names of potential prospects in myterritory and mailed out 10 postcards with a hand-written invitation everyThursday. I'd follow up with everyone on the following Monday morning and againon the morning of the seminar. Usually I'd end up with one or two attendeeseach week. Within months I had a strong, constantly renewing pipeline and waskilling my numbers. After a couple years, I was getting two thirds of mybusiness from existing accounts and referrals. But every Thursday, I was stillsending out 10 postcards and every Wednesday I was playing host to newprospects.
No matter how many leads you receive, cold calling, or proactiveprospecting, remains a necessity for most salespeople and most sales teams.Clearly the amount of time a salesperson has to devote to cold calling couldshrink as increasing numbers of prospects pre-educate themselves online andinitiate connections with potential vendors. But the role sales prospectingplays in building a strong pipeline of qualified prospects to ensure that youmake your numbers is will never go away completely.
Sometimes you just gotta do what you gotta do.
I read a blog posting recently about what a salesperson could doto increase sales. The title was something catchy like "A Billion and One Tips to Increase Sales." It was hardto argue with the premise of the post. Everyone in sales can use good advice onincreasing sales. It's the reason I continue to read everything I can aboutsales. There is always something new to learn.
In this case, this author's useful quick tips were all aboutcreating more sales activity. He was asking the question 'What should you do ifyou have prospects but they aren't moving forward fast enough?' and providinganswers that were designed to create a flurry of sales activity aroundprospects to stimulate them to engage and move forward with the seller.
But is selling the same as sales activity? And, if a prospect isnot yet fully committed to the buying process, is random sales activity the wayto get them engaged?
Nothing is sometimes better than something
I had a salesperson, named Arte, working for me once who hadconfused activity with selling. He came into my office one day and told me thathe had invented his own method of selling that he called SWARM. The acronymstood for Surround With Activity to Regain Momentum. His thought was to envelophis prospects in a constant swarm of sales activities such as of phone calls,visits, emails, voice messages, invitations to webinars and seminars, productdemonstrations in the hope that eventually something would stick and theprospect would relent and engage.
How'd that work for Arte? Not so well. But he got high marks forcreativity.
Unfortunately, similar to Arte, many salespeople fall into thetrap of believing that doing something, anything, with a prospect is betterthan doing nothing. This happens all the time when the prospect has gone radiosilent. There are lots of reasons why this occurs and it is the job of thesalesperson to determine the answer and respond appropriately and with contentthat has value for the prospect. But rarely is the correct response to bombardthe prospect with trivial, time-wasting requests and interactions.
Keep in mind the customer's objective
In a sales situation, or buying situation, it is important tokeep in mind that the goal of the customer is to gather the information or datathey need to make an informed purchase decision with the least investment oftheir time possible. This is not to say that customers won’t spend theappropriate time to purchase a product or service. This just means that theywon’t spend a minute more than they have to.
Create and deliver value each time you talk to your prospects and customers
If you are selling you should only be taking actions with acustomer that have a defined purpose, deliver clear value and support thecustomer's goal. To that end, instead of unthinkingly reaching out to thecustomer and demanding some of his or her time with a trivial request, considerthe opposite approach: make sure that every interaction you have with aprospect or customer achieves Maximum Impact in the Least Time (MILT) possible.It requires planning and thought to make certain that each time you interactwith the prospect or customer you are providing information that will bringthem closer to their goal of making an informed decision. But the result isthat you will bring value to the customer through your selling. If you want acustomer to engage, create value for them by your actions. Wasting theirlimited time with "sales activities" does the opposite.
Selling has a purpose. It is not the goal of your prospects orcustomers to spend time with you. In fact, the opposite is true. They want toaccomplish their job, which is to buy a product or service, while spending aslittle time with the salesperson as possible. The winning salesperson willusually be the one who knows how to make that happen.
Which is more important in selling: Process or selling skills?
This is one of the classic debates about sales and selling. Itis very similar to the 'nature vs. nurture' debates that young adultswithout kids and too much time on their hands indulge in. (Anyone with kidsquickly learns the answer to this...) The answer is that both process and skill are required to succeed insales. However, process provides the platform for skills to flourish.
What Would Michael Do?
Take the case of an elite athlete like Michael Phelps, the worldchampion swimmer. Michael Phelps trains like a demon, spending hours face downin a pool every day, to showcase his skills on the world's biggest stage, theOlympics. He won an unprecedented 8 gold medals in swimming at the BeijingGames in 2008. There is no doubting his obvious skills. Having conquered theworld once, the question was would he return to the London games in 2012 andtry again?
In preparation for the Beijing Olympics, Michael followed thetraining regimen put together by his coach, Bob Bowman. It was a process thatfocused on the quality of the daily work Michael did in preparation forcompetition. Every workout he swam and the details of how he performed in thatworkout, every weightlifting session, every cross-training session weremeticulously recorded, tracked and analyzed. Bowman and Phelps knew that themost accurate predictor of how Michael would perform in the big competitionswas the data collected about his daily training process over the previousmonths and years.
The Day-to-Day Process
This is similar to selling. How you execute your sales processon a day-to-day basis will be the most accurate predictor of whether you willwin orders and meet your objectives. An effective and disciplined sales processcan do for you what it does for Michael Phelps. If you work hard, it will putyou in a position to compete for and win orders. It is how well you execute thebasic sales activities that comprise the steps of your process, and how often,that will ultimately lead to the order.
As he began his preparations for the London OlympicsPhelps strayed from the process that had led him to the podium eight times inBeijing. And, with all the skills in the world, his results in competitionsuffered. He was losing to swimmers that previously couldn't compare to him.What did he do? He redoubled his commitment to the process laid out by hiscoach. He might have rebelled against the process but he returned to it becausehe knew that if he invested his hard work into it results would follow.
Listen to Michael Phelps being interviewed after a competitiontoday and he defaults to talking about his process. The race result might nowhave been a first place finish but he will talk about how well his training isgoing instead. His focus is on how is he performing each day in each step ofhis training process. He knows that if he executes his process he'll puthimself in the position to achieve the results he expects.
In the same way sales process can provide a much clearersnapshot of potential sales than simply looking at your pipeline of prospects.Well-defined sales processes provide a method to continually assess and measurethe underlying sales activities that will lead to orders. Using metrics tocontinually measure and fine-tune sales processes, just as Bob Bowman did withPhelps' training regimen, leads to improved outcomes for salespeople of allskill levels.
Your Process Enhances Your Skills
I had a client where one of the more senior salespeople, agrizzled sales professional, Ollie, was determined to resist management'sefforts to implement some fundamental and essential sales processes to respondto a changing sales environment. Ollie had always managed his sales territoryhis own way and while he possessed great sales skills and experience he wasfloundering. He found himself at odds with evolving prospect and customerexpectations for salespeople in terms of responsiveness, follow-up, contentdelivery and service.
The processes that Ollie's management implemented saved hissales career by requiring Ollie to become more responsive, more proactive andtimely in follow-up, more knowledgeable of the products he sold, more consciousof eliminating time-wasting sales calls and making every customer interactionachieve the maximum impact in the least time possible in order to compressbuying cycles.
This does not mean that a salesperson should ignore the skillcomponents of selling. We should always be working to improve our sales skillsno matter how much experience we have. But sales skills need to be utilized insupport of defined sales process to create the most value for the customer. Andthe salesperson.
Why are your sales so slow? I'm not referring to your orderrate. I am talking about the activities and processes that have to be happeningin Zero-Time in order for you to achieve your sales goals. One thing leads toanother and if you are running in place in February, you'll be running to catchup by March and hopelessly behind by June.
Here we are, still near the beginning of a new year, when hopesfor the next twelve months should be running high. And your selling effortsfeel like they are stuck in the thick mud. Just like they were last year. Thisis not the way to kick off what should be your most successful sales year ever.
Everyone has a reason or an excuse for slow selling. Believe me,we have all been in a situation where you question your sales manager about whyit is taking so long to move a customer along in their buying cycle, and theydon't have an answer that makes sense. Or any answer at all.
I ask all my new clients to identify the reason, or reasons, whythey are not growing, why their sales efforts are stuck in neutral. Theresponses I receive are typically all of a piece. As CEOs they can identify thesymptoms but not the causes of the problem. But as CEOs and sales managers ofSMBs you can't be a doctor who can only diagnose the symptoms of the illnesswithout prescribing a cure.
I group the symptoms of sales lethargy into the S-L-O-W acronym.
S is for Status Quo.
Too many companies are just coasting along. The CEOs are notreally satisfied with their results but they are too worried about making anychanges that could rock the boat and potentially jeopardize the sales they domanage to capture. Maintaining the status quo is not a way to thrive.
"Status Quo is ancientGreek for 'slow death.'"
Folks, say hi to Milt again. (To learn more about Milt, checkout my book, Zero-Time Selling,or this previous blog post. )
"Hey."
Actually, Milt, Status Quo is not Greek. It is Latin for "thecurrent state of affairs." But when an SMB's sales are stuck, maintainingthe status quo is the same as slowly dying.
"As I said."
L is for Lack of Urgency.
In today's economy you can't expect the customer to operate onyour schedule. The timeframe for every sales action has to be immediate.Customers do a lot of online research on your product before they ever call youand when they do they are single-mindedly looking for answers to theirquestions. The first seller with the complete answers wins.
O is for Outdated sales practices.
Unfortunately many SMBs still operate their sales teams like itis 1912 not 2012. Their only concessions to the 21st century are a website andemail.
"What would you callmy pager?"
Google d-i-n-o-s-a-u-r.
Your customer and their buying behavior have been irrevocablyaltered by technology over the past 15-20 years. And if your sales practicesand sales methods haven't changed in concert with your customer then you can'texpect to effectively compete for their business against competitors who haveevolved.
"GoogleN-E-A-N-D-E-R-T-H-A-L?"
W is for Weak sales management.
I don't like to point fingers.
"But you will."
SLOW starts at the top.
Even a highly self-motivated sales person will find it hard tosucceed in company where the status quo rules, where everyone's motor revs at aslower idle and where the sales systems and processes were obsolete before theturn of the century. A successful sales culture begins and ends withmanagement. The CEO and sales management have to commit to change and urgency.
Make a change today to get your sales going!
Now, as you move further from the old sales year and deeper intothe new sales year, now is the time to evaluate what you can do to shake thingsup, to change the routines your sales team have followed year after year. Breaksome of your bad old habits and reach a level of sales success that you haven'tachieved before.
Here are THREE tips you can put to use today. These are notpermanent fixes. Or suggestions for how to comprehensively revamp your salesefforts. There are just small ideas you can put to use TODAY that can begin tomake a difference and break you out of the SLOW mold. It doesn't matter whichone you choose. Just choose one of the following steps and put it into play.
Make One Change Today.
Take a close look at your sales routines; your sales processes.Tell each of your salespeople to choose just one customer facing activity andchange it. Now. Don't just pay lip service to change. Do something about it.This is not a change that requires a committee to plan and implement. I'madvocating something much more simple than that. Just choose one aspect of yourday-to-day sales activity and change it. Simple.
Create a Metric.
Every aspect of your sales process is measurable. Do you havemetrics for each step of your selling process? Are you measuring how long ittakes to respond to your sales leads? Or how long it takes you to write a quoteand deliver it to a prospect or customer? Choose a single aspect of one salesprocess and assign a metric to it. Then measure it today and again tomorrow.
Be Accountable.
Tell someone about the change you made or the metric you'retracking. Tell a colleague that you have undertaken to make a change in yoursales routine. Tell your boss which part of your sales process you have begunto measure and what the goal is. When you tell someone else that you are makinga change they will be interested to learn if it is helping you. As a resultthey will ask you how it is going. And you will need to have an answer forthem. Being accountable for change is a big motivator.
Sales Territories: What are they good for?
Every time a client asks me about the best wayto set up sales territories I instantly hear that old Edwin Starr song pop intomy head. I substitute "territories" for the word "war,"which is a bit clumsy from a rhthym perspective, but I quickly get past thatand start singing "Territories, huh, Good God, y'all, what are they goodfor? Absolutely nothing, Say it again."
Do you still use sales territories? Do youstill assign your salespeople territories based on a geography or a certainaccount type? Really?
Here a three good reasons to get rid ofgeographic and account-based territories. (And, yes, I'll answer your questionabout what you should do instead below.)
Reason #1 is that assigned sales territoriesare holding you back. If you're a small business, this will be a familiarscenario. Sales are not growing as you would like. You have 5 salespeople. One,maybe two, of the salespeople have been with your company for a long time.Perhaps since the beginning. Together they are your most productive salespeoplein terms of the dollar volume of orders they bring in. Together they aremanaging the company's biggest accounts and bring in the lion's share of thebusiness.
Your other 3 salespeople are in spots thattend to turn over every year or so. The people in those positions constantlycomplain that they are unable to generate enough new business to meet thequotas that are assigned. As the manager you dismiss their complaints andassume that they are just not the right people for the job. So, you tend tochurn those sales positions in an effort to find more capable people to bringon board. You ask yourself: how can I grow the business if I only have twopeople who can bring in enough orders?
That leads us to reason #2: Assigned salesterritories turn your best new account salespeople into fat account managers. Ihad a client where the number one salesperson accounted for nearly 50% of thecompany's sales each year. He had been with the company almost from thebeginning. Along with the founder of the company he had been responsible forlanding almost all of their early customers, many of which were still orderingproduct from them. 10 years later he was still working those accounts andgrabbing up every lead that came in from them. The other 3 salespeoplestruggled mightily each year to meet their goals. The CEO kept telling me,"I need 3 more people like Jim." I said the real problem was Jim."What?" You have taken your most accomplished new account salesperson, the one who went out when you were just starting up and landed all thesebig accounts, and turned him into an account manager. Most of his job involvespicking up the phone and taking an order. Your best salesperson isn't doinganymore what he does better anyone else; developing new accounts.
The third reason to dump assigned salesterritories is that they encourage lazy sales behavior and increase salesturnover. Think back to Jim. When he first started selling for his company,when it was brand new, his charter was to go out and find business, no matterwhere it was. He was opportunistic and entrpreneurial. But he isn't anymore.And he has such a large percentage of the available accounts that he is workingbroadly with each account instead of deeply. He isn't getting the most out ofeach account. But his presence prevents anyone else from getting in the door.
Here are 3 simple fixes to permanently changethis situation. Not everyone will be happy at first, but in the long run itwill improve your overall sales.
1. At the end of each year, each salespersonhas to give up 30% of their accounts. At one client we set up a biddingprocess, almost like the expansion draft that the NFL holds when they haveexpansion teams joining the league. All the current teams have to designate 10players out of their roster of 45 that are available to be drafted by theexpansion teams. Each salesperson had to put 30% of their accounts into thepool. We put names in a hat and determined the order of people picking newaccounts. The only rule was you couldn't select one of your own accounts. Theyeach got N picks. All accounts that were leftover went back to their originalowner. An amazing thing happened. The veterans started to go out and developnew business. And they started working their accounts more effectively, goingdeeper and broader then they were able to before. The other salespeople didn'tpick up great accounts but they got accounts that had potential that hadn'tbeen well served by the other salespeople. They picked up some confidence andstarted doing a better job on new accounts.
2. If an existing account hasn't ordered, orbeen contacted, within the prior six month, then they become an open territory.At one client I introduced a rule to break up account monopolies that strangledoverall sales. I said that if you hadn't sold into an account within the priorsix months then any rep could call on them. You might think that chaos wouldensue but actually it was the opposite. The salesreps with all the establishedaccounts began to willingly shed those accounts that they couldn't service. Ofcourse, they weren't giving away their prime accounts. But they saw that unlessthey freed up the time to really focus on their big accounts they were at riskof losing them. I added a second change to the mix. If a lead, a sales inquiry,comes in from an existing account that had not been contacted by the assignedrep within the prior six months, then any sales person could take the lead.Sparks flew. But orders started growing as accounts started getting moreattention.
3. Allnew sales leads are available to any salesperson on a first come first servedbasis. Without fixed sales territories salespeople should be free to competefor leads. I believe that management should get out of the business ofassigning sales leads. I have never worked with a client where the CEO wasn'tshepherding what he or she thought were the high value leads to his topsalesperson. When this system is implemented a few interesting things happen.First, the salespeople who were hungry for leads had the opportunity to showthat they could perform. They showed up earlier in the office in order to gettheir choice of leads. That was healthy. Without a CEO directing leads to hisfavorites, it makes for equal opportunity among all salespeople. Those people who had been complaining about thelack of new leads might have had some justification. Under this system, theirexcuses were removed and they had to put up or shut up. Second, salespeople hadan incentive to stay on top of, and truly work, their existing accounts. Theycertainly didn't want a stray lead to come in from another division of anaccount that they were managing and have another salesperson scoop it up. Butmostly, the high performing salespeople largely got out of the business ofservicing new leads.
I got the idea for this system from my UncleBill. I remember visiting Bill and his family in Iowa when I was very young. MyAunt Martha was justly famous for her dark chocolate layer cake and on this onevisit after dessert was served there was one tempting slice of this deliciouscake remaining. All the kids around the table were eagerly eying the cake andeach other, gauging who was going to jump first. Finally I couldn't take it andI broke the silence and asked, "Who get's it? Who gets that last piece?"Uncle Bill slowly reached over and picked up the cake plate. While looking ateach of us kids in turn around the table, waiting for his decision, he leanedover and licked the top of the cake with his big tongue from one end to theother. "Me."
The idea behind all three of these solutionsis to ensure that your entire salesforce is engaged on an equal footing in thebusiness of selling. Everyone is given a fair shot to succeed. This works tothe distinct benefit of the company as you create an opportunity for everyonein sales to succeed to a greater degree. As long as you create an unevenplaying field you are dooming certain of your salespeople to failure. Why?