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B2B Sales Management Mistakes That Might Prove Fatal

by Karen Jackson  | 4 Comments

Small business B2B sales management is a tough, tough task. (It’s not so easy in big business either.  According to consulting firm Sales Benchmark Index, the average tenure of a new sales leader is just 19 months.) In part, it’s tough because small businesses don’t typically have an experienced sales manager. Often that task is left to the CEO, whose expertise lies in their product or service subject matter, not in sales.

Whether you’re the sales manager or the CEO wearing that hat reluctantly, the challenge is surmountable. Get outside help, subscribe to sales management blogs, and don’t make any of these 9 mistakes:

1.    Hire The Wrong Title.  This may seem obvious but it’s a common set-up for failure. Desiring to lure a big producer, you hire someone with the title “VP of Sales” even though it’s a direct sales role. I’ve yet to see a VP of Sales worth their salt go back to carrying a bag – unless they’re getting a big equity position. (Even then, they may no longer have the stomach for it.) They’ll collect their check from you and wait for permission to hire, you guessed it, a sales person. Instead, get clear about your needs, what makes your opportunity compelling, and go find a compatible person for your organization. He or she is out there; you don’t have to settle.

2.    Fail to Define a Go-to-Market Sales Plan.  “Go sell something” is a poor directive but it’s a pretty standard marching order. Writing a clear sales plan is hard, but essential, work. How else will your reps clearly understand their target markets, ideal customer profile, value proposition, positioning? How can they create smart tactics when they don’t clearly understand the goal? How will you decide where their energy is best spent, which opportunities to seize and which to pass on? Without a clearly defined plan, you’re guaranteed inconsistency at best; chaos at worst.

3.    Ignore Sales Process.  Without process companies fail to capitalize on best practices or manage their resources in the most productive way. By understanding the customer’s buying cycles and creating a related sales cycle with stage specific activities and milestones, you’re able to analyze sales activities and outcomes, take actions that influence buyer behavior, and uncover where sales people need additional support and training. Without process, forget about a realistic forecast; you’re left with lots of wishing and hoping.

4.    Neglect Metrics or Accountability Structures.  The adage “what gets measured gets managed” couldn’t be more true in sales. First identify key performance indicators, then create sales metrics that better influence outcomes, motivate individuals, and make forecasting more predictable. Include your team in developing these to gain buy-in. They’ll understand that by managing to those metrics their success is far more likely than without them. It’s not baby-sitting, it’s management. Big difference.

5.    Treat Your Reps The Same.  The sales manager is a coach. Like any team, the players need different levels and type of attention. Does s/he need help with skills, mind-set, time-management?  You won’t know unless you meet them where they are as individuals, and respond accordingly. Applying the same management techniques to everyone will not create equality; it will create frustration and missed opportunities to grow your team members. Keith Rosen’s book Coaching Salepeople Into Sales Champions offers some excellent guidance.

6.    Substitute Your Comp Plan for Management.  Slashing pay for a poor performer doesn’t solve your performance problem. It simply lures you into a false sense that the individual isn’t costing you too much. You’re kidding yourself. They’re costing you dearly through unexploited territory, wasted energy by support staff, and team morale. If you can’t manage a rep to better performance, release them. Quickly.

7.    Saddle Your Reps with Non-Sales Activities.  Every position has a certain amount of administrative work, but it’s mind-boggling how much non-sales activity small business reps get saddled with. If you want reps to sell, give them time to do so. Look at your processes and identify what activities could be off-loaded to a less skilled, lower paid headcount.

8.    Skimp on Tools.  Are your reps on the road but they’ve no access to your servers through their mobile devices? Are they travelling regularly but don’t have a wireless card to access 3G networks when no wi-fi is available? Are Post-Its, lists, and disconnected spreadsheets substituting for a CRM tool? Don’t think of these items as nice-to-haves. They are keys to productivity, sanity and morale, which make them investments, not expenses.

9.    Undervalue Continuous Recruiting.  It’s really hard to hire good sales reps, and it doesn’t get easier when the pressure is on to fill a spot. When territory is open there’s a tendency for management to settle on a sub-optimal candidate. Be disciplined to continually interview and recruit for the role. Put the word out with business partners and maintain an on-going search through LinkedIn and other social media platforms. Target individuals who work in your industry and court them. They may not be ready to move today, but when something changes, they’ll call you first. Equally important, you’ll learn tons about what the competition is doing and what others perceive as risks / opportunities in the market.

B2B sales management is hard, but essential in an organization’s ability to drive revenue. Without customers, there’s no reason for a company to exist. I can’t think of a better motivation to improve sales management skills.

Please share mistakes you’ve made, suffered, or witnessed so we all can learn.

 

| Categories: B2B Sales Strategy, Blog, Growth, Leadership, Sales, Sales Marketing Strategy
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4 Comments to B2B Sales Management Mistakes That Might Prove Fatal

  1. Robert tormey
    July 12, 2012 2:50 pm

    Great points here, i might add that as a CFO, I’ve been involved in many sales organizations. I would add to your list of mistakes to avoid these
    -1) reduce In house friction for salespeople. I see this most
    often in credit administration not being well thought. but
    there are other areas in inventory and production management
    where salespeople have to wage internal battles fighting for their customer.
    these issues can be addressed with well thought credit insurance programs
    production and capacity flexibility etc
    can give you some war stories but you get the idea
    -2) tie salespersons compensation to the profitability of the customer’s business not to the dollar amount of sales. many salespeople associate
    large sales with profitability. often this is not the case
    customer profitability should be well understood and compensated for . iVe turned around many companies with only this decision rule.
    -3) know the difference between sales and marketing and don’t ask sales people to solve marketing problems! if you do that you wil end up with as many approaches to the market as you have salespeople.
    identify marketing issues quickly resolve them and take the burden of solving them off the salespeople.

    • Karen Jackson
      July 12, 2012 10:42 pm

      Bob, thanks so much for your thoughtful comments. Great point about making salespeople wage internal battels to fight for their customers. It’s a common point of friction, often stemming from a lack of understanding about go to market plan, which ties into your point #3. Re: paying comp on profit vs sales, I get your point, but warn that companies who pay commissions on revenue vs profitable revenue often find themselves overpaying commission, resulting in distorted S,G & A expenses. As you mentioned, it’s really important that everyone understands customer profitability. I’m a fan of giving incentives for sales people to close a deal above a standard profit target.

      • Gary Zander
        July 16, 2012 10:59 pm

        Paying commissions on profit vs. revenue is always a good idea but beware it may cause short-term/WIIFM thinking on the part of the sales staff instead of what’s in the best interests of the client. If you’re selling “one-and-done” transactions it probably won’t hurt you, but if you’re relationship selling products & services and esp. solutions, you want your salespeople to balance your own profitability with your client’s ROI. And of course, there are times when building market presence and penetration takes a temporary front seat over profitability. So purposefully varying your sales commission plan to reflect your specific objectives across products, clients, etc. should always be considered.

        • Karen Jackson
          July 17, 2012 9:09 am

          Thanks Gary for weighing in. Your comments underline then need for paying close attention to deal structures and ensuring that the comp plan never overides making the right business decision.

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