Across the years we have worked with many different clients in different industries, trying to solve a variety of their sales related challenges. Many of our clients state that they want to “improve sales effectiveness.” However, we have observed there are many variations to perceptions about what that means; improving a sales process, gaining traction on utilization of sales tools, sharpening-up recruiting, enhancing selling skills through coaching and development - You can take your pick. The bottom line goal, however, is usually always the same - improve growth or profitability, and preferably both.
What we always try to emphasize is that sales effectiveness does not revolve around one particular factor. Rather, it is a constellation of many factors that all need to be in alignment to truly optimize a sales force’s efforts. For example, you may have the best technology available, and your sales force uses it to great advantage – But if you have not sized your sales force to the market opportunity, or your territories/account assignments are off-kilter, you are leaving money on the table. Likewise, you may have a terrific sales process that has proven its merit, but the sales force’s alignment with your organization’s internal functions that support the process is broken – Internal employees don’t understand their roles, how they contribute, and what they need to do, so there are constant hiccups and fires to put out, which then result in reduced customer satisfaction, less sales, and more outcomes we never like to see.
It is difficult to harness the power of true sales effectiveness, and you need to constantly be monitoring if any of the key factors are slipping out of alignment (see our 10 Sales Effectiveness Drivers). It can pay just to go back to the basics to check how well you are aligned across the sales effectiveness constellation.
“True” sales effectiveness needs a foundation, and we recommend starting with clarification and communication of your sales strategy, so everyone knows what they are striving for. Key questions you should be able to answer include: Which markets and customer segments do we want to target? What is the competitive differentiation of our product or service, and is it well articulated and understood? What channels should we use? Once those and other fundamental questions are addressed, you need to look at how well the rest of your sales organization and processes support your objectives. These include multiple areas and can best be tested answering additional questions, a sample of which are included below:
Sales Organization and Roles:
- How many sales people are required to cover our target markets/customers given growth objectives?
- What is the optimal sales organizational structure and associated roles to reach our target customers?
- What kind of sales roles do we need? (Channel or distributor oriented, direct, inside sales, telesales, national accounts)
- What is a manageable span of control we can support that will not undermine our success?
Regarding roles - many of our clients run into issues around the clarity of sales roles – e.g., who a sales person should be calling on, products that should be prioritized, and what boundaries exist. What you want to avoid is a situation where sales people are stepping on each other’s toes, undercutting each other instead of the competitors, and other dysfunctional behavior.
Sales Territories and Territory/Account Management:
- Are the territories viable? I.e., can the sales person complete the necessary amount of calls to service and grow current customers, as well as prospect and close some new ones?
- Are the territories balanced, or are there wide discrepancies between sales people in terms of the volume they are supporting and the opportunity for growth?
- Is there a consistent approach to account management that leverages what has been proven to work for your particular industry and organization?
- Are best practices from your top performers being disseminated throughout the sales force?
Territories and account assignments should be evaluated formally at least once per year and every time you have turnover.
Compensation, Administrative Processes and Reporting:
- Have you selected performance measures that align with your stated strategic objectives? – e.g., high growth generally correlates to revenue as a key measure
- Is the compensation structure appropriate for the role – e.g., commission, quota/bonus, management objectives, with strong incentive to overachieve expectations?
- Do sales people receive regular customer/performance/data updates and personal appraisals?
- If quotas are set, are they realistic and achievable, and are they being communicated early in the year and used to help sales people plan for their success in a given fiscal year?
There are a number of potential pitfalls in this collection of factors, and again these are all intertwined – e.g., in a uniform, commission based plan, if your territories are all over the place revenue or gross profit wise, you will have a wide disparity in earnings opportunity, which can make it difficult to manage pay expectations, as well as recruit and develop sales talent.
Coaching, Training and Development:
- Are sales people regularly coached by their direct sales managers? (and in a somewhat uniform and effective manner?)
- Are new recruits going through a training period to ensure they hit the ground running in their new territory?
- Are more tenured sales people receiving helpful training to further their selling skills and develop within the organization if they have aspirations for other roles?
“True” sales effectiveness is about constant vigilance to make sure you don’t fall short in any of these areas. You may be able to turn in a fine performance with 70% of your engine power, but for excellent performance, you want to get as close as possible to 100%!