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The Key Levers for Sales Transformation Success

May 24, 2016 • Global Business, Strategic Spotlight, STRATEGY & MANAGEMENT, Transformation

By Warren Shiver and Michael Perla

For a sales organisation to reach its “ideal transformational advantage” it needs to pull the right levers in the sales force and across the entire organisation to drive meaningful and significant improvement. In this article, Warren Shiver and Michael Perla discuss the six levers they identified that not only help to amplify and sustain change within a sales organisation, but that can be applied to almost any organisational change.

 

“Which levers do I pull to improve sales performance?” We hear that question a lot from sales executives. Just as a CEO is interested in revenue growth, operating margin, incremental investment, and other factors that impact the company’s stock price, sales executives want to ensure they are leveraging the right things to improve sales performance.

As part of our recent book, 7 Steps to Sales Force Transformation, we outline six key levers that can help to support, undergird and drive a sales transformation. These levers should be assessed before starting a sales transformation and throughout the initiative to ensure alignment and focus.

Before we describe the six levers of sales force transformation, let’s take a brief look at what, exactly, a lever is.

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Amplifying Change

The word “lever” comes from the French lever, “to raise”. A lever amplifies, or raises, the force you put into it, and in this way it puts out an even greater force. The ratio of the output force to the input force is known as the lever’s ideal mechanical advantage. When you invest money, or time, or effort, you are seeking a similar ideal advantage. You want to gain leverage. You seek a maximum return on your investment. It’s the same with sales force transformation.

[su_pullquote]We’ve identified six levers that not only help to amplify and sustain change within a sales organisation, but that can be applied to almost any organisational change.[/su_pullquote]

In almost every change initiative, resources are limited, and the transformation is expected to occur within a certain budget and time frame. And, perhaps most important, at the same time the sales organisation must continue to bring in revenues that fund the business. One of the big challenges is how to get the most return from your investment in change. So, when considering a major change or transformation of your sales organisation, what levers can you pull for an “ideal transformational advantage”?

We’ve identified six levers that not only help to amplify and sustain change within a sales organisation, but that can be applied to almost any organisational change. They are particularly valuable with sales teams, however, because sales professionals can be highly resistant to change. In every successful transformation we know of, the leaders pulled most (if not all) of these key levers. How might they apply to your organisation and which ones should be bolstered and reinforced?

 

Lever #1: Perspective

Much has been written about how the customer’s buying process has changed over the past decade, mainly as a result of the Internet. In their book, How Google Works, Eric Schmidt and Jonathan Rosenberg succinctly describe three technological drivers of this change. First, the Internet has made information free, copious, and ubiquitous – practically everything is online. Second, mobile devices and networks have made global reach and continuous connectivity widely available. And third, cloud computing has put practically infinite computing power and storage and a host of sophisticated tools and applications at everyone’s disposal, on an inexpensive, pay-as-you-go basis.

We know the world is now better informed, but little has been written about what these better informed buyers want from their suppliers, vendors, or partners.

[su_pullquote]Involving your customers and your sales team in the design of a solution is a great approach to leading change, and it is essential if you want to get this done successfully. [/su_pullquote]

Sales teams need a perspective to understand why change is happening. An outside-in perspective provides leverage because you are listening to the needs of those who will buy more from you if you get it right. An outside-in perspective is one in which the company elicits feedback and listens to what their current and prospective customers want, need, and value, and then develops or modifies its offerings accordingly.

Involving your customers and your sales team in the design of a solution is a great approach to leading change, and it is essential if you want to get this done successfully. We’ve worked with numerous clients who have created both external customer boards and internal sales advisory boards. The key to success with both is to select members who are seen as influential by their peers and have credibility in their areas of expertise.

 

Lever #2: Alignment

Everett Hill, SVP for Customer Development at Sipi Metals, remembers when he was charged with transforming a 1,200-person on-premises sales team for Coca-Cola Enterprises, Coke’s largest bottler at the time. The primary goal of the transformation was to standardise and simplify the organisation’s sales approach that had grown unwieldy over time and had too many metrics and too many goals. As he set out to simplify the process, Everett quickly realised that no sales transformation would happen unless distribution made changes as well. In our interview with Everett, he told us, “One of the things we learned from the national data is you can’t be successful in selling if you can’t keep the promises you made to customers. This spawned the distribution transformation project”.

This was exactly the same situation at Central Garden & Pet. In order to be successful from a customer’s perspective, the sales teams needed to be able to deliver on their promises, and this required alignment with other business functions, such as distribution and supply chain. In Central’s case, we saw a classic alignment gap: the sales team could sell certain products, but the supply chain couldn’t keep up, resulting in stock-outs, long delivery times, and unhappy customers.

These examples represent a key theme from our research and our own experience: Sales can’t be an island when it comes to successful transformation. If the sales organisation tries to go it alone, the transformation is unlikely to be successful, and by the same token, the organisation cannot transform unless the sales team is a willing partner.

Gaining alignment early on in your sales transformation provides significant leverage to your sales transformation, because your sales team (and customers) can immediately benefit from the support and resources offered during the transition, and specific requirements can be integrated (rather than waiting to see what sticks). Common examples include updating recruiting profiles and compensation with the support of HR, linking the sales pipeline and forecast to the manufacturing and product planning schedule, and updating messages and sales kits from marketing.

 

Lever #3: Leadership

Strong and engaged leadership is essential for any change initiative. In almost all of our interviews for our book, the importance of leadership came up. In short, most said that if the key leaders weren’t committed to the change and helping to drive it, it was not going to happen. Ultimately, the vision and commitment must be top-down, and they must go far beyond new coffee cups or trite slogans.

Leadership comes from several different levels, certainly the top, but also the first-line sales leaders, where sales initiatives often live or die. In one telling example, a former client of ours – a health care consulting firm with revenues of $250 million – wanted to transform into a solution and outsourcing-oriented organisation based on changes its executive team saw occurring in the health care industry. Interestingly, the two sales directors in the United States (East and West) were split over whether to embrace a sales transformation initiative.

[su_pullquote]Strong and engaged leadership is essential for any change initiative. Most said that if the key leaders weren’t committed to the change and helping to drive it, it was not going to happen.[/su_pullquote]

The sales director for the western region led the change from the front, facilitating key meetings, tracking and reviewing key metrics, communicating about transformation constantly, and coaching his team in new solution-oriented behaviours. The sales director for the eastern division did not embrace transformation. He didn’t track key metrics, didn’t coach, and was barely present with his team. Later, some in the organisation said he’d been on autopilot and didn’t want to put in the work to transform. Ultimately, and not surprisingly, the western division grew its revenues by approximately 20 percent more than the eastern region.

Leadership and ongoing commitment provide the leverage to distinguish a sustainable transformation from a one-time training event. Beyond lip service, leaders at every level who can effectively model, coach, and reinforce the desired behaviours and practices provide the critical link between vision and implementation. By going beyond a one-time sales development effort, sustained and authentic leadership across all levels of the sales team provides a multiplier effect that helps to accelerate change.

 

Lever #4: Sequence

According to Jim Collins’s classic bestseller, Good to Great, to become a great company not only must you get the right people on the bus, but you also have to get them in the right seats: “First Who, Then What”. Perhaps counterintuitively, many of our interviewees echoed this theme, but in the opposite sequence. In order to recruit, select, and hire the right people, you first need to know what they will be doing – what knowledge, skills, and abilities will be needed to support a new sales process or way of selling with your customers.

If the transformation involves moving to a solutions selling model or to a split focus between existing and new accounts, these sales strategies require different skill sets and, often, different people.

For example, we worked with a Fortune 50 company that had a lot of great products, but little direction and no roadmap. Most of the company’s profits came from a commoditised product, and leaders had no plan for focusing customers on their strategic offerings, such as servers, IT services, and software.

The strategic offerings had significant competition from best-of-breed providers and other large technology companies. The majority of the business units lost money, and not surprisingly, a lot of their best people left those same units. In addition to a clear overall integrated business strategy, the marketing and sales organisation was missing the “what” of enablement and strategy, for instance, providing integrated solutions to their customers’ enterprise business and technology challenges.

 

Lever #5: Measurement

The metrics you use to quantify the sales transformation should focus on the vital few things that will determine success or failure. In our research we found that the number one predictor of success was whether or not a company measured progress. But keep in mind, it’s a big world filled with data, and you can’t measure everything.

[su_pullquote]Metrics are a lever as they are a proxy for what is important to the company and sales organisation, and they focus leadership on what measureable targets they need to reach and exceed. [/su_pullquote]

In fact, if you try, you’ll end up measuring nothing. One client we worked with was measuring 180 KPIs, but no one really knew where the business was headed. The client ended up doing a balanced scorecard approach and went down to seven key metrics to track. These metrics were intimately linked to the heart of their sales transformation effort – things like revenue growth greater than run rate growth, wallet share, and contract renewals.

Metrics are a lever as they are a proxy for what is important to the company and sales organisation, and they focus leadership on what measureable targets they need to reach and exceed. Almost all clients we’ve worked with have been interested in benchmarks and target setting so they can measure themselves against others and against a goal or target.

 

Lever #6: Communication

The greatest vision (or offering for that matter) in the world is useless if no one knows about it. We’ve worked with a number of clients where the sales organisation created some great new processes and sales aids, but because only a few people knew about them, those innovations “died” from disuse. In one case, a client created a robust buyer-aligned sales process that was launched at a global sales kickoff meeting at the MGM Grand in Las Vegas. We’ve all been there: semi-dark room, everyone’s tired, or otherwise impaired from the festivities that went late into the night before, and the SVP of global sales takes the stage. In an incredibly well produced event, the SVP brought in several customers via a live video chat, including CIOs from global Fortune 500 organisations, to describe the value they received from this company and how much of that value was shaped by the interaction with the sales team.

Based on this type of customer feedback, the company was rolling out a new customer engagement process and supporting tools and training. It was a wonderful event and launch, but three months later, there was no visible communication regarding the changes, and there was no reinforcement through coaching and inspection from the first-line sales leaders. The sales leadership team was later reshuffled, and the process never got a chance to become institutionalised.

Communication may be the most essential piece of what leaders do in conveying their vision, commitment, and ongoing sponsorship regarding a transformation. The essence of sales and marketing is communicating your value and difference and compelling someone to act. As in a winning sales campaign, the right communications, at the right time, to the right people is critical to winning a competitive, complex deal or effectively making the internal sale for a transformation.

In conclusion, for a sales organisation to reach its “ideal transformational advantage” it needs to pull the right levers in the sales force and across the entire organisation to drive meaningful and significant improvement.

 

Warren Shiver and Michael Perla, “7 Steps to Sales Force Transformation”, published 2016, reproduced with permission of Palgrave Macmillan.[su_divider]

About the Authors

Warren Shiver  and Michael Perla are the authors of 7 Steps to Sales Force Transformation: Driving Sustainable Change in Your Organization (Palgrave MacMillan).

shiver-webWarren Shiver is the Founder and Managing Partner of Symmetrics Group and has more than 20 years of sales, management and consulting experience.

 

perla-webMichael Perla is a Principal with Symmetrics Group, and has more than 20 years of sales effectiveness consulting and strategic marketing experience.

 

 

 

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