Although my first job was as a Sales Representative and my second job was as a Sales and Product Manager, I didn’t really get interested in how to enhance fundamental Sales performance until I became a General Manager. Before that I was too busy doing thngs to think about how to improve what I was doing.
At that time I had the privilege to work with Guinness Overseas Ltd, a company now part of Diageo. The good thing about Guinness was the brand was so hard to sell, the team really had to think hard about how they could improve sales- beyond superficial discussions like have a promotion here, a discount there. As a result of this I became involved in considering, testing and evaluating ways of enhancing Sales effectiveness, and I’d like to share some of my learning that I refined when with APB and Heineken.
Sales Effectiveness for any business is finding out what’s the right things to do and then how to do it right- effective strategy + efficient implementation.
After much thought, our approach to consider sales effectiveness came down to strategy + implementation, where strategy was the sum of skills plus intelligence. While implementation was execution plus leadership. And so in assessing the sales effectiveness of any organisation I’d like to think of the following…
Sales Effectiveness = ( Sales Skills + Sales Intelligence) X (Sales Execution + Sales Leadership)
Certainly you can analyse any problem to death, you can add more elements to each of these four components, you can drill down further. But as the purpose of any Sales Effectiveness review is to make the business more effective, an exhaustive review of every element is self defeating, and so we spent a long time pruning down to bare essentials what constitutes each element.
A. Basis of the Assessment
Each of these variables has 8 constituent drivers to assess, only because eight is enough to think about.
1. Sales Skills ; an assessment of the performance of the typical person who connects with your customers and the range of individual skills they have vs the skills they need as well as the institutional skills and knowledge residing within a business. We would assess company performance int he following areas;
- Prospecting Skills – ability to find new customers, how you assess their benefits to you and assess whether they could add value.
- Probing Skills – ability to know what the customers needs are.
- Listening Skills – ability to discern objections and buying signals.
- Presenting Skills – ability to pass the right information to the customers based on their needs and your solutions.
- Closing Skills – ability to turn buying signals into confirmed sales at a profit.
- Pipeline Management Skills – ability to manage the flow of existing and new business; retaining existing customers, replacing ex/poached customers, converting new customers based on typical purchase lifecycle. Ensuring an appropriate flow of new business and existing business.
- Product Knowledge – knowledge of own products and what they offer your customers.
- Industry Awareness – knowledge of what the competition offers, and cycles in the category.
2. Sales Intelligence an assessment of the performance of management and team intelligence, and the range of people skills available as well as the institutional skills and knowledge residing within a business. We would assess the companies performance in the following areas;
- Recruitment Process – hiring and developing the right sales people.
- High Performance Focus – identifying and developing the behaviours to get high performance.
- Target Compensation – the link between the plan and what the sales force get paid as a whole and individually.
- Peer Recognition – recognising great performance in appropriate ways.
- Resource allocation – the process of allocating scarce resources to various competing areas of operation
- Tactical Sales Plans Aligned with Strategy – line of sight management from the plan to the implementation, actually doing what you planned to do.
- Incentive Plan Clarity – how to ensure sales performance above planned performance; simplicity, clarity, alignment and sustainability.
- Effective Field Coaching – generating sustained positive behaviours in the sales force, and elimination of negative behaviours.
3. Sales Execution; consistency and sustainability of implementation, assessing how the company performance in each area.
- Goal Clarity – simplicity, clarity, alignment and sustainability.
- Tactical Selection – selecting the most appropriate tactics to achieve the most appropriate goal
- Performance Metrics – ensuring measurement is related to outcome related sales goals, infield performance of tactics against pre-set levels and actual customer-beneficial behaviours of the sales force.
- Defined Performance Management Process – appropriate process for managing day to day, cycle-to-cycle activities.
- Activity Levels – number of and performance of infield calls as part of the work of the sales force.
- Readiness Assessment – agility to respond appropriately and at speed to changes in business environment, market, competition, resourcing, and performance situation.
- Coaching & Counseling – managing teams for the long term performance.
- Culture – the belief systems supporting sales teams.
4. Sales Leadership; quality and style of the leadership approach to create positive outcomes, assessing the performance of leaders in the company against;
- Strategy Development; devising a range of actionable scenarios and selection of most appropriate approach to sustained performance in the current market environment.
- Strategy Communication – process of successfully passing actionable knowledge, tactics, targets and plans from the top to the bottom of the organisation
- Tactical Definition & Measurement – step by step organisation of elements of the sales mix to achieve goals, and appropriate independent measurement of this.
- Readiness Planning – agility to appropriately predict and pre-empt to top-level changes in market, competition, resourcing, plan situation and have alternate approaches available.
- Sales Participation – process of the whole company getting infield and engaging with customers to the benefit of the planning process.
- Performance Management Execution – generating acceptable company-wide process of sustained positive performance.
- Leadership Style – appropriate to the market, business culture, people and customers.
- Recognition & Communication – process of ensuring information and recognition flows within the business.
These are what I perceive the 32 drivers of sustained sales results. Based on your particular industry and sales channels, the content of each part of the process will vary somewhat. And certainly, you could add more, but these are the basic constituents to an effective sales team.
B. Assessment Process
At the start the assessment process its important to understand firstly, that this isn’t an academic exercise aimed at describing your organisation perfectly, and then describing the perfect organisation. Instead, its aimed at generating sustained positive change to your sales force performance. Secondly, that there is a limit to the organisation’s resources and ability to execute change and to work within these tolerances and not to wreck the business trying to make everything better, now. We aim to create an improvement plan to last a few years of steady improvement.
1. Create ‘To Be’;
Firstly, we outline what the desired future outcome would be for each area of assessment. This is the platinum standard that could be aspired to. We would then benchmark this by assessing how well your most effective competition performs in each area- this would set an acceptable level of attainment. And then assess the absolute minimum performance in each area from a customer perspective, this creates a the base acceptable level.
As a side-bar, this industry assessment will also provide you with a valuable assessment within your industry sector of what are the must-haves (the elements of your relationship that customers desire and competitors do well) as well as any potential competitive advantages (elements customers desire, but competitors do badly). We would not suggest improvement in every area, but to select those areas where you MUST improve to remain on par with the competition where it counts, as well as to identify some potential areas where you can create a competitive advantage with your customers.
This process then sets up an assessment matrix with three performance levels- minimum acceptable, competitive equivalence, industry leadership.
2. Assess ‘As Is‘ ;
We would then propose assessing the sales teams performance in each areas, based on objective measurement and demonstrated performance; Not, ‘i think we do that’, but show me and lets see if it matches up. This is not a witch-hunt, but a necessary objective assessment of actual performance against the benchmarks to enable us to see what your current performance really is.
3. Find ‘The Gap”
We now clearly have a desired outcome (To Be), and an objective assessment of current performance (As Is). Most companies now would slowly work there way from top to bottom making small improvements everywhere.
We disagree with this. We’d suggest a more robust review based on must-haves and areas of competitive-advantage. Identify the areas customers value, the competition do well and your company does badly- this are the initial must fix items to gain the greatest performance traction.
After identifying a “catch-up” plan; look for an area of potential competitive advantage to take you ahead of your competition.
Don’t be sucked in trying to do to many things. Once the four to six most important gaps are identified, I would review and discuss them with the team sponsoring the effectiveness review to find within those identified project gaps where the solutions can be bundled into a single initiative (rather than four or six distinct projects if possible). Its much easier to motivate the sales force to implement one project, with a couple of parts, than to have four or five different improvement projects running. Again, this approach is designed to save money, time and ensure sustained and positive execution.
4. Implement the plan.
We’ll help you create a plan for implementation, with clear achievement goals in agreed timeframes. But we insist the managers physically sign onto the plan, to make it their plan…. not ours. We would then schedule monthly follow up meetings with senior management along with weekly coaching calls to ensure the plan is being implemented. When the plan is complete, we then go back to the assessment to identify what’s next, and repeat the process.
Why bother with a sales effectiveness assessment?
Assessing and then enhancing your sales forces effectiveness clearly and objectively enables business owners to focus on the elements in sales that are hindering company performance as well as identifying opportunities for enhancing sales growth.
Why spend money on negotiation training that a sales training company has sold you if your poor performance issues arise from a lack of field coaching? Why waste time perfecting a program to identify new customers when your individual sales representatives are handicapped in not knowing what are the most profitable customer needs? Why continue to throw good money into an incentive plan when your recruiting process keeps bringing in candidates with low skill and low sales intelligence?
Great organisations have a common approach to problem solving. Measure, plan and execute. Sales force effectiveness kickstarts this process.
Have you gone through this process, please share your findings to assist us all improve.