Throughts on Successful Sales Management – Friday at 11:30

August 12, 2010 — 4 Comments

Preparing for this week’s upcoming Teleseminar on Successful Sales Management, a few random comments from things I see almost every day… (sign up at http://www.stelzl.us/business_strategy_TeleS.asp)

1. Good sales people are entrepreneurs.  They can’t be managed like a team of factory workers.  Keep in mind – high risk, high reward.  Let let the compensation plan do most of the managing.

2. Building on No. 1 – high reward means you are willing to pay them when exceedingly great things happen, so don’t manipulate the pay plan, claiming they are making too much.  High risk (required to receive the reward part) means, when things don’t go well, they don’t make money.  It’s not your problem.

3. Complex compensation plans drive sales person into hours of meaningless research and number crunching.  They lock up the entire selling process.  Keep it simple.

4. Smart sales people are going to sell things that pay well.  Stop telling people what to sell – instead, design your compensation to drive the behavior you need.  This requires focus and a clear understanding of what needs to be sold.

5. Quota is not a tool for controlling how much people make.  It’s a gauge, letting you know if people are hitting the number required to stay.  Compute quota based on necessary performance, then design compensation to pay big on the things that are worth paying for.  E.g. Accelerators are great – but set them above quota if that’s where they need to be.  Don’t raise the quota just to make this year harder than last, instead raise the accelerator.  If people don’t make quota – send them on their way.

6. Don’t create two goals for any one person.  Selling is hard and requires focused effort.  Give a person one thing to aim at that will then drag many things.  That one thing becomes the strategic objective around which the compensation plan hinges.  This leads to successful selling.

7. Most meetings are a waste of the sales person’s time.  On the other hand, you need to know exactly where the sales are, the timing, the numbers, etc.  Let your CRM tool manage this and require your sales people to keep it up to date.  This is one area where micro management and penalties may apply.

8. Sales people are consummate negotiators.  Stability is required to create a strong sales team.  Set your “well thought out” plans in place, have a great, well constructed compensation plan, and hire people a great character.  Set things in motion and stick to them.  If a sale person isn’t making enough money, advise them to sell more or move on.  (This assumes that you really do have a well thought out plan).  Change leads to more thrashing.

9. Don’t accept a personal plan that compensates you more for selling then managing.  This leads to failure as a sales manager and is destined to lead to your own termination.  Negotiate your plan up front to focus on multiplying the sales of your team by working alongside them and relieving them of any and all distractions from selling.  Most sales people spend a solid 90 minutes a day selling.  Imagine if you could help them double this!

10. When new hires come on, ride with them, mentor them, and make sure they really know how to get started. Most won’t, but a little direction will go a long way.  If you’re too busy for this, it’s the wrong time to be hiring.

© David Stelzl, 2010

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4 responses to Throughts on Successful Sales Management – Friday at 11:30

  1. 

    Channel recruitment is key to the growth of a business. It is by forming a well-mobilized and motivated pipeline that a company maximizes its revenues and sales. Considering that 60% of most companies’ profits come through their partners, it is not surprising that businesses make it a priority to choose the right distributors and retailers. On the other hand, putting the right people in your cloud entails time, effort, and huge investments on phone calls, events, and travels.

    Another challenge that even top vendors face today is the competitiveness of the industry. Gone are the days when VARs would easily tie up with a vendor that has the best product or marketing proposition. Retailers are now looking for competitive advantages and incentives that vendors can give them. Strong and efficient management of partners is also another factor that attracts quality resellers to a business.

  2. 

    And channel management should be set apart from sales management – two different skill sets…

  3. 

    Dave,

    I would also add some thoughts on compensation.

    If I want my salespeople to behave as trusted advisers, as opposed to street peddlers and bazaar hucksters, I have to pay them accordingly.

    Buyers don’t trust commissioned salespeople because they know salespeople try to sell whatever makes them the most money NOT what solves buyers’ problems.

    Commissioned salespeople don’t have the “walk-away” power that is so much needed for good positioning. They cling on to every penny they can make.

    Commissioned salespeople are compensated for short-term individual performance. The problem is that long-term thinking is lost and teamwork is lost. In today’s world of complex solutions, it’s teams of people who make sales not individuals. The only way I can “buy” expectation of 100% effort, engagement and dedication from my people is by paying them to play in my corner.

    Using a military example (being a former soldier), I wouldn’t want to go to battle with people whose main incentive is the number of dead bodies they can produce.

    In the selling environment, I wouldn’t want to have someone on my team whose main motivation to do work is the money. There is a profession for that under “P” in the dictionary.

    In my experience, a nice fixed salary allows salespeople to behave as unbiased trusted advisers. On the top of that, there is a company-wide bonus which is the function of their documented progress on their pre-set individual professional development curriculum.

    And the individual professional development curriculum is a blend of business skills and subject matter expertise.

    In my experience buyers are eager to meet subject matter experts with business savvy, like you Dave, but they do their best to avoid salespeople who have neither subject matter experts nor business savvy, even if they’ve memorised 1 million closing tricks.

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