Tice - HR & Sales Partnership: Developin High-Performance Sales People

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Tice - HR & Sales Partnership: Developin High-Performance Sales People

  1. 1. HR & Sales Partnership: Developing High-Performance Sales People Presented By Tom Tice Towers Watson September 1, 2010
  2. 2. Sales People: Wheelers And Dealers? 1
  3. 3. Sales Forces In The U.S. • There are approximately 14 Million full-time sales people in the U.S. • Sales people represent 16% of the U.S. workforce • Companies spend $1 to $2 Trillion a year in compensation cost for sales people • Sales people are responsible for growing the top line in good times and bad 2
  4. 4. What’s So Special? • Front line – company’s face to the customer • Impact top line like nobody else, and bottom line too • All about growth – cost management is secondary • Sales force issues are unique – Sales force life cycles, rules of engagement, etc. – Perfect data link: Σ sales rep results = corporate results • Requires a specialized body of knowledge and competencies “…fundamental DNA structure is different” 3
  5. 5. Sales Force Prominence Varies Based On The Selling Environment Partnership Application- Selling Oriented Consultative Selling Need Selling Level of Sales Rep Buyer- Multi-Level Selling Complexity Prominence Oriented Post-Sale Selling Relationship Selling Pressure Selling Product- Feature Selling Oriented Order Taking 4
  6. 6. . . . And Job Roles Change Market Unique Specialists Sales Force Prospects Finders Market Makers Buyers Product Specialists Customers Keepers Growers Existing/Core New/Different Products 5
  7. 7. Sales Coverage Models Evolve . . . In the beginning... Sales Process Lead Qualify Propose Close Fulfill Manage Small Mid Geographic Territory Sales Reps Large 6
  8. 8. Iterations Begin To Accumulate. . . Sales Process Lead Qualify Propose Close Fulfill Manage Small Telesales Mid Geographic Territory Reps Large Account Named Account Sales Reps Enterprise Coordinators 7
  9. 9. Coverage Becomes More Complex – And Expensive Sales Process Lead Qualify Propose Close Fulfill Manage Telesales Reps Proj Cust Small eChannel Mgrs Care Agents/Distributors Mid Large Named Account Account Telemarketing Sales Reps Coordinators Enterprise Reps Vertical 1 Vertical 1 Specific Reps Vertical 2 Vertical 2 Specific Partners 8
  10. 10. HR And Sales Must Act As Partners To Assure That The Sales Function Has… l Programs, tools and processes to guide: — Hiring/ re-deployment / exit 1. The right people — Feedback and coaching with right skills — Sales Supervisor (people mgt.) effectiveness — Talent development and career progression — Base pay progression l Sales strategy clarification 2. Focused on the l Sales process clarification right opportunities l Sales role design and sales organization development with the right tools l Quota setting and allocation l Employee Value Proposition assessment and design 3. Highly motivated l Sales compensation assessment and design (often = regional/global) to execute sales l Sales compensation implementation strategy l Sales compensation risk assessment and mitigation l Sales compensation governance 9
  11. 11. First, The Right People with The Right Skills … Career Framework + Competencies M anagemen t Career Path Executive VP SVP EVP CEO M anagement Supv Mgr Sr Mgr Grp Mgr Sr Grp Mgr Professional/Expert In dividu al Contributor Career Path Entry Intermed Career Specialist Master Expert Technical/Business Support Entry Intermed Senior Lead Supv Productio n Entry Intermed Senior Lead l Uses career bands (e.g., Career Framework + l Competencies Clarifies the knowledge, skills professional, manager) and and abilities required for career levels (e.g. entry, successful performance intermediate) to organize and l Provides foundation for align roles across the performance management, organization career pathing and planning, l Includes criteria to clearly learning and development, and describe each career level succession management 10
  12. 12. Providing A Clear Career Path Helps Both Retain Sales Talent and Guide Development Discussions Entry Level Description 2nd Level General Product & Selling Client S7 Manager Profile Sales Expertise Process Orientation 1st Level • Sells less • Has basic • Emphasizes the • Typically is S6 Manager complex understanding of process rather responsible for a products and/or business, service than developing territory or group S5 Team Leader services and/or products own sales of accounts with • Works within sold approaches more than 10 an assigned • Has up to two (e.g., make 10 current and S4 Expert territory or years of sales calls a week) prospective customer base experience; may • Typically makes customers S3 Career have recently sales calls from • Has up to two years of sales worked in standardized S2 Associate experience telesales or out- “scripts” for bound call center some of the and is company’s less S1 Entry transitioning to a complex field sales products and position services Sales/Sales Management 11
  13. 13. Providing A Dual Career Path Can Help Retain Top Sales People Executive Management Career Path VP SVP EVP Management Supv Mgr Sr Mgr Grp Mgr Sr Grp Mgr Professional/Expert Individual Contributor Career Path Entry Intermed Career Specialist Master Expert Technical/Business Support Entry Intermed Senior Lead Supv Production Entry Intermed Senior Lead 12
  14. 14. Illustrative Career Path Based On Sales Competencies And Career Bands Illustrative career path example – Sales CASE EXAMPLE Sales Senior Senior Sales Sales Operations Operations Operations Operations Operations Operations Specialist Specialist II Project Specialist Manager Director Manager Associate Senior Manager Product Product Senior Product Product – Product Specialist Manager Manager Manager Management VP of Sales Sales District Sales National Sales Regional Sales Sales Rep I Sales Rep II Supervisor Manager Manager Manager Senior Customer Senior Manager Customer Customer Customer Service – Customer Service Rep I Service Rep II Service Rep Manager Service Sales Support and Customer Service Director Sales Support Senior Sales Senior Manager Sales Support I Sales Support II Project Support – Sales Support Manager Entry Intermed Career Specialist Master Expert Sr Group Sr Group Supv Manager Career Manager Manager Manager Bands VP 13
  15. 15. Sales Competencies Define the Knowledge, Skills and Abilities Required For Successful Role Performance Commonly, we develop competencies for both sales and sales support . . . CASE EXAMPLE Direct Sales Customer and Relationship Influence/ Demonstrating Industry Solutions Selling Management Persuasion Value Knowledge Sales Support Customer and Business Customer Industry Process Consultation Implementation Experience Knowledge Management 14
  16. 16. By Scaling Each Competency, We Clearly Communicate Development Expectations And Provide A Basis For Assessment Influence/Persuasion – Creates compelling rationale to facilitate and motivate action toward a desired outcome l Uses appropriate interpersonal styles and communication methods to gain acceptance from others for an idea, plan, activity, service, or product l Seeks to understand others’ opinions, positions, and emotions to provide direction to solve problems and negotiate mutually-beneficial outcomes l Gains support and commitment from others and mobilizes them to take action Developing Supporting Applying Leading Shaping l Learns to utilize various l Uses a variety of basic l Presents ideas and l Identifies key motivators l Modifies own behavior to communication methods communication and recommendations in a to direct others toward a accommodate situations and recognize differing facilitation techniques to manner that clearly links point of view and and individuals in an interpersonal styles persuade others in to business priorities and generates new ideas effort to facilitate l Paraphrases others’ straightforward situations gains acceptance from based on differing view attainment of mutual points of view to check l Builds common ground others points to gain broader agreement for understanding and by highlighting areas of l Identifies and addresses acceptance for ideas l Demonstrates a communicate areas of agreement and focusing key concerns from l Diffuses emotional balanced understanding agreement efforts on resolving areas differing perspectives to situations through focus of all sides of an issue or l Responds to objections of disagreement develop mutual on mutually beneficial conflict and provides with supporting data and l Clearly articulates the understanding solutions and identifying support and tools to help information case for action and l Involves others in key win-win outcomes for all others move to describes the benefits of decisions or plans to parties agreement a proposed plan influence a desired l Involves others across l Defines expectations, outcome; ensures others the organization, where goals and the future feel they have necessary, to influence a state to generate contributed to the desired outcome; excitement and action conclusion ensures others feel they from others, giving have influenced key direction and purpose to decisions others’ collective efforts Competency Atlas, Towers Watson’s competency dictionary, can be used to develop the sales organization’s competency model 15
  17. 17. The Sales Competency Framework Needs To Be Tightly Aligned With Sales Strategy – But Stay Flexible … Is This Our Strategy? OR Is This Our Strategy? Team selling & Individual selling Cross-selling Geographic Territory Assigned accounts Transactional Selling Consultative selling Order Taking Account Planning Competencies need to be integrated into how managers coach and manage their people . . . Let’s look at an example 16
  18. 18. Case Illustration: One Of The Fastest Growing Pharmaceutical Companies HR-Sales Partnership Challenge “We more than doubled our sales force size in the last two years and are having a hard time attracting and retaining top sales talent into our organization.” Background Activities Sales’ desired HR Program Content outcome: l Career-based competency model – career ladders + functional competencies l A consistent framework for l Placement of roles into model organizing roles, with clear l Refinement of existing competencies and leveling for each; role-specific competency linkages to career management and talent expectations programs l Career paths and criteria for progression and promotion l Clear career paths and l Linkages between the career-based competency model and current talent management opportunities for all programs employees – demonstrating l Compelling and motivational “story” that employees can have a Implementation long and successful career l Branding with the company -On Track to Success l Enhanced succession l Communication strategy and campaign management to meet the demand for leadership - eCards talent - E-mail announcements - Reference guide l Manager and employee training – three meeting events l Project management, including meeting facilitation and leadership briefings 17
  19. 19. Case Illustration: Pharmaceutical Company (Continued) Results Improved Recruiting and Selection l Recruiting process was able to staff the rapidly growing organization l Recruiting tools and communications clearly articulating career paths within the organization provided an advantage over larger pharmaceutical companies Improved Sales Management Effectiveness l Common set of competencies and expectations took the guesswork out of the process for managers l Provided more time and better tools to effectively mentor and coach the sales organization l Engagement levels increased for both sales reps and sales managers in the first year following implementation Improved Succession Planning l Developed formal high potential program and “fast tracked” many through the career paths l Used formal assessments to rate sales and sales management staff on the key competencies and promotability 18
  20. 20. “Best” Principle of Sales Force Competencies Development How important is this How frequently is this competency to overall job competency required in a performance in a sales sales role? role? Not Applicable Not Applicable Daily or More Times a Year Importance Somewhat Important Important Important Annually Of Little Monthly Several Weekly Critical Often Very N 1 2 3 4 5 1. Competency Name N 1 2 3 4 5 N 1 2 3 4 5 2. Competency Name N 1 2 3 4 5 N 1 2 3 4 5 3. Competency Name N 1 2 3 4 5 N 1 2 3 4 5 4. Competency Name N 1 2 3 4 5 N 1 2 3 4 5 5. Competency Name N 1 2 3 4 5 5 N 1 2 3 4 5 6. Competency Name N 1 2 3 4 Criticality = Importance x Frequency 19
  21. 21. Linking Pay & Capability Development Base Pay Progression Incentive Pay • Vertical pay grade progression • Target incentive pay linkage opportunity – Job level / grade – Different role – Base pay – Same role, but at higher level of competency • No explicit linkage – Commission structure • Horizontal pay progression opportunity • LTI linkage – Range penetration based on performance rating – Job level / grade – Competency-based pay – Discretionary (retention progression within pay range vehicle) 20
  22. 22. The HR-Sales Partnership in Sales Compensation Design Projects Role of Steering Committee l Articulate corporate objectives and interpret corporate policy Steering Committee l Make critical strategy decisions l Guide overall direction of the project l Review and approve recommendations Role of Design Team Design Team l Oversee ongoing project tasks l Participate in analytical process l Review/critique hypotheses, findings , and recommendations l Identify and help gain access to, and Business Sales Human information from , any needed Subject Matter Finance Sales Unit Operations Resources SME Experts Leadership SME SME l Champion any needed data gathering, interview scheduling, and general navigation assistance The role of HR will be either Project Role of HR Project Manager Manager, or Co-Leader with the Sales l Participate as a member of the Project Team l Manage all aspects of the project to achieve Operation Manager timely delivery of results l Lead all activities and Project Team meetings l Create all meeting material and documents l Provide perspectives on best practices through 21 research and data bases
  23. 23. The HR-Sales Partnership in Sales Compensation Design (Continued) Sales Strategy Sales Channels Sales Roles Sales Processes “Top Row” + + + External Required Mix & Performance Payout Surveys Leverage Plan Design Measures Sales Goals Frequency + + + + + 22
  24. 24. Single “Best Principle” for Sales Compensation Poor Pay Dispersion Min Typical Payout Excellence Difference between top and average = 100% of 110% 115% of 15% of target target target Improved Pay Dispersion Difference Min Target Excellence between top and average = 150% of 0% of 100% of 200% target target target of target Make sure that total cash is compelling and differentiated for your top performers 23
  25. 25. HR And Sales Must Act As Partners To Assure That The Sales Function Has… l Programs, tools and processes to guide: — Hiring/ re-deployment / exit 1. The right people — Feedback and coaching with right skills — Sales Supervisor (people mgt.) effectiveness — Talent development and career progression — Base pay progression l Sales strategy clarification 2. Focused on the l Sales process clarification right opportunities l Sales role design and sales organization development with the right tools l Quota setting and allocation l Employee Value Proposition assessment and design 3. Highly motivated l Sales compensation assessment and design (often = regional/global) to execute sales l Sales compensation implementation strategy l Sales compensation risk assessment and mitigation l Sales compensation governance 24
  26. 26. Questions? 25
  27. 27. Contact Details • Tom Tice – Senior Consultant – Sales Effectiveness & Reward – Towers Watson – One Alliance Center – 3500 Lenox Road, Suite 900 – Atlanta, GA 30326-4238 – 770-864-3963 – tom.tice@towerswatson.com 26

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