10 tips for a successful (CRM) training plan

Article by www.salesforce.com

Whilst this document was created by SalesForce for their users, the concepts apply to any users of a CRM.

Having a terrific training plan is a huge step toward getting Salesforce CRM off to a great start. After all, user adoption is the single most important ingredient in success. With more than 1.5 million users raving about Salesforce CRM, our customers confirm the importance of training when it comes to adoption. We’ve talked to those customers—across industries and around the world—to come up with the following 10 best practices for creating a successful training plan:

1. Set expectations – To your users, Salesforce CRM is all new, so your first task is to give them an overview and to set expectations—what they can expect from the application and what you expect from them. If possible, involve your executive sponsor in this presentation to highlight his or her support and the importance of Salesforce CRM to your company.

2. If it’s not in Salesforce CRM, it doesn’t exist – It’s a good idea to set this expectation right away—otherwise, you lose key advantages such as giving managers visibility into the pipeline and doing accurate forecasting. Have your executive sponsor deliver this training segment as well to show that you mean it.

3. Be clear about how users are measured – Have clear metrics to let users know how they’ll be measured. For example, set target dates by which users must make changes, managers must review the funnel, and when pipeline reports will be pulled. Other metrics include how often users log on and how many objects they create. We suggest that your executive sponsor also deliver this segment.

4. Answer “What’s in it for me?” – Don’t just make demands—get people excited as well. The best way to do so is to show how Salesforce CRM will make life easier—for example, with less administrative work, easier reporting, around-the-clock access, a clear view of the sales funnel, or easy forecasting. Ask one or more respected power users to deliver this training segment.

5. Provide hands-on training with real-life scenarios and data – Don’t make users figure out how hypothetical data applies to them. One way to get people excited is to let them see their data in the application, to show firsthand what Salesforce CRM can do for them. Be sure you clean your data and develop day-in-the-life scenarios your users will recognize as theirs.

6. Reinforce your processes – Treat Salesforce CRM as an opportunity to roll out more effective processes that make life easier for users. For example, introduce a new Opportunity process that uses the application’s Lead functionality to get leads directly from the Web and into the application.

7. Help users learn the lingo – Create cheat sheets with Salesforce CRM terminology, simple overviews of your processes, and step-by-step summaries of the most important processes. These job aids will serve as handy, easy-to-use references. Also consider giving users a head start by using the free online course as a training prerequisite.

8. Offer incentives – Motivate your users to dive right in with contests, incentives, and a little competition. For example, you could award a $500 prize to the first users to create 15 new Accounts or generate a pipeline report. Money is a great motivator for sales users, but so are prizes such as iPods or iPhones. You can also use a leader board in the application to show how individual users compare in adoption to generate some healthy competition.

9. Get feedback – Be sure to leave time for Q&A and ask people for their opinions. To get off to a good start, it’s important to clear up any confusion and to find out what’s on your users’ minds. Make it a priority to try to incorporate feedback into the application—and then be sure to communicate those changes to show users that they have a say in how the application works.

10. Provide follow-up training. Some people think you train users once and you’re done. But successful training isn’t a one-shot effort. Be sure to follow up after a few weeks because by then, your users will have a new set of questions. A great way to provide follow-up training is to recruit enthusiastic users to follow up with their peers and use what they find out to create highly targeted mini-training for various user groups.

Providing great training isn’t difficult, but it does require planning, effort, and an ongoing commitment. Use these tips to help you create and execute a training plan that works!

Article by www.salesforce.com

The Sales Manager’s Guide To Controlling Cost of Sales

Article by Lynn Shively and Barry Shamis at http://www.Sales-Management-Insight.com

Every Sales Manager is responsible for cost of sales, which includes two considerations.  The first is to bring in as much revenue as possible through their sales team, and the second is to bring in the revenue with the least possible cost outlay.

Even though the sales team brings in most of a company’s revenue, most finance people look at sales as an expense.  They look at the sales, general expenses, and administrative costs (SGA) line items.  To maximize the profitability of sales efforts, the Sales Manager’s job is to reduce or maintain general sales expenses while driving maximum revenue.  There are some areas where it makes sense to reduce sales expenses, and other areas where reducing expenses can be counterproductive.

Below are some ideas to consider for cutting the costs of sales.  These ideas may or may not be right in the situation because for every action there is a reaction.  There are few places where this is truer than with sales personnel.

Variable Expenses

The first items most companies address to control cost of sales are the variable expenses associated with sales.  This includes travel, lodging, entertainment, meals and outside expenditures.  These are cut back, at least short term, until sales increase or return to normal levels.  However, there is a reaction to cutting those expenses.  Cutting out all non-billable expenses might reduce sales success and put sales into downward spiral.  Consider the consequences of cuts before making them.

Review The Commission Plan

Every sales rep quickly figures how to maximize the commission plan to their benefit.  The key to an effective commission plan is one that motivates behaviors that profitably sell the products and services into the marketplace.  And it makes them happy to be doing it.

Companies often justify increasing commission rates and lowering base salary to make it possible for some reps to bring in more money by making more sales.  Some companies even go to straight 100% commission plans, but this can invite the sales reps to look for other employment opportunities.  That can lead to another large round of hiring and training expenses.

When reviewing the commission plan, make small steps in the mix between salary and commission.  Monitor the change in sales and associated sales support expenses as result of the changes.  Modify the plan based on the results.  Remember, variations in the pay scheme affect top performers differently than bottom performers. Engage the sales team to help brainstorm commission plan changes.  Always pay special attention to retaining the top performers.

Address Individual Performance

Generally the biggest cost item on any Sales Manager’s budget is the fully loaded cost of a salesperson. The goal is to have the proper number of sales people all producing at top levels.  This is the ideal situation to manage cost of sales.  Evaluate the historical performance of each member of the team.  It is better to cut a person loose rather than to prolong the agony when an individual has not produced in an acceptable time.  Removing headcount from the team saves expenditures and expenses.

However, there are costs associated with terminating a member of the sales team.  There are the costs of interviewing, hiring, on-boarding, training, lost revenue, and customer dissatisfaction in an open territory.  These costs add up quickly. Have a plan together and move rapidly to deal with the risks and consequences when swapping out a sales rep.

Losing a top performing salesperson has a greater impact on the cost of sales.  Sales Managers focus the majority of their time and effort on the poor performers, at the expense of their top performers.  There is a greater return when a top performer increases the percentage of their sales.  Leveraging the top sales producers is a good way to reduce the cost of sales.  Losing a top performer can be very painful for the business.

Territory Coverage

Review territory coverage to see if there is a way for fewer people to cover more territory.  Is technology and communications being used as well as possible?  This can help reduce head count and cost of sales.  Make certain that changes in territory coverage does not impact or dilute the sales to the point that customer coverage is lost.

If you use sales partners or independent reps, review their performance and coverage as well.  It is better to keep the top-producing partners and expand their impact than it is to hang on to non-producing partners and hope that they will eventually get better.

Economies of Sales Calls

Sales calls are very expensive but face-to-face time with the customers and prospects is valuable.  It is important to strike a balance.  Review the number of calls that are logged each week.  Compare that number to the weekly sales to calculate the cost of sales per call.  Calculating the average revenue produced per sales call and the average cost of each sales call is an excellent metric to have on a sales manager’s dashboard.

Do the best to enhance the number and effectiveness of sales calls that the team makes. Focus the team’s efforts on the most profitable prospects and redirect efforts towards accounts or geographies where the cost of sales is lower.  Aim for those situations where the opportunity for repeat business is higher.

Cost of sales is impacted positively when you can get more revenue per sales call.

Sales Contests and Promotions

It is possible to increase short-term revenue with sales contests.  These should be designed to motivate salespeople to meet specific objectives.  Often times a one or two month sales contest can yield better results with less additional costs then an increased bonus or commission plan.  Designing a fair sales contest is sometimes difficult.  Take the time to design a contest that incentivizes the behavior you want to achieve.  It’s difficult to change the annual sales compensation plan, but it’s much easier to run a short-term sales contest at little additional cost.

Customer Loyalty

It is much more expensive to obtain new customers, then to generate additional revenue from existing customers.  The costs of marketing, prospecting, relationship building, and setting up business engagements with new accounts all take time, resources, and money.  By growing existing accounts, sales teams can focus on customers who already have a relationship with the company, and who have processes already in place for transacting business.   This helps reduce the cost of sales.

Resource Utilization

Resources are expensive.  Getting the maximum utilization from them is important to managing the cost of sales.  Review the cost and usage of the most critical resources.  Those resources can include:

• People
• Money
• Marketing
• Equipment
• Other core team members
• Company management and executives

Qualify the investment of any resources before you engaging them.  Consider the targets, the objectives, the available time, and the other opportunity costs of using the resources.  Ask if the planned level of resource usage makes sense compared to other alternatives.  Sometimes the plan needs to be adjusted for more realistic targets.  See if resource requirements can be reduced, without impacting total sales.  See if resources can be shared by combining usage with other team members.

With today’s technology, it’s possible to use webinars and videoconferencing to cut down on expensive face-to-face time.  Sometimes increasing resources a small amount might advance the sales plan even more rapidly than the cost of the additional resources.  Employing either of these strategies helps reduce the cost of sales.

Sales Management

The other side of cost reduction is to increase revenues per sales rep.  This means the Sales Manager needs to manage and execute the role effectively.  There are several key areas to consider when managing the team’s business for maximum revenue.  They fall into three categories.  They are the business aspects of the job, leadership and readiness and helping with strategic engagements.  Here are things to consider in each area:

Business Aspects

• Optimize sales coverage and partners
• Create account planning for key or strategic accounts
• Implement timely pipeline management
• Have opportunity management plans for key in strategic deals
• Help garner resources and support
• Remove logjams for the  sales team
• Have the proper dashboard and metrics to track the business
• Make sure the infrastructure is supportive and cost effective
• Provide appropriate cost effective training and development for team members

Leadership and Readiness Aspects

• Motivating and supporting the team’s selling efforts
• Managing both high and low performers properly
• Provide leadership in the daily execution
• Hire, train, and develop the best people you can find for the team
• Coach the team in needed growth areas
• Plan review and report on the business in a timely manner

Helping With Strategic Engagements

• Set a focused strategic direction for the group
• Communicate effectively to the team so they know what to do and why
• Develop key customer relationships
• Gather and provide internal feedback
• Help develop and deliver value to the company and customers
• Help the team become advocates in the marketplace for the company’s expertise

Conclusion

Keeping the cost of sales in line with revenues is a necessary part of any sales Manager’s job.  Be aware of the costs of sales in all aspects of the business.  Impact the costs in a positive way by increasing revenue while keeping costs steady, declining, or growing at a rate which is lower than sales are increasing and you will consistently lower the cost of sales.

Article by Lynn Shively and Barry Shamis at http://www.Sales-Management-Insight.com

Use Best Practice to Fire Up your Sales Team

Article by Jonathan Byrnes, a Senior Lecturer at MIT and President of Jonathan Byrnes & Co.

Jonathan Byrnes explains how best practices developed by your ”A” performers can be used to train and motivate “B” and “C” players.

Many managers ask for references to best practices that they can observe and replicate. In virtually every company I’ve seen, the answer exists within the company itself.

I’m always amazed by the variety of practices within a company. Think about this: If you took a movie of everything your sales force did last year, edited  it carefully, and played the best parts, I’ll bet that you would have an absolutely stellar, world-class performance.

The problem, however, lies on the cutting room floor. This is where the evidence of the unevenness of practice in your company appears. But here’s another way to look at it: It shows the magnitude of the potential upside if you could bring your whole team up to your own best practice standards.

The observed overall performance of the sales force is the weighted average of your best practice, your average practice, and your problematic practice. In most companies, the fastest and easiest way to improve your bottom line is to move all of your employees up to your own best practice. This is especially true of your sales force.

Most managers take for granted that their company has “A” players, “B” players, and “C” players, particularly in their sales force, and that their company’s overall performance inevitably reflects this reality. In my experience, this assumption is almost always false.

The flaw in their view is the implicit assumption that the sales process, or  any business process, cannot be analyzed, codified, taught, and coached so that even an employee of “average” ability can perform with consistent excellence. Why not?

Changing the changeover process I recall visiting a major manufacturer several years ago. This was during the time  when manufacturers were shifting from the long production runs that characterize mass production to the shorter production runs that are entailed by quick response systems. The difficulty in shifting production to quick response is that it requires very rapid changeovers of the production line from product to product.

This manufacturer developed a simple but ingenious approach to solving the changeover problem. They actually videotaped changeovers. The whole work team analyzed the tapes to identify improvements, much like a football coach watches game tapes.

With clear information before them, the factory workers developed new procedures. They also developed detailed processes to codify and teach the new changeover methods as well as measures to monitor their successful implementation. Changeover times were cut dramatically.

Standards of care
In medicine, there is a guiding principle called “standards of care.” If you meet with a doctor before surgery, he or she will describe the procedure that you are going to experience. Most likely, the doctor will say something like, “If I see A, I’ll do B; if I see C, I’ll do D.”

In this conversation, the doctor is describing well-established best practice “standards of care.” These standards are based on rigorous research and well-analyzed experience. They are accessible and followed by practitioners throughout the field. These standards represent and provide the shared understanding of best practice. Leading researchers and practitioners are always trying to improve the standards of care in their particular areas but no one should mistake this process for “winging it.”

The “standards of care” process is extremely powerful. It allows the participants to systematically analyze and identify best practice and ensures that all practitioners adhere as closely as possible to this best practice. For perspective, the best surgeons will always be the most capable practitioners, but the “standards of care” system ensures that the rest of the surgeons practice as capably as possible. At the same time, it offers a way for leading specialists to subject the best practice standards to constant improvement and to spread the gains rapidly.

Managers can apply this process to dramatically improve their own businesses.

Business standards of care
Some may argue that the sales process, like other business processes, is inherently
idiosyncratic: every customer is different, every sales rep is unique, and it’s virtually impossible to systematize the process. In my experience, this view is counterproductive and wrong.

For example, account penetration is one of the most difficult processes in business. Many sales reps, particularly inexperienced ones, avoid trying to penetrate highly underpenetrated accounts. These accounts may be “locked” in a relationship with a competitor or may even be “turned off” to the rep’s company because of a past incident. Yet, turning around a major account in which the company is doing little or no business is generally the highest-payoff use of the sales rep’s time.

In several companies, I’ve had an opportunity to investigate this problem. The results were strikingly similar.

In a company, the best-performing sales reps, when interviewed independently of one another, typically have a very methodical and remarkably similar view of the account penetration process. They know almost meeting by meeting, month by month, what contacts and activities they will be working on. For sure, they know that the process will vary somewhat from account to account, and they know how to handle these variations. However, within the company, it quickly becomes clear that the top performers are “all on the same page.”

The “B” and “C” players, however, are usually on a very different page, or more likely, very different pages. Most often, they will have widely varying views of the process, either very optimistic or very pessimistic in terms of the results-to-effort ratio. The overly optimistic reps quickly get discouraged by the seemingly slow initial phase of the penetration process, while the overly pessimistic reps simply avoid the whole process. In fact, in most companies, the high-performing reps will even be able to tell you at what point the “B” and “C” players will give up on a turnaround account and refocus on more “comfortable” accounts.

Compare this with the “standards of care” system in medicine.

In a company, the high-performing reps, the “A” players, have independently discovered a set of best practice standards that are strikingly similar from rep to rep. Over time, in numerous accounts, they have refined these standards to accommodate the variations in the sales process that occur naturally from account to account. Typically, however, these standards are not systematically gleaned and codified, but they exist nonetheless in parallel practice among the top performers.

Talking to these high-performing reps is very much like talking to an accomplished doctor. “If I see A, I’ll do B; if I see C, I’ll do D.” But this is where the parallel ends.

The “B” and “C” players, on the other hand, generally do not have the experience or capability to discover best practices on their own. At the same time, all too often sales training is general in nature, focusing on developing broad capabilities like discovering customer needs, rather than helping the company’s reps master critical company-specific best practice procedures.

Sales management often succumbs to the error of exhorting reps to improve their results, or coaching parts of the process piecemeal, rather than teaching and drilling critical company-specific best practice “standards of care.” In most companies, it is this absence of systematic best practice knowledge and supporting mechanisms that leads to such great variance in practice.

Best practice process
Here is a seven-part process to create “standards of care” in your own company’s sales force.

• Identify best practice. Try interviewing your top performers. Focus
  on key processes like territory management, account selection, the account
  penetration lifecycle, and day-to-day fundamentals like sales visits and
  follow-up.
• Codify best practice. Here, the key is to concentrate on a small number of high-payoff activities that can be translated into replicable processes, your “standards of care.” To take an analogy from football, try dividing the world into fundamentals and game plans. Fundamentals include things like crisp sales calls and the ability to talk comfortably with customer managers and engineers; game plans include an account prioritization process and a small number of well-specified alternative account penetration lifecycle profiles.
• Train the process. The most effective training must go far beyond teaching general sales capabilities. It must focus on systematically teaching your reps your company-specific best practice “standards of care.” For example, in the account penetration process, there likely will be a small number of well-proven game plans, and each of these will have several identifiable stages with particular critical activities at each stage. Every rep should know your best practice process and master in advance the essential skills necessary for success at each stage.
• Coach the process. Consider the words of Tom Brady, the New England Patriots’ star quarterback: “The goal of winning three consecutive Super Bowls should take a back seat to putting together three straight quality practices.”
  In the account penetration process there will be certain identifiable “pinch points” at each stage. For example, if a rep is moving into a stage in which the critical element is talking to engineers, the manager should coach and drill the rep in the process of talking to engineers until his or her performance is consistently excellent.
• Measure the process. All too often, sales measures are too vague and broad. In account penetration, measuring progress in moving an account from stage to stage is critical. Sometimes, important progress does not yield
  immediate revenues.
• Compensate the process. The compensation system must be aligned with the best practice process. If turnaround account management is critical, a significant component of compensation should be tied to account penetration
  milestones.
• Constantly improve the process. Like any “standard of care,” your best performers will always find ways to make the process better. The key is to identify and capture these improvements and systematically move your whole sales force to this new and better level.

Cultural consistency
The most powerful aspect of harnessing your own best practice is that your sales force will be very receptive to the improvements. Your own best practice is literally your own. It was developed by your own top performers, whom everyone in your company respects and admires. The accounts in which the best practices worked are your own accounts, often legendary turnaround successes. Your reps will be hungry for an understanding of how they could do the same.

Harnessing the power of your own best practice is the best of all worlds. The “standards of care” are available within your own four walls. You can identify, codify, teach, coach, and spread them rapidly and effectively. And your own sales force will readily accept and embrace them.

Article by Jonathan Byrnes, a Senior Lecturer at MIT and President of Jonathan Byrnes & Co., a focused consulting company. He earned a doctorate from Harvard Business School in 1980 and can be reached at jlbyrnes@mit.edu

The Huge Mistakes that Sales Managers Make…

Article by Geoffrey James, written for www.BNET.com

Sales managers have a difficult job.  Their employees tend to be independent and even secretive while the higher-ups tend to be demanding and unforgiving.  Not surprisingly, the tenure of a top sales manager is now around 18 months.

The purpose of this post is to identify the seven most dangerous mistakes that otherwise good sales managers make, along with some  advice on how they can avoid making them in the future.  Note: this is NOT criticism of sales managers but my attempt to help them avoid the icebergs that might sink their team and even their careers.

So, then, without further ado…

Huge Mistake #1: Hiring the wrong people and leaving them in place.

• Why It’s Huge: Sales managers often hire people who have no natural talent and then keep them on board, hoping that they’ll somehow acquire that talent.  This damages the ability of the entire team to perform because it creates a lower standard of performance for everyone.  It also lowers the group averages and can force the rest of the team to do extra work so that the entire team can make quota.
• Why They Do It: It can be very difficult to find talented sales people.  Candidates who have worked inside other companies often have bad habits and candidates without prior sales experience are always something of a crap shoot.  But the real problem is keeping the non-performers on board, which is usually the result of the sales manager feeling sorry for the non-performer or (worse) an inability of the sales manager to admit that he’s not all that great a judge of sales talent.
• How to Fix It: Give every candidate for a sales position a personality assessment to confirm that they have the basic chops to sell.  Continue to measure their performance to see whether there’s a problem with basic selling skills.  Provide training on skills that are lacking.  If that doesn’t work, do everyone (including the non-performer) a favor and force the non-performer to find a more compatible position elsewhere.

Huge Mistake #2: Failure to control sales and marketing costs.

• Why It’s Huge: Many sales managers get hypnotized by revenue, without thinking about how much money it’s costing to make that revenue.  In the quest for rapid revenue growth, sales managers often lose track of spending, especially when that spending is taking place inside another group.  Worst case, a company can end up in the situation of losing money on every sale, but trying to make up the difference by selling in volume.
• Why They Do It: Most of the time, it’s pure parochialism.  Since the money isn’t coming out of their own budget, they figure it’s harmless to  “invest” in programs (like pricey ad campaigns) that aren’t likely to have much impact on sales.  The only problem is that top management quickly figures out that nobody is watching the bottom line and (surprise!) blames the sales team for under-performing.
• How to Fix It: Sales managers should specifically request that other groups not fund any activities that that don’t have a measurable effect upon sales.  Sales managers should also consider implementing a commission structure that pays according to profit rather than revenue, providing it’s possible to communicate those metrics to the sales team in a meaningful manner.

Huge Mistake  #3: Promising sales manager jobs to the best reps.

• Why It’s Huge: The skill set for selling and the skill set for managing and coaching a sales team are completely different.  While some people can do both, these paragons are relatively rare.  Setting up sales management as a “reward” for sales performance makes it likely that the team will lose a top sales performer and gain a lousy sales manager.  That’s a pretty terrible trade-off.
• Why They Do It: In most cases, it’s simply an attempt to keep a top performer from jumping ship, by identifying an upward career path.  What’s lost in the promise is that sales reps must focus on building relationships and closing business, but  managers must focus on developing the potential of each employee.  They’re different jobs entirely.
• How To Fix It: Keep top sales people in sales positions, but identify and build an alternate career path that will increase their earnings and raise their recognition level.  Then hire people with  management and coaching talent for sales management jobs.  You can still hire from within, but only if the rep shows interest and aptitude for coaching and mentoring.

Huge Mistake  #4: Failing to establish an appropriate division of labor.

• Why It’s Huge: Many companies expect the same sales rep to 1) create a brand image in the prospects’ minds, 2) locate likely candidates for the product, 3) develop the account and make the sale, and 3) handle the ongoing relationship.  These are very different skills and very few people can do all of them well.
• Why They Do It: This usually happens when an organization grows organically from a small firm or start-up.  By necessity, the first sales pros have to be “jacks of all trades”, because there’s nobody else around to do all those jobs.  As the organization grows, there’s a tendency to keep doing what worked the past, even though it’s neither efficient nor effective.
• How To Fix It: This is fairly straightforward management stuff.  Step back, look at what’s needed, then separate sales and marketing personnel by natural talent and work.  Asher suggests segmenting the sales and marketing team into four groups with the following functions: 1) raising awareness, 2) locating qualified leads, 3) closing business with qualified leads, and 4) ongoing account management.

Huge Mistake  #5: Failing to have a repeatable sales process.

• Why It’s Huge: Many sales managers look to hire “self-motivated” individuals and let them loose to sell however they deem appropriate.  However, if managers rely too heavily upon the natural talent of the sales reps to develop and close business, every rep ends up “re-inventing the wheel” because there’s no way to share what’s worked in the past (and what hasn’t).
• Why They Do It: Ironically, most sales managers do this because they want their sales reps to be happy and independent.  They don’t want to be seen as micromanagers and therefore let the reps practice their “art” without interference.  The intention is good, but the results can be awful.
• How to Fix It: Without going overboard, sales management should create and document a realistic and workable sales process.  It should describes the various stages that the buyer typically goes through, and explain (briefly) how to help the buyer move to the next stage.  Hold monthly or quarterly meetings to share what worked and what didn’t, and fold those observations into the process, if appropriate.

Huge Mistake #6: Constantly changing the pay plan.

• Why It’s Huge: Some sales managers have an addiction to changing the compensation plan.  However, if the plan keeps changing, you can end up in a situation when, no  matter how many hours the rep works, he or she can’t break the pay ceiling.   Soon the company won’t be able to hire good sales reps, as the company  will have a bad reputation.
• Why They Do It: Two reasons.  Usually, pay plan changes are an attempt to react to new priorities from top management.  However, sometimes (sad to say) pay plan changes are made in order to reduce cost-of-sales by paying the sales reps less for the work that they do.
• How to Fix It: Never make rapid changes in the pay plan.  If priorities change, take a gradual approach, and get the sales team involved in determining what incentives will drive the desired behavior.  Always pay promised incentives.  Reward hard work rather than punishing it with pay plan cuts.

Huge Mistake #7: Creating sales stars at the expense of the team.

• Why It’s Huge: Some sales managers set up  one sales reps as the “star”, while ignoring the hard work  of other reps. The “star” gets all the hot leads and plenty of recognition while the rest of the team is overlooks.  This alienates the rest of sales staff and sends the message  that kissing up is the way to succeed.
• Why They Do It: Usually sales managers create “stars” because they know that the “star” will close the deals.  The “star” therefore gets all the hot leads, creating an upward cycle, where the “star” keeps getting more, well, stellar, while the rest of the team languishes.
• How to Fix It: The key here is to keep the playing field level and hand out leads equally among the sales staff.  Rather than creating a “star”, sales managers should strive to develop the potential of everyone on the team, through ongoing training and coaching.

Article by Geoffrey James, Sales Machine. Geoffrey has sold and written hundreds of features, articles and columns for national publications including Wired, Men’s Health, Business 2.0, SellingPower, Brand World, Computer Gaming World, CIO and The New York Times. He is the author of seven books, including Business Wisdom of the Electronic Elite and The Tao of Programming.

Steve Jobs Quotes Provide Insight Into His Maverick Management Style

Steve Jobs has resigned as CEO of Apple.

Jobs engineered Apple’s transformation of our relationship with our computers, phones and music.

What he’s accomplished in the past decade has not just restored Jobs to the Silicon Valley pantheon but elevated him to the status of superstar.

On the brink of bankruptcy when he returned after being fired, Apple now has a market value of $108 billion.

$1,000 invested in Apple shares on the day Jobs took over is worth about $36,000 today.

Here is a collection of his quotes: I think they will provide an interesting insight into the maverick management style of Steve Jobs…

*****************************************

“Sometimes when you innovate, you make mistakes. It is best to admit them quickly, and get on with improving your other innovations.”

“Being the richest man in the cemetery doesn’t matter to me … Going to bed at night saying we’ve done something wonderful… that’s what matters to me.”

“We’ve gone through the operating system and looked at everything and asked how can we simplify this and make it more powerful at the same time.”

“Be a yardstick of quality. Some people aren’t used to an environment where excellence is expected.”

“I want to put a ding in the universe.”

“I was worth over $1,000,000 when I was 23, and over $10,000,000 when I was 24, and over $100,000,000 when I was 25, and it wasn’t that important because I never did it for the money.”

“The Japanese have hit the shores like dead fish. They’re just like dead fish washing up on the shores.”

“Unfortunately, people are not rebelling against Microsoft. They don’t know any better.”

“Bill Gates‘d be a broader guy if he had dropped acid once or gone off to an ashram when he was younger.”

“The only problem with Microsoft is they just have no taste. They have absolutely no taste. And I don’t mean that in a small way, I mean that in a big way, in the sense that they don’t think of original ideas, and they don’t bring much culture into their products.”

“My job is to not be easy on people. My job is to make them better.”

“People think focus means saying yes to the thing you’ve got to focus on. But that’s not what it means at all. It means saying no to the hundred other good ideas that there are. You have to pick carefully.”

“Our DNA is as a consumer company – for that inpidual customer who’s voting thumbs up or thumbs down. That’s who we think about. And we think that our job is to take responsibility for the complete user experience. And if it’s not up to par, it’s our fault, plain and simply.”

“That happens more than you think, because this is not just engineering and science. There is art, too. Sometimes when you’re in the middle of one of these crises, you’re not sure you’re going to make it to the other end. But we’ve always made it, and so we have a certain degree of confidence, although sometimes you wonder.

I think the key thing is that we’re not all terrified at the same time. I mean, we do put our heart and soul into these things.”

“We don’t get a chance to do that many things, and every one should be really excellent. Because this is our life.

Life is brief, and then you die, you know?

And we’ve all chosen to do this with our lives. So it better be damn good. It better be worth it.”

“Almost everything–all external expectations, all pride, all fear of embarrassment or failure–these things just fall away in the face of death, leaving only what is truly important. Remembering that you are going to die is the best way I know to avoid the trap of thinking you have something to lose. You are already naked. There is no reason not to follow your heart.”

“Here’s to the crazy ones, the misfits, the rebels, the troublemakers, the round pegs in the square holes… the ones who see things differently — they’re not fond of rules… You can quote them, disagree with them, glorify or vilify them, but the only thing you can’t do is ignore them because they change things… they push the human race forward, and while some may see them as the crazy ones, we see genius, because the ones who are crazy enough to think that they can change the world, are the ones who do.”

“In most people’s vocabularies, design means veneer. It’s interior decorating. It’s the fabric of the curtains of the sofa. But to me, nothing could be further from the meaning of design. Design is the fundamental soul of a human-made creation that ends up expressing itself in successive outer layers of the product or service.”

“We made the buttons on the screen look so good you’ll want to lick them.”

“Click. Boom. Amazing!”

“You can’t just ask customers what they want and then try to give that to them. By the time you get it built, they’ll want something new.”

“Design is not just what it looks like and feels like. Design is how it works.”

“Why join the navy if you can be a pirate?”

“A lot of companies have chosen to downsize, and maybe that was the right thing for them. We chose a different path. Our belief was that if we kept putting great products in front of customers, they would continue to open their wallets.”

“Innovation distinguishes between a leader and a follower.”

“Recruiting is hard. It’s just finding the needles in the haystack. You can’t know enough in a one-hour interview.
So, in the end, it’s ultimately based on your gut. How do I feel about this person? What are they like when they’re challenged? I ask everybody that: ‘Why are you here?’ The answers themselves are not what you’re looking for. It’s the meta-data.”

“We’ve had one of these before, when the dot-com bubble burst. What I told our company was that we were just going to invest our way through the downturn, that we weren’t going to lay off people, that we’d taken a tremendous amount of effort to get them into Apple in the first place – the last thing we were going to do is lay them off.”

“I mean, some people say, ‘Oh, God, if [Jobs] got run over by a bus, Apple would be in trouble.’ And, you know, I think it wouldn’t be a party, but there are really capable people at Apple.
My job is to make the whole executive team good enough to be successors, so that’s what I try to do.”

“It’s not about pop culture, and it’s not about fooling people, and it’s not about convincing people that they want something they don’t. We figure out what we want. And I think we’re pretty good at having the right discipline to think through whether a lot of other people are going to want it, too. That’s what we get paid to do.
We just want to make great products.”

“So when a good idea comes, you know, part of my job is to move it around, just see what different people think, get people talking about it, argue with people about it, get ideas moving among that group of 100 people, get different people together to explore different aspects of it quietly, and, you know – just explore things.”

“When I hire somebody really senior, competence is the ante. They have to be really smart. But the real issue for me is, Are they going to fall in love with Apple? Because if they fall in love with Apple, everything else will take care of itself.
They’ll want to do what’s best for Apple, not what’s best for them, what’s best for Steve, or anybody else. “

“So we went to Atari and said, ‘Hey, we’ve got this amazing thing, even built with some of your parts, and what do you think about funding us? Or we’ll give it to you. We just want to do it. Pay our salary, we’ll come work for you.’ And they said, ‘No.’ So then we went to Hewlett-Packard, and they said, ‘Hey, we don’t need you. You haven’t got through college yet.”

“The people who are doing the work are the moving force behind the Macintosh. My job is to create a space for them, to clear out the rest of the organization and keep it at bay.”

“Your time is limited, so don’t waste it living someone else’s life. Don’t be trapped by dogma – which is living with the results of other people’s thinking. Don’t let the noise of other’s opinions drown out your own inner voice. And most important, have the courage to follow your heart and intuition. They somehow already know what you truly want to become. Everything else is secondary.”

“I’m the only person I know that’s lost a quarter of a billion dollars in one year…. It’s very character-building.”

“I’m as proud of what we don’t do as I am of what we do.”

“Quality is more important than quantity. One home run is much better than two doubles.”

“I’ve always wanted to own and control the primary technology in everything we do.”

“It comes from saying no to 1,000 things to make sure we don’t get on the wrong track or try to do too much.”

“It’s really hard to design products by focus groups. A lot of times, people don’t know what they want until you show it to them.”

“Innovation has nothing to do with how many R&D dollars you have. When Apple came up with the Mac, IBM was spending at least 100 times more on R&D. It’s not about money. It’s about the people you have, how you’re led, and how much you get it.”

“Insanely Great!”

“I’m convinced that about half of what separates the successful entrepreneurs from the non-successful ones is pure perseverance.”

“It’s rare that you see an artist in his 30s or 40s able to really contribute something amazing.”

“I feel like somebody just punched me in the stomach and knocked all my wind out. I’m only 30 years old and I want to have a chance to continue creating things. I know I’ve got at least one more great computer in me. And Apple is not going to give me a chance to do that.”

“I didn’t see it then, but it turned out that getting fired from Apple was the best thing that could have ever happened to me. The heaviness of being successful was replaced by the lightness of being a beginner again, less sure about everything. It freed me to enter one of the most creative periods of my life.”

“Do you want to spend the rest of your life selling sugared water or do you want a chance to change the world?”

“The products suck! There’s no sex in them anymore!”

“The cure for Apple is not cost-cutting. The cure for Apple is to innovate its way out of its current predicament.”

“If I were running Apple, I would milk the Macintosh for all it’s worth — and get busy on the next great thing. The PC wars are over. Done. Microsoft won a long time ago.”

“You know, I’ve got a plan that could rescue Apple. I can’t say any more than that it’s the perfect product and the perfect strategy for Apple. But nobody there will listen to me.”

“Apple has some tremendous assets, but I believe without some attention, the company could, could, could — I’m searching for the right word — could, could die.”

Thanks to Federico Viticci http://www.macstories.net/ for compiling the quotes.

Implementing a CRM … here are some lessons learnt

Article by Bob Coulthurst, PACE Australia www.paceaustralia.com.au

There is much written about implementing a Customer Relationship Management (CRM) system or Salesforce Automation (SFA).  Here is a summary of many lessons that have come from implementations that did and did not deliver against expectations.  We can learn from both!

1. Keep it simple and be clear about the purpose

All embracing total ‘perfect’ solution implementations often fail to deliver.  It is best to keep it simple, implementing specific fixes to specific problems rather than trying to change the way the business is working in its entirety in one go.  So, starting small, fixing a problem and then growing the implementation to cover other areas of the business over time can be a more effective approach than a large one off ‘let’s fix everything’ approach.

At the end of the day, what is the purpose of the system?  Ensure the objectives are kept in focus.  These objectives should be something along the lines of:

1. Enable sales staff to spend more time selling: reduce admin, increase effective selling activities
2. Provide improved information to help sales and management to identify prospects, convert prospects and retain customers
3. Capture customer information to ensure continuity and improved serviceability of  customers
4. Drive customer contact via a mix of human and automated contact strategies

2. Planning and preparation are  key

… A new concept?  No!  However preparing and planning must include genuine and early involvement from all staff who will use the system, it needs to value and consider their input.  It is best to involve all staff at some points in the process and a representation at other points.  It needs to consider how they work now and fix problems for them.  It needs to consider how you want them to work in the future and determine what the implications are in their working habits.

What will need to change?

Are you adding work or replacing work effort?  Gain a good understanding of how they work now and what you will be expecting them to change when the new system is up and running and how this will affect them.

Have a project team that includes users, and a project schedule.  Communicate often to keep staff up to date on progress.  Create excitement about how the system will provide benefits.

If staff are involved early in the design and planning of how they will use the system, what they need from the system and the planning of the data entry and reporting, there will be far less resistance when the system goes live.

3. Model your company’s sales process in the system

At the design stage, refresh your sales process and then design the sales process into the system.  Sales staff will get frustrated if  their manager wants them to work in a particular way and the system does not help them/support them/guide them.  The sales process needs to be kept up to date with how the business wants the staff to work after implementation, it needs to make it easier for staff to write letter to clients, send emails, and track progress.

4. Provide minimum expectations of usage

Be very clear on what is expected in terms of system usage guidelines.  What data entry is required, when it needs to be completed and why it must be done.  Managers must drive the minimum expectations with no exceptions.  If  the managers in the business are not clear and aligned on the usage, you  can imagine how the message will get lost when left to individual front line staff.  Clear communications and quick interventions if protocols are not followed are best.

5. Benefits for Users

The system needs to provide benefits to the users.  This can be in different ways.  It may include new analysis, easier tracking of opportunities, easier access to customer information etc.  Show staff the benefits for them.

At the end of the day a software system is just a system, it is useless if staff do not use it properly, so allocate time to ensuring that staff will want to use it and they will be more likely to want to use it if there are benefits for them and they have been engaged in the process of designing/implementing the system.

6. Work through how you expect  staff to use the system

Show that you have considered how the system will work  and how you expect them to use the system and how long this will take.  We have seen systems implemented and staff are asked to input data that will take 30 mins per customer because the system is clumsy or the system is slow etc.  Ensure that what you are asking is reasonable for the staff and importantly, good for the business.  If you have ‘tested’ the system and can demonstrate that the system will provide efficiency and effectiveness benefits, allowing them to be more productive, make sure you show them!

7. Dashboards and Reports

The system should provide staff with a summary dashboard including information along the following lines if applicable to your  business:

1. Actions today/week
2. No. of customers, segmented, against target
3. Customers at risk/end of contract
4. No. of prospects at different stages of sales process, against target
5. Revenue budget, Sales completed, Sales forecast and the GAP (between Budget and Forecast)
6. Average client/deal size
7. Conversion ratio, compared to rest of sales team
8. New leads/Target prospects
9. Upcoming marketing campaigns

There are other measures that may be effective.  It is best to think through the  measures that will help your business to find new customers, win new customers and keep existing customers.

Reports should be ‘pushed to users’ rather than pulled from users.  i.e. users should not have to go in and extract data; the  reports should be generated by the system and supplied to the users via email, the dashboard or some other method.

8. Management must be committed, passionate and excellent role models

Management must be trained and fully ‘on-board’.  They must be motivated, confident users and role models.  They need to maintain energy and support their staff in their challenges of changing their behaviours.

The adoption challenges can be more about change management than technology issues.  It is a fact that staff take on the behaviours of their managers, so it is important that managers are fully trained and effective users of the system.

9. Training and maintaining energy and focus

When the system is going live, ensure there is plenty of training in advance.  Ensure that staff receive help to get started with the system.  Management should maintain energy and support the users.  This may include mini workshops to input data as a group.

Lots of practice will help smooth out the usage issues and prevent excuses “…I didn’t know how to do that …”

Useful articles on the website: http://www.crm-guru.com/crm-articles

Wrap

Technological tools can be fantastic. Can you imagine running a business without a mobile phone today?  However we need to keep the following in balance:

• What are the objectives of the CRM?
• Who will benefit from the system/information?
• How do we make sure the core role of sales staff is kept top of mind and the CRM is considered a ‘tool’?
• What are the practical implications on those who enter data and those who want to analysis the information.  How easy and practical is it?
• How do we make sure we leverage the information?  If analysis of the data provides critical insights, how is this fed into the company’s planning cycle, regularly?

Spending plenty of time planning what all the stakeholders will get out of the system is vital.  Buy-in is essential; if the system is not used effectively, it becomes a burden.

Supporting users to embed the system in their daily routines and gain real benefits from the system is essential.

Picture this …

The CRM is fully embraced by staff and used effectively every day. The information from the CRM is analysed and lessons learnt are fed into the planning system of the business.

Customers receive great service supported by the power of technology and automation.

Sales and service staff know what to do each day.

Because they know the sales and service processes and the CRM drives best practice activities efficiently, they
have a great business tool.

… All this is a real possibility.

Article by Bob Coulthurst, PACE Australia www.paceaustralia.com.au

Key Accounts: Maximizing Revenue From Large Strategic Accounts

Article by Lynn Shively and Barry Shamis of Sales Management Insight

Identifying key accounts is important to most sales organizations. However, many organizations fail to use a strategic process to identify them. There is a misconception that a big company should automatically fall into this category. Including big companies in your customer portfolio is usually a good idea, unless they don’t match your ideal customer criteria. Bigger accounts generally have a higher cost of doing business, and they are more demanding in terms of their services required. Selling to and supporting big accounts has several challenges.

•Big accounts demand more attention, but they typically do not want to pay a premium for it.

•They leverage their scale and power in the marketplace to negotiate lower prices, better terms, and better support.

•They often exploit suppliers to create competitive price wars for their own benefit.

•They squeeze smaller suppliers to get lower prices, which they used against larger suppliers.

Many large companies do not provide you with the business that is deserved based on the efforts you put into them. Because of that, it is important to identify why you identify a customer as a key account, and what special treatment and attention they will get from your company as a result of that label.

Key accounts can be:

•Big companies with the potential to do a large amount of business with you

•High margin, and high profit accounts that return more to your bottom line than other accounts that require the same attention

•Strategic to your company’s goals and business direction

•Important anchor accounts in the marketplace or industry which you can leverage to gain access to other companies

•Provide positive visibility for your company

•Learning and educational customers that help your business progress

As with most companies, you’ll find that 80% of the value of your company gets in the marketplace, comes from 20% of your accounts. Finding that 20% is your objective.

Once identified, your company needs to decide what that means in terms of how you interact differently with those accounts than all the other. There can be many factors that may be considered as benefits that you might provide to these special accounts.

Those may include:

•Increased discounts

•More account sales reps and overall coverage

•Better service, support, and response time

•Tighter relationships between executives

•Joint business development and product direction

•Cooperative marketing

•Better integration of buying and shipping infrastructure

•Special training, implementation, and deployment

•More open disclosure of mutual business issues and directions between companies

Conclusion

Key accounts can be an important part of any sales organization. Take time to identify what attributes you expect, and what the special treatment you are willing to provide to them. Watch your cost of sales, your return on investment of resources, and set metrics that will enable you to monitor the growth you expect.

Article by Lynn Shively and Barry Shamis of Sales Management Insight

How to Motivate Your Most Difficult Salesperson

Article by Ralph Burns  http://www.salesmanagementmastery.com 

Now we’ve all had them. 

If you haven’t had them, then you will have them. 

If you have had them, then you know exactly what I am talking about.  

And those are the most difficult sales people, the ones that are motivated through a variety of different motivations, but the biggest one is the need to be assertive and to have power of their own. And these are typically the type of sales people that are highly opinionated, they are brash at times, they are boorish at times, they are fiercely independent, and they have a strong desire to have their voices heard.  

You probably know what these sales people look like if you haven’t had one in your sales management career. If you are a VP who has a bunch of sales managers, you can probably visualize the type of sales person that we are talking about. 

This is a double edged sword, because typically these power hungry individuals are your best sales people. 

Often times their power or need to be assertive is reflected in a strong desire to succeed.

 Typically those things go hand in hand, not always, you do have some opinionated sales people that are not successful. 

The ones that I have had in my 15+ year sales management career are power-centric, but also they are very successful because of their domineering style or their highly opinionated ways and their drive to succeed at all costs. 

The reason that this kind of sales person is the most challenging from a leadership perspective is because most sales managers perceive these people as a direct threat to authority. 

This is very common, because if you are a new sales manager, and you have a few veterans who sit in the back of the room, who second guess a lot of the things that you say, they complain about company policies and why they make no sense, or things that you have to do. These are the ones that are constantly nit picking maybe even challenging your authority at times, maybe sometimes less obvious and sometimes very obvious and sometimes in a public forum, sometimes in a private forum. It depends; there is no one way that this is done. 

This personality type is fairly common amongst sales times. We’ve seen this type of personality pattern repeat itself over and over again throughout most sales teams. The good thing about it is that these type people are in the minority. If you have 100 people in your sales team, maybe 8 or 9% of your team have these personality types. Or if you have 10 sales people, maybe you have 1 or 2 power people at most. 

There was one year that I had 6 sales people, and I had 2 of these people, and that was a very long, very painful sales year. However, we did extremely well. 

Often times the interaction between the sales person and the sales manager with this type of power craving personality style often results in outright conflict due to diametrically opposed ways to how things are done. They are very opinionated on how things should be done. It this isn’t necessarily a bad thing. 

Highly opinionated people are what you want on your sales team.  

You don’t want every to follow you without giving you some constructive criticism. 

You want people in your group to give you constructive feedback and to question you somewhat. It keeps you honest and it keeps you on the right path. 

Don’t look at it as a threat to your authority, look at it as an opportunity for you to get things right. 

The best way to diagnose which of your sales people fall into this category of “power” personality is to take our motivational questionnaire which you can get through our paid membership at The Sales Management Mastery Academy. We take them through many questions which calls out individual characteristics so that you can lead, coach and manage them in the appropriate ways using the techniques. 

One of the things about this type of sales person is that power struggles between the sales rep and the sales person rarely end with an environment of motivation. It usually ends with one person being right and one person being wrong and somebody losing face in the process. 

As a sales manager, it is not your job to be right. 

It is your job to increase sales. How you do that is that you solicit the opinions of others and listen to what they have to say. 

Some of your power sales people may have the best ideas. 

They may come across as whiners and complainers, and general pains in the neck, but if you filter through all of that, and listen to what they have to say, then you may get some of your best ideas as a sales manager in order to achieve your objective, which is usually increased sales success for the team. Or maybe it is to put yourself in a position to be promoted, or maybe you are the VP of sales and you have your own motivations that you want through the organization. 

Harnessing the talents of these power sales people will certainly help you to get there.

 Typically they are some of the strongest people on your team. 

Contrary to what may appear on the surface, the power sales rep does not want to take away your power. 

Let me say that again, contrary to what it may seem on the surface, power sales people do not want to take away your power. 

Although it would seem that way because they are constantly challenging your authority these are the people sitting in the back of the room that and questioning everything that you say as you are speaking to your group.

 Or they disagree vehemently with some sort of corporate policy that leads to an argument or some sort of internal debate. 

If you don’t take things personally, you can get some great ideas out of them. 

My point is this; not only can you get great ideas out of them, but don’t look at them as a threat, what they really want is some power of their own. 

They don’t necessarily want your power. 

If you share your power with another person that craves power does it diminish your own power or does it diminish your authority? 

Some managers would say yes, but I challenge you to think differently. 

Think of it this way:

If you have a candle and your power sales person has an unlit candle, if you reach over to the wick of your candle and light it with your candle. Then you draw your candle away, is your candle any less bright? Or less lit? No it is not. 

It is lit just the same. But you have in turn lit their candle.

 By you giving away some of your own power, you don’t diminish your own authority. 

It doesn’t undermine your ability to lead your sales team.

 If you deal with them in the right way, you can actually harness their innate talents while maintaining your authority by giving some of your power and authority away to them. 

That is the key with the power sales person and how to get the best out of them. 

Typically they are some of the most competent sales people and maybe some of the best sales people in your group. 

The key to all of this is that the sales manager absolutely has to be flexible with his/her approach.

With the power sale person it is especially true. 

You are dealing with 10 or 100 different personality types. You can’t manage, lead, and coach everyone the same. You need to be flexible; you need to be a chameleon. 

When you are dealing with the power sales person, this is especially true. If you have a hot temper, and they say something derogatory, it is up to you to control your emotions and take the high road, and it is up to you to be flexible in your approach, so that you get what you want. 

You both want the same thing. They want to be successful, they want to make money, get promoted, move forward in the organization, satisfy their customers, have a feeling of satisfaction when they get home at night, and whatever that motivation is. You can find out through the motivational questionnaire as to what really drives them. One of the things that drive the power sales person is this hunger for assertiveness, the need to be heard. And if you constantly squelch that, you’ll never really be able to get the best out of them. 

You can maintain that authority, but by giving some of that power away so that you end up sharing your power. 

The last part of this is that as a sales manager it is important for you to be not only competent, but also to be a confident sales manager.  

So many new sales managers come to us and they are not yet confident in their approach.

 If you have been around as a sales manager for a while, and you are listening to the show for new ideas, you probably have a pretty good idea of what your management style is and you have a track record of success. Or maybe you just understand that you have to be flexible and if that is the case, that is tremendous. 

 When you are dealing with the power sales person you have to be confident and competent. 

And you can do this by soliciting their input and gaining feedback from them but really competent and confident sales managers are the only ones that can deal with the power sales person. 

Most people do like praise, but the power sales person does not like praise. It may de-motivate them. You have to be careful with using praise and how it is used. 

Not using praise, but using another technique in order to get the best out of them and to channel that personalities so that you both get what you want which is increased sales. 

If this is channelled effectively, these kinds of sales people can also make extraordinary leaders.  

As a sales manager, you should be looking for opportunities to mentor and to help along your sales people in their current role as to whatever their career aspirations may be and to assist them. 

There are often times a tremendous leadership underlying quality, but you as a sales manager need to channel it in the right way. These types of sales people do need coaching and mentoring. 

To summarize:

 How to motivate your sales people that are motivated primarily by power.

•Usually power hungry sales people are the most challenging because they are a threat to authority

 •These sales people are defiant of corporate policies, sometimes we have power struggles that occur, but often times they are the best sales people on the team

 •Sales managers should channel their energy and drive into the right way

 •Sales managers must be flexible in your approach

 •Sales managers must be both competent and confident: a combination that is effective with the power sales person

 •Be careful with using praise, they may look at it as disingenuous and they may sense false praise

 •Have them mentor under you so that they can move forward in the organization into some sort of leadership capacity 

Article by Ralph Burns  http://www.salesmanagementmastery.com

The Challenge of Market Coverage Optimization

Article by Michael B. Mooreman, a Principal with ZS Associates, a global management consulting firm specializing in sales and marketing strategy, operations and execution. www.zsassociates.com

A well-respected selling organization recently asked us to assess the way they determine and manage their market coverage. In the course of understanding their situation one of the early questions we asked was: “why do you think you have an issue?” The response was essentially the following:

We have highly talented sales people and are a leader in sales process and pipeline management. We also recently re-evaluated our sales organization structure. Even so, we’re losing too many opportunities and we’re missing our numbers. We think our sales force is spending most of its time with current customers on short sales cycle opportunities. We don’t seem to be spending enough time selling our more complex solutions and pursuing attractive prospects, both of which require longer sales cycles and more effort. We also don’t seem to be able to capitalize on our cross-selling opportunities. On the cost side we have many internal debates about whether we are appropriately utilizing our telesales and business partner channels to manage our cost of sales. We need the right level of focus on all of our opportunities to achieve our growth targets.

As we’ve thought about our situation we’ve become concerned that our current methods, processes and tools may not be ensuring we have the right number of sales people, of the right type, allocated in the best ways across our businesses, products, segments and sales activities. We also aren’t confident our process for geographically deploying and assigning accounts to our sales people is necessarily maximizing our market coverage. We have spent nearly a year trying to better solve this problem. We don’t know to what degree it is possible to more effectively optimize our market coverage, but we are sure the return would be significant …

Many sales executives would empathize with the market coverage challenges faced by the above company. Market coverage optimization focuses on ensuring the most cost-effective type, number, allocation, deployment and targeting of sales resources to maximize the revenue and profit impact of the sales organization. The financial gains that can typically be achieved through optimizing market coverage are considerable. This has become even truer in today’s increasingly complex selling environments in which hybrid market coverage models—including strategic account teams, field account teams, generalists, industry specialists, solution specialists, hunters, farmers, tele-prospecting, tele-sales, e-channels, business partners and a host of other variations—have become common. In fact, for many sales organizations, competitive advantage has become much less an issue of another innovative go-to-market strategy, and much more an issue of executing the existing sales model much more effectively.

On average, top-line revenues can be increased from 2-7% through market coverage optimization. The opportunity can be far greater for organizations that are significantly mis-sized or mis-deployed. Even in highly mature industries we commonly find significant growth opportunity.

Few successful sales leaders have failed to recognize the impact market coverage decisions have on sales performance. Substantial investments in data, analytics, tools and sales operations resources provide evidence of this recognition. However, even with these investments, the majority of sales organizations fall well short of optimizing their market coverage. In most cases the root causes are a lack of awareness and expertise in current best practice methods, processes and tools, along with insufficient capacity during the usually time-crunched planning process.

Some of the most egregious—and common—revenue- and profit-losing practices are: (see below for more details)

• Use of financial ratios to determine sales resource funding and allocation
  
• Focus on existing revenue, instead of opportunity, when determining where to allocate resources
  
• Allocation and deployment of sales resources proportional to either revenue or opportunity
  
• Over-reliance on intuition to decide resource needs
  
• Over-reliance on workload build-up approaches to determine sizing
  
• Over-reliance on sales process and pipeline management to drive optimal market coverage
  
• Disconnected sales resource sizing, deployment and targeting decisions
  
• Too short a time horizon
  
• Misperception that mapping software optimizes market coverage
  
• Coverage design decisions that are driven by goals achievement rather than revenue and/or profit maximization

Effective market coverage optimization links product plans with sales force resource plans and ensures the type, number, allocation, deployment and targeting of sales resources maximize financial performance. Today’s leading approaches to market coverage optimization are based on a “bottom up – top down” evaluation of the market and dynamically incorporate:

• product forecasts and margins
• existing customer and prospect account potentials
• sales channel win rates, deal sizes, and costs
• account segment needs, buying processes and buying preferences
• long-term customer value and future market events
• disruption and relationship breakage costs
• travel times

Companies that excel at market coverage optimization have the advantage of fact-based assessments of the financial and strategic implications of alternative coverage models:

• They are able to confidently make informed market coverage decisions that reflect the reality of local markets.
• They gain strong buy-in and commitment from the sales force and experience less channel conflict.
• They are able to provide the information and support necessary to achieve quality execution right down to the account level.

They win by more consistently putting the right type and amount of resources against the best opportunities at the right times.

Unfortunately, sales organizations that have institutionalized some or all of the performance drains outlined in this article are more common than not. The highly-admired sales organization mentioned in the introduction was plagued by many. Fortunately they realized it.

Article by Michael B. Mooreman, a Principal with ZS Associates, a global management consulting firm specializing in sales and marketing strategy, operations and  execution. www.zsassociates.com

 

Common Pitfalls in Market Coverage Optimization

• Use of financial ratios to determine sales resource funding and allocation

  Financial ratios such as sales/rep and expense/revenue have no connection with the effort required to cover the target market, or with the marginal return associated with increased or decreased sales investments. The sales force is an investment, not a cost. Use of such ratios typically leads to underinvestment in the sales force, underinvestment in new products and emerging segments, and over-investment in more mature products and declining segments. All ultimately lead to lost sales and profit.

• Focus on existing revenue, instead of opportunity, when determining where to allocate resources

  Allocating resources based on revenue does protect the current revenue base and is an appropriate strategy for businesses focused on maintaining sales. However, for businesses that aspire to grow, allocating resources based on revenue leads to an undesired and self-fulfilling prophecy. You keep getting revenue with the companies with which you already have revenue, and don’t grow fast enough elsewhere. The inability to effectively estimate account potentials and to incorporate these potentials in coverage decisions means that the appropriate resources are unlikely to be available and focused on the best growth opportunities.

• Allocation and deployment of sales resources proportional to either revenue or opportunity

  Optimal effort requirements do not scale proportionately with revenue or opportunity (e.g., a $10M account does not typically require 10 times the coverage effort of a $1M account). Allocating resources proportional to either revenue or to opportunity will lead to many situations of under and over-investment across the account portfolio. Correspondingly, this error also leads to many heavy territories in which there are more sales resources than appropriate (i.e., high cost of sales) and light territories in which there are too few resources relative to need (i.e., high opportunity cost). Such inequities can quickly lead to rewards that are inadvertently more related to the quality of the territory than the performance of the individual.

• Over-reliance on intuition to decide resource needs

  Sales manager and (sometimes) rep input is essential to ensure coverage decisions reflect local market and account specific realities. However, sales force sizing and resource allocation modeling based on factors such as likely win rates, deal sizes, effort requirements and sales channel costs dramatically improve the quality of market coverage decisions. In particular, these models allow management to understand the financial implications of alternative coverage strategies looking across businesses, products, segments and geographies. In lieu of such capability the loudest or most persuasive sales managers tend to win the resources regardless of what is actually best for the company.

• Over-reliance on workload build-up approaches to determine sizing

  These approaches make assumptions about the number of accounts a given rep can manage or about the amount of rep effort that will be required to cover a given type of account. The shortfall is that neither approach takes into account the financial impact of the decision or the incremental revenues and profit that could be achieved through alternative sizing and allocation. While these methods can be somewhat better than using financial ratios, they are essentially a variation on intuition.

• Over-reliance on sales process and pipeline management to drive optimal market coverage,

  Sales process and pipeline management are also critical to market coverage optimization—once the right type, number and location of sales resources has been determined. Sales process and pipeline management are relatively far downstream in the market coverage optimization process. If the right type and level of sales resource have not been deployed to a local area, sales process and pipeline management are just making the best of an already sub-optimal situation.

• Disconnected sales resource sizing, deployment and targeting decisions

  When done correctly, the account-level analysis underlying sizing decisions should also drive decisions about where to locate resources and how to target those resources to accounts. A disconnect in these decisions almost certainly signals a poorly conceived market coverage approach.

• Too short a time horizon

  This error takes two forms: 1) not taking into account the future value of incremental sales achieved in the near-term, and 2) not considering market coverage needs in years two and three. The first error leads to under-valuing the sales force investment and, as a result, under-investing in new products and the sales force as a whole. The second error can lead to too much disruption to the sales force as it is reshuffled from year to year in response to product, customer, environment and competitive changes—some of which should have been anticipated well in advance.

• Misperception that mapping software optimizes market coverage

  Sales force deployment mapping software is a valuable tool. Although alignment optimization software is a tremendous enabler, however, the market coverage conclusion is only as good as the estimates of existing and prospective account potentials, the assignment of accounts to the right sales channels, the determination of optimal account efforts, and the management of relationship breakage during the design process.

• Coverage design decisions that are driven by goals achievement rather than revenue and/or profit maximization

  Effective goals enable fair individual performance measurement based on the opportunity that has been assigned to each rep. When territories are designed to enable goal attainment, the typical logic tends to be something like “make sure each rep’s territory has approximately $5M in base revenue.” However, goals should be driven by the territory, not vice-versa. Since effort does not scale proportionately with revenue, this common mistake suffers all of the many costs outlined above in error 3. This particular example also suffers from all of the costs outlined above in error 2!

Top 10 Factors for Getting Sales People to Overachieve

Article by Dave Kurlan – a top-rated speaker, best-selling author, sales thought leader and highly regarded sales development expert at  www.omghub.com

There isn’t a single key to over achieving so I’ll list my top 10 factors for helping salespeople overachieve. 

Goals - I’m talking “raise the bar, stretch, out of the comfort zone, more than the typical 15% increase in sales” type goals here.  You must raise expectations in order to celebrate superior performance.  Don’t forget two things: (1) that a forecast and plan come from the goals; not the other way around; and (2) goals are derived, not from the company, but from the individual’s income requirements, based on the bills that accompany life’s obligations and desires.

Incentives - including compensation, contests, commissions, awards and prizes.  Incentives bridge the gap between corporate carrots and the personal goals we just discussed.  If an individual has the goals but the company’s compensation isn’t designed to reward superior achievement, the incentive to perform can not be maintained.  If the company has a rock-solid compensation plan but the goals are wouldn’t excite Dr Phil, the personal incentive to perform will be AWOL.

Managing the Pipeline - a Visual Pipeline makes it significantly easier to manage the pipeline but the key to managing the pipeline effectively is working with your critical ratios.  Think monthly goal, closing percentage, average sale and length of the sell cycle. Let’s say that your salesperson has a six month sell cycle, a $100,000 monthly goal, a $20,000 average sale and a 25% closing percentage. Effectively managing the pipeline requires that your salesperson places 20 (5 $20,000 sales x 4 at 25% closing) new opportunities worth of total of $400,000 (25% of $100,000) into the pipeline 6 months in advance of the monthly goal (if the goal is for July then the opportunities must enter the pipeline in February).  Get that to work and the outcomes are all but guaranteed.

Accountability - This is such an important factor in over achievement.  You must hold each salesperson accountable to something measurable (like the number of conversations required to book the number of sales calls required to identify those 20 new opportunities) every day.  Even more importantly, you must have consequences for failure to meet those requirements and consistently follow through whenever necessary.  Develop the nerve for full accountability and you’re nearly there!

Motivation - This is the combination of Goals and Incentives. In essence, does the salesperson have a strong enough Desire and Commitment to do whatever it takes – every day – to reach the goals?  When they don’t, it’s your job to motivate them by knowing what each salesperson’s goals are. I’m not talking income requirements or gross sales here, I’m talking planes, boats and cars; big houses, vacation homes, golf trips, world travel, home theaters, fantasy camps, exclusive events, etc.

Self Starter - Last week I posted an article that discussed what it takes for salespeople to succeed in a remote location.  Those factors, whether salespeople are more effective when working independently or as part of a team; and whether they require supervision or can work without it; help to determine whether they are self-starters.  If not, you must start them up every day, twice daily or as often as it takes.  If you have self-starters, you are one lucky manager.

Skills - The more the better, but let’s focus on the most important skill sets for overachieving.  Your salespeople must be able to hunt for new opportunities, identify the most qualified and be able to close them.  Anything else they can do is a bonus!

Urgency -  I wrote about Closing Urgency in January.  Your salespeople must have enough urgency to get their opportunities closed, when they become closable, even when their prospects are trying to put them off.

Weaknesses - Unfortunately, there are weaknesses that will neutralize all of the previous 8 factors.  There can be dozens of weaknesses that could impact performance but none are so powerful as these five:  Non Supportive Buy Cycle, Need for Approval, Tendency to Become Emotionally Involved, Money Issues, Self-Limiting Record Collection.

Coaching and Training - Your coaching must support any training initiative and help salespeople overcome their weaknesses, develop skills and master the selling process.  While most training will be conducted by sales development experts from outside your firm, the coaching absolutely takes place from within.  Pre-call strategizing and post-call debriefing, with every salesperson, every day.

This list of factors is not all inclusive but it’s a good start.  You can build a sales force of over achievers if you incorporate not some, but all of these factors.

Article by Dave Kurlan – a top-rated speaker, best-selling author, sales thought leader and highly regarded sales development expert at  www.omghub.com