Sales Laundry

Posts Tagged ‘compensation’

Who is managing your sales force, your Sales Manager or your compensation plan?

If you said your compensation plan, the good news is you are in the majority. The bad news is your sales could likely improve 15-20% with a solid Sales Manager steering the ship.  Neil Rackham , in his book Rethinking the Sales Force: Redefining Selling to Create and Capture Customer Value, would say 17%.

When I find a Sales Manager that is giving honest effort but is not effective, it is usually because of one of these reasons.

1. The Sales Manager was your best sales professional and is still your best sales professional. Management? What management?
2. Most companies have a training program in place for new sales professionals and executive management, but few utilize any formal training for their Sales Managers. As a result, Sales Managers have no tools to help them manage the revenue production arm of the company, and run solely on gut instinct.
3. Sales Managers have a responsibility to complete a myriad of reports every week, with consequences for not getting them done. There is usually no compelling reason to make time for training or coaching exercises, and as such they don’t get done.
4. The Right Now. Sales performance is often measured on 30 day – 90 day increments on products and services with sales cycles that are much longer. No one dares to take their eye off the sales ball long enough to build in team development time.
5. The Sales Manager compensation model is out of line with company and/or the sales teams defined objectives.

Here are the first five tools I drop in my tool box when I am headed out to fix Sales Management related problems.

1. Put a “sales Manager” instead of a “Sales manager” in charge of your sales organization. Having the wrong person or personality type in the Sales Manager role is more often than not a significant part of the problem.
2. Train your Sales Manager. If you don’t have the budget, think of what an additional 15%+ in sales could do for your business.
3. Build training metrics into your Sales Manager performance measurements and make sure his/her workload will allow time to get the job done.
4. Build a model of continuous improvement into your sales process, making sure you do not shortchange your sales team’s growth and long term revenue potential for short term sales targets.
5. Align the Sales Manager job and compensation model with company goals to make sure a Sales Manager is watching and responding to the objectives and issues that are important to the company. Tie your Sales Managers compensation to the sales team and/or the sales professionals he is responsible for.

I want my Sales Manager to take care of his customers (the sales professionals he is responsible for) and keep the road clear of obstacles that might prevent them from doing their job.

I want my Sales Manager to be my eyes on the front line, making sure we are allocating our sales resources in the most efficient way possible to engage prospects and that he has and will use his authority to make necessary changes on the fly.

I want my Sales Manager continually engaged in enhancing or reinforcing the skill set of the sales team and identifying new ideas and best practices discovered by one sales professional and incorporating them into the entire sales team.

Put your Sales Manager to work growing your business instead of growing the stack of paper in your in-box. There is typically not another person in your organization that can have as much immediate impact for the dollar on your front line sales team as a well trained Sales Manager.

Have any Sales Management best practices or unique signs of spotting trouble?  I would love to hear them.

Image courtesy of  lumaxart

Q&A’s are excerpts of questions I have answered as part of Sales Laundry or other forums that I am apart of.  If there is a relevant sales message for the masses I post it here to share, gather feedback and discuss.

 

Q:  Channel Sales & Direct Sales Teams:  What are your thoughts on best practices for structuring a sales team that maximizes sales for both groups and minimizes/avoids conflicts.

A:   I don’t know your specific industry,  but my experience comes from technology, so that is how I have framed my comments.  Here are my general thoughts:

The Direct Sales Team

 Dividing the loyalties of your direct sales team between their own numbers and helping out the channel sales organizations can be a recipe for disaster.  If times get tight, I have seen direct guys pull all sorts of tricks to take a juicy channel deal direct.  The hedge to that is a partner deal registry and clear rules of engagement, neither of which is ever a bad thing.  On the other side I have seen channel partners act like blood sucking leaches, draining a manufacturer of resources and continually begging for leads.  It can get ugly either way.

 I would seriously consider putting a dedicated sales resource in your office supporting your channel partners exclusively. 

 You need your channel organization to spend the time and money needed to get trained up on your products and dedicate enough mindshare to them to get them heard above the noise of their other offerings.

 Use your internal dedicated sales resource to go on sales calls with them and help them put sales proposals together and nudge them along the sales funnel.  Force the dedicated channel sales representative to drive all revenue through the partners.  That way you have someone other than your Channel Manager working in the channels best interests on a daily basis.  Put a smart sales person in that role that can leverage the legitimate leads and deals that he uncovers in his patch into incentive for the partners to get up to speed and stay current.  You can use the leads to reward those partners that are moving the needle for you, for priming the pump for new partners or as needed to help steer your channel sales force.

 This dedicated sale representative can also be a good entry level sales position for your company in more established territories that you can develop into a direct role if the compensation model works like that for you.  That way they have your channel supporting them a bit as they come up to speed so you don’t have the huge dips in productivity when a new guy takes over a territory.

 Your dedicated sales representative should support your best partners and their best reps to keep the pipeline full, then spend time working your best partners second tier reps, other partners and finding new partners that are not going to stomp all over one another in a given geography.  Cut the bottom 20% of your partners and all those 1-off deal guys that pop up.

 

The Channel Sales Team

 Channel organizations are often times the whipping boys of the direct sales team and feel they drive product sales but have no real line of communication with the manufacturer to discuss strategy or to communicate feedback they get from the field.  Listen to your channel.  Typically the top 20% of the reps at the top 20% of your channel partners are driving the majority of your business.  You need to talk to them and understand their challenges with your organization if you want the real scoop.  The execs are usually not as helpful in the day to day stuff and Sales Managers are sometimes in the weeds because they were great reps that got promoted without any training.

 Give the channel a mechanism to register their deals and be protected from your direct reps.  Give them ready access to sales and support until they have their own resources trained and representing your brand well in the field.

That is about 1% of the topic.  You can check out The VAR Guy for dedicated blogging on technology channel sales.

 

Discussion boards are rife with comments from business owners lamenting the problems they have experienced on their quest to find an exceptional sales professional.  Arguably, a person that is exceptional should, by definition, be hard to find.

 So how DO you find the right sales guy for your company?  Begin by defining your sales process and the role you need this new sales professional to fill.

 This is ONE aspect, mind you.  Future posts will define other aspects selecting and building a solid sales team for your business.

 I use the terms “hunter” and “farmer” in this post, I assume most are familiar with the terms, but just in case, here is a brief definition:

 Hunter – a sales person engaged in finding new opportunities with new clients.

Farmer – a sales person engaged in managing existing client relationships.

 

Sales Intern – Free to low paid position, the primary reward for this position being the resume worthy experience and references the position can provide.

 Hire for:  sales lead data entry, basic sales contact management, assist with proposal development, general support host for in office lunch meeting, answer the phones, take some messages, general sales gopher.

 

Telemarketer – Typical entry level position with higher than average turn over and typically the lowest rung on the sales job ladder.  Could be home based, office based or outsourced to a 3^rd party call center.

Role:  Sometimes Farmer; Rarely Hunter/Farmer; Typical Hunter

 Hire for:  Hire a telemarketer if you have plenty of leads, you just need someone to call them.  Hire this person to do simple product driven sales, call to set appointment, research, sales or service add-on’s, follow up or act in a supporting sales role or layer of marketing for a larger sales organization.

 

Inside Sales – Home based or office based sales professional of entry or mid-level career experience.

Role:  Typically Farmer; Sometimes Hunter/Farmer; Rarely Hunter

 Hire for:  Hire a person for this role as a training ground to develop future outside sales professionals.  Hire a person in this role to assist an outside sales team, cold call, develop leads, manage an existing client base, develop proposals, do sales follow up calls, or as your primary selling organization if you do not need to build strong client relations or an outside sales presence.  In many instances this role is blended with aspects of telemarketing.

 

Account Manager/Executive – Like the Inside Sales Representative, typically home based or office based sales professional of entry or mid-level career experience with minimal to no activities supporting other sales teams.

 Role:  Typically Farmer; Sometimes Hunter/Farmer; Sometimes Hunter

  Hire for:  Hire for this role if you need someone to manage all aspects of the sales process that can be accomplished bound to a desk.  A person in this role can work in support of an outside account manager(s), or be your primary sales weapon if you product or services can be sold without the need for an outside sales presence.

    

Account Manager/Executive – Outside Sales – Like the Account Manager, except working a defined territory, visiting a prospects place of business.  Typically mid to senior level experience.

 Role:  Sometimes Farmer; Sometimes Hunter/Farmer; Often Hunter

 Hire for:  Hire for this role if you need someone to engage with your client at their place of business, at networking events, seminars, trade shows or other external promotional events.  The person engaged in this role is typically a hunter.  In many cases these individuals are responsible for finding their own leads, sometimes this role is supported by an Inside Account Manager or Inside Sales person.  Sometimes leads for this individual are driven by Telemarketers as well.

 

 Business Development Executive – Can be another name for an Inside/Outside Account Manager but is a title typically reserved for those engaged in activities beyond selling a set product to a set market.  Typically mid career to senior level experience.

 Role:  Rarely Farmer; Sometimes Hunter/Farmer; Often Hunter 

Hire for:  Hire for this role if you need someone to create new lines of business, new markets for existing products, new applications for existing products or new partnership opportunities.  As with an Outside Account Manager, in many cases these individuals are responsible for finding their own leads and are sometimes supported by an inside sales staff. 

 

Sales Overlay/Subject Matter Expert – Role typically defined as a single product champion within a multi- product sales organization.  Typically mid to senior level experience.

 Role:  Specialist; Supporting Hunter/Farmer

 Hire for:  Hire for this role if you need to focus attention on one product line, if one product line is vastly more complex or difficult to sell than other offerings, or if there are too many products for your primary sales organization to promote consistently.

 

Sales Engineer/Subject Matter Technical Expert – Role

 Role:  Specialist; Supporting Hunter/Farmer 

Hire for:  Hire someone for this position if your sales cycle involves engaging with customer side technical teams to discuss technical aspects that are beyond the depth of what you expect your traditional sales team to address.

 

Sales Manager – Role responsible for managing single or multiple teams of the sales professionals comprised of one or multiple sales roles.

 Role:  Primarily Manager, Sometimes Farmer; Sometimes Hunter/Farmer; Rarely Hunter

 Hire for:  Hire someone for this role to manage an existing sales team, hire, train, develop, coach, motivate, teach, possibly set compensation models, manage forecasts and pipeline activity, possibly set strategy and marketing direction.

 

 Director of Sales – Role responsible for managing multiple sales managers within an organization.  Can set overall strategy and tactics 

Role:  Manager

 

 VP of Sales/Business Development – Title is in some cases interchangeable with Director of Sales.  Can manage multiple business units, sales directors, and sales management teams. 

 Role:  Manager

 Hire for:  Executive level position providing front line sales experiences with executive management team.  Sets overall sales strategy and company targets for the entire sales organization.

 

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The title or role of the sales professional is only one aspect you need to keep in mind when hiring the right sales professional for your organization.  Just make sure you understand the sales role you need to fill so you can identify the sales qualities you need to look for in your interview process.

 If you have a question, ask.  If you need a little more assistance, email me at val @ saleslaundry.com

Image courtesy of  http://stillhiring.ie

I got this email today from one of the LinkedIn groups I am associated with trying to sell me outsourced services for my business.  I opened it up, read the first three lines and deleted it.

 Then I decided to pull it back out and see if I could improve on the efforts of the original sales person and make a sales lesson out of it.  I am ignoring the spelling/gramatical mistakes as I am not an English teacher, I am a VP of Business Development.  The names have been changed to protect the sales or marketing knucklehead that wrote it. 

 

The Original – feel free to skip ahead as I could not get past the first 3 lines of this email on my first pass.

 HEADLINE: For Possible Business Collaboration / Oppurtunities

 Dear Mr.Val, 

I represent ABC Company, an offshore based services outsourcing Organization. We help our world-wide clients with our outsourced services such as;

Global HR Services – All Technologies, All Business Domains, All Business skills, At all levels of expertise & Knowledge.
- Recruitment Process Outsourcing (RPO),
- Worldwide Contractor staffing – Offshore/Remotely working resources/Onsite resources
- Online/Remote/Onsite Training & Development -Technology & non Technology training, e-learning courses development & Administration, Monitoring & Managing Training needs etc.
- Payroll Processing
- Employee records maintenance, & verifications
- Travel &, Accommodation
- HR policies & strategies
- Market /Competitor research
- Employees Compensation & Benefits
- Performance Appraisals processing, Administration & Management.

In addition, ABC Company helps worldwide organizations in the following areas;
1. Information Technology services (IT solutions development, customization, integration, Migration, upgrading, Implementation, Maintenance, Support etc. – All Technologies & Business Domains

2. Knowledge Process Outsourcing (KPO services – (a) Engineering – Mechanical, Civil, Architectural, structural b) Legal Process Outsourcing (LPO – all skills) c) Technical Writing & Communications d) Remote infrastructure Management (RIM – Monitoring & Managing any IT resources remotely, Technical Help desk, Systems & Database Administration, support, e) Animation, 2D, 3D modeling etc.)

3. Business Process Outsourcing (BPO – Document processing, Data entry, help desk, Data analytics, Data/market/IP research, Billing, verifications, Transcriptions etc, Outbound/Inbound Calling services etc – All Business domains and skills)

4. Bioinformatics (Contract/Collaborative Research & Development, Consulting, Life Sciences Software Applications & Tools, Data Mining/Data Analysis, Data & Applications Integration. Clinical Trial I/Medical informatics, LIMS, Internet/Intranet Applications, Multimedia & Virtual Reality Applications, Education & Training)

We have seen the following benefits accruing to our clients from our services;

1. We have a large team of highly qualified, experienced, talented, efficient, young and enthusiastic resources to support your organization in any of the areas shown above.
2. Our teams work as an extended team of onsite teams of our customers, thereby adding more strength and bandwidth and increase your teams’ skills and servicing capabilities.
3. Our resources can work on a 24x7x365 basis; our turn-around time for our service is very short. In most cases, the output will be in your inbox when you reach office the next day morning
4. We help our customers in cost savings of as much as 30-60% on case to case basis
5. We can provide our resources in good numbers at a short notice, and quickly ramp-up to meet your business needs.
6. Our clients save the hassles of constantly searching around for resources, every time, a task needs to be accomplished.
7. Our teams bring to the table, a very strong technical & English Communication (verbal & written) skills, highly professional & helping attitude, business ethics, services delivery expertise & commitment

I would be very glad to know, if ABC Company can be of any help and support to your organization or any of your client organizations, in any of the areas shown above please. I appreciate your time.

My Version

HEADLINE:  Are You Running Your Business or is Your Business Burying You?

 ABC Company helped me save my business!  ABC helped me identify why my operations costs were increasing even as our sales were slowing down.  ABC handles the backend of my operation so I can focus on bringing in new sales.

 Jay Richards, JR Enterprises (VIDEO CLIP:  Jay talks about ABC Company)

 Val,

Imagine I gave you a magic wand that let you eliminate every aspect of your business that you don’t enjoy, or that just seems to take your focus away from the things you feel you need to be doing.

 How much better would your business be if you enjoyed everything you did and had the time to focus on growing your business?

 What could you do if all of that extra weight was lifted off your shoulders?

 My name is Val King and I specialize in helping guys like you offload all the excessive weight that keeps your business from soaring.

 It is not magic, though, it’s our business. 

 Here are the Top 5 things our customers typically ask us to offload for them.

 Human Resources.

Payroll.

Insurance & Benefits Programs.

IT Services & Help Desk.

Billing & Collections.

Call me at 800-xxx-xxxx and let’s identify the Top 5 things weighing down your business.

If it makes sense, I will offload your Top 5 list for Free for a few weeks so you can experience our brand of magic and experience the impact you can have on your business once that excess weight is gone.

Val 

 ABC Company manages all of the time consuming aspects of my business that I hated.  Our business is growing again and I spend my days doing what I love.  Thanks ABC.

 Dave Johnson, Johnson Medical (VIDEO CLIP:  Dave talks about ABC Company)

LESSONS LEARNED

The original email reads like a laundry list, these guys are into everything from 3d animation to Life Sciences and Bioinformatics.  They list a lot of capabilities but this sales guy has no idea what my problems are, so he just lists everything they do in this email to make sure they cover every sales base possible.

LESSON:  Research your customer and avoid firing a shotgun email like this one.  Narrow your focus to what you are absolutely best at. 

The intent of this extensive list of services is to show me that they can help me in many different areas of my business with a huge stack of sales offerings and services.  However, I read this feeling that they could not possibly do all of this well.  I have no way of knowing which sales offering is their strongest, nor do I want to take the necessary time it would take to figure it out, so my instinct is to hit the delete key.

LESSON:  Avoid the temptation to send out a laundry list disguised as a marketing email.  It weakens your message and erodes some of your credibility.

The original email establishes no credibility for this company.  I have never heard of them and the only person telling me how great they are is the sales guy.

LESSON:  If the only person saying your company is good is the sales person then no one is saying anything good about your company as far as I am concerned as a customer.  Use legitimate references I can call or for a bigger bang for the buck, use video references I can watch.

There is no tie to what any of these services do for me, the guy that is supposed to pay for this fabulous service.  The sales professional should paint some sort of picture of how my life as the business owner or how my company might be better if I just offload this stuff to them.

LESSON:  It is your job as the salesperson or as the organization sending the email to explain to me how I will benefit from your product.  If you don’t make that connection, don’t expect me to respond.

There is too much text in this flippin’ email (and probably this post.)  The text is small, there are acronyms all over the place (RPO, KPO, LPO, RIM, and LIMS.)

LESSON:  Be as short and concise as possible as you are imposing on my time with your email and use language that is plain and free from industry jargon.

They use the work “all” eight times in the email.  Example:  ”Global HR – ALL Technologies, ALL Business Skills, at ALL levels of experience and knowledge”

LESSON:  Horsefeathers.  I don’t believe it.  I will delete it.  

There are 7 stated benefits for me the customer.  Some are ridiculous adjective fests…

Benefit 1:  Large team that is highly qualified, experienced, talented, effiecient, enthusiastic and as if that was not enough they are also described as being young.  I don’t know about you, but I feel better already. 

Some are not benefits to me at all; they are minimum standards like…

Benefit 7:  Our teams bring very strong technical and English communication skills.  

LESSON:  It is only a benefit if it benefits me.  Write your email as if you are standing in my shoes, not trying to talk me out of them.

This was the closing line.  “I would be very glad to know if ABC Company can be of any help and support to your organization…in any of the areas shown above…  I appreciate your time.”

When I read this closing line what I get out of this email and what the salesman wants me to get out of this email are clearly two different things.  I am sure the salesman would like me to look at the list like some sort of ala carte menu, make a few selections and get back to him so he can work up a quote.

What I read is that the salesman at ABC Company is too lazy to figure out what my business is or what I do all day.  He has effectively hit me with a list of SIC codes and a Scan-Tron asking me to color in the little circle next to my selection with a #2 pencil and get back to him.

LESSON:  Figure out what I need to buy before you try to sell me something.  It seems to work better that way.  If you are going to be lazy and not do the research then don’t send the email at all.

 

Got a suggestion of your own to improve on my improvement?  See another lesson here worth covering?  Add a comment.

“Cleaverly disguided” photo – courtesy of  http://rlv.zcache.com

“English photo” courtesy of - http://www.flickr.com/photos/40741986@N00/399082864

“2 shoes” photo – courtesy of http://www.flickr.com/photos/conqenator/2952567054/ 

 

Negotiating a strong compensation package for yourself in any role, but especially business development, can be a two edged sword.

 

On one hand you have sliced yourself a nice slice of base with a healthy heaping of commission, but on the downside if you have trouble putting your money where your mouth is, your compensation package could make you a particular juicy target when your company is looking to trim the fat.

 What should you do about it?  You should avoid becoming a target in the first place

 

If your mouth and sales skills have landed a particularly rich compensation package above and beyond some of your peers you darn sure better produce to a standard beyond yours peers as well.

 You might also want to make sure the level of production you need hit is even possible with your existing sales methodology.

 Many years ago I made that mistake.  I managed to work myself into an exceptional compensation package, and managed to lose sight of reality just long enough to agree to some stratospheric sales targets.

 I completely missed the fact that using my current sales strategy those new targets were a mathematical impossibility.  In retrospect, if I could have suspended the rule that there are only 24 hours in a day or my occasional need for sleep and a good bath, I MIGHT have been able to pull it off.

 While I am smarter today, I am still not smart enough to bend time and space to meet my sales objectives.  Sure, I could have gone the safe route and negotiated a smaller compensation package but that would have taken a large degree of the challenge and fun out of the journey.

 Placed in that situation today I would work backward from my lofty goals and determine what changes I would need to make on a daily basis to make sure my goal was well in line at year end.   Those changes could be as simple as making a few more calls each day or as difficult as pulling a Tiger Woods and completely revamping my sales swing so to speak.

 Either way, the experience would make me better at what I do and earn me a heady title typically reserved for laundry detergent, such as “new and improved” or “new more powerful formula!“

  The only draw back I see from this line of thinking is that by hitting those crazy numbers, next years’ budget will be crazy number + 10% and it will be time to revamp that swing again.

Image courtesy of www.consumerwarningnetwork.com