What’s the best approach to managing sales reps?
Is it monitor activity? There are lots of guys who do that – the 100 calls each week type task masters.
Is it micro management? – go there, say this, ask that, give this presentation, close, discount, plead, threaten. There are more than a few who’ll work that way too.
Then there’s the Analytocrats – bureaucratic types who know all the data, but not what it means.
There’s also the Patriarchs – father figures who’ll carry the can.
And the Teflon guys, who spend all their time making sure somebody else gets the blame.
What do you think? Which management strategy works best?
We think the answer is None of the Above.
The best approach to managing sales reps is not to bother. Manage their prospect lists instead. That’s the grown up approach to managing grown up, professional sales staff. Treat them like business people who get paid for adding value, not making calls or corporate presentations.
Maybe, you don’t think this makes sense? After all, the traditional sales funnel starts with calls, right? Sales is a numbers game, isn’t it? More calls equals more prospects equals more sales. It’s always been that way. !00 calls gets you 20 first meetings gets you 5 proposals, two presentations, and one sale. Or something like that.
Perhaps. But not anymore. It used to be that way, in the Industrial Age.
The Information Revolution is changing all that, and fast. In the 21st Century, customers are better informed, more demanding, and have more choices. Successful sales propositions are tailored to meet their specific aspirations, not cookie cutter pitches.
In this type of market there is no one profile for the successful sales rep. Good ones come in all sorts of shapes and sizes, with different personalities. They’re every bit as individual as the customers they sell too. And every deal is unique too. Each sale is a three dimensional puzzle. The difference between successful reps and the rest is their ability to navigate a way through that puzzle, emerging with an order for the right product, at the right price, and making the customer happy in the process.
Everything else is window dressing, at best, and irrelevant nuisance, at worst.
What really counts is the prospect list.
That’s the sharp end of the business. The start of the revenue generation process, which ultimately pays the wages, bonuses, and shareholder profits.
The prospect list is where the enlightened sales manager monitors both ends of his operation – what the sales guys do at one end, and how much revenue gets produced at the other. If the rep’s deal doesn’t qualify for the list, she has to go find another one. If the sales plan isn’t working out, it gets revised with new strategy and actions. If the sale is progressing as it should, the rep is rewarded with a higher probability percentage, and greater sales forecast as a result. Reps with high quality and high value sales forecasts enjoy more freedom, are accorded more respect and support, and more opportunities.
Every sales rep wants to have a big prospect list. It means credibility, and security, and status. Left to their own devices they’ll cram every conceivable deal onto it. That’s the cause of the Hockey Stick problem.
The sales manager can’t control everything sales reps do. They spend most of their time unsupervised. It has to be that way. It’s the nature of the job.
But the sales manager can control what’s on the prospect list, and what weighted value it gets. Scrubbing low probability deals off, and increasing the value of higher probability deals, is the simplest, most effective approach to influencing sales rep behaviour.
It doesn’t make many friends, but it does make sales people focus on results. Sales people soon learn. Faced with the sales manager review, they’ll work harder at doing the right things and stop doing the wrong things.
There’s a double win here.
Driving sales rep behaviour, by attaching value to their inputs, takes care of one end of the revenue generation process. They make a better job of what they’re supposed to do.
Happily, it simultaneously, and automatically, drives the other end of the process. More forecast deals result in sales, and fewer are lost.
Sales managers who really understand sales people control their prospect lists, not the number of calls they make, or what they say to customers.
Why doesn’t the traditional approach to selling and sales management work so well any more? What can the modern sales professional do to stay relevant in today’s customer driven markets? Check out our eBook Reengineering Sales Management for ideas on how to embrace the new order of customer driven buyer/seller relationships.