What Do The Experts Tell Us About Sales Management Failure?
Before reading this post, try typing sales management failure into Google. In summary, you’ll find 15,900,000 posts, articles, and studies with titles like the:
- Top 10 Reasons Sales Managers Fail
- Eight Common Ways Sales Managers Lead Their Team To Failure
- Seven Reasons Why Sales Managers Fail
All things considered, reviewing this information can provide you with a basic understanding of the issues. However, if you are looking for an approach or method that will prevent sales management failure then be cautious. For the most part, these blogs, articles, and studies lead us to believe that sales management failure is caused by:
- Taking too long to learn the business and being unable to adapt to the culture of the company
- Missing sales activity targets and expectations
- Being ineffective at communicating within the company
- Making little to no time to coach and train salespeople
- Hiring the wrong salespeople
- Not motivating salespeople
- Focusing on the wrong target buyers
- Ignoring or not managing poor performing sales people
- Using poorly designed sales presentations and handouts
While these reasons are true, they are mere symptoms of a larger problem, not the root cause of sales management failure. Think of it this way, if sales managers were to work night and day to address each of the failure points above, would they still be vulnerable to failure? Yes, because the failure points above only address a small portion of the challenges that sales managers face every day.
So What Is The Root Cause of Sales Managment Failure?
With this in mind, one common denominator seems to be shared by companies with a history of sales management failure. All things considered, the lack of defined work activities is the root cause of sales management failure. In fact, I have found that poorly defined work activities are prevalent in companies where:
- Business leaders are focused on acquisitions, product development, or other processes
- There is a “Just Do It” mindset and culture
- Process management is viewed as a bureaucratic waste of time and money
As an illustration, if you’re experiencing any of the following it’s a safe bet that your work activities are not well defined.
- Never ending disruptions from confused sales and service people looking for answers to questions about how to do their work
- Inaccurate sales pipeline and sales opportunity forecasts from poorly structured data tracking and recording systems
- Burnout from trying to solve the same problems repeatedly without success while simultaneously managing daily sales operations
- A continuous flow of improvement project starts and stops as business leaders grow impatient and jump from solution to solution
- An inability for salespeople to execute consistently from sales call-to-call and sales person-to-person
Under those circumstances, it’s also a safe bet that the probability of sales management failure is high.
So What Steps Should We Take To Prevent Sales Management Failure?
Generally speaking, reducing the probability of sales management failure is hard work with no easy, quick, or simple solution. With this in mind, here are five steps that you can take to reduce the probability of sales management failure.
Step 1 – Ensure That You Have Identified All Work Activities That Must Be Managed
- Lack awareness of all the work activities that must be managed for salespeople and teams to execute with precision.
- Underestimate the time that is required to define, map and build procedures for all work activities
- Have no universal set of guidelines to turn to that defines all sales and service work activities.
What Do The Principles of Strategic Management Have To Do With Sales Management Failure?
With this in mind, after working to prevent sales management failure for nearly 30-years, I discovered a solution. In fact, I found it in a most unlikely place – – a college textbook that had been sitting on my bookshelf since my college days: The Principles of Strategic Management.
In short, The Principles show us how to build sustainable company success by proactively managing three strategic processes – – strategy, execution, and evaluation of their strategy and execution.
Think of it this way, if proactively managing The Principles of Strategic Management increases company and business leader success, then shouldn’t sales management proactively manage to these principles? For that matter, shouldn’t all department leaders manage their operations to The Principles of Strategic Management?
The Chief Sales Leader Framework™
In short, this breakthrough led to the creation of a hierarchical framework that reduces the probability of sales management failure. In summary, the framework consists of three strategic processes, twelve operating sales processes, hundreds of sub-processes, and thousands of tasks, including.
- Strategy – forecasting, planning, organization structure, and culture
- Execution – process, management, technology, and information
- Evaluation – tracking, analyzing, reporting, and process improvement
Over time, my clients began to refer to it as The Chief Sales Leader Framework™. Eventually, this breakthrough led to the creation of a roadmap that provides step-by-step instructions on “how to” implement the hierarchical framework. To clarify, the roadmap provides instructions on how to build, improve, and merge sales teams. My clients call it The Chief Sales Leader Road Map™.
To reduce the risk of sales management failure, it’s important to ensure that all work activities in the twelve operating processes:
- Are defined, mapped, have policies, and step-by-step instructions that show people how to do their work
- Have metrics, goals, and reports so you know when they are in and out of control
- Have knowledge transfer and training in place for sales managers and salespeople
Step 2 – Update Your Sales Management Job Descriptions
In fact, most companies that have a history of sales management failure do not. On the contrary, they typically focus on one or two of the twelve operating sales processes and ignore the others. It’s also true that many companies do not have job descriptions for their sales managers.
Are You Expecting Too Much From Sales Management?
It’s worth noting that small companies tend to overwhelm their sales managers with too many job responsibilities. Obviously, this further increases the probability of sales management failure. For example, the CEO of a software-as-a-service client in New York City expected her sales manager to:
- Sell to cover their cost
- Hire and manage salespeople
- Build an accurate sales forecast
- Install our CRM system
- Craft reports that tell us if our sales team and people are in or out of control
- Create a sales compensation plan
- Develop our sales and market plans
As you can see, with this volume of job responsibilities, the probability of sales management failure is almost 100%.
One Way To Prevent Sales Management From Being Overwhelmed
One potential solution to this problem is to separate job responsibilities into two or more job descriptions. For example, I asked the CEO above to define her top two or three priorities for your sales manager. She replied, “I want them to sell, hire and manage our salespeople”.
So, we narrowed the sales manager job description to focus on selling, hiring, and managing salespeople. Next, we placed a sales management consultant on retainer for 2-hours per day to handle the rest of the job responsibilities. Using a management consultant in this situation resulted in:
- Immediate focus without the fixed overhead cost of an additional sales manager or sales support manager
- The use of best practices to define, map, establish policies, and measures for work activities
- Mentoring for the sales manager to develop them into a Chief Sales and Marketing Officer
- Being able to promote from within which built employee morale
To reduce the risk of sales management failure, use job descriptions to:
- Define which of the twelve operating sales processes and hundreds of sub-processes they are responsible for
- Assign responsibility for those that the sales manager is not responsible for to other managers or consultant
Step 3 – Set Time Management Expectations
In most cases, companies with a history of sales management failure leave these decisions to each sales manager. As a result, their time is spent reacting to the blizzard of daily fires caused by the lack of defined work activities.
For example – – if sales management is spending most of its time on executing sales:
- Procedures for new customer acquisition, renewals, cross-selling, and winning back customers – – then who is managing the other eleven operating sales processes?
- Management procedures i.e. hiring, onboarding, coaching, evaluating, compensating, rewarding – – then who is managing the other eleven operating sales processes?
- Strategy i.e. sales forecasting and sales reporting – – then who is managing the other eleven operating sales processes?
To reduce the risk of sales management failure it’s important to:
- Clearly define how much time you expect sales managers to spend working on each of the twelve operating sales processes
- Continuously adjust your time management expectations of sales management. This can be done by soliciting their feedback about where they are experiencing time management bottlenecks.
- Reassign operating processes, sub-processes, and tasks that are destroying your sales managers schedule
Step 4 – Measure Sales Manager Performance
Are you measuring your sales managers performance in each of the three strategic and twelve operating sales processes? In fact, companies with a history of sales management failure typically measure performance based on sales results. As a result, they have limited, if any, measures in the other eleven operating sales processes. To reduce the risk of sales management failure it’s important to:
- Measure management performance in each of the three strategic processes and twelve operating sales processes
- Hold frequent review meetings with sales managers so they can see whether each of the twelve operating sales processes are in or out of control
- Work with sales management to prioritize and implement targeted process improvements in the twelve operating sales processes
Step 5 – Link Job Descriptions, Measures, Performance Evaluation, and Compensation
Is your sales management compensation directly linked to their job description, measures, and performance evaluation? Does it compensate them for the work they perform in each of the three strategic and twelve operating sales processes?
In most cases, companies with a history of sales management failure have little to no correlation between job descriptions, measures, performance evaluation, and compensation plans. Instead, they focus compensation on commission or bonuses related to units sold and revenue.
Consequently, this signals to sales managers to ignore the other eleven operating sales processes. To make matters worse, business leaders often ask sales managers to work on things that are not connected to their compensation. Thus, placing the sales manager in a vulnerable position that increases the probability of sales management failure.
Think of it this way, if they focus attention on work activities that:
- Drive their compensation they risk angering business leaders
- Are not tied to their compensation they risk losing income
To reduce the risk of sales management failure it’s important to:
- Link merit increases, commission, and bonuses to job responsibilities for the three strategic and twelve operating sales processes
- Limit requests for sales managers to work on activities that are not linked to their compensation
The risk of sales management failure can be substantially reduced by proactively defining, training employees on, measuring, managing, and improving sales and service work activities. As a result, salespeople and sales teams will execute with precision – – effectively, efficiently, and predictably. In conclusion, taking the following steps will reduce the risk of sales management failure:
- Ensure that your business leader, sales leader, and sales manager have identified all work activities that must be managed
- Update sales management job descriptions to define the specific responsibilities they have for the twelve operating sales processes
- Set time management expectations for how many hours sales management should spend working on each of the twelve operating sales processes
- Measure sales manager performance in all twelve operating sales processes
- Link sales management job descriptions, measures, performance evaluation, and compensation to the twelve operating sales processes
A Final Thought On Sales Management Failure
There are tools that can help predict sales management failure, including:
- Interviews with sales management job candidates are used for evaluating candidate knowledge, skills, and experience with the twelve operating sales processes. Using a Job Candidate Process Interview can help eliminate candidates that have a high probability of failure.
- Assessment of sales management knowledge, skills, and experience with each of the twelve operating sales processes. Using a Sales Manager Assessment can help target training and development needs.
- Audit of sales team process management capability within and across the twelve operating sales processes. Using a Sales Team Assessment can help pinpoint sources of chronic underperformance and focus process improvement efforts.
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