As they grow and hire sales people, many CEOs become fearful of their sales team. They don’t know how to manage them, don’t understand how they do what they do, worry that a key sales person will leave and take business along, don’t know how to compensate them, and worry whether they are paying too much. For their part, many sales teams are happy to leave that CEO in the dark!
On the other hand, CEOs get nervous about revenue and make unrealistic short-term demands of the sales team without having built processes and procedures to support those expectations.
Typically in a small company, the sales team owns all the knowledge about sales. But often, the small company sales person or people start out as transactional sales people, using traditional methods that they’ve learned, primarily, to perfect their personal sales approach and methodology. The one-on-one transactional sales model will not work for bigger, complex sales to larger companies. But the model that has worked in the past is hard to dislodge for more rapid growth.
The CEO senses that something is missing and is hungry for more and better results, but does not know what to do. The sales team would like fewer fire drills and end-of-quarter and end-of-rear panics. Here are five reasons why there’s such a mismatch in expectations, counting down from #5 to #1:
5. No process. Sales is usually one of the very last “processes” to be deliberately designed in a growing company. It is left to the sales team to figure out their approach. Usually this leaves them out of the loop with operations and leaves everyone out of the loop with them. Their approach is not strategic or repeatable. Each sales person, in fact, may approach the job very differently from the others. Because no one understands what the sales team does or how they do it, there is a lot of fear, envy, and anxiety. Maybe the sales team like to focus on the bells and whistles of your product or service, while the operations team like to deliver a pre-configured box off the shelf. Sales worries that ops will mess up; ops worries that sales sells pipe dreams.
4. Poor data. If there’s no process, rarely is there any reliable data. The sales team can estimate but cannot tell you a closing percentage, the true cost of sale, an average deal size, or the association of a particular step in the sales process with the probability of a sale. The lack of data makes improvement unlikely because there are few process metrics to support changes in process. If the only metric is absolute revenue produced, the company is missing a great deal of valuable information.
3. Unreliable predictions. Because there is little reliable data, it is impossible to predict what sales will be for a given quarter or year. Predictions are done and budgets are built blindly, based on hope or need or the CEO’s demands rather than previous experience or a specific new process. Therefore, the expectation for sales productivity may be way out of whack–far too high or far too low. That circumstance is demoralizing to a sales team and frightening to a CEO.
2. Rock Stars. Historically, the great salespeople have cultivated their “rock star” status. They are the road warriors, the relationship kings and queens, the company saviors. Against all odds, they keep their company afloat. They don’t have time to fill out forms or manage CRMs–they need to get out there and sell! The CEO lives in fear that the rock star will leave, taking his or her Rolodex and relationships and half of the customers to a competitor. In the new world of sales, the one-person rock star will have great difficulty in being successful with larger customers. Rather, the sale will be orchestrated by a sales person who is skilled at training and engaging a team of subject matter experts to make the sale.
1. “Magic.” In the end, all of this appears to be “magic” to the CEO or to anyone else on the outside looking in. The CEO is afraid to push, to ask hard questions, or to demand a better understanding of what is going on for fear of angering the sales team. The sales team has never been trained on the bigger picture of business development and how to integrate with other departments and functional areas, so they may be at a loss for how to change even if they are less successful than they would like to be.
Convinced that salespeople have a certain magic, the CEO gives in to it and just goes on losing sleep over sales.
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