Today’s post is by Scott Runkle, director of global account team at Vantage Point Performance, a global sales management training and development firm. Scott helps his clients transform their sales teams to drive better sales performance. Visit our Resources Center.
Each year, as June rolls into July, sales leaders start breaking into a panic. It’s mid-year and, if sales results aren’t where they need to be—and let’s face it, they are rarely where they need to be—leaders begin pulling out all the stops to drive higher performance.
This is a widespread phenomenon. Studies find that fewer than six in 10 reps are making their targets, while our own comprehensive study of sales management practices found 75 percent of managers had less than half their reps at quota. Yet companies keep raising the sales bar. And, in their effort to clear that higher bar, sales leaders mostly turn to two common approaches for improving sales performance:
- Train sales reps. Organizations spend millions of dollars every year on tools, tactics, and methodologies aimed at elevating individual rep performance, but the ultimate impact of these investments is negligible.
- Implement new technology. Last year, according to Gartner, the CRM industry approached $36 billion. Companies pour money into technology like CRM and other selling tools but then frequently complain about underutilization and failure to move the performance needle.
As leaders look at their year-to-date performance and the disappointing results from these two investments, they’re asking, “What else can I try to hit our number by year end?”
The answer lies in the sales management population referenced above. A whopping three-quarters of sales managers report that less than half their team is making quota! There’s the opportunity. The latest technology and the best sales rep training can’t overcome ineffective management. To really impact results, you need to first elevate the performance of your managers.
High-quality management leads to high-quality reps, which leads to high-quality results. The opposite is also true: inconsistent management leads to inconsistent reps, which leads to inconsistent results. We see this time and again. You determine your company’s path to success or mediocrity simply by choosing whether or not to give your sales managers the skills they need to excel in a management role.
What are some of the signs you may have a sales management problem? Beyond low performance numbers, the following challenges typically signal an issue with sales management:
- Inconsistent performance at the sales team level
- Low overall close rates
- Inaccurate forecasts
- Bloated pipelines
- Lack of a common management language
That last point is the key to successful sales management. We hear it all the time from sales leaders: “We need all our managers speaking the same language and working from the same book.” And, “If we could just duplicate what our top 25 percent of managers do, we could drive better results.” They are right. By employing a solid, repeatable framework for sales management, organizations can set up their sales teams for solid, consistent, repeatable results. It’s management process and training that drives consistent performance – not the lucky hire of a naturally great manager.
Here’s an example. We recently worked with a furniture manufacturer’s Texas district, where sales had remained within a static range over a four-year period. While the company had developed a sales methodology, it had never deployed sales management training. After working with Vantage Point to integrate its sales methodology with sales management training, the Texas district sales manager grew revenues from $5 million to $9 million over a four-year period – an 80 percent improvement. Other key metrics improved sharply as well. For instance, the Texas district now has the lowest discounting rate in the company due to better opportunity qualification.
These results were attributable solely to the creation of a great sales management framework coupled with training that changed the game. And this is no isolated case. We regularly see improved forecast accuracy, higher win rates, lower push rates, increases in net new business, more reps hitting quota, and other positive results when companies implement a sales management framework.
It’s not too late! You can still hit your target numbers this year. Simply turn your sights away from the well-worn paths of technology upgrades and sales rep training, and look instead at improving the performance of the group that has the greatest impact on results: your sales managers.