cats

Challenges of the Sales Leader #2

Managing self-employed sales teams

cats of differing shapes & sizes

It doesn’t have to be like herding cats

Is there anything special about managing self-employed sales people?  Does the topic deserve an article in its own right?  The answer to these questions depends in part on your point of view about what good management looks like and what expectations you have of your sales team.

Just to clarify, we are talking about self-employed individuals rather than a channel business partner, which is yet another management challenge.

A debate which often occurs around self-employed sales people is whether this is just a means of paying the person or does it define a different “animal”?  In many cases companies who use self-employed staff adopt the stance that they are self-sufficient so they need only limited support.  There is also a belief that the self-employed person will be motivated by the need to earn money so again they need little management.

Far from being a motivator, money can cause a distortion in the way the person thinks about their job.  If through necessity they are mainly focused on satisfying their own financial needs they will spend less time than you might hope on your needs such as promoting your products or defending your brand.

It is also common that self-employed people are required to satisfy only very basic selection criteria with the belief being that no salary = no cost so, if they don’t work out, then they can be replaced.  This is an entirely false belief as there is a real cost in lost opportunities, a risk of reputational damage and of course the cost of continually recruiting and inducting new people.

Most people want to do a good job and to be successful for themselves and their employers, but without the correct type and amount of management and leadership most people under-perform.  The need for good management and leadership is magnified if the recruitment selection process has been “lite touch”.

Sales Performance

An important part of helping sales people to perform to their optimum level is to equip them with; appropriate training, good sales and selling processes, the tools they need to do the job and the appropriate support.  Once these things are in place you have a foundation to support good performance and productivity.  Then the critical differentiating factor is on-going coaching and this is the key role for those of us who manage sales people.

Sales coaching, addresses two main needs.  Firstly, it focuses on helping the sales person with strategy and tactics around specific prospects and individual opportunities; this helps them to sell more for you.  The second coaching role is to support sales people by helping them to maintain motivation for what is a tough, lonely and challenging job.

Having observed many companies with self-employed sales people we find that in many cases both levels of coaching are inadequate.  The main reasons have been laid out above and can be summarised as a belief that the nature of self-employment makes the people self-sufficient and it also means they will be motivated by the need to earn money.

So, do we need to treat the self-employed differently?  In the main no; they are human beings with the same basic needs as employed people.  The one key difference comes from the insecurity created by self-employment so people on these contracts will typically reward you through loyalty and performance if you demonstrate that you see them as equal to all other employees.

Some key points to consider:

The key to managing self-employed sales people is not to treat them as though they are any different to salaried people, hence most of these points also apply to salaried staff:

  • Break the cycle of belief (throughout the organisation) that self-employed sales people will behave in a particular way which dictates how you will treat them. This leads to a destructive negative spiral which is costly for you.
  • Recruit, induct and train all sales people in the same way.  Understand what the prime skills, attitudes and competencies need to be.
  • If you have self-employed and salaried people, treat them as one team.  They should attend the same sales meetings, functions and celebrations, receive equivalent rewards and in the event of failure they should suffer the same outcomes as your salaried staff.
  • Regardless of their employment status all sales people need to be supported, lead and coached.
  • The self-employed are often home based which increases their isolation and loneliness.  Maintain regular contact; one-to-one meetings, joint customer visits, regular sales meetings and frequent telephone contact.  Weekly webinars for the whole team is an effective way of staying in touch and maintaining the sense of “team”.
  • Money of itself is not the only motivator so you need to coach self-employed sales people to help them maintain motivation.
  • Being self-employed is for many not a choice and it can lead to a general feeling of insecurity.  There is nothing to buffer the odd poor month when they still have to pay the household bills.  So be mindful of the needs of each individual and treat them accordingly.
  • High churn, even of the self-employed, comes at a cost both financially and through its impact on customer service and your reputation.  If you make the effort to recruit good people and demonstrate your commitment to them, they will reward you with loyalty, hard work and commitment to you and your brand.

You have spent time and money finding and recruiting your self-employed sales people so it must make sense to maximise the return you can get on that investment.  Once recruited, the fixed cost of employment is close to zero which means you have more money to spend to helping these people perform as well as they possibly can for themselves and for you.

Self-employment should only define the way people are paid not how they are treated, managed, led or coached.

time allocation to team members

Challenges of the Sales Leader

The Executive as Sales Manager:

This is specifically focused on the executive, who does not have a sales background but who does have to manage the sales and selling functions of the business. This is a typical scenario for many owner managers but is also the position when someone from a different discipline, for example the FD, assumes responsibility for the sales and selling operations. One obvious thing to observe about this person is that as well as managing sales they will also have another job to do as well; CEO, MD, FD, etc.

A principle that we have long subscribed to is that you can lead or supervise people but you can only manage processes. Attempts to “manage” people typically descend into supervision and this in turn tends to focus on monitoring the quantity of activity whereas what matters is the quality and value of the outcomes achieved by the activity. Good sales managers know this and spend most of their time training and coaching their sales people to achieve better outcomes rather than supervising them to produce higher volumes of activity.

The key to effective leadership of any sales operation, regardless of whether the leader is experienced in sales and selling, is to have in place a well-defined sales methodology and a complete set of associated selling processes. The methodology represents the go-to-market strategy while the processes are the tactics used to implement that strategy.

WHY IS THIS KEY?

allocate time to each

Make time for coaching individuals and the whole team

The processes define the stages and gates that need to be followed throughout the lifecycle which sees a suspect become a prospect, then a customer, then a user and eventually an advocate. The processes ensure there are standard outputs from the mundane routine parts of the job. Those outputs must benefit both the company and the sales person. The sales people need to be trained in the use of the processes and progress is then easily monitored by observing how potential deals move through the stages of the process.  Such movement should be driven by adherence to the “rules” of the processes. This removes the need for the executive to try to manage (in fact supervise) every individual action and item of activity by every sales person – now, management can focus on exploring the exceptions.

Because the executive will be wearing a number of hats, it is important to allocate regular time slots throughout the week which are reserved exclusively for managing the sales and selling functions.

Here are a few tips to guide the executive as sales manager:

  • Design the commission plan to encourage the behaviour and results required to meet the business goals.
  • Create a sales methodology and associated selling processes.
  • Communicate these to the sales people ensuring they understand why they are expected to follow them.  The objective is to create an environment which permits intelligent adaptation within a defined environment.
  • Induct new people and train existing people into the methodology and processes
  • Reinforce this by managing people via the processes – make your expectations clear and consistent, e.g. if you ask for weekly reports, ensure you read them and respond.  Be alert to anomalies which may indicate coaching is needed.
  • Monitor progress through a dash board consisting of a few KPIs, pay attention to the exceptions and act on them.
  • Set aside regular times when you are in sales manager mode and publish these
  • Make time to coach individual sales people
  • Make time to visit prospects and customers with sales people, not on your own
  • Have a sales meeting with the whole team at least once per month – discussing account issues and tactics helps everyone learn
  • Speak to each individual sales person regularly and if they are remote do this by phone
  • If you feel you cannot do any of the previous points then bring in help, either a dedicated sales manager or part-time interim assistance to cover specific areas for you.

What Holds Your Business Back?

It has always been our purpose to find answers to this question, to find more and better ways to improve business and selling performance for our customers.

One mechanism involves tracking surveys seeking to identify “What holds your business back?” conducted amongst CEOs, MDs, other board members, key shareholders and special interest groups such as trade body members.  Albeit it in different words, the things that such surveys always rank as the top four issues are:

  • Not selling enough to grow the top line
  • The sales cycle is too long
  • Not converting enough leads into orders
  • Sales forecasts are not accurate enough.

We were amazed when these very things came out as the top four issues in a recent AberdeenGroup report looking at “Sales Performance Management 2012” which was published at the end of 2011.  Here we are 11 years down the line and businesses are still reporting the same issues.

We were also interested to read a quote from Andrew Goodwin, a senior economic advisor to the Ernst & Young Item Club, who said; “Businesses are waiting for the economy to pick up before they start spending…”.

Keeping expenditure under control is always a good idea but it is risky to lump all types of expenditure into one big bucket.  We think that now is a very good time to spend money growing the top line which is the only real way to increase profits and improve cash flow.  If you do it now, while your competitors are still holding back, you will steal a march on them.  By the time they notice what you have achieved, you will be driving the bandwagon and they will be trying to jump aboard.

Don’t let your business be held back – call us to find out how to get moving in the right direction.

TECG, sales process, sales pipeline, sales forecast

The Energy Conservation Group

The Outcome:

A streamlined and more effective and agile sales operation positioned for continued sector fluctuation.

“Performative made a significant contribution to securing our position as a leading quality supplier in the renewable energy market.  We now have a fully integrated sales process for both office and field staff, which has brought us more effective new business generation and better visibility of the sales pipeline. We are now better placed to respond to whatever the market, government regulations or the competition may throw at us.  We enjoyed working with Performative and found them responsive, collaborative and pragmatic, always willing to contribute and flex with the changing needs of the business.”  Chairman, TECG;

The Challenge

The Energy Conservation Group (TECG) helps homeowners and businesses conserve energy, save and make money through the design and installation of energy solutions.  Although TECG was performing well, competition in the sector was increasing and government regulations and incentives were changing, both of which created business risk.  Performative was asked to review the sales operation to find areas to streamline and improve agility and performance.

The Performative Solution

Performative initially undertook a Sales Maturity Assessment (SMA), which found:

  • Fragmented sales management
  • Leakage throughout the sales cycle leading to lost opportunities
  • Field sales motivation issues
  • Lack of sales targets
  • An over-complex lead generation process.

The issues found were compounding to create low efficiency and effectiveness.  Performative designed a Sales Performance Transformation programme to address this, which included:

  • “Lead generation” performance improvement for two telesales teams
  • Field sales performance improvement
  • Improvement of the interface between the lead generation and field sales operations
  • Recruitment and selection of both internal and external sales people
  • Definition and delivery of new sales models and associated processes
  • Induction, training and development of all sales people
  • Design and delivery of compensation plans based on achievement against selling targets
  • Definition and delivery of an optimum sales management model for the field sales people
  • Design of the optimum sales management model for the whole selling operation
  • Review of the sales “employment” model and recommendations for change
  • Preparation of a handover to TECG including the means for on-going evolution
  • Provision of on-going support and advice.

Arrk

The Outcome:

Transformed sales team structure and composition to reduce reliance on too few customers and on the Managing Director as the focal point for sales, thereby positioning the company better as an acquisition target.

The Challenge

Arrk is a software development company that focuses on helping its customers improve their bottom line through the imaginative use of web and mobile technologies.

Arrk’s challenge was that it had built a strong, but small, customer base and this had become a risk to the business.  The Managing Director (MD) was also heavily involved in the success of these few customers, thereby compounding the over-reliance position.  At the time of Performative’s project, the MD was interested in the possibility of selling Arrk, so needed to ensure a robust selling operation was in place for the benefit of potential buyers.

The Performative Solution

Performative undertook a Sales Performance Transformation exercise in two stages:

  • Performative initially provided an interim Sales Director, who undertook a range of activities to structure and establish a good team.  These included:
    • Evaluating the capabilities and motivations of Arrk’s existing sales and marketing people through one-on-one interviews and psychometric tests
    • Creating a marketing/lead generation capability
    • Designing and delivering a training and development programme for sales, marketing and sales support staff
    • Managing the sales team and undertaking coaching and mentoring as required
  • In parallel to the sales team work, Performative implemented Performative Structured Selling®, which included:
    • Creating an overarching sales and marketing strategy
    • Reviewing Arrk’s current sales and marketing processes including the bidding processes and standard document used for bidding and proposals
    • Amending existing processes as required and blending with Performative Structured Selling ® to produce a complete sales and marketing approach
    • Documenting the complete process as a sales manual.
mantix, business performance improvement