Sales Performance Continues to Decline Even as the Economy Rebounds and What Strategic CEOs Do to Stay Ahead of the Competition

by: Trisha Allmon, GrowthSmart Consulting

With many companies trying to shake off the drag of a global recession, CEOs and business leaders are eager to find growth opportunities. One place they need to look is in optimizing their own sales and marketing organization. Unfortunately, too few companies are willing to reorganize or reengineer their own marketing and sales processes for fear of disrupting business as usual; especially as the economy begins to recover and sales begin to improve. Executives must realize that what got you here will not get you there. In other words, transformation doesn't happen easily. You have to commit to change and sometimes that means making a cultural shift.

In addition, according to extensive sales effectiveness research, it's not clear that top level decision makers that are making changes are shifting fast enough to modify their sales and marketing models to meet current demands of today’s buying patterns. What we do know is that CEOs and leaders who put sales management at the heart of their agenda have captured astonishing growth — outperforming their peers by 50 to 80 percent in terms of revenue and profitability according to a Harvard Business Review article (2012).

Unfortunately, sales managers and sales people are not prepared for a changing model in the new economy and ever changing buying landscape. In fact, according to the Sales Executive Council (2010), 65 percent of the sales people say that their managers are not equipped to handle the shifting sales environment to effectively guide and train them. According to a Harvard Business Review, of the $20+ billion that U.S. companies spend training their sales forces every year, very little gets directed towards sales managers to support their growth initiatives. In many firms, revenue growth targets are not being met, a large percentage of sales people are not proficient at qualifying or prioritizing opportunities, and the foundations of account planning are not being routinely executed. Sales systems and methodologies are not being leveraged consistently, even though it’s widely recognized that the use of a formal sales process improves performance. Even more concerning, sales forces cannot effectively map the sales process to the customer’s buying patterns, despite the fact that clients are often vocal about what they need.

Here's the scary truth and why all sales organizations and managers should care: according to a recent independent research study, “approximately 30% of the time, the winner of the sales cycle was determined before the "official" selection process even started. Another 45% of the time, customers had already made up their minds about whom they were going to buy from about halfway through the process. That means that 75% of the time, customers made their decision halfway through the process. Only 25% of the time did customers make their final decision at the end of the selection process” (Author: Steve W. Martin, Effectiveness of Sales Training Programs, originally appeared in the Harvard Business Review). In other words, if you are not clearly in the lead at the midpoint of the sales process, the odds are that you are going to lose the business.

Here’s how you can get ahead of your competitors and overcome the threat of low sales performance and increase your deal conversions:

1. Assess your sales organization to find the gaps and low performing areas – a MUST for successful sales and marketing organizations. Get an outside perspective as often as possible. Most companies don't know what they don't know. They are in the weeds so it is very difficult to see what they haven't already tried. Businesses that perform frequent audits are able to optimize their results and focus on making incremental improvements; drastically improving marketing and sales performance. The key is to assess your team as well as the marketing and sales operations to ensure you uncover all opportunities.
2. Map out your sales process and create a systematic, formal process that can be institutionalized across the organization – most organizations have an ad hoc sales process. I say WOW to them. How can you fly a plane with no instruments, dials or instruction? Often times in our discovery we find that successful reps have a system that is not known to anyone else in the organization. In fact, most reps especially new ones are left to their own devices. According to research, mapping out your sales process has an immediate impact and is proven to increase conversions by 20% across the organization on average (HBR Sales Effectiveness 2012).
3. Understand each marketing and sales persons’ traits to learn if they have the high performance TALENT personality you are looking for – do you know if your team has marketing and sales character deficiencies? If not, this is absolutely CRITICAL to optimizing your results. Very few organizations look at hiring, onboarding and training sales and marketing talent as a strategic advantage. Many of these positions are acquired through seniority or promotions and usually do not think of the personality fit for the outcome the organization is trying to achieve.
4. Determine if a training program will improve sales performance – Look for sales training that teaches strategies to incorporate the entire sales and marketing funnel effectiveness, from lead generation to conversion – most companies are only focusing on one or two areas, if any, and are leaving money on the table. If you don’t have a sales training program click here to get a 21 Day Free Trial with three complimentary coaching sessions by a certified Mastery Level Coach to help you assess your sales organization and training initiatives.
5. Ensure marketing and sales alignment as a strategic initiative - A great leadership topic for discussion is Sales and Marketing alignment. Very few organizations we work with unite these two functions. The impact of creating synergy between these notoriously siloed operations can drastically affect results. With 66-99% of the buyer’s journey complete before they reach out to a sales person, then in order to make a sale, your company already has to be a trusted source of information for your buyer. Make sure your coach or consultant understands how marketing and sales are integrated before reaching out for help. At the very least, make it a top priority in your next leadership strategic planning session.

Finally, research shows that “companies with stronger client relationships and a dynamic sales process significantly outperformed peers. For instance, top performers—those with a more strategic or trusted partner relationship with accounts and a formal, dynamic sales process and training — had 20 percent more of their sales force attaining quotas and were 17 percent closer to attaining their company’s sales plan than their peers that lacked these strategies” (HBR.org Sales Effectiveness 2012).

As the economy begins to rebound, now is the time to super-charge your sales results and look for areas to optimize. Smart CEOs have a sense of urgency and demand looking for all opportunities even when things are going well.

To assess your organization, your sales people or your training needs please go to www.GrowthSmart.com and request a breakthrough call.

Research and sources: Harvard Business Review, Accenture, Independent Research, Matt Dixon, co-author of the article The End of Solution Sales and The Challenger Sale, Author: Steve W. Martin, Effectiveness of Sales Training Programs) originally appeared in the Harvard Business Review.