Sales Management Is Killing Sales
Suppose that you wrote the following goal on your office whiteboard: âI want to make as much money as possible.â Now suppose your clients saw it. How would they feel? How would you feel knowing that theyâd seen it? Would you feel proud or embarrassed?
What if you went over your prospect list, and the only thing written next to each prospectâs name was a dollar figure and a projected close date? Would your prospects be happy if they saw that? Would they want to do business with you?
Probably not; it reduces them to nothing more than a number. Yet, thatâs exactly how most organizations talk about their customers on a daily basis.
Think about the typical conversation a sales manager has with his or her sales rep. It usually goes something like this:
âWhen are you going to close this? How much revenue will it be? Are all the key decision makers involved? Whoâs the competition? What do you need to close this deal?â
All of the questions are about when and how weâre going to collect revenue from the customer. Very few managers ask about the impact the sale will have on the customerâs business or life.
This is a big problem.
Imagine a salesperson walking into a customerâs office and opening the sales call by plopping a revenue forecast down on the customerâs desk, announcing, âI have you projected for $50,000 this month. Give me an order now!â
That rep would be thrown out in a second. Yet thatâs the kind of language most organizations use when they talk about their customers internally. Itâs like two different worlds.
We expect salespeople to focus on customersâ needs and goals when theyâre in front of customers, but the majority of our internal conversations are about our own revenue quotas. Although itâs an unintended disconnect, itâs a fatal one.
Most organizations want to have a positive impact on their customersâ lives. It makes good business sense, and it appeals to our more noble instincts. Yet when managers are caught up inside the pressure cooker of daily business, their desire to improve the customerâs life is eclipsed by quotas, quarterly numbers, and daily sales reports.
This results in salespeople who donât have any sense of a higher purpose, other than âmaking the numbers.â It sounds good in theory, but customers can tell the difference between the salespeople who care about them and those who care only about their bonuses.
The great disconnect between what we want salespeople to do when theyâre in the field (focus on the customer) versus what we emphasize and reinforce internally (our own targets and quotas) results in mediocre sales performance.
Traditional sales management training does little to solve this problem.
Managers are taught to coach to the numbers or to the sales process. Instead of asking salespeople about how they are going to help the customer achieve their goals, most sales managers focus exclusively on their own goals, profit margin, close dates, and revenue targets. With no sense a larger purpose, and no discussion about how the salesperson is making life better for the customer, it all comes down to the numbers.
This is fatal.
When the customer becomes nothing more than a number to you, you become nothing more than a number to the customerâand your entire organization suffers. When you overemphasize financial goals at the expense of how you make a difference to customers, you make it extremely difficult for your salespeople to differentiate themselves from the competition.
And the problem doesnât stop there. It has a ripple effect on salespeople, who:
- Fail to understand the customerâs business environment.
- Cannot connect the dots between your products and customersâ goals.
- Cannot gain access to senior levels within the customer.
Then the problem escalates:
- Customers view you as a commodity.
- Contracts are constantly in jeopardy over small dollar amounts.
- Salespeopleâs default response is to lower the price.
- Sales has a negative perception in the rest of the organization.
- Top performers become mid-level performers.
- Sales force morale declines.
Itâs not a pretty picture. When the internal conversation is all about money, the external conversation becomes about all money. And all of a sudden, thatâs the last thing youâre making.
Companies have tried a variety of methods to solve this problem. Organizations spend millions on sales training programs that teach salespeople how to ask better questions and engage the customers. They spend even more millions on customer relationship management (CRM) systems to capture critical customer information. They host off-site retreats to create mission and vision statements. They hire expensive consultants to craft their value story.
But the results are short lived at best. Salespeople abandon the training. No one updates the CRM. The mission and vision are put on a meaningless placard in the lobby. And the value story is reduced a bunch of ho-hum slides that sound just like everyone elseâs.
The reason these solutions donât deliver sustained improvement is because they address only the symptoms. They donât tackle the root cause: the lack of purpose.
Peter Drucker, widely considered the most influential management thinker in the second half of the twentieth century, once famously said, âProfit is not the purpose of a business but rather the test of its validity.â
Iâll take that a step further: driving revenue is not the purpose of a sales force; itâs the test of its effectiveness.
When targets and quotas become the primary organizing element of your business, the result is a mediocrity at best. Profit is critical, but itâs not the best starting point for driving sales revenue. To do that, you have to start with a noble sales purpose (NSP).
An NSP is a definitive statement about how you make a difference in the lives of your customers. It speaks to why youâre in business in the first place. Used correctly, your NSP drives every decision you make and every action you take. It becomes the underpinning for all your sales activities.
One of our clients is a provider of information technology (IT) services for small businesses. Their NSP is simply, âWe help small business be more successful.â It drives everything they do. Every decision, large or small, must pass through that filter, âWill this help us make small businesses more successful?â If the answer is no, they donât do it.
Every new product and service they createâevery sales call theyâre onâis focused on how they can make their customersâ businesses more successful.
Since implementing their NSP strategy, their sales are up 35 percent. In a tough economy when customers are cutting back on outside IT services, their business is growing.
An NSP is a new way to think about your business. Doing business from an NSP perspective is counter to the way most corporations, entrepreneurs, and salespeople have been told to thinkâand thatâs exactly why it works.
Instead of making profit your sole purpose, you emphasize the impact you have on customers. Profits are the result of your work, not the sole purpose of your efforts. It might sound like heresy, but purpose is the secret to driving more revenue.
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Passionate || Solutions Driven || Trusted Advisor
6yWhat a great article! Consultative selling is constantly being driven within our team. Our customers goals are our goals. Working with our clients to come up with a clear process on how we can work together to achieve their goals is always the focus. Business awards will then naturally follow..
"Transforming Supply Chains with Strategic Leadership | Managing Director, Logistics Expert"
6yLisa, Outstanding article! Make your customer's goal your goal!!
Every word true! Exceptional salespeople are seemingly punished for concentrating on customersâ needs, particularly if they arenât aligned with a companyâs objectives du jour for any given period. I sold for a Fortune 500 company and was incredibly successful in relationship management and in attaining results for the client, often credited with helping build out their brand. I made a lot of money in the process. But, the internal fight to push through buys (and no, I didnât sell based on cost, my contracts were never low-balled, they were customized to what was most effective and beneficial to the objectives and budgets of my clients. My churn was virtually non-existent and I lived largely on referrals). Oddly, the philosophy I based my sales in was the very thing that often kept me at odds with direct âmanagersâ and directors at various levels who had no idea about the realities of what we were being paid to do. I no longer associate with this company, and they are now staffed primarily by mediocre salespeople who play political games. The corporate mandates ran counter to what our clients wanted and needed. It is a losing proposition to put CRM metrics above customer satisfaction and service. Such a broken system. Pity!
Sales Manager with a passion to empower the team and see it achieve unbelievable heights.
6yExcellent article. Definitely a thought provoking read and time to put it to practice.
AGS Worldwide Movers
6yThis is so spot on!