Three Strategies for the Sales Organizations of Fast Growth Companies
After working with countless fast growth companies in numerous industries, some obvious patterns have emerged as the senior leaders are trying to scale their sales organizations quickly. The issues typically appear in three specific areas: their choice in sales leadership, hiring standards for the salespeople, and how they coach and hold the salespeople accountable. These problems are often the underlying cause of inaccurate sales forecasts.
[wcm_restrict]1. Prepare the people before you promote. Many sales teams are made up of the combination of a handful of superstars: those in the middle who are floating along and those holding up the rear of the pack. We see companies take their top salesperson and make them a sales manager. The logic is amazingly similar. Let’s assume that they see “Debbie” as the top performer. The wisdom is that if they had 10 more “Debbies”, sales would never be a problem. So they promote Debbie with one mission: we see that she can do it, so Debbie should be able to get others to be top performers. What people don’t know is that the sales skills possessed by Debbie are not quickly and easily transferable to others on the team. Most importantly, Debbie was never formally trained on how to coach, mentor, motivate, recruit, and most importantly, hold people accountable without killing the team’s morale. So the team usually gains a lousy manager and loses a great salesperson. What is the alternative? Assess your people ahead of time and start to train the most promising talent well before they are promoted. This preserves the company culture and demonstrates the company’s commitment to personal growth. Often, hiring most of management talent from the outside can stress the company’s ability to maintain its culture and operate under a consistent set of values. Invest in your most promising talent. If you think that training them is expensive, try not training them and then having them stay a long time.
2. Define the hiring criteria and never compromise. This one is tricky. We see a lot of companies panic with an empty territory. They want to get the best possible candidate as fast as possible because they are afraid of losing revenue. If you take the time to carefully analyze the cost of a bad hire, it is staggering. Consider the cost of all the hours of interviewing, training, and coaching. Add in the salary and other sunk costs. Then take the opportunity costs of the lost sales if the hire was a poor producer and blowing good chances. We have seen companies that were only paying a base salary of $50k losing over $100k for a single bad hire. If they have four sales failures that cost them $400k, think of the gross sales that need to be made in order to cover that loss. It’s staggering. In most cases the companies are mathematically better off to wait for the perfect hire while a territory sits empty a little while longer. We know that about 7% of all salespeople are elite and another 22% are good. The rest are horrible and their best sales call is usually made on the hiring manager to get the job. Be patient.
3. Don’t attempt to fix conceptual problems with discipline. All salespeople have issues. They are either technical or conceptual in nature. If a rep does not know what to say, how to say it, or when to say it, then they have a conceptual problem. I will use money as an example when explaining this. Most reps either bring up the topic of money far too soon, or way too late in the sales process. For example, discussing the money before the emotional compelling reasons for buying your product have been established, leads to the salesperson having to typically negotiate in the end to close the deal. The prospect simply does not see the value and in a lot of cases, neither does the salesperson. Let’s look at money as a conceptual problem. Let’s assume the rep was told that it was impolite to talk about money as they were raised as a child. Then they will usually avoid the topic of money as long as possible, and at best, act very nervous when finally broaching the topic. This, in turn, sends unspoken signals to the buyer that the rep may lack the conviction that it’s in their best interest to pay that price for the product. Here is the key: the manager will never fix this issue with the conventional “PIP” workout plan or harsh threats. Instead, they need to coach and mentor the rep to adopt the proper belief system to sell better. This takes time, patience, and great coaching skills. So why do many sales managers default to discipline when a rep’s numbers are off? They were never trained on how to coach. They have probably never been assessed for their own hidden conceptual weaknesses. As a result, they are not even aware of their own conceptual weaknesses. So we are right back at full circle. Train your sales leaders on how to coach the most common conceptual weaknesses: money, emotional involvement, and need for approval, to name a few.
If at all possible, don’t allow the pressure of growth to force you to compromise your leadership choices, your sales hires, and how you drive improvement.[/wcm_restrict][wcm_nonmember]
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About the Author
Karl Scheible and Adam Boyd are co-authors of Succeed The Sandler Way: 14 Personal and Professional Breakthroughs, and experienced Sandler trainers who play important roles in Sandler’s worldwide organization and are recognized as business development experts specializing in executive sales training and sales productivity training.
For more information visit www.Sandler.com.
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