Every VP of Sales and Sales leadership team have their own unique way of trying to drive the greatest amount of productivity from their sales reps. However, all too commonly, when only looking from the top down a layer of insight into what is driving your team is lost. That insight can mean the difference between crushing quarterly revenue goals or seriously dropping the ball. If you want the team you manage to be as successful as possible you must consider the following sales and marketing alignment philosophy and shift the way you oversee your sales department:
Without maintaining an understanding of what impacts your sales team, looking from the bottom up, your team will never be as successful as they possibly can be.
Before we breakdown that philosophy and discuss how to put it into action, let’s briefly touch on what the word "management" usually means to leadership teams.
What is Sales Management?
Usually, management can be boiled down to a few key components:
- Resource allocation
- Organizational structure
Motivation is defined by the tactics, incentives, and spiffs your organization leverages to rally your troops. Sales folks tend to be monetarily driven and highly competitive individuals. Whether that comes in the form of a commission percentage, quarterly bonus, or something in the middle, the carrot you dangle is what you use to light that competitive fire.
Resource allocation is the strategic understanding that not everything that needs doing can be done all at once. It’s the ability to see what business priorities exist, know what your available means are to address those priorities and then rank them accordingly after you weighed the costs and benefits of each.
Organizational structure determines how your team or department fits into the larger structure of the company. It brings to consideration how much your team leans on and interacts with others. Or, how much do other teams lean on and interact with your teams.
When you combine the three you’ve defined your top-down approach to management. You’ve considered everything (from that lens) that should result in a successful and well-motivated sales army. However, what sounds good in theory doesn’t always pan out that way when put it’s into practice. What’s missing from these three over arching management components is sales environment of your organization. But’s why is that important?
Let’s get back to the philosophy I mentioned above, maintaining an understanding of what impacts your sales team from the bottom up.
Top down only management creates a separation from the tip and tail of the whip. When Indiana Jones cracks his whip to dole out some justice, the subtle motions he makes from tip of his whip result in a loud and stinging crack on the other end. When a change is made at the top of an organization (the tip of the whip) and is passed down throughout the company, the trickle down impacts the individuals at the bottom the most (the tail of the whip). Unless that sales environment is factored into managerial planning, the outcomes of changes made by decisions makers at the top may vary drastically from how they anticipate things will shake out bottom.
The Nature of the Sales Environment
So, what comprises the sales environment? This will be a very generalized definition, but the sales environment consists of all the elements that define and affect the working environment of your front-line sale reps outside of motivation, resource allocation, and organizational structure. Here is a detailed list of those elements:
- Product Sales Factors
- Functional limitations of your products
- Common purchase objections
- The product portfolio structure
- The competitive landscape
- Complexity of the product
- Level of product education required
- The product pricing structure
- Job Role Functions and Tasks
- Sending emails and the time that takes
- Making calls and the time that takes
- Proposal/pitch building and the time that takes
- Product demos and the time that takes
- Administrative and CRM logging tasks and the time that takes
- Reporting functions and the time that takes
- Cadence meetings and the time that takes
- Organizational Factors
- Product positioning and changes that may occur to it
- Target audience and changes that may occur to it
- Product/ company branding and changes that may occur to it
- Organizational processes and changes that may occur to it
- The organization’s tech stack, its complexity, how insightful it is, how user-friendly it is
- Company road map (merger and acquisition vs exit strategy vs growth strategy)
This list may seem a little daunting, but that's the point. All of these elements and more impact your team’s day-to-day ability to close deals.
A Real-World Example of the Sales Environment Factor at Play
Let’s add a little more color with a real-world example of what happens when the sales environment isn’t considered in management’s decision-making phase and how that impacts the reps at the bottom of the chain.
Company A has a very expensive consumer product that only appeals to a niche and affluent market. From management’s perspective, this product offers a revolutionary new way to perform a luxury service. From a rep’s perspective, due to the nature of the product, it requires a considerable amount of customer education on the rep’s behalf to communicate its value. Their current product portfolio is comprised of just one primary product.
Management has now decided to sell a new product within the portfolio that is a “light” or “entry level” version of their original offering. This new product version will be less expensive, offer reduced product features, and slightly broaden the target audience to slightly less affluent folks. The goal of this play is to drive more revenue by selling a greater number of “light” versions rather than make the same amount of revenue by selling fewer versions of the full product at its higher price point. Simply put, a volume play.
Management preps the sales team on the difference in features and price points, then rolls out the product for selling. To complement the product’s strategy, commissions are restructured around volume of deals won versus a commission percentage based on the amount of revenue per deal sold.
After 3 months of having this product strategy implemented and having forecasted the consumer base to aggressively grow by 15%, after trending along at 5% for the previous 3 quarters, the strategy bombs.
So why did that happen?
In this example, resource allocation and organizational structure weren’t affected by the new product strategy and motivation was adjusted to compliment the product play. From a top down perspective, this should have been a slam dunk. Sales reps should have been incentivized to sell more deals and it be done more easily because of the reduced price point. It’s what wasn’t considered that put the nail in the coffin.
Recall how this was a revolutionary product that requires a decent amount of consumer education, from the sales rep’s perspective? Well, that’s what wasn’t considered from the top. Because they didn’t take this feedback into consideration, management couldn’t anticipate that even with a reduced price point and fewer features, reps were still selling essentially the same product. Because of this, any time upper management expected reps to save on selling individual deals didn’t pan out. No time saved meant no additional time to pursue more deals stifling the volume play this new product was based on. To add to the woes, because commissions were restructured around volume and that volume didn’t come to fruition, reps made substantially less money only further demotivating them. End result, the organization came in way below their quarterly forecast.
Avoiding the Top-Down Pitfall
So how do you avoid this pitfall? The fact of the matter is, unless you have a very small team, gathering constant bottom-up feedback from every individual you oversee just isn’t feasibility possible. It would be a dramatic time suck.
Instead, focus on the three areas that provide bottoms-up insights in a digestible fashion. These areas can be targeted individually, but I personally recommend leveraging all three in unison to provide the most holistic view of your department’s environment:
- Sales rep interviews
- Productivity dashboards
- Rep shadowing
Although these concepts are fairly self-explanatory and shouldn’t be utterly foreign, let’s dive into them nonetheless to get at the necessary insights that provide you your bottoms-up view.
Interviewing Sales Representatives for Candid Feedback
Who better to tell you how things are going than the people following through on the processes and strategies you’ve put in place? The men and women on the front lines of course!
Interviewing your reps is a great way to collect anecdotal feedback, assuming, of course, the feedback is honest and candid. So what kind of feedback should you look for? Allow me to direct your attention to the list of functions and factors I laid out at the beginning of the post. These are great starting points to then drill in on to collect the insights you’ll need.
Honest and candid feedback is the key to this being a successful method of gather bottoms-up insights. Your reps need to feel comfortable enough to speak their minds honestly without fearing repercussions. Now, be honest with yourself. Does your organization foster this kind of culture? If not, you’ve got more than just sales management to worry about. If your reps feel like voicing their opinions might blow up in their faces, all you’ll get from this exercise is foster this kind of culture? If not, you’ve got more than just sales management to worry about. If your reps feel like voicing their opinions might blow up in their faces, all you’ll get from this exercise is generic agreement that you’re doing the right things from a bunch of yes men. That does no one any good.
If you have a large team, obviously interviewing everyone would take far too much time. If your organization falls into this bucket I recommend taking a representative sample to accomplish this. I try to pool a few of the top performing reps, a few from middle of the pack, and a few of the under achievers.
Sales Team Productivity and Activity Dashboards
I’ve already done a very in-depth blog post about this topic so I won’t dwell here long. Here is a link to my piece on using and building reports to improve sales performance.
The long and short of this particular method is that you should use hard stats and data from activity reports to balance the anecdotal feedback you get from your rep interviews. It is hard to argue with numbers, right? The reports can be used to validate the feedback your reps provided you in person. Are reps complaining that the current sales cycle is too long? Well then, how are the number of activities trending rep by rep? Are reps suggesting that leads are too difficult to convert or are low quality? Check how long prospects are taking to move from stage to stage. Are reps finding success by practicing other sales tactics then what management preaches? Find out the count of communications between reps and potential customers. You get the point.
Leverage data with anecdotal feedback to get a balanced view.
Shadow Your Reps to Get an In-Action Assessment
Alright, you’ve got your anecdotal feedback and your hard numbers, the last piece to this trifecta is the in-action side of things. I’ll admit that collecting this kind of bottoms-up insight gets a little big brotherish, but there isn’t a way around it.
There are three big communication tactics your reps partake in on a regular basis:
- Phone calls
- Presentations/ Demos
You should be monitoring all three of these.
Why is this necessary? With anecdotal feedback people can, and in some cases, will, inaccurately representing things. They may tell you one thing but mean another. With hard data, you’re dealing only with numbers. Numbers, although very telling, still can’t completely represent the human component of selling. That’s where in-action communication monitoring comes in to fill the gaps.
In-action monitoring provides the answers to these sorts of questions:
- Are reps creating more work for themselves based on how they handle their communications?
- Are they leveraging effective collateral and supporting material to help move prospects through the sales cycle quickly?
- How are reps handling objections and questions?
- When in front of decision makers, do your reps handle themselves accordingly and present your products in a clear and concise fashion that communicates value?
Just as with interviewing reps, there is far too much going on to be able to listen to every call or sit in on every demo. Cherry pick, based on your rep’s performance, to determine what you’ll spend your time monitoring. I’d again recommend pooling a sample from your top, middle, and bottom team performers.
All three communication tactics are necessary to monitor because they usually play different parts during the sales cycle.
- Emails- generally speaking, are used more heavily early on, before a personal rapport is built
- Phone calls- generally speaking, are leveraged more heavily after that personal rapport is established
- Presentations/ Demos- are obviously used in the late stages of the sales cycle
Gather your findings and observations. Then, cross compare them to what you’ve learned with your data and interview feedback. If you have all three, you won’t have any blind spots to worry about. Take all that you’ve learned and bring that to the table the next time your leadership team is discussing a departmental change.
By this point, if you’re still with us, there may be a few of you rolling your eyes at what I’ve said so far. A certain degree of top down management will always be necessary. At the end of the day, decisions need to be made to spur growth and development. In a perfect world, decisions makers would have all the time in the world to analyze their decisions from every angle. They’d have all the necessary data to make informed decisions. However, this isn’t a perfect world and you have to make do with the best of what you have.
The simple point I’m trying to make here is that as a management team it is very easy to become totally disconnected with the bottom of your organization. However, if you want to get the most out of your team, take an honest walk in their shoes and look at life in your company from their eyes. Only then will you be able to you be able to roll out your strategies and truly anticipate what the outcomes will be.