First of all, what is winning? Do you know what winning means to your board? Does the CEO and your peers leading their respective groups all agree on what winning means? Does winning mean increased market share, increased margins, or top line revenue growth? Here’s my definition from a sales perspective: Your sales division needs to make the assigned sales quota number…..not come close, not just keep margins healthy at the expense of top line growth, but MAKE or EXCEED the assigned sales quota, period. Teach your reps how to cross the finish line. This rises up from the individual sales rep to the region to the division to the company.
The assigned number typically comes from trend data. Makes sense right? Not neccessarily! Trend data represents historical performance. Historical performance may not have reached potential and simply building a curve based on past performance will lead to mediocrity. Trend data, although very important to have, will not do you justice if you are a newer, small or even mid size company who has not yet reached potential.
Sales leaders need to track various data points but the difference maker is when new opportunity is factored into forecast methodology. Forecast sales revenue based on opportunity and you’ll set a higher bar for your whole company to reach. This higher bar will test sales, marketing, finance, technology, customer service and operations. Of course sales reps will need reassurance there is good reason and new tools and resources to help them deliver the higher numbers.
When you can stretch your sales organization and the company supporting the effort, you are finding out how good you really are. Talent, resources, value proposition, product and process throughout the organization are hung out to dry and all the weaknesses start to show up. This is where leadership takes the bull by the horns and as necessity is the mother of invention, process, product improvements, sales optimization and productivity are improved to keep up. Action plans are built and executed on to find ways to get there.
These are some of the ingredients to develop a top-to-bottom winning culture throughout the organization. Asking reps to reach for the stars requires a whole lot of prep work to make the request reasonable. You must arm your team to succeed. You’ve certainly heard the expression expecting better results while doing the same things is insanity. Process improvements, lead generation, market segmentation, product improvements, pricing, new offering packages, relevant marketing programs and sales optimization including fair compensation plans that allow your reps to earn what they deserve will pave the way for sales breakthroughs.
Respect your reps, treat them like partners and solicit their advice and suggestions. Reps are on the front lines every single day. They’re the face of the company and have lots of valuable information that can be converted into companywide improvements. When your sales reps have a voice, are recognized for their efforts and successes and paid fairly, they feel like winners.
As you continue to build trust throughout your sales force, reps will have a bounce in their step and look forward to the challenge of setting new sales trends within their industry. When you’re the best you carry that badge with you every day and you will live up to it. Winning culture requires all out effort throughout the company. It starts with the CEO who needs to foster transparent relationships between all group leaders within the company. There’s no room for heroes to problem solve in a vacuum. If you have the green light to share your group’s weaknesses, the company can help solve the problem. This takes the right senior leadership. This is where many companies fail, as groups do not openly share issues but sit on problems in the hopes of fixing them before they’re discovered outside the dept. This is a formula for disaster. Regular monthly and quarterly operational reports should provide deep dive data and establish action plans to drive the necessary fixes.
Some tenets from wise and phenomenally successful people I’ve been lucky enough to work with:
“Always be trying and pilot testing new things”
“Keep doing new things but don’t get enamored with your ideas, it will probably change ”
“If we have the right people we can do this…if we don’t have the right people it won’t matter what we do”
“Know your business from the ground up”
“I have faith”
Create a winning culture based on trust, real data, collaborative effort and high expectations across the organization. The result will be a sales team that goes through brick walls for you.
Now watch your sales soar.
Wednesday, July 14, 2010
Wednesday, March 10, 2010
Are Sales Territories Essential?
While recently discussing sales strategy with Paul Ringuette, a colleague of mine from our Monster days, we analyzed the question of assigning hunter sales reps territories or directing them based on changing opportunity. Retention or "farmer" reps will typically be assigned accounts to retain and grow. What follows applies to new business acquisition or "hunter" reps:
There are definite pros and cons to the concept of assigned territory vs. working leads that produce the highest ROI regardless of territory. Assigned territories can provide geo based accountability to ensure coverage in the respective market. Someone is responsible for that geo and there is a micro universe of potential customer records for that territory that can be identified and tracked. Also, action plans can be created specifically to address market factors in certain geo based territories with someone specifically responsible for executing on those plans.
Territories can be geographical or vertical-based depending on the product or service offered. A geo based territory set up could make sense where product appeals uniformly to a large mass of customers across many industry groups, Verticals may be required if sweet spot industries to target are concentrated in few areas. Verticals also make sense when the selling process requries a unique approach for certain sweetspot industries.
Territories, however, can be cumbersome if reps are not easily directed to where the opportunity is. A sales manager with data intelligence can point the team in a different direction to get more sales conversion results if there were no territory limitations.
An alternative to territories: when you're trying to maiximize revenue by focusing your greatest asset (your sales force) on high value activities, one of the greatest levers to pull is sales optimization. Sales optimization, or efficiency, minimizes sales "dead" time and increases productivity per head. Calling on the wrong prospect records to connect on 1 out of 100 calls is pure insanity. If you had a way to use data captured through the CRM, your website and financials, to create analytic models, you could then score prospect records and leads based on success trends and "push" these high yielding customer prospects to your reps. Your reps' success ratios could then improve dramatically to say 1 out of 25 calls. Now that's greased lightning productivity boost multiplied by the number of reps you have! You might now even be able to afford adding more reps as the cost of sales and rep ramp time improve.
This is where the strategic method of using analytics for lead generation may require doing away with structured territories and instead pushing these highly scored prospects via CRM to your sales force. The main advantage of this method is your sales reps are calling on the most fruitful segment of prospects. In time, as more data is fed into the analytics algorythm, prospect scoring will become more and more accurate. Of course, accountability can still be measured using coverage data on the number of prospects contacted and the resulting conversion (success) ratios of respective reps compared to the companywide standard.
Another advantage to focusing reps in this manner is the flexibility to shift direction as market factors change. You can position your sales reps based on current conditions rather than be stuck with hard coded territories.
The difficulty with running this model is the need for superior operational process to keep the flow of prospects coming into the CRM's prospect pool to keep your reps busy. This will require business analysts and impeccable CRM management on a day-to-day basis, as well as, disciplined data capture by sales reps, Marketing and Finance.
Which model is best for your company? Comments and thoughts on this topic are welcome.
There are definite pros and cons to the concept of assigned territory vs. working leads that produce the highest ROI regardless of territory. Assigned territories can provide geo based accountability to ensure coverage in the respective market. Someone is responsible for that geo and there is a micro universe of potential customer records for that territory that can be identified and tracked. Also, action plans can be created specifically to address market factors in certain geo based territories with someone specifically responsible for executing on those plans.
Territories can be geographical or vertical-based depending on the product or service offered. A geo based territory set up could make sense where product appeals uniformly to a large mass of customers across many industry groups, Verticals may be required if sweet spot industries to target are concentrated in few areas. Verticals also make sense when the selling process requries a unique approach for certain sweetspot industries.
Territories, however, can be cumbersome if reps are not easily directed to where the opportunity is. A sales manager with data intelligence can point the team in a different direction to get more sales conversion results if there were no territory limitations.
An alternative to territories: when you're trying to maiximize revenue by focusing your greatest asset (your sales force) on high value activities, one of the greatest levers to pull is sales optimization. Sales optimization, or efficiency, minimizes sales "dead" time and increases productivity per head. Calling on the wrong prospect records to connect on 1 out of 100 calls is pure insanity. If you had a way to use data captured through the CRM, your website and financials, to create analytic models, you could then score prospect records and leads based on success trends and "push" these high yielding customer prospects to your reps. Your reps' success ratios could then improve dramatically to say 1 out of 25 calls. Now that's greased lightning productivity boost multiplied by the number of reps you have! You might now even be able to afford adding more reps as the cost of sales and rep ramp time improve.
This is where the strategic method of using analytics for lead generation may require doing away with structured territories and instead pushing these highly scored prospects via CRM to your sales force. The main advantage of this method is your sales reps are calling on the most fruitful segment of prospects. In time, as more data is fed into the analytics algorythm, prospect scoring will become more and more accurate. Of course, accountability can still be measured using coverage data on the number of prospects contacted and the resulting conversion (success) ratios of respective reps compared to the companywide standard.
Another advantage to focusing reps in this manner is the flexibility to shift direction as market factors change. You can position your sales reps based on current conditions rather than be stuck with hard coded territories.
The difficulty with running this model is the need for superior operational process to keep the flow of prospects coming into the CRM's prospect pool to keep your reps busy. This will require business analysts and impeccable CRM management on a day-to-day basis, as well as, disciplined data capture by sales reps, Marketing and Finance.
Which model is best for your company? Comments and thoughts on this topic are welcome.
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