CSO Insights Blog Posts

Sales Management 2.0

I haven't actually heard the term "Sales 101" for a while now. Borrowing a page from college catalogs that used 100 series course numbers to denote undergrad and first year courses, selling 101 was basically-well, the basics. This term kicked around for at least 25 years and I was always tempted to develop a course or write a text, Sales 201, just so we could say we'd finally gotten past the entry level.

Jump ahead to the proliferation of the Internet and then Web 2.0 and you are brought suddenly to Sales 2.0, a term coined by David Thompson, CEO of Genius.com, Geoffrey Moore, and Nigel Edelshein. This term has been with us for four years now and yielded Anneke Seley's book, Sales 2.0, and Selling Power's Sales 2.0 events (the next in Boston June 28^th).

But what of Sales Management 101? Or Sales Management 2.0?

It turns out a lot more has been said and written about sales than about sales management, even though there is huge leverage in developing competent sales managers. What kind of leverage? Glad you asked; last week we released our first-ever Sales Management Optimization study based on responses from 630 companies. The study looks across 75 metrics and identifies the top 10 Key Trends.

One of these metrics is looking at the primary experience profile of new sales managers. Companies promoting successful sales reps (but lacking management experience) slightly outdistanced the second place profile, hiring sales reps outside the company but within the industry. One way to gauge the leverage gained is comparing average rep performance. We see in the table below, experienced sales managers had a higher percentage of reps meeting/beating quota in 2009's very tough climate.

Percentage of Reps making quota by sales manager type

But wait, there's more. From the report:

While the table results show experienced managers do a more effective job of getting work done through others, the fact that overall plan attainment was the same (84% in either case) may make you wonder, who cares? Isn't the point to make the company plan? Not necessarily.

Looking at the numbers again from a variety of different angles, we see other factors to consider. For example, let's take a look at the time required to get new reps fully productive. Of companies relying predominately on existing reps going into management, 57% reported a ramp-up time of >10 months, compared to a 40% figure for companies turning to experienced managers to fill positions.

The best sales reps don't neccessarily make the best managers. Taking certain steps can help you choose the most effective manager for your team:

Implement a career planning assessment: Talk to your sales folks; find out their career path goals.
Train would-be managers before promoting them: Teach them the ideal traits and skills your manager should possess.
Ongoing training for your manager: Training a manager is a longer lever than training individual reps.

Next week, insights from our Telemarketing/Inside Sales Survey, which will be released in June. If you'd like to order a pre-release copy at a discount, reserve your copy before June 2010.

Sell Well,

Barry Trailer

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Barry Trailer

SM 2.0 Tools

Friday June 04, 2010

Ron,
Thanks for your commments. I could not agree with you more re: all the moving parts. As you say, the point (and goal) is to make plan--consistently. You mention getting comp plans right which is one of the important moving parts. If the company continues to make its number but less than half of reps attain their quota targets, you'll likely see increased rep turnover. If reps are making their numbers and even hitting accelerators but the company comes up short, you'll find a lot of questions being asked from other functional areas.
As with all things, the answer is balance. Please note that we'll be launching our Sales Compensation survey later this month. I encourage you or the appropriate person in your firm to participate.
Regarding forecast tools, again, we are in violent agreement; please take a look at my blog of 3/14: Metrics Matter. Forecast accuracy is at an all-time low and this has serious implications for all involved.
Thanks again for your thoughtful comments.
Barry

Ron Dimon

Sales Management 2.0 tools

Friday May 28, 2010

Good points and I hadn't heard of the study so thanks for pointing it out. I still think, though, that the points *is* to make plan. And ramp time is only part of the equation. There are a lot of moving parts: forecast accuracy, getting the comp plans right, sales rep training, and so on.
Another thing we need for Sales Management 2.0 are better weekly forecasting tools. Salesforce.com is great for granular opportunities and keeping track of customer relationship interactions, and I would consider it and the other CRM systems like the G/L of accounting: the system of record. But when it comes to managing changes, week over week, and doing a "what-if" exercise, rep by rep or opportunity by opportunity, most managers get frustrated with the lack of tools - including Excel - and the time it takes to do this repeatedly. Perhaps more "what-iffing" will give the sales manager (promoted or professional) insight into the best corrective actions to make the plan.