Aligning Sales Force Responsibilities With Growth Goals Affina White Paper 02 2009


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Explore the challenges faced by sales teams, 4 models that can be implemented to dissolve barriers to sales success, and considerations for implementing successful solutions

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Aligning Sales Force Responsibilities With Growth Goals Affina White Paper 02 2009

  1. 1. A HINDUJA GLOBAL SOLUTIONS COMPANY WHITE paper Aligning Sales Force Responsibilities with Growth Goals Four Sales Support Models that Maximize Sales Performance Business-to-business sales leaders are facing increased pressure to drive revenue growth while balancing sales initiatives with cost containment Can an alternative measures. When considering the recent macro-economic conditions, the support solution drive challenges associated with achieving sales growth and profitability expands results for your sales exponentially. organization? In between revenue generation and expense management activity resides A re you 100% confident your team is optimally aligned for conflicting goals and evolving obstacles. Today, successful sales organizations success? must deploy flexible strategies supported by nimble tactics. Successful leaders D o you experience periods will quickly adapt to the increasingly competitive business environment, of frustration related to the productivity of your team? which will greatly reward those willing to embrace it. With rising performance expectations and increased attention from key stakeholders, it is more A re the key stakeholders in the company satisfied with important than ever to ensure the efforts of the sales force are optimally sales performance? aligned with growth and profitability goals. If the responsibilities and activities of the sales team are misaligned with growth and profit expectations, turbulence will ultimately find its way into the team, forcing leaders to implement and enforce unavailing policies with great expectations. More than ever, sales organizations need leaders that passionately embrace change and have the courage to question the true effectiveness of historical practices. Addressing sales challenges effectively requires more than adjusting bonus plans, requiring additional cold calls, implementing new direct mail campaigns or transitioning to an environment that uses fear to drive results. This paper explores ongoing challenges faced by sales organizations, highlights four models that can be quickly implemented to dissolve barriers to sales success, and defines considerations for implementing successful solutions. Organizations that have deployed these, and similar, initiatives have experienced results such as:
  2. 2. 20% increase in sales force productivity, leading to increased face-to-face selling time and a renewed focus on revenue generation activity Additional $18 million in revenue by releasing a new product line to market ahead of forecast 300% increase in pipeline revenue within 6 months When applied appropriately and consistently, these models will deliver measurable results and provide an attractive return on investment. Through a centralized and optimized solution, sales organizations can realize qualitative and quantitative benefits, including: Increased face-to-face selling time for field sales force personnel Ongoing pipeline development through continuous prospecting and lead development New and enhanced product launches ahead of the competition Steady performance during times when territories are vacant Decreased cost of sales by centralizing operations, and removing lower value administrative tasks from field sales team Improved sales strategy effectiveness through advanced analytics and reporting Powerful and effective presentations, driven by proper research and solution development The models outlined herein can be implemented independently or collectively. It is common for successful organizations to implement using a phased approach, gathering proof points according to pre-defined milestones. The remainder of this document is arranged in four sections, including: Current State of the Sales Organization The Impact of Misaligned Sales Force Responsibilities Four Sales Support Models for Driving Revenue and Customer Loyalty Options for Implementing Models Current State of the Sales Organization The journey to find balance within the sales organization is continuously disrupted by evolving market conditions, conflicting internal goals, inefficient processes, revised performance expectations, competitive threats and differences in human behavior. These obstacles exist today just as they did fifty years ago and as they will 100 years from now. The challenges presented to the sales leaders of modern time are similar to those faced by their predecessors. Sure, new technologies have been introduced to drive efficiencies, track performance and remain connected to prospects virtually 24x7. However, the responsibilities and activities of the sales force remain the same. Sales people prospect, present, report, close, and unfortunately lose deals. They stress about properly preparing for key presentations while balancing prospecting activity to identify new opportunities. The result is typically a final presentation that would be awarded a “C” at best if using an academic grading system, and a pipeline that is stagnant or depleting. Sales people are interrupted by their leaders to prepare last minute performance reports, attend discussions to address performance and to prepare solutions to overcome unexpected market challenges. Unfortunately, the result is less face time with key prospects and less activity related to strengthening the pipeline. So much time is spent exploring problems and reporting and planning that the core responsibility, face to face selling time, of the sales team is often limited to less than 40%.
  3. 3. How would your company’s sales performance improve if your sales people spent just 20% more time with qualified prospects and clients with growth potential? The true impact of misaligned sales activities will be outlined in the following section, Impact of Misaligned Sales Responsibilities. For now, consider a common scenario that occurs every day across thousands of sales organizations. Misaligned Sales Responsibilities at RSM RSM has experienced an unusual amount of client churn due to competitive pressures and volatile market conditions. Due to this unexpected loss of revenue, RSM will miss its annual revenue growth target. The executive team challenges the sales organization with replacing the lost revenue and the timeline is aggressive. RSM’s sales pipeline has been quickly depleting for the past three months. Five of the company’s 30 territories are vacant due to turnover and the sales team has been focused on communicating product enhancements with current customers. Turnover has been driven by sales rep dissatisfaction with newly assigned responsibilities for servicing existing accounts, which has resulted in fewer new sales. While sharing product enhancements with existing customers was important for client retention, the activity reduced the focus on growth from new business. During the same period, RSM lost three major opportunities and received feedback from prospects that competitors submitted stronger proposals that were more relevant and full of value added recommendations. The prospects also felt that MSR’s competitors’ sales people were better prepared to communicate value related to delivering a solid return on investment. Bottom line, MSR has been traveling through a perfect storm that was generated by the sales team focusing on activity misaligned with growth objectives. In an effort to ignite the sales team, and to demonstrate leadership to the executive team, the sales managers engage in a collaborative effort to drive sales. Sales managers offer new bonuses that are attached to meeting short term goals. New lead generation plans are implemented with an explosive introduction and followed by fading enthusiasm. Meetings are scheduled that are filled with fear tactics supported by feedback from the executive team that a close eye has been placed on the effort of the sales organization. Sales representatives participate in focus groups in an attempt to identify immediate opportunities. The initiative captures attention across the organization, overshadowing the fact that performance remains the same. At the end of the year, revenue goals are still missed. The effort ends, and activity returns to normal. During the following months, RSM repeats the cycle as fear mounts that quarterly performance will miss expectations. What went wrong and how can the sales organization regroup? The steps outlined within the example at RSM aren’t entirely ineffective and in some cases required. However, they are repetitive and seldom impact long-term improvements in sales performance. Continuous sales performance can only be achieved when the responsibilities of the sales force are aligned with the performance goals of the company.
  4. 4. RSM experienced multiple problems due to misaligned responsibilities, including: Turnover and vacant territories driven by sales force dissatisfaction regarding earnings potential Depleting pipeline due to lack of focus on new business when servicing existing clients Lost revenue, resulting from competitors that delivered a stronger value proposition Many of the issues at RSM could be avoided if the company implemented the appropriate support machine for maintaining existing relationships and handling administrative tasks for the sales force. This example applies to thousands of global sales organizations. Unfortunately, similar obstacles are too often addressed using repetitive solutions without prevail. When gaps in performance are addressed as they were at RSM, turbulence enters the sales environment and policies are implemented under the influence of pressure to correct performance. The fundamental problem is that too much hype is placed on implementing short-term initiatives rather than aligning responsibilities with growth objectives and then introducing support mechanisms that allow the sales team to meet with more qualified prospects. Think about the challenges that are recurring in your sales organization; the ones that are discussed in each sales team meeting. Make a note of the most common sources of your frustration and the top barriers that work against the achievement of your goals. Perhaps the sales pipeline is weaker than expected. Maybe you are experiencing a higher than expected turnover of the sales team. There may be a competitive threat that has been stealing the customers your team has neglected because they are focused on other activities. As you explore the sales models that are outlined within this paper, compare your frustrations and issues with each solution. The Impact of Misaligned Sales Responsibilities When the responsibilities of the sales force are not aligned with the company’s growth objectives, issues will surface and performance will suffer. The following highlights common challenges that sales organization face as a result of managing teams that are not optimized for performance. Less face to face selling time Loss of sales talent Vacant territories Weak proposals Unacceptable pipeline growth Depleting pipeline revenue Rising cost of sales Client churn Missed opportunities Missed revenue goals Lack of strategic planning The following four sales support models have been designed to allow sales teams to maximize face-to-face selling time and revenue generation. Additionally, these models can improve the effectiveness and efficiency of your team, while assisting in lowering the sales expenses. Whether implemented independently or collectively, the performance of your sales organization will improve when these models are applied correctly.
  5. 5. Four Sales Support Models for Driving Revenue and Customer Loyalty A number of companies have implemented smart sales support models with measurable success. At AFFINA, we partner with companies that have fully embraced a sales support solution, and others that are just beginning to explore the benefits. Each of the models defined below can be implemented collectively or independently. Most of our clients have implemented with a phased approach and in most cases, these solutions are designed to complement the field sales force. However, the models can be used to replace field sales teams or enhance existing inside sales operations. Model 1 - Partnership Selling Partnership Selling improves the productivity of the sales force by optimizing the time field sales people spend face–to- face with prospective clients. Many reports estimate that face–to-face selling time accounts for less than 40 percent of a sales team’s activity. Using a Partnership Selling solution, a field sales team member is paired with an inside sales partner. These are typically designed as one–to-one relationships. However, the ratio can vary and is sometimes set much higher. A Partnership Selling model allows your field sales team to be more productive by transferring lower value activities to the inside sales partner. We define lower value activities as any tasks that reduce face-to-face selling time. While lower value in terms of direct sales activities, these functions still are essential for achieving sales success. Activities of the inside sales partner can include, but are not limited to: Prospecting Lead development Appointment setting New account set up Competitive intelligence gathering Presentation development Meeting coordination Model 2 - Account Management Transitioning existing customer relationships to a growth-focused, centralized account management team can improve customer loyalty and retention, as well as drive organic growth. By removing account management tasks from your sales team, you free up time for the team to meet new prospects and close new business relationships. Too often, sales people become comfortable working with existing customers and avoid establishing new relationships. The result is missed goals related to new business. A good account management program will drive growth through improved customer retention and up-selling and cross-selling initiatives. By removing this responsibility from higher-paid sales representatives, you can also lower the total cost of sales. Support that can be provided through a separate account management program includes: Order management Customer service Billing and account administration Identification of organic growth opportunities Special program management New customer on-boarding
  6. 6. Model 3 - Direct Sales Balancing the rising cost of sales with growth initiatives is a challenge all sales leaders face. Managing a field sales team is a large expense assumed by companies and the cost continues to rise. Travel expenses continue to increase and customers are demanding more attention than ever. An option to combat rising costs while increasing customer communication is to implement a centralized inside sales team that handles a targeted segment of customers. A common practice is for companies to assign “C” level accounts to the inside sales team. Depending on your customer expectations, you can replace your field sales team completely, or complement it by reassigning representatives to profitable and growth accounts. A direct inside sales team can drive growth and profitability by: Focusing on small to mid-sized accounts Covering vacant territories Managing cross-selling and up-sell initiatives Communicating new products to market faster than outside team Model 4 – Centralized Sales Support and Administration When your sales team is focused on completing reports, analyzing territory performance or setting up new accounts, they are not in front from high potential prospects. The traditional sales model suggests that these activities are part of the sales person’s responsibility. Our position is that anything that restricts face to face selling time has the potential to be redistributed to a centralized support team. Consider the expectations of professional athletes. Players are not expected to prep the field or compile competitive statistics. They are provided with an optimal environment and the necessary intelligence for maximizing their skills. Professional salespeople excel when they work in a similar environment. Examples of administrative work that can be removed from the sales team include: Territory performance reports Account analysis Application processing and due diligence Account changes On-boarding new clients Research, presentation development Competitive Analysis Options for Implementing Sales Support Models There are three options to consider when exploring the implementation of these sales support models. The right option for you will depend on your current situation. For example, many companies have managed similar programs internally for years only to find an external partner can perform the work more effectively. For others, the work has been completed more effectively in-house. The only true test is to implement a pilot program. The three options include: Implement in-house with internal resources Implement with an external partner that has proven experience Implement using a blend of in-house and partner
  7. 7. Many companies are compelled to implement internally first, citing expertise in their culture and products. Others will partner with an outsourced service partner and commit to transferring the appropriate knowledge. Outsourced partners can typically deliver benefits related to: Scalability and flexibility Accountability – it is easier to hold an external partner accountable. The revenue of the third party is dependent on the program’s success. Lower costs related to labor, taxes, administrative and employee benefits Experience developing proven processes to support centralized operations Application of best practices and proven processes Access to latest technology solutions To identify the right option for your company, we recommend taking the following steps to get started. You may also be well-served in meeting with an external resource that has implemented similar models. 1. Survey and have discussions with your field sales team to identify activities that reduce face to face selling time. Also influencing the effectiveness of presentations to high potential prospects? identify the tasks that conflict with revenue generating activity. For example, is the pressure to prospect for new business 2. Estimate the additional time your team could spend with qualified prospects if not focused on administrative tasks. Complete a benefit analysis. How much additional revenue would correlate with just 20% more time in front of qualified prospects? 3. Meet with internal or external resources that have successfully implemented centralized sales operations and develop an initial blueprint for removing specific responsibilities from your sales team. 4. Implement a pilot period following discussions with others that have managed similar programs. About AFFINA AFFINA – A Hinduja Global Solutions Company is a wholly-owned subsidiary of Hinduja Global Solutions, Inc. (HGSI). AFFINA and HGSI partner with Fortune 1000 and Fortune 500 companies to provide comprehensive contact center, business process outsourcing, and fulfillment services from a global network of operations centers, including locations in the United States, Canada, India, Philippines, and Mauritius. Integrated, end-to-end solutions set includes customer service, business-to-business sales support and account management, inbound sales support, fulfillment, market research and analysis, claims processing, data capture, order administration, and service provisioning. The 36-year-old company, combined with HGSI, now employs approximately 14,000 people globally, and serves clients in a wide variety of industries, including consumer electronics and products, packaged goods, publishing, automotive, technology, banking and financial services, media and entertainment, logistics and transportation, utilities, healthcare, insurance, and telecommunications. For more information about AFFINA and HGSI, visit or, or call 1-877-4-AFFINA. About Author Cole Proper is a vice president of business development at AFFINA. He has designed and implemented inside sales and sales support operations for multiple companies. He has over eight years of experience assisting companies with outsourcing initiatives. Prior to joining AFFINA’s business development team, he held leadership positions within the company’s operations department. Cole is a graduate of Illinois State University’s Professional Sales Institute, a leading university sales program and was featured in the 2007 edition of Professional Selling – A Trust Based Approach. 1-877-4-AFFINA | | United States | Colombia | Canada | India | Philippines | Mauritius Copyright ©2009 AFFINA, LLC | All Rights Reserved