Archive for category SALES LEADERSHIP
Coaching – A Critical Element of Sales Performance and Retention
Posted by Rick Pranitis in GENERAL DISCUSSION, SALES LEADERSHIP on March 1, 2013
Most sales managers would agree that coaching their sales teams is key job function contributing to their success. However, when it comes to actually defining what the term “coaching” means, how best to do it, and what are its affects in the long term, each sales manager would probably have a different opinion.
What is coaching? Is training and coaching the same thing? How much time should a sales manager spend coaching? How much time do they actually spend? What type of sales rep benefits most from coaching? Do top performers need it? What are the best ways to coach? Does it affect sales staff turnover?
Leslye Schumacher of Talent Bits and Bytes recently addressed these issues in her blog post, “How Much Time Should Sales Managers Spend Coaching Their Salespeople?” You can read the entire article here. In my opinion, it’s a must read for anyone involved in managing sales people.
In this very well researched article, Schumacher quoted several studies that give much clearer answers to these important questions. Here are some of the highlights:
- To maximize sales results, the optimal amount of coaching is 5 hours per month per sales rep.
- Salespeople that are coached daily outperform other salespeople by 30%.
- What prevents sales managers from coaching is the time spent on administrative tasks, the time spent direct selling, and lack of training in proper management techniques.
- Only 7% of sales managers were found to be effective at coaching without training.
- Core salespeople receiving ineffective coaching averaged 83% of goal attainment. Their performance rose to 102% when they then received effective coaching.
- In regards to retention, top performers were 50% more likely to stay if they received good coaching
The conclusions are clear. These statistics prove what the top sales managers have been practicing for years; coaching works and you have to plan to make time to do it! Not just any coaching, mind you, it has to be effective. Take the time to learn how to “show how, not do for” properly, and you will be a better sales manager for it.
Remember as John Quincy Adams once said, “If your actions inspire others to dream more, learn more, do more and become more, you are a leader.”
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This article was originally posted on A Sales Compass on February 13, 2012 by Susan A. Enns
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Eight Reasons Great Leaders Let People Fail
Posted by Rick Pranitis in SALES LEADERSHIP on January 28, 2013
Sales leaders, how comfortable are you letting failure happen? Are you OK letting your sales manager make a mistake? Are you OK letting the sales rep lose a deal? What do you do when you see a flaw in the strategy of your sales V.P.? Do you let them execute the plan?
What should you do when you see failure on the horizon? — Let it happen!
Letting failure happen is one of the most difficult challenges of sales leaders and other leaders alike. No one likes failure, especially when we see it coming. The best leaders know this however and let it happen anyway.
Why let failure happen?
Failure is the only way to learn:
Failure is the only way we learn. As leaders we need and want people to learn and grow. Failure is a part of the learning process. If people aren’t allowed to fail, they won’t learn and without learning, they won’t grow.
It creates ownership:
When we don’t let others fail, we strip them of ownership. When we don’t let people fail, we in essence make the decision for them. We don’t let them make the final call. When people don’t get to make the call, they don’t feel attached to the end result; good or bad. Ownership is important to creating accountability. We want our people to feel ownership for their decisions and the consequences; good or bad.
People need to make their own decisions:
At the end of the day, people have to make their own decisions. They have to be empowered to make the decisions they think will work best. Preventing people from failing takes away their ability to make decisions. We have to let people chose for themselves.
It creates accountability
When people make their own decisions, it creates accountability. We can’t hold people accountable for outcomes when they aren’t given the latitude to choose for themselves. When we don’t let people fail, it’s because we chose for them. We disagreed with an approach, we saw a flaw in the thinking, and we did the work for them. When we step into avoid failure we are taking over the decision making process. Taking over the decision means it’s no longer their decision and we can’t hold them accountable for the end results. People have to be allowed to make their own decision if we want them to experience the consequences — good or bad.
It’s empowering:
When we let people fail, we are empowering them. We are telling them, “We trust you.” People need to know they are trusted for their expertise. People need to feel valued for what they know and for what they do. When we don’t let failure happen, we strip people of a sense of competence. We send the message that says; I don’t trust your judgment and therefore I’m going to do this for you. Do this too many times and your will create stunted robots, as no one will make any decisions. They will just wait for you.
You could be wrong:
Has it ever entered your mind, you could be wrong? What happens if you are wrong? What if your idea wasn’t the right one and failure happens? What if they WERE right? Now what? Just because we think we know the answer, doesn’t mean we are right. We can be wrong too.
It creates diversity, creativity and innovation:
By letting people fail, we are giving permission for people to think for themselves. When an entire organization is allowed to think for themselves it creates a wide swath of ideas and approaches for creating opportunity and to solving problems. If there is one single greatest benefit to letting people fail, this is it. When we don’t let people fail, we stunt creativity. Idea’s are put through the leadership filter and stripped of creativity. When ideas or approaches have to be run by management rather than implemented they lose their ability to be proven out. Letting failure happens means, letting ideas go out without the constricting filter of you. Leadership can’t think of all the good ideas, nor can they determine what the good ideas are. Let people fail, you’ll learn more than by trying to keep them from failing.
It’s why you pay them:
At the end of the day we hire people to do their job. If you don’t trust them to make good decisions, don’t hire them. If you do trust them, then let them fail. They will only fail once. They will learn a lot. They’ll feel as if they have ownership and that they are empowered. The will grow and get better. Letting people fail is an investment.
Let people fail. You’ll have a much more creative environment and a lot more time on your hands to SUPPORT all this new found creativity — and that’s exactly what you should be doing.
Let failure happen. You’ll be happy you did.
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Eight Qualities Which Lift Sales Leaders Above Managers
Posted by Rick Pranitis in SALES LEADERSHIP on January 19, 2013
What’s the difference between a sales manager and a sales leader? How can you become more effective on the job and dramatically increase your influence with your customers and your company?
Here’s the CODE leaders live by:
- Company orientation. They’re interested in the future of the company and are concerning about every department, not just Sales. They’re always ready to suggest ways to help work flow more smoothly, save time or cut costs. They embrace responsibility, recognizing that salespeople who try to put the blame on others don’t inspire others to follow them.
- Organization. They never approach the day in a state of panic and are in full control most of the time. They put the needs of others ahead of their own to achieve goals. They are goal-centered rather than ego-centered, when dealing with customers, their sales manager or other employees.
- Detail focused. They take the time to listen about customer concerns and question any areas of confusion. They listen carefully before setting goals and moving ahead. They get others to cooperate by selling their vision on what must be done and are able to get customers and other employees to accept their roles.
- Energy. They’re willing to work longer than required, getting a lot done in a day’s time and enjoying it.
Traits of a leader
Of all the characteristics of a sales leader, four are particularly important. Test yourself to see how you measure up.
Do you:
Relate to the larger picture? Sales leaders understand how their jobs go beyond selling. They act as a treasure-trove of information for their customers, keeping them abreast of competition and paying close attention to the markets in which they and their customers are competing. They’re seldom surprised when price cutters suddenly threaten their accounts.
Have a vision? Sales leaders have visions that are easily understood by customers and are attainable if everyone works together.
Prepare yourself to make fast changes? Good leaders are prepared to change direction whenever new information warrants making a shift.
Think long-term? A sales leader’s focus extends far into the future. How long? At least a decade, often longer. Whenever you evaluate your future, ask yourself, “What demands are likely to develop over the next two to 10 years? How can I help my customers and my company meet them?
Four critical steps
These steps will help you improve your sales leadership skills:
- Connect with people and stay connected. That means being open to ideas from customers, prospects and your own management. It takes more than simply listening and asking a few questions. It requires building a feel of trust and letting customers know what’s happening. Talking to them is important, but listening to them is critical.
- Expand your boundaries. Don’t restrict yourself to your job as a salesperson. Converting features into benefits and practicing value-added selling is only part of your job. Ask questions to help you investigate the possibilities for doing your job more effectively. The answers you get may help you become bolder in your pursuit of efficiency and productivity.
- Show respect for established practices. This is a good way to win respect from both your customers and your management. Respecting “the way things are done around here” may also help you suggest changes when they’re needed.
- Be willing to take risks. All of the techniques outlined above involve some element of risk. You’re going to be wrong sometimes. But you’ve got to do it. A willingness to take some risks separates the sales leaders from average salespeople.
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Characteristics of a Successful Sales Team
Posted by Rick Pranitis in SALES LEADERSHIP on October 14, 2012
What does it take to develop a high performance sales team? This question has been asked by business leaders for as long as B2B sales transactions have been around. So what should you be looking for in your people and what separates a great sales team from an average one.
In this article I’m borrowing heavily from a piece originally written by Steve Eungblut the Managing Director of Sterling Chase. His group worked with hundreds of sales teams and conducted extensive research into what makes the real difference between an average sales team and a great sales team. They came up with the following characteristics:
1. Customer orientation: Since selling is all about aligning your solution with the customer’s needs and desires, a superior knowledge of the client’s world is crucial to the success of any sales team.
To gain superior customer knowledge and outsell the competition, team members should gather as much information about their customers as possible. They should be passionate in their pursuit of customer satisfaction and should immerse themselves in conversations around the customer’s external environment, internal ‘pain points’ and their (known and hidden) needs. Individual team members should also sell their customers’ needs to their own company and portray their customers as the most important that the company has.
2. Own company capability knowledge, relationships and innovation: To acquire a superior knowledge of their own company’s capabilities, each team member should be encouraged to familiarize themselves with the features, advantages and benefits (FABs) of all their products and services. Along with superior customer knowledge, a high degree of product knowledge will make it easier for sales people to align solutions with customer needs and desires. Individual team members should also map out innovative ways in which their company’s capabilities can be positioned and/or adapted to differentiate their proposition from that of the company’s competitors. This should also help team members to up-sell and cross-sell solutions across their portfolio.
3. A proactive drive & determination for results: The sales team should be highly self-motivated and proactively create and drive sales opportunities forward. This should enable individual team members to deliver benefits for their customers, as well as great results for their employers, the team and themselves.
4. Collaboration and a balance of personality types: To be a successful sales team, it is really important that individual members of the team work together rather than in competition with one another. By working collaboratively and being dependent on each other’s selling skills and knowledge, members of the sales team will be deterred from behaviors which can be destructive to the entire team. Collaboration will reduce the likelihood of a destructive blame culture developing in the sales team, for example, while it should foster a more positive and creative working environment – in turn, improving team performance and results.
The team also needs to be balanced with creators, shapers and completer-finishers. If you have a team that simply consists of fiery hunters and you ask them to work together, sparks will most likely fly and team members will clash. On the other hand, if all of your team members are farmers, it is most likely that your sales strategy will take too long to bear fruit.
5. A structured approach to planning and actions: The sales team must take planning really seriously and ensure that they develop and implement plans that have direct and tested links from the analysis stage right through to action and results. Many times a team will implement a sales strategy which fails to credibly link the past, the present, the near-term and the long-term. Successful sales teams make their plans and all associated activities SMART (Specific, Measurable, Achievable, Relevant and Time-bound). They make their plans drive their activities and constantly revisit, review and test their plans.
6. Manager, leader, coach: Great teams need great leaders. Great leaders are inspirational in the way they are able to adapt to different situations and different challenges. Sometimes they need to tell and drive; sometimes they need to create a credible vision for others to aim for; sometimes they need to facilitate and coach; sometimes they simply need to let go. In fact, every day and every task requires a slant towards different requirements and the sales team’s leader has to let go of his or her own ego – they need to be agile when it comes to switching their leadership style.
Many say great leaders are born and great teams rarely come together by chance. But in reality, successful sales teams can be designed, built, developed and emulated in any situation. You need intelligent, willing and passionate sales people on board who are willing to work together for the customer, the team, the company and for their own ultimate gain.
In summary, great teams need to be put together carefully. They need to love their customers while leading the way for their own company. They need to plan and drive results. They need leaders who can adapt their style from being a sales manager to a sales leader to a sales coach when the time is right.
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Steve Eungblut’s original article can be found at the Sterling Chase Sales & Business Development Blog.
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6 Steps to Enable Your Sales Team to Sell with Insight
Posted by Rick Pranitis in SALES LEADERSHIP on October 12, 2012
Unless you’ve been living under a rock for the past few years, it should come as no surprise to you that buyer behavior has changed dramatically. I’ve come across a number of well-written research documents, such as Base One’s “2012 Buyersphere” report and Forbes Insight’s “The Rise of the Digital C-Suite” study, that highlight how this is playing out in the marketplace. Simply put, buyers are more educated, better prepared, and further along in their buying process when they engage sellers.
So, what does this all mean for a company, its sales force, and its ability to compete? Here are 6 steps to leverage “insight selling” to help your team engage buyers early in their process and shape a solution that gives you the best odds of winning:
1. Understand the forces driving your customers to change. Changing external forces such as new technology, competition, or regulatory requirements, as well as internal forces such as new leadership or strategic initiatives, drive organizations to change. Whether driven by external or internal factors, change creates opportunities for providers who can help companies navigate the change. To be successful, you and your sales team must stay on top of the latest trends so that you can guide your clients to capitalize on those that are worthwhile and steer them clear of pitfalls they should avoid.
2. Determine how your organization can uniquely enable these change imperatives. This requires you to reframe your value proposition to address the change your buyers face. You need to determine how you can help them navigate the change process, the benefits they will realize, and the investment (e.g., financial, emotional, or time) required on their part for success.
It’s not enough to be able to say, “We’ve been in this business for 50 years.” That can make you sound old and stale. What have you done lately? Can you demonstrate to prospects that you and your people are at the cutting edge? What makes you better than other companies offering the same service?
3. Proactively educate the buyer on the change imperative and solution options. Be a source of knowledge and insight to raise awareness of the issues driving change and potential solutions to navigate the change. This happens both at a macro level in marketing through research and thought leadership programs and at a micro level by helping your sales reps identify prospects in flux and engage in an insightful dialog around the issue and potential solutions.
Remember our premise above: buyers are more educated and better prepared than ever before. This gives you an opportunity in your marketing to provide research, thought leadership, and practical case studies addressing common issues so that as buyers are getting educated on the matter, insuring you’re already on their radar.
However, don’t assume that your customer is aware of the need or how to solve these challenges. External forces, such as regulatory change or technological innovations, may not be front-page news in the mainstream media. Your organization has to keep its finger on the pulse of the forces that create need for your solutions. You need to help your sales team connect the dots between the emerging challenge and your ability to help. Savvy buyers will be skeptical of following the latest trends, and rightly so. It’s up to you to help them realize what trends to pursue and which to avoid.
What’s the best way to do this? There’s a lot of debate around whether your sales reps should lead with questions or with insights. Much of this depends on your prospect and their level of familiarity with the issue. Sometimes, prospects won’t know what they don’t know, and other times, they will know more than you do. It’s important not to patronize your prospects or speak over their heads. As such, we believe that it is best to either phrase your insight as a question (“How have you prepared to deal with issue XYZ?”) or to state your insight and follow up immediately with a question (“Many organizations we work with have done ABC because of XY&Z; have you considered that concept?”).
4. Proactively educate the buyer on how your solution is typically bought and sold. You sell your solutions every day, but your buyers may only buy a solution to a problem once in a lifetime. You need to tell them how to buy and why that is beneficial to them. This will surface other players in the buying organization who influence the decision and who need to be on board with the solution.
There is some recent thinking on the usefulness of asking questions to better understand the buying process. We believe that not asking these questions is a lost opportunity. The mutual sharing of information around the buying and selling process with prospects that you’ve motivated to change will help you avoid missing key influencers in the sale and help you refine your value proposition to address their unique concerns.
Chances are that what you’re selling will have a greater impact in your clients’ organizations than your buyers’ immediate business unit. Explore with your buyers the “ripple effect” throughout their organization, and use that as an opportunity to engage influencers in those areas.
5. Ensure your sales reps have the knowledge and skills to educate clients, position your value proposition, and cover their bases on a complex sale. With so much information available on the internet, it is easy for you to assume that your sales reps are following developments in their field and can confidently engage in business discussions with buyers. While your sales reps may all be active consumers of industry news, this is seldom sufficient. The biggest risk is that they will misrepresent the issue or your company’s solution or exaggerate the benefits in their enthusiasm to win business.
You need to provide your sales reps with your company’s position on the issue, solution guidelines, and expected benefits. This should be a collaborative activity with your marketing and product teams. Insight selling works most efficiently when your marketing team works on the front end by doing the research on the issue, market, competition, and thought leadership – while your product team creates the roadmap and pricing policies.
Then, you need to arm your sales reps with this material. Teach them to communicate your value proposition to different buying influencers involved in the decision-making process, and the process to advance the sale to closure.
6. Reinforce and sustain “Insight Selling” as a key strategic initiative. Even after you’ve done your positioning and solution preparation and training, you need to continually reinforce the behavior change necessary among your sales reps to realize the full benefit of insight selling. Don’t think of this as a sales training or a marketing initiative – it is really a strategic initiative that requires alignment across your organization.
It requires awareness of the issues, value proposition, and solution from top to bottom. The business needs to make the investment in thought leadership, refining solutions, and marketing. In order for the behavior to stick, each level in the sales organization has a responsibility to “own” their part of the process:
- Sales leadership needs to make the investment in sales rep and management development and have the discipline to establish metrics and measure the progress and impact of the initiative.
- Sales managers need to invest in their own continuous learning about the issues, build their ability to coach sales reps in this new selling paradigm, and hold their sales reps accountable for the right activity and effectiveness.
- And of course, sales reps need to embrace a new way of thinking, continuously build their ability to share insights, and engaging customers in business conversations.
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This article was originally posted to The Richardson Sales Excellence Review™ by Dario Priolo on October 10, 2012
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Thoughts on Integrity and Leadership
Posted by Rick Pranitis in SALES LEADERSHIP on September 28, 2012
Anyone can easily say they are “leading with integrity,” but the challenge lies in actually following through. The majority of us have had the importance of being honest instilled since we were children. Unfortunately, some people struggle more than others to live with and exhibit integrity, no matter how many times they hear it.
But what does “integrity” actually mean? Most of us could easily define the word and have a pretty good idea of what that really looks like— or could we?
Integrity can be defined most simply as “being honest” or “following moral and ethical principles.” Integrity has also been defined as being when “a person’s behavior is the same, whether someone is watching them or not.” Integrity is not a characteristic you can demonstrate occasionally, or most of the time. Leading with integrity means you’re demonstrating it all of the time. I like to consider integrity to be like an eggshell that must be protected at all times in order to keep the egg (or your integrity) whole. Once an eggshell has even a slight crack, the structure can no longer be depended on to handle the pressure of the environment. It is simply a matter of time before the egg is completely compromised. A leader’s integrity (or eggshell) is the exact same thing: a leader can do the right thing 100 times, but if on the 101st time they choose to deviate, their integrity comes under scrutiny from those around them. Even though we may live a life of integrity throughout the first 100 situations, if we choose to act incorrectly the 101st time, the way people perceive us can change forever.
If we want people to follow our lead, there must be a strong level of trust. Keeping your word and living with integrity are two critical pieces to this process. Trust is not something built overnight; however, it can be lost instantly. The easiest way to come across as not being honest is to say one thing, but do something completely different. When people choose to follow us, they need to know the words we speak are genuine and that we will not deviate from what we said we would do.
Some people believe if they always handle the big issues with integrity, the little issues don’t always need to be handled the same way—especially if no one will know the difference. This couldn’t be any farther from the truth. A person who leads with integrity will always keep their integrity untarnished and will not waver, regardless of the size of the issue at hand or whether or not people will ever know what they did.
There is nothing worse than listening to someone speak about what they plan to do when we know their actions will not match what they said. This type of dishonest behavior is what usually creates the first crack in what is sometimes called: “The Trust Foundation”. It’s the bedrock upon which the leader/follower relationship is based. As a leader today, the challenge is for us to live the true lifestyle of a leader with integrity at work and outside of work. When people see us acting differently in public than we act in the workplace, our genuineness becomes questionable, as does our integrity. Show the people who choose to follow you what kind of leader you are by keeping your word and always living with integrity.
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This article was originally posted by Mike Camp on Human Resources iQ on April 19, 2012
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Confronting an Under-Performing Sales Rep
Posted by Rick Pranitis in GENERAL DISCUSSION, SALES LEADERSHIP on September 22, 2012
Every sales coaching workshop that I deliver I ask sales managers, “How many of you have a performance problem with a sales rep that is just unacceptable, and you know you need to address the situation?” Everyone raises their hand. Then I ask, “How long have you known this?” The answer I hear is often months, and occasionally years. Clearly, many sales managers have tremendous difficulty confronting an under-performer, and so they keep putting it off.
There are a variety of reasons why sales managers avoid this most difficult of all conversations. Sometimes it’s just a time management issue – the sales manager has many other more pressing issues to deal with. Another reason is that the sales manager blames him or herself for the salesperson’s lackluster results – “I haven’t provided the salesperson with enough ongoing coaching” or “I need to provide this person more training.” So the sales manager accepts personal responsibility for the rep’s performance problem, but that’s not right.
The simple truth for sales managers is that your team is only as strong as your weakest performer. You can say all you want to about sales performance, but your actions speak louder than words. Everyone on your sales team looks at the lowest producer as the minimum level of sales production necessary to stay on your sales team.
When you fail to address a sales performance problem you send a message to everyone else on the sales team – that you tolerate mediocrity. Face this issue now. Have the tough conversation. Don’t let another day go by without addressing this performance problem. And before you have this “positive confrontation” conversation, jot a few notes down next to the following checklist so you are properly prepared:
- What aspect of this person’s performance (and/or skills and attitude) is unacceptable? Be very specific about what the person must change. Be prepared to provide examples.
- Why has the person not been performing up to expectation? As the sales coach, you must assess the performance problem. Is it the rep’s lack of skill, a lack of will, or both? During the meeting, ask questions to either confirm or disprove your analysis of the situation. You never know what might come out here. I once had a salesperson break down in tears in my office about his marital problems.
- Why should the person make these changes? Remember that Skill + Activity = Sales Results. All too often sales managers, when communicating expectations to the team, focus on the outcome expected (sales quota) rather than the inputs necessary to achieve the outcomes, and the importance of each step in that process. When you explain “why” a certain task must be accomplished with a certain amount of quantity or quality, you are also explaining why it cannot be avoided.
- What should the consequences be if the salesperson does not make these changes? Another conversation with the manager? A written warning in their personnel file? Termination? You must be prepared to explain in very clear terms exactly what will happen if the changes are not made.
- The “Two-Roads” Discussion One sales manager with whom I’ve worked refers to this is the “Two Roads” part of the discussion. “Ms. Or Mr. Under-performer, you have reached a fork in the road. If you continue down the path that you have been on this is what the consequences will be… However, there is another path for you to choose, and it leads to greater sales performance, more money, etc.” Ultimately, the responsibility for change is the rep’s responsibility, not yours. If coaching or training is required, or would help the situation, then do it now.
Peak performance sales managers do not accept mediocre performance. They realize that their entire sales team is watching how they handle the under-performer. They accept the responsibility for their role, and if someone is not performing up to expectations they address the problem sooner, rather than later.
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This article was originally posted on the TopLine Leadership Blog by Kevin Davis on September 18, 2012
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Does Your Sales Dashboard Have The Right Indicators?
Posted by Rick Pranitis in GENERAL DISCUSSION, SALES LEADERSHIP on September 20, 2012
The idea of a sales dashboard is appealing. What business manager wouldn’t like to run their company like a well-oiled machine, with the help of a few select indicators? But in practice, it is ironically the choice of these indicators which can stall the effectiveness of the sales dashboard…
Every company is certainly different, and it goes without saying an industrial equipment maker cannot manage its sales process (for example) like a travel agency, or a service provider. However, here’s some tips on zeroing in on the right indicator can be helpful in the majority of situations.
Choose indicators which are useful throughout the sales process – As the saying goes, you shouldn’t count your chickens until they hatch. Nevertheless, you want to manage your sales process continuously, not just once a quarter. It’s important to avoid indicators which only become meaningful at the end. For example, “Actual/Projected sales” is more useful when compared to its historical average at that stage of the quarter.
Be selective – you start with the laudable intention to stick to the essentials, but find yourself a few months later with a computer screen that looks more like a spacecraft cockpit than the clear-cut dashboard of your dreams. To be more selective, ask yourself this question before adding another indicator to your sales dashboard: is it directly related to what your company is trying to achieve (i.e. prospects progressing along your pipeline), or is it merely informative?
Choose actionable indicators – avoid indicators which look sexy but don’t bring anything tangible to the table. A traditional indicator that clearly points you in the right direction is better than a “sophisticated” one which needs to be explained to everyone and even leaves you scratching your head.
Favor dynamic indicators – one which measures a sales team’s progress. A static indicator only measures an activity. For example, “Number of leads qualified/Week” is a dynamic indicator, while on the same subject “Number of qualification calls/Week” is a static indicator. From this example we can infer that a dynamic indicator is naturally outward-looking (i.e. focused on prospect dynamics) while a static indicator is often inward-looking (i.e. concerned with your team’s processes).
Beware of environmental indicators – those which are focused on your company’s environment (e.g. “Number of RFPs in my sector”) are most certainly outward-looking. Yet, do they belong on your sales dashboard? Not especially. You’re interested in your company’s performance, which only indirectly depends on its environment. Environmental indicators are rarely actionable, unless you are matching them to a triggering threshold. For example, you could decide to re-contact your existing client base systematically when the number of RFPs in your sector falls below a threshold of ten per month.
Certainly there are others, more specific to your particular situation. The objective here is to give you a starting point. Get you thinking about what’s key to steer your sales process to success. As always I’m interested in what you think and what you’ve found to be effective in your sales dashboard. I invite your comments, ideas and suggestions.
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Five winning strategies of the world’s top sales organizations
Posted by Rick Pranitis in GENERAL DISCUSSION, SALES LEADERSHIP on September 12, 2012
The team at McKinsey and Company evaluated the results of over 700 sales projects and identified the companies that consistently delivered industry-leading sales performance, that is companies which grew their revenues an average of 48% faster and their EBITA 80% faster than their peer groups over a five year period.
What were their common characteristics? It turns out that size, geography and what they sold had little effect on performance. It was how they sold which drove the differences.
Here are the five common strategies which McKinsey determined characterized the top performers:
They found growth where their competitors could not. Top-performing sales organizations tended to both look far ahead – an average of 10 quarters – and uncover growth opportunities in the near term. Perhaps most telling, top performing sales organizations practiced micro-segmentation. They divided their potential markets into as many as 100 or more cells and identified areas where significant growth potential existed even when the overall market growth appeared slow or stagnant.
Key take-away: take a look at your current approach to market segmentation and targeting. Are you looking at a sufficiently granular level to identify the pockets of segment-leading growth potential?
They sold the way their customers wanted to buy. There’s no excuse any more for basing your sales process and sales pipeline stages around sales activities, rather than stages in the buying decision process, and the results of the top sales performers validate this strategy. In a striking validation of the “Challenger Sale” philosophy, McKinsey also pointed out that top performers focused their attention on the prospects for which they had something original to offer.
Key take-away: even if it means dramatically restructuring the way you manage your marketing and sales processes and pipelines, you must refocus your efforts on understanding, tracking and facilitating your prospect’s buying decision process.
They freed up their sales people to sell. Sales people in the top-performing sales organizations tended to spend far more of their time on customer-facing front-line sales activities rather than wasteful back office administration, and it’s no accident that these organizations used technology and process as key weapons to make their sales people more productive.
Key take-away: look carefully at what your sales people are currently spending their time doing, and systematically eliminate or offload any tasks that are not directly contributing to the customer sales experience.
They focused on developing their people. The top-performing sales organizations not only recruited thoughtfully, they also implemented induction programmers that served to turn “rookies into rainmakers” far faster and more effectively than their competitors. They established a tempo for reporting and targeted intervention that helped the sales people with potential to realize that potential faster. They inoculated the whole sales organization with the winning habits of their top performers, and they refused to leave new hires to “sink or swim”.
Key take-away: the consequences of making a bad hire are horribly expensive. First, make sure that you recruit for attitude and not just experience. Then, involve every new hire in a carefully crafted skills transfer, induction and mentoring program.
They expected exceptional performance. The top performing sales organizations drove growth from the top. They set stretching targets, challenged the status quo, established role models, and created a culture that expected results. The pains they took to equip their sales people to be successful were balanced with the expectation that their sales people would succeed, and persistent poor performance was constructively addressed.
Key take-away: if you have taken pains to establish a winning environment (and only if you have), and invested in recruiting and developing the right team, it is reasonable to expect your sales people to rise to the challenge.
So there you have it: five winning strategies which have driven exceptional results for the organizations that have put them into practice. Together, they make a smarter approach to accelerating revenue growth. It should be noted: none of these winning habits require huge budgets or large staffs. All they require is smart thinking, focus, discipline and willpower. So if your organization hasn’t yet put every one of these principles into practice, what’s holding you back?
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This article was originally posted by Bob Apollo in the Inflexion Point Blog on June 12, 2012
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Sales Pipeline Review and Evaluation
Posted by Rick Pranitis in GENERAL DISCUSSION, SALES LEADERSHIP on September 6, 2012
An important and vital responsibility of a Sales Manager is a regular review of their sales peoples’ pipeline. But repeated pipeline reviews are often a source of stress between sales managers and sales people. As you might expect, there are the usual focus points when it comes to questions at a typical pipeline review:
- What deals will close this month?
- What cover does the sales person have to meet their quota?
- How much of the pipeline is new business versus add-on?
- How does the pipeline feel relative to other months?
- Is marketing delivering on their lead gen targets?
- What are the next steps in the sales process?
- Is senior management from the prospect engaged?
- What is the average deal size?
- Where is the competition on individual deals?
Invariably most sales people, who are under pressure to deliver, will try to concentrate the discussion on Marketing’s contribution to inbound leads. While this may be a valid concern it can quite often hide the fact the salesperson’s own management of their pipeline is poor. A good salesperson will generate continued input to their pipeline in the absence of leads from other sources. A bad salesperson will hide behind Marketing and try to mask their under performance by inflating their pipeline with opportunities which are not likely to close.
So what is a good leading indicator of this, or where should the manager look? The place to start is the average age within the pipeline of new business. If the average age of closed/won business is significantly lower than the average age of open or closed/lost opportunities, then it’s highly likely the sales person is holding onto deals which won’t close instead of creating and adding new opportunities to their pipeline. The tendency to “beat a dead horse” rather than cold call is very strong in inexperienced sales people or those who are accustomed to a regular supply of leads from Marketing. A simple view of the average age of the pipeline by sales stage will highlight if there is an issue. If the average age of open opportunities is more than one and a half times that of closed/won deals then further investigation is required.
Encouraging and training the sales person in understanding a better use of their time would be to do their own demand generation through cold calling or cold connecting in the social world is key. The salesperson will defend why different opportunities deserve to stay open. But ultimately if your company has a particular set of sales cycles/close rates/sales velocities then these are not likely to shift dramatically over time. The reality however is too many managers neglect to focus sufficiently on age when reviewing their sales peoples’ pipeline.
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